Shah Deniz Gas Output Falls to 20 bcm in Nine Months

The Shah Deniz gas field in Azerbaijan's sector of the Caspian Sea produced about 20 billion cubic metres (bcm) of gas in the first nine months of 2026, operator bp said in its third quarter results for Azerbaijan, published on 4 November. That is 4.8% less than the 21 bcm produced a year earlier, Trend reported, while condensate output was unchanged at about 3 million tonnes.

The figures show Shah Deniz spending more while producing less. At the field, capital expenditure rose 42.6% to about $1.078bn and operating costs rose 9% to about $2.002bn, according to Trend's comparison with the same period of 2025. The Azeri-Chirag-Gunashli (ACG) oil field produced about 87 million barrels, an average of about 320,000 barrels a day.

What bp reported

bp said Shah Deniz has the capacity to deliver about 79 million standard cubic metres of gas a day, or about 28.8 bcm a year, figures also carried by Report. Over the nine months, the Sangachal terminal exported about 138 million barrels of oil and condensate, mainly through the Baku-Tbilisi-Ceyhan pipeline, and sent out about 73.4 million standard cubic metres a day of Shah Deniz gas.

At ACG, bp spent about $401 million on operations and about $1,088 million on capital projects. The partners completed 12 oil producing wells, three water injectors and two gas injectors. bp said the Central Azeri Gas Expansion project raised gas reinjection capacity on the platform by 20%, and that non-associated gas production started in the first half of the year, the field's first commercial gas production. The Azeri Central East platform produced about 26,900 barrels a day over the three quarters.

Since start-up, Shah Deniz has produced about 284 bcm of gas and about 55 million tonnes of condensate, Trend reported. The field's partners are bp as operator with 29.99%, Lukoil with 19.99%, TPAO with 19%, SGC with 16.02%, NICO with 10% and MVM with 5%.

Spending ahead of compression

Part of the higher spending sits alongside work on Shah Deniz Compression, a $2.9bn project designed to recover about 50 bcm of additional gas and about 25 million barrels of condensate. bp said an offshore pin pile campaign began in October, with four pin piles installed for the platform jacket, marking the start of offshore construction. Platform construction is due to finish in 2029. bp expects first gas from the project at the Shah Deniz Alpha platform in 2029 and at Bravo in 2030. CBJ reported the start of offshore work in October.

What the budget expects

Azerbaijan's draft 2027 state budget assumes lower tax income from Shah Deniz. According to Trend's reading of the draft, the government forecasts 1.42 billion manats ($835.29 million) in profit tax from the field next year, 11.3% below the 2026 estimate and 37.2% below actual receipts in 2025. Profit tax from ACG is forecast to rise 6.7% to 320 million manats ($188.24 million).

The budget assumes ACG output of 316,400 barrels a day in 2027, 0.5% below the 2026 forecast, and an oil price of $75 a barrel.

Analysis

In CBJ's reading, the numbers describe a field in a phase of reinvestment. Shah Deniz spent more on capital projects in nine months than in the same period of 2025 while producing less gas, and on bp's schedule the compression project adds volumes only from 2029.

The fiscal picture moves in the same direction. A smaller Shah Deniz profit tax forecast for 2027, alongside a slightly higher ACG figure, shows the government expecting less tax from a field whose output is easing. At ACG, bp's report of higher reinjection capacity and the first non-associated gas production shows the oil field adding a gas stream of its own.

What to watch

bp's full-year figures for Azerbaijan will show whether the 4.8% gas decline held through the fourth quarter. Progress on the offshore campaign for Shah Deniz Compression will show whether the 2029 platform target holds. The profit tax figures remain forecasts in a draft budget until it is adopted.

Sources: bp Azerbaijan, third quarter 2026 results; Trend, Shah Deniz output; Trend, Shah Deniz capex; Trend, 2027 profit tax forecast; Report.