Italian engineering, drilling, and construction services firm Saipem has secured three new contracts for a gas project in Azerbaijan operated by UK-headquartered energy giant BP , which together have a value of approximately $600 million.
The offshore contracts were awarded in consortium with BOS Shelf LLC and BOS Shelf International FZCO, both affiliates of the State Oil Company of the Azerbaijan Republic (SOCAR), for the Shah Deniz Compression project, having an overall value of around $700 million.
Saipem’s scope includes the transportation and installation (T&I) of a new 19,000-ton compression platform in the Azerbaijan sector of the Caspian Sea, as well as the engineering, procurement, construction and installation (EPCI) of circa 26 kilometers of offshore pipelines to connect the new compression platform to the existing facilities, and all major permanent subsea works.
Subsea construction vessel Khankendi, owned by the Shah Deniz consortium, and pipelay barge Israfil Huseynov, owned by the Azerbaijan Caspian Shipping Closed Joint-Stock Company, will be employed for the offshore operations and will be managed and operated by Saipem.
Offshore activities are expected to commence in the third quarter of 2026, with completion targeted for 2029.
The contracts will be executed under the existing framework agreement in force between BP and Saipem, as announced in July 2024 .
The $2.9 billion Shah Deniz Compression, one of BP’s eight to ten major projects expected to start up between 2028 and 2030, is expected to contribute to growing the company’s global upstream production to 2.3-2.5 mmboed by 2030, with the capacity to increase further to 2035.
Besides BP (operator with 29.99%), project partners are Lukoil (19.99%), TPAO (19.00%), SGC (16.02%), NICO (10.00%), and MVM (5.00%).