Turkey to Increase Stake in Azerbaijan’s Shah Deniz Gas Project

May 30, 2014 6:17 am ET

May 30 (Bloomberg) -- Turkey’s state oil and gas company will sign a deal today to increase its stake in Azerbaijan’s Shah Deniz natural gas project, according to officials from the Azeri oil company Socar.

Turkiye Petrolleri AO will raise its share to 19 percent from 9 percent under the accord to be signed in Istanbul, Vaqif Aliyev, Socar’s head of investments, said in an e-mail. Turkey will also increase its stake in the Trans-Anatolian Pipeline project, led by BP Plc, to transport Caspian Sea gas to Europe through Turkey, according to Socar Deputy Vice President Vitaliy Baylarbayov.

Turkey is seeking to diversify supplies away from Russia and Iran, which last year supplied more than half of its gas imports. The Azerbaijan pipeline and other Caspian projects also offer European Union countries a chance to reduce their reliance on Russia, amid concerns that disputes over Ukraine may affect energy supplies.

It wasn’t immediately clear how much the Turkish company will pay, or who its additional shares will be purchased from. Stakeholders in Shah Deniz include France’s Total SA, Norway’s Statoil SA and Russia’s Lukoil OAO, as well as BP.

In a possible benchmark for the Turkish deal, Statoil sold a 10 percent stake in Shah Deniz to Socar and BP in December for $1.45 billion.

Turkiye Petrolleri’s press office declined to comment when reached by phone yesterday, and Turkish Energy Ministry spokesman Ali Kerem Eskigun couldn’t immediately be reached.