Work on the Sangachal Terminal Electrification (STEL) project continued successfully in the third quarter of this year, reaching 90% overall completion by the end of the quarter, APA-Economics reports, citing bp's report on the results of its operations in Azerbaijan for the first nine months of 2026.
According to the report, progress was made in transitioning the project from the main construction phase to operational testing and commissioning preparation in the Shah Deniz 2 area of the terminal, while construction work continued in the ACG area. The modernization of AzerEnergy's state power grid infrastructure outside the terminal site has been completed.
"During the quarter, a number of important installation and testing activities were completed, operational testing began, and modernization of the power supply system continued to support the future electrification of the terminal. An independent internal assurance review was also completed as part of the planned commissioning preparation process," the report stated.
It was reported that the project's focus remains on ensuring that commissioning and connection to the state power grid are carried out in stages while maintaining uninterrupted operations at the terminal.
Work on the project is expected to be completed in two phases, with Phase 1 scheduled for mid-2027 and Phase 2 by the end of 2028.
The $230 million STEL project will enable the terminal to connect to the state power grid operated by AzerEnergy OJSC. For this purpose, new facilities are being constructed both inside and outside the terminal site.
The STEL project is closely linked to the Shafag solar project, which envisages the construction of a 240 MW AC solar power plant in Jabrayil district, through a new commercial model known as the "virtual power transfer mechanism." Under this mechanism, the Shafag plant will generate electricity and supply it to AzerEnergy in Jabrayil district, while AzerEnergy will subsequently deliver an equivalent amount of electricity to the Sangachal Terminal.
According to current forecasts and plans, the Shafag and STEL projects together will enable an approximately 50% reduction in emissions from terminal operations during the Sangachal Terminal's future operational period.
Currently, the terminal uses seven gas turbines to meet its energy needs. Following electrification, the turbines will be gradually dismantled, allowing the volumes of fuel gas no longer used to be redirected for export.
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