Baku Tiblisi-Ceyhan Pipeline

completed

The Baku-Tblisi-Ceyhan, or BTC, pipeline will be a pipeline system to transport up to one million barrels of oil per day (bopd) of crude oil from Azerbaijan to the Mediterranean coast in Turkey. The pipeline will be the principal export route for production from the Azeri-Chirag-Gunashli, or ACG, fields in the Azerbaijan sector of the Caspian Sea. The 1,760 km long BTC Pipeline, starts from the Sangachal Terminal near Baku in Azerbaijan, passes through Georgia and ends at a new marine terminal at Ceyhan on the Mediterranean coast in Turkey. The BTC pipeline originates at Sangachal where crude from the ACG fields is received. From here, the pipeline is routed west, closely following the existing WREP (Western Route Export Pipeline), which is currently being used to transport crude oil production from the ACG fields. At the Georgian border with Azerbaijan, the route traverses west and south until it meets the Turkish border. In Turkey, the route runs south to Erzurum, then west to Erzincan and Sivas before turning south to the Ceyhan terminal. The pipeline is due to become operational in early 2005.ACG production is currently shipped primarily through the Western Route pipeline, completed as part of the Early Oil project, ending in Supsa, Georgia; however, the current capacity of this route is approximately 140 mbopd. In addition, the Northern Route pipeline to Novorossiyk, Russia has a capacity of 115 mbopd. The BTC pipeline became a necessity due to current transportation capacity constraints to transport ACG crude resources to market, which at peak may approach 1 million bpd. Early conceptual development of the project took into account the need for a dedicated export route for the ACG fields that would not require the shipment of Caspian oil through the Bosphorus Straits thereby significantly reducing environmental risk. The BTC pipeline will be constructed and operated in accordance with stringent international environmental and social standards, will be buried along its entire length and will avoid the need to resettle any home or household as it passes through Azerbaijan (442 km), Georgia (248 km) and Turkey (1,070 km). The expansion of the existing Sangachal terminal will require the resettlement of one family of seasonal herders from their winter grazing area.The BTC project is being sponsored by a number of national and international oil companies, eight of whom have interests in the upstream ACG fields. The estimated aggregate cost of the BTC project is US$3.7 billion, the financing of which will include total debt of approximately US$2.4 billion. The Export Credit Agencies (ECAs) include USExim, JBIC (Japan), ECGD (UK), Hermes (Germany), COFACE (France) and SACE (Italy).