Lukoil cuts stake purchase at Shah Deniz field

Russia's Lukoil has had to reduce its planned stake purchase at the BP-operated Shah Deniz gas field off the coast of Azerbaijan, after its bid to buy the 15.5% interest held by Malaysia's Petronas was revised because other project shareholders used their pre-emptive buying rights.

In a statement on December 10, Lukoil said it would instead buy a 9.99% interest in the field, which supplies Turkey and Europe with gas. As a result, its overall share will increase to 19.99%. Azerbaijan's national oil company SOCAR said separately on December 10 that it had bought 4.35%, while BP had taken 1.16%, raising their shares to 29.99% and 14.35% respectively.

Lukoil said the deal was on track to close before the end of January. Other partners at Shah Deniz include Turkey's TPAO with 19%, National Iranian Oil Co with 10% and Azeri state holding firm SGC with 6.7%.

Lukoil views the Caspian Sea as one of its core regions and is eager to expand there. It reached a deal in September to buy a 25% interest in the BP-led  Shallow Water Absheron Peninsula (SWAP) area, and is looking at other acquisition opportunities off the shore of Kazakhstan.