Supporters of an oil pipeline from Azerbaijan to Turkey attempted Thursday to breathe life into the project with a move to win over oil companies in Kazakhstan to join the US-backed link.
Representatives of Georgia, Turkey, Azerbaijan and Kazakhstan signed in the Kazakh capital Astana a memorandum which set guidelines for oil companies in Kazakhstan wishing to pump their crude through the proposed Baku-Ceyhan link.
Valekh Aleskarov, foreign investment director with the state oil company of Azerbaijan, said the memorandum would enable private oil companies to make a decision on whether to join the project.
He admitted, however, that it changed little in terms of the commercial viability of the link. "From the point of view of its (the pipelines) technical fulfillment, reality and profitability nothing has changed," he said.
Many analysts believe the commercial viability of the proposed $2.4-to-$2.7 billion dollar pipeline from Azerbaijan to Turkey, which has been heavily backed by the United States, hinges on the inclusion of Kazakh oil in the export volumes.
However, companies producing oil in Kazakhstan have not made any crude commitments towards the proposed 1,700 kilometer pipeline, which is expected to have a capacity of 45 million tones annually.
Talks had been held with Texaco and BP, as well as members of the OKIOC consortium on participating in the project, said Kairgeldy Kabyldyn, vice president of Kazakhstans oil transportation concern Kaztransoil.
The Offshore Kazakhstan International Operating Company (OKIOC), which includes TotalFinaElf, Shell, Agip and ExxonMobil, is exploring what could be the largest oil field discovered in decades on the Kazakh sector of the Caspian shelf.
Kabyldyn said that contracts were expected to be signed with foreign oil companies this year although he refused to give more details.
US oil firm Chevron, which is developing Kazakhstan's giant Tengiz oil field, was recently reported to be negotiating to take part in an engineering study into the proposed route, in what was seen as a further boost to the Baku-Ceyhan link.
Chevron was cited by Interfax as saying it had decided to participate in the study after it began exploring the Absheron field offshore Azerbaijan.
Azerbaijan, Turkey and Georgia signed an intergovernmental protocol in November 1999 to build the one-million-barrel a day pipeline to transport oil some 1,700 kilometers to the Turkish port of Ceyhan.
Kazakhstan has kept its options open, saying it would back the project in the event of the discovery of more oil reserves.
Washington is keen to see the construction of Baku-Ceyhan, which would allow resource-rich Central Asian states to reduce their dependence on Moscow and cut out Iran.
Russia, Iran, Turkey and the United States are competing for control over the transport of the regions oil and gas wealth.—AFP.
©--Agence France Presse 2001.
© 2001 Mena Report (www.menareport.com)
