Source: Reuters; Türkiye, BP solve BTC pipeline
row; April 30, 2003
Türkiye and BP said yesterday they had addressed
land and tax problems in the way of the construction of the $3 billion
Baku-Tbilisi-Ceyhan (BTC) oil pipeline to carry Caspian crude to world
markets.
Project-leader BP's Michael Townshend said he had
discussed issues of taxation and the compulsory purchase of land for the
pipeline with Turkish Energy Minister Hilmi Guler.
"We raised those concerns with the minister
and he has taken strong action to solve the problems," Townshend told
a joint news conference with Guler in Ankara. "Now we share the view
that all issues have been addressed and the pipeline project is on
track," he added.
He said the pipeline running 1,800 km from
Azerbaijan to the Turkish Mediterranean coast would be completed by the end
of 2004.
Pumping would start at 300,000 barrels per day in
2005, rising gradually to 800,000 barrels a day by 2008 compared to the
pipeline capacity of one million barrels a day, he said.
The project was proposed by Türkiye in the early
1990s to bypass its busy Bosphorus straits, the only outlet at present for
Russian and other oil transported via the Black Sea.
It would also earn Ankara valuable transit
revenues for its frail economy and raise Türkiye's strategic importance in
the region.
The project has received strong support from the
U.S. government as it would help diversify oil supply line routes from the
region. Baku-Ceyhan would be the first pipeline bypassing both Russia and
Iran but it has long been criticised by oil companies for being
non-commercial.
But interest by some U.S. and European oil
companies operating in Kazakhstan to add significant volumes to the BTC
pipeline has made the project feasible, according to several oil analysts.
"Kazakh oil is welcome but not necessary to
make BTC commercial," Townshend said.
About 30 per cent of the project will be financed
by the sponsor group initially and the remaining will be financed via loans
from international banks. Top
