Construction of Turkish section of BTC may be suspended

The construction of Turkish section of BTC (Baku-Tbilisi-Cheyhan) oil pipeline may be suspended until the middle of 2005. The reason is an appearance of certain difficulties in the mountainous areas of Turkey. KZ-today correspondent has been informed about this in the press service of BP-Azerbaijan with reference to the company president David Woodward, who has returned from his business trip to Turkey.

The head of BP-Azerbaijan said that he had carried out negotiations with the Turkish government and the general contractor of the Turkish part of BTC pipeline - BOTAS company. During the negotiations the Turkish party assured D. Woodward that the works would be completed in due time. According to him, to prevent delays in the realisation of the project the BOTAS is attracting additional forces.

"It is expected that in two or three weeks the Turkish party will present plans of works on speeding up the construction to the BP. If they fail to keep their promise, the works may be suspended until the next year", - D. Woodward said.

With regard to the necessity of investing additional funds because of delays, according to D. Woodward, as per agreement with the BOTAS, these costs must be covered by the Turkish party.

Commenting on the course of works on construction of Georgian BTC section, D. Woodward said, that the schedule of construction works in Georgia was realised in time. According to him, the government of Georgia understands the strategic importance of this document and will take all measures to complete the construction works in time.

The length of BTC pipeline makes 1,767 km, of which - 443 km are in Azerbaijan, in Georgia - 248 km, in Turkey - 1076 km. The pipeline capacity is 50 million tons of oil per annum.

A Greek Consolidated Contractors International Company is a contractor for the construction of the Azeri part of BTC pipeline, a contractor for Georgian part is Spie Capag/Petrofag, which is also a contractor for works on the construction of pumping stations on the territory of both countries.

The construction works started in April 2003 and will be completed in the 4th quarter of 2004. Moreover, the construction of Georgian part is planned to be completed in October, 2004, and the Turkish one - in November. The export of Azeri oil from Cheyhan port (Turkey) must start in the 2nd quarter of 2005.

In total, $2.95 billion will be required for the pipeline construction (the total cost of the project making $3.6 billion, including the interest on loans)

$155 million will be required for the pipe installation on Azeri section of BTC, $170 million - for the Georgian section, $148 million will be required for the construction of pumping stations at Azeri-Georgian section.

The costs for construction of Turkish section of the pipeline will make $1.4 billion.

The participants of BTC project are: BP (30.1 %); SOCAR (25.00 %); Unocal (8.90 %); Statoil (8.71 %); TPAO (6.53 %); ENI (5.00 %); Itochu (3.40 %); ConocoPhillips (2.50 %); INPEX (2.50 %), Total (5.00 %) and Amerada Hess (2.36 %).