Economic Overview

BTC

At a length of 1,768km, the Baku-Tbilisi-Ceyhan (BTC) pipeline is one of the great engineering endeavours of the new millennium.

It runs 443km through Azerbaijan, 249km through Georgia and 1,076km through Turkey to the Ceyhan Marine Terminal.

The pipeline is buried along its entire length. At its highest point where it crosses the Caucasus Mountains the pipeline climbs to an altitude of 2,800 metres. It has a capacity to export one million barrels of oil a day, designed to meet the export requirements of the full field development of the ACG field.

It is one of the longest pipelines in the world. With a total construction cost approaching $4 billion, the BTC pipeline in Georgia was completed in 2005.

BTC became fully operational in 2006. Oil flow rates through the pipeline have steadily increased, and the pipeline now brings around 700,000 barrels of oil per day to the world market. Reinstatement and landscaping work on the right of way was completed along the pipeline route to a very high standard.

By creating the first direct pipeline link between the landlocked Caspian Sea and the Mediterranean, the BTC project will bring positive economic advantage to the region and avoid increasing oil traffic through the vulnerable Turkish Straits.

The BTC pipeline is being developed by a group of 11 national and international oil companies and the BTC Pipeline Company was formed for this purpose in August 2002 as a separately incorporated company.

The BTC Co. shareholders are:  BP (30.1%); AzBTC (25.00%); Chevron (8.90%); Statoil (8.71%); TPAO (6.53%); ENI (5.00%); Total (5.00%), Itochu (3.40%); INPEX (2.50%), ConocoPhillips (2.50%) and Hess (2.36%).

SCP

The 692km South Caucasus Pipeline has been designed to transport gas from the Shah Deniz field in the Azerbaijan sector of the Caspian Sea, through Georgia and on to the Georgia-Turkey border.

At full capacity, and after additional stages of development, it is envisaged that the pipeline will export up to 20 billion cubic metres of gas a year. At the border the pipeline links up the Turkish-built extension joining SCP to the domestic supply grid at Erzurum.

Construction of the SCP pipeline, built in the same corridor of land as the BTC pipeline through its passage in Georgia, was completed in 2006.  Like the BTC pipeline, it is buried underground.  SCP carries natural gas from the Shah Deniz field in the Caspian Sea to customers in Azerbaijan, Georgia and Turkey.

Gas entered the Georgian section of the pipeline in September 2006 as part of the pipeline testing and commissioning process.  A new 12km pipeline, connecting the SCP to the Georgian gas distribution system near Gardabani, was also completed in 2006. Following commissioning, first commercial gas was delivered into the Georgian market in January 2007. 

BP is responsible for managing and carrying out development and production activities on behalf of the various project partnerships within agreed management frameworks. Seven national and international energy companies are partners in the development of the South Caucasus Pipeline and Shah Deniz. BP is technical operator for SCP during its operational phase.

The SCP Co. funding shareholders are: BP (technical operator – 25.5%), Statoil (commercial operator - 25.5%), the State Oil Company of Azerbaijan Republic (SOCAR - 10%), LUKoil (10%), NICO (10%), Total (10%), and TPAO (9%).