FID on Shah Deniz Pipeline May Happen by End of Year

A final investment decision (FID) on the winning Shah Deniz pipeline could be decided by the end of this year, according to vice president of SOCAR.

Speaking to Reuters today, VP for investments and marketing Elshad Nassirov said there was a possibility the pipeline decision could be made ahead of its 2013 schedule.

"There is the chance that we could make a final investment decision by the end of this year," he said.

Two contenders for the pipeline, which would supply gas to Europe from the Azeri Shah Deniz field, are now left in the running following the elimination of the South East Europe Pipeline (SEEP) yesterday. The elimination of this pipeline as an option means the revised Nabucco pipeline, Nabucco West, is the sole contender for a Cental European supply route.

The Trans Adriatic Pipeline (TAP) is the other contender for supply of the gas, having beaten out competition from the ITGI pipeline earlier this year. A decision on the overall winning pipeline had been slated to take place in mid-2013, but following Mr. Nassirov's comments, this decision may take place this year.

Initial supply from Shah Deniz II is expected to begin by the end of 2017, with 16 billion cubic metres of gas a year to be transported to Europe and Turkey through the winning pipeline. This is in addition to the 9 billion cubic metres of gas a year already supplied from the first stage of the Shah Deniz field.