EBRD Approves BTC Pipeline Financing

The European Bank for Reconstruction and Development (EBRD) approved on November 11 financing of USD 125 million for the USD 3.6 billion Baku-Tbilisi-Ceyhan (BTC) oil pipeline from Azerbaijan through Georgia to the Turkish Mediterranean port of Ceyhan.

The EBRD also approved financing of up to USD 30 million for the USD 3.2 billion Azeri-Chirag-Deepwater Gunashli (ACG) Phase 1 oilfield in the Caspian Sea offshore from Azerbaijan.

The BTC pipeline, with a capacity of 1 million barrels a day, will deliver ACG oil to Ceyhan for export mainly to European markets.

The decision to finance BTC and ACG reflects the importance of both projects in unlocking the economic potential of the resource-rich Caspian region.

The Board of the International Finance Corporation (IFC), the private sector arm of the World Bank Group, approved on November 4 investment projects in the Azeri-Chirag-Deepwater Gunashli (ACG) Phase 1 oil field and the Baku-Tbilisi-Ceyhan pipeline.

The EBRD together with International Financial Corporation will continue to be closely involved in the projects and will continue to monitor compliance with all undertakings.

The projects were financed by the EBRD and earlier by the IFC despite protests from human rights and environmental campaigners.

The Financial Times reported that protesters demonstrating outside the British government’s development department on November 11, some of the campaigners vowed to keep up the pressure.

They say the project would damage the area’s ecology and that local communities are not receiving fair compensation.

Campaigners have said the decision was another example of banks embracing big business over local people’s rights.

The EBRD said it had ?thoroughly? examined the social and environmental effects and maintained that its presence would ?ensure transparency? and help deliver oil revenues to the general population.