Azerbaijan's State Oil Company (SOCAR) and Turkey's state-owned Botas Pipeline Company signed a contract on May 30 in Istanbul for the sale of SOCAR's 10 percent share in the Trans Anatolian Pipeline (TANAP) project.
The contract was signed by the Botas Director General, Mehmet Konuk and SOCAR President and TANAP Board's Chairman, Rovnag Abdullayev.
The parties also signed a contract on transportation of gas via TANAP.
Azerbaijan's Energy Minister Natig Aliyev and his Turkish counterpart Taner Yildiz signed a memorandum of understanding on the TANAP project.
The purchase and sale contract will help to increase Botas' share in the project from 20 percent to 30 percent.
SOCAR previously said it intends to retain no less than 51 percent of 80 percent share in the TANAP project. British BP decided to buy some 12 percent share in the project; the deal must be completed in 2014.
BP is the operator of the Azerbaijani 'Shah Deniz' offshore gas and condensate field development project.
Following the completion of the deal with BP and Botas, the shares of SOCAR in this project will stand at 58 percent.
The TANAP project envisages transporting gas from the Shah Deniz field through Turkey up to the country's border with Europe.
The pipeline's initial capacity is expected to be 16 billion cubic meters per year. About six billion cubic meters of gas will be delivered to Turkey and the rest to Europe. The pipeline's capacity can be further expanded to 31 billion cubic meters of gas per year.
TANAP shareholders plan to lay the pipeline's foundation in the second quarter of 2014 and commission it in 2018. TANAP project's cost is estimated at $10 billion to $11 billion.
On December 17, 2013, a final investment decision was made on the Stage 2 of the 'Shah Deniz' offshore gas and condensate field's development. The gas produced at this field will first go to the European market.
The gas to be produced as part of the Stage 2 of the field's development will be exported to Turkey (six billion cubic meters per year) and to the European markets (10 billion cubic meters per year) by means of expanding the South Caucasus Pipeline and construction of the Trans-Anatolian Gas Pipeline (TANAP) and the Trans-Adriatic Pipeline (TAP).
Partners operating for Shah Deniz field's development, which has reserves of 1.2 trillion cubic meters of gas, include SOCAR with a share of 16.7 percent, British BP (28.8 percent), Norwegian Statoil (15.5 percent), Iranian NICO (10 percent), French Total (10 percent), Russian Lukoil (10 percent) and Turkish TPAO (9 percent).