Italian Bank Quits BTC

The Banca Intensa, an Italian bank that was a part of a syndicate of 15 banks providing loans to the Baku-Tbilisi-Ceyhan (BTC) oil pipeline project, announced this week that it has sold part of its interests in financing BTC, Reuters and Financial Times reported.

Reports say that the Banca Intensa is conducting talks over selling its full package as well.

The syndicate of commercial banks now includes: ABN AMRO, Citibank, Mizuho and Soci?t? G?n?rale, BNP Paribas, Cr?dit Agricole Indosuez, Dexia, HypoVereinsbank, ING, KBC, Natexis Banques Populaires, San Paolo IMI, West LB and Royal Bank of Scotland.

Recently some unfavorable news has broken about the BTC.

President of the Azerbaijani state oil company SOCAR Natik Aliyev told reporters on November 29 that construction of the Baku-Tbilisi-Ceyhan (BTC) oil pipeline will cost around USD 4 billion, which is 350-400 million more than originally expected.

This increased cost of the BTC pipeline prompted ExxonMobil, which has the rights to export Azeri oil, to announce that it will not participate in the BTC and instead signed a five-year contract with the Azpetrol company to export 10 million tons of Azeri oil by rail from Baku to the Georgian port of Batumi.

The Guardian reported on November 17 that hundreds of joints in one section of the pipeline alone had been found to be defective.

The Guardian cited a report by the U.S. consultancy WorleyParsons, which was asked by lenders to investigate the BTC, following speculation at the beginning of this year that construction of the pipeline faced problems.