(Adds Saipem details, shares)
LONDON, May 3 (Reuters) - The consortium developing thesecond phase of Azerbaijan's Shah Deniz gas field has awarded a$1.5 billion subsea production contract to a consortiuminvolving Saipem, BOS Shelf and Star Gulf FZCO, itsaid on Tuesday.
The group has won a contract to operate a SubseaConstruction Vessel (SCV) to transport and install a deepwatersubsea production system, said the Shah Deniz consortium, led byBritish oil major BP.
The consortium said the Shah Deniz 2 project was on track todeliver its first gas in 2018.
In a separate statement Saipem said its share of thecontract was worth $1.3 billion.
The Italian oil services group said the contract would lastfive years with a possible extension for another five.
"This award also further strengthens Saipem's key role inthe construction of the southern gas corridor," Saipem CEOStefano Cao said.
Saipem shares retraced earlier losses and were down 1.6percent at 1026 GMT while the European oil and gas index was down 2.3 percent.
In April Saipem won an order to lay the subsea TransAdriatic Pipeline (TAP) that will bring Azeri gas into Italy.
The 870-km TAP pipeline, part of the so-called southerncorridor that will link Azerbaijan's giant Shah Deniz II fieldwith Italy, is the largest project to bring new gas supplies toEuropean consumers.
(Reporting by Karolin Schaps and Stephen Jewkes, editing byLouise Heavens and David Evans)
BP (BP.)