BTC oil pipeline fire out after Turkey explosion

11 August 2008 16:14  [Source: ICIS news]

LONDON (ICIS news)--A fire on the Turkish section of the Baku-Tblisi-Ceyhan (BTC) oil pipeline has been extinguished six days after it was hit by an explosion, a spokesman from major shareholder BP said on Monday.

 

The 1m bbl/day pipeline, which supplies Europe with oil from the Caspian Sea oil fields, was not expected to start up for another one or two weeks. Turkey's state-owned pipeline operator was preparing to start investigations into the cause of the blast, said BP.

 

Fighting between Russia and Georgia, through which the BTC passes, has disrupted some exports from the region while Georgia has claimed Russian jets were targeting the pipeline over the weekend.

 

Oil industry expert Paul Stevens said the explosion in Turkey would not affect crude supplies to western Europe, but any damage from the conflict in Georgia could have a serious impact.

 

“If the pipeline were lost it would be significant. That is quite a slab of the world’s oil supply and there’s not much surplus capacity elsewhere to replace it with,” said Stevens, senior research fellow for energy at Chatham House.

 

Although the chances of disruption by Russia were unlikely, he added, the threat of limited supply could still drive up the crude futures market.

 

Georgia, which has no significant oil or gas reserves of its own, is a key transit point for oil from the Caspian and central Asia regions to Europe and the US, the only route which avoids Russia and Iran.

 

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By: Mark Watts
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