Russian company Lukoil has signed an agreement to acquire an additional 15.5% interest in the Shah Deniz natural gas project in the Azerbaijan sector of the Caspian Sea for around $2.25bn.

The company will acquire the stake from Petronas. Once the deal closes, Lukoil’s interest in the project will jump to 25.5% from the existing 10%.

Lukoil president Vagit Alekperov said: “Increasing our share in the Shah Deniz project creates new opportunities for synergy in future-oriented economy sectors of our countries.

“Over 25 years, Lukoil accumulated enormous experience in the Caspian region, which we perceive as strategically important, as well as created extensive production and transport infrastructure.

“We are proud of the confidence placed in our competences by Caspian countries, which are among leaders of oil and gas production, regarding implementation of high priority international projects.”

The completion of the transaction is subject to some preceding conditions, including approval from the State Oil Company of the Azerbaijan Republic (SOCAR).

The Shah Deniz gas condensate field is located around 70km south-east of Azerbaijani capital of Baku. The project produced 18.1bcm of gas and 3.6 million tonnes of gas condensate last year.

In 2018, the second stage of the project was launched to boost annual production to 26bcm of gas and five million tonnes of gas condensate.

BP operates the project with 28.8% interest. Other stakeholders are TPAO (19%), SOCAR (10%), NICO (10%), and SGC (6.7%).

The latest deal comes a week after Lukoil agreed to acquire a 25% stake in the Shallow Water Absheron Peninsula (SWAP) exploration project offshore Azerbaijan from BP.