BP-led group to pay BOTAS $ 333 mm for pipeline cost overruns
The British Petroleum-led Baku-Tbilisi-Ceyhan Pipeline consortium said it will pay Turkey's BOTAS oil and gas company
$ 333 mm for cost overruns in the Turkish section of the pipeline.
"The size of BOTAS' claim has been determined, and both sides have agreed to this amount," said Vagit Aliyev, head of
the foreign investment department of Azerbaijan's SOCAR state oil company, a member of the consortium.
However, a spokeswoman for BP in Azerbaijan declined to confirm or dispute the figure, and said talks with BOTAS were
still underway. She said the total cost for the pipeline construction would be "under $ 4 bn," though that amount
does not include the cost of filling the pipeline, which required more than 10 mm barrels of oil.
The 1,760-km pipeline links Azerbaijani oil fields to the Turkish Mediterranean port of Ceyhan, opening an outlet to
Western markets for some of Azerbaijan's vast Caspian Sea oil and gas wealth.
BP announced in April that the construction cost was likely to exceed the original estimate of $ 2.95 bn by some 30
%. The first 600,000-barrel tanker-load was lifted from the pipeline.
The pipeline is currently pumping 200,000 bpd into storage tankers in Ceyhan, BP said. It foresees that the pipeline
will pump 300,000 to 400,000 bpd by year end. The pipeline will stop pumping oil for 10 days later this month to
allow for the final stages of construction, BP's associate president in Azerbaijan, David Woodward, told.
