The South Caucasus Pipeline (also known as Baku–Tbilisi–Erzurum Pipeline, BTE pipeline, or Shah Deniz Pipeline) is a natural gas pipeline from the Shah Deniz gas field in the Azerbaijan sector of the Caspian Sea to Turkey. It runs parallel to the Baku–Tbilisi–Ceyhan pipeline (oil).
Image By Thomas Blomberg - Own work, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=4536714
Description
The 42-inch diameter gas pipeline runs through the same corridor as the Baku–Tbilisi–Ceyhan pipeline until Erzurum, where BTC turns south to the Mediterranean. It is 430 miles long, of which 275 miles is in Azerbaijan and 154 miles in Georgia. The initial capacity of the pipeline was 8.8 billion cubic metres (310 billion cubic feet) of gas per year. For the second stage of the Shah Deniz development, the capacity would be increased up to 25 billion cubic metres (880 billion cubic feet) by adding additional looping and two new compressor stations, costing $3 billion. As the pipeline has the potential to be connected to Turkmen and Kazakh producers through the planned Trans-Caspian Gas Pipeline, Azerbaijan has proposed expanding its capacity up to 60 billion cubic metres (2.1 trillion cubic feet) by building a second line of the pipeline.
Economic impact
The first aim of the pipeline is to supply Turkey and Georgia. As a transit country, Georgia has rights to take 5% of the annual gas flow through the pipeline in lieu of a tariff and can purchase a further 0.5 billion cubic metres (18 billion cubic feet) of gas a year at a discounted price. In the longer term, it will supply Europe with Caspian natural gas through the planned Southern Gas Corridor pipelines, such as the Trans Adriatic Pipeline and Trans-Anatolian gas pipeline.
South Caucasus Pipeline expansion (SCPx)
As a part of the Shah Deniz Full Field Development (FFD), otherwise called the Shahdeniz-2 project, BP will expand the pipeline through capacity extension by putting two additional compressor stations in Georgia and Turkey. This will almost triple the current transportation capacity of the pipeline up to 20 bcm/year. This capacity increase would be able to accommodate an additional 16 bcm gas coming from the SD-2 project
Project company
The pipeline is owned by the South Caucasus Pipeline Company, a consortium led by BP and SOCAR. The shareholders of the consortium are: BP (UK) 28.83%; TPAO (Turkey) 19%; SOCAR (Azerbaijan) 16.67%; Petronas (Malaysia) 15.5%; Lukoil (Russia) 10% Naftiran Intertrade (Iran) 10%