Baku-Tbilisi-Ceyhan oil pipeline to be fulfilled by March 2006 - Turkish Energy Minister

Question: In what stage is the construction of the Turkish section of the Baku-Tbilisi-Ceyhan (BTC) main export oil pipeline?

Answer: Under the Baku-Tbilisi-Ceyhan pipeline we try to export crude oil from the Caspian region to the world markets and first of oil, the Azerbaijani oil. This section of the pipeline will enable to achieve the goal (the fulfillment of tankers in the Ceyhan port) in a safe and economic way without any environmental damage. 10 million barrels of oil are needed to fulfill the pipeline. In this stage the Azerbaijani and Georgian sections of the oil pipelines have been already fulfilled, while the 1076km-long Turkish section started receiving oil on 18 November 2005.

To ensure secure and proper functioning of the Turkish section of the oil pipeline and provide for efficient functioning of pipeline over 40 years, we continued the scheduled work over its testing and linefill. We plan to fulfill the BTC with the Azerbaijani oil pipeline by March 2006.

Question: Which work has been done for the construction of infrastructure for admission of natural gas transported via the South Caucasus gas pipeline (SCP)?

Answer: The project envisaging acquisition of the Azerbaijani natural gas by Turkey via the territory of Georgia is implemented in three parts: Shah-Deniz (upsteam), SCP (South Caucasus Pipeline) (medstream) and Georgian border - Erzerum gas pipeline. The last part of the project stipulates the connection of the pipeline with the length of 225km and diameter of 48mm finally to the East Anatolia route (project on Iranian natural gas).

Today the work over the nationalization of the territory where the pipeline runs, as well as engineering work has been complete. The construction work under the project is underway. All the scheduled work is carried out with the schedule to set up gas deliveries in the last quarter of 2006.

Question: Will Turkey directly purchase oil from its partners at BTC project? It is reasonable for Turkey to purchase Azerbaijani oil in the Ceyhan port with the objective of further refinery at the local ORPs?

Answer: TPAO, a Turkish sate company, participates in the consortium on behalf of Turkey with the stake of 6.75%. Besides, taking into consideration the low transportation expenses for oil that Turkey needs besides the share of TPAO, Ankara could purchase oil in Ceyhan port.

Question: Will Turkey continue the policy on toughening the rules on passage of tankers via the Bosporus and Dardanelles straights?

Answer: With respect to transport energy resources from the Caspian region, Near East and Central Asia to the European and world markets the Bosporus and Dardanelles straights are used nearly as pipelines. However, the volume of transport deliveries is anyway high. This volume of deliveries increases diligently. For instance, in 2003 the volume of oil transportation via the Turkish straights comprised 134 million tons, in 2004 – 140 million tons. By 2009 the figure is expected to comprise 190-200 million tons. Such a tendency offers ecological and social risks in regard to one of the most ancient culture centers of mankind – Istanbul, as well as the Turkish straights.

Despite the measures taken with respect to improve the traffic and improve the control over the passage regime of tankers via the Turkish straights, even if to take into consideration the new standards adopted by the International Maritime Organization in regard to oil tankers, the above said risks still exist.

The same time they stressed the necessity of the use of the Odessa-Brody oil pipeline in the direction of the Black Sea. It is necessary not to forget about increase of the oil production volumes in the near future from the Tengiz field of Kazakhstan. Of course, it obviously testifies for rise of risks for Turkish straights.

Based on the above-mentioned facts it is necessary to note that the measures taken target the improvement and control over secure passage of tankers via the Bosporus and Dardanelles straights. From this respect, such policy assumes a vital importance