An oil platform off the Caspian sea coast near Baku
Azerbaijan enjoys rare upstream FID
BP and partners have reached a $2.9b FID on a new phase at Shah Deniz, but slow progress on other gas projects is attributed to a lack of European support
BP and its partners greenlit a $2.9b compressor project at the giant offshore Shah Deniz gas field at the start of June, marking the first FID on an upstream development in Azerbaijan since 2018. The approval is a boon for the country’s oil and gas sector, generating fresh contracts, jobs and state revenue. Yet, the six-year dearth of FIDs means Azerbaijan will fail to ramp up gas exports to the EU to 20bcm/yr by 2027—as targeted in a memorandum the government signed with the European Commission in May 2022. Baku has repeatedly attributed the lack of new investment to insufficient financial backing from European banks and a reluctance among EU gas buyers to commit to long-term supply contrac
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