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The BTC pipeline, which stretches a total length
of 1,103 miles, covers more than 160 miles in
Georgia and 650 miles in Turkey.
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t
the height of last summer’s war in Lebanon, when
oil prices reached $80 per barrel, Azeri Light was pumped
commercially into the Turkish port of Ceyhan for the
first time. Scarcely two months after its official opening,
the Baku-Tbilisi-Ceyhan (BTC) pipeline had transported
12 million barrels of Azeri crude from the Caspian Sea
to the Mediterranean. The State Oil Company of Azerbaijan
(Socar) (INTERVIEW) announced
a sales tender for its first load on July 13: a total
of 135,000 tons scheduled to be shipped a month later.
Turkish media reported at the time that 11 million barrels
of crude had been loaded onto 16 tankers at Ceyhan’s
Heydar Aliyev terminal. The first to benefit from the
sweet crude were countries like the Netherlands, Greece,
India, France and the U.K.
The ultimate beneficiary of the BTC, however, is Azerbaijan.
Speaking at the inauguration ceremony in May 2006, Azeri
officials hailed it as the optimal answer for the Caspian’s
landlocked resources. Bottlenecks in the Bosporus and
the Dardanelles Straits, loss of market value via the
northern export route through Russia and the geo-political
impossibility of shipping crude through Iran finally
cleared the way for the $4 billion BTC. Test filling
began in May 2005 and so far, export volume has exceeded
all forecasts. Socar can now bring Azeri Light to market
on its own terms and at world prices. A wider implication
of BTC is that it elevates Azerbaijan’s status
to that of global energy player. In the long run, BTC
will help diversify energy sources and dampen price
speculation.
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full capacity the pipeline will deliver one million
barrels per day of crude to Ceyhan, or 1.3 percent
of global supplies |
The BP-led pipeline has a total length of 1,103 miles.
In Azerbaijan, it covers 248 miles, in Georgia 161 miles
and in Turkey 668 miles. Most crude originates in the
Azeri-Chirag-Gunashli (ACG) field east of Baku. Prospected
in the 1980s, ACG is a joint project involving ten companies.
According to BP sources, ACG holds a staggering 15.3
billion barrels of reserves with a geological lifespan
of 30 years. BTC will generate $140 billion in revenue
for Azerbaijan over 20 years. At full capacity, the
pipeline will deliver one million barrels per day of
crude to Ceyhan, equivalent to 1.3 percent of global
oil supplies. Its importance is even greater if one
considers it can meet 25 percent of world demand growth.
“Our end target is to maximize the capacity of
BTC. We will attract all the oil in the region in order
to export it via BTC,” Natik Aliyev, the Minister
of Industry and Energy, said last summer. The strategy
is to test the BTC for efficiency before withdrawing
from other pipeline routes. Kazakh authorities have
signed an agreement to use the BTC as a conduit for
five million tons of oil per year, with a gradual increase
to 38 million tons. Mr. Aliyev therefore supports a
continued use of the Baku-Novorossiysk pipeline, the
export route through Russia’s Transneft system.
Likewise, the Baku-Supsa pipeline to Georgia will remain
in operation because of its low cost.
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