The collapse of the Soviet Union in 1991 opened up new opportunities for oil companies and international investors in the Caspian Sea region. The tremendous oil production potential in the Sea and the surrounding region has led to a boom in investment and fierce competition for exploration and development rights. During the Soviet era, oil exports from the Caspian Sea region were routed through Russia. Now that they are independent, Azerbaijan, Kazakhstan, and Turkmenistan, with the help of foreign investment, are seeking to increase their oil production and to diversify their export options. As oil from the Caspian region begins to flow in greater amounts, new pipelines will be needed to carry this oil from the Caspian to world markets.
Due to the Caspian region’s relative geographical isolation, building new infrastructure to deliver the region’s oil to consumers will be expensive. Geopolitical considerations, as well as the unresolved legal status of the Caspian Sea, are additional issues complicating the construction of export pipelines. Finally, several regional conflicts may prove to dissuade international investors from financing pipelines. Nevertheless, the region’s bountiful oil production potential has meant that a number of Caspian oil export pipelines have been proposed. The United States has supported the principle of providing multiple export options for the Caspian’s oil-producing countries, but it has unilaterally discouraged export routes through Iran by enacting the Iran and Libya Sanctions Act.
Baku-Supsa West, to the Black Sea via Georgia
As part of the Eurasian Transport Corridor (TRACECA) transporting goods to Europe from the Caucasus, Georgia is set to become a major transit point for Caspian region oil.
On March 8, 1996, Georgian President Eduard Shevardnadze and Azerbaijani President Heydar Aliyev signed a 30-year agreement to pump a portion of the “early oil” from the Azerbaijan International Operating Company (AIOC)’s production-sharing agreement in the Azeri, Chirag, and the deepwater portions of the Gunashli field through Georgia. The so-called “western route” for the AIOC early oil runs from Baku to the Georgian port of Supsa on the Black Sea.
The Georgian International Oil Company, a subsidiary of the AIOC, made substantial upgrades to the existing pipeline along this route and built the $565 million Supsa terminal on the Black Sea. The 515-mile, 100,000-bbl/d-capacity pipeline became operational in April 1999, with oil being pumped through Georgia at 18 cents per barrel. Officials from British Petroleum (BP), the operator of AIOC, said that the consortium exported approximately 130,000 bbl/d in 2001, with virtually all of its oil available for export being shipped to Supsa.
Recent upgrades have raised capacity on the Baku-Supsa pipeline to approximately 145,000 bbl/d. Proposals have been made to increase throughput along this route from the original design capacity of 100,000 barrels per day (bbl/d) to 300,000 bbl/d or even 600,000 bbl/d, but AIOC has focused its efforts on pushing ahead with the Baku-Ceyhan pipeline instead.
Rail and Smaller Pipeline Options
Oil from the Caspian region also could transit Georgia to its Black Sea ports via several smaller pipelines. Georgia already is playing a major role as a rail transit center for Caspian Sea oil, as it has been carrying oil from Azerbaijan and Kazakhstan by rail to its Black Sea ports since 1997.
Prior to the opening of the Caspian Pipeline Consortium’s (CPC) Tengiz-Novorossiisk pipeline in the fall of 2001, ChevronTexaco had been delivering oil from the Tengiz field in Kazakhstan via the Caucasus. ChevronTexaco sent its oil across the Caspian by barge to the Dubendi terminal in Azerbaijan, where it was further transported via a pipeline to Ali-Bayramly (Azerbaijan), and then to Georgia’s Black Sea port at Batumi in rail cars.
In September 1999, Chevron (now ChevronTexaco) and Georgian company Geoengineering signed an agreement on the preparation of a feasibility study for the reconstruction of the 105-mile pipeline from Khashuri to the port of Batumi, with an eye towards using the pipeline for transiting Tengiz crude. Together with an upgrade of the Batumi refinery, the project was estimated to cost $100 million.With the launch of the CPC, however, ChevronTexaco decided in May 2001 to cancel the project to reconstruct the Khashuri-Batumi pipeline, saying that the pipeline was economically unfeasible, especially since most of the Tengizchevroil exports are now routed via the CPC.
Nevertheless, Tengiz crude has been replaced at the Batumi port by high-quality Kumkol crude, supplied by Euro Asian Trading, and the lower-quality Buzachi blend, produced by Kazakhstan’s Mangistaumunaigaz, both of which reach Batumi via a combination of barge, pipeline, and rail across the Caspian and the Caucasus. Turkmenistan also exports occasional cargoes of Cheleken and Okarem crude, which are mostly blended with the Kazakh oil either at the Batumi terminal or on barges, forming a “synthetic Urals” blend.
In order to accommodate more Caspian region oil transiting its territory, Georgia is upgrading its Black Sea ports and constructing new terminals. The Supsa and Batumi ports have been upgraded, and in May 2001, the EBRD agreed to finance the construction of a $20 million oil terminal at the Black Sea port of Poti. The Poti terminal will be able to handle up to 50,000 bbl/d, proving an alternative to the main port at Batumi.
In addition, Georgia and Turkey are working on plans to utilize a 172-mile railway line between Tbilisi and Kars, Turkey, to transport up to 200,000 bbl/d of crude oil from the planned Baku-Ceyhan pipeline to Turkish refineries. The railway plan, which could cost $400 million, will require refurbishing an existing line from Tbilisi to Akhalkalaki for $200 million, as well as extending the rail line 77miles to Kars.
West, to the Mediterranean Sea via Georgia and Turkey
In November 1999, Azerbaijan, Georgia, and Turkey signed agreements affirming the Baku-Ceyhan route as the Main Export Pipeline (MEP) for Azeri oil exports.
Baku-Ceyhan
The planned 1-million-bbl/d capacity, “Main Export Pipeline,” which has received backing from the United States, will stretch approximately 1,038 miles (281 miles through Azerbaijan, 135 miles through Georgia, and 622 miles through Turkey) and is expected to cost between $2.8 billion and $2.9 billion to construct. Despite initial opposition to the pipeline, which several oil companies criticized as too costly and uneconomical with the planned volumes from Azerbaijan, construction on the Turkish section of the pipeline began in June 2002. The entire pipeline is expected to be finished in late 2004, with the first tanker leaving Ceyhan with Azeri oil in January 2005.
Despite earlier misgivings, BP, the operarator of the AIOC consortium that is expected to fill the pipeline, threw its support behind the Baku-Ceyhan proposal in 1999. BP had been opposed to the project, citing doubts that enough oil has been found to justify the high costs. However, BP revised downwards the amount of oil reserves that would be needed to make the pipeline economical, from 6 billion barrels to a more achievable 4 billion to 4.5 billion barrels.
Following the completion of a basic, 6-month engineering study in May 2001, the pipeline’s sponsorship group, led by seven international oil companies and the State Oil Company of the Azerbaijan Republic (SOCAR), undertook a one-year, $150 million, detailed engineering feasibility study for the pipeline in Azerbaijan and Georgia (Turkish pipeline company Botas is responsible for the Turkish section of the pipeline). The detailed engineering study, covering all issues relating to the final details of the route, including the type of line pipe to be used, the pumps and pumping stations requirements, was completed in 2002.
Although construction on the Turkish section of the pipeline already has begun, financing for the Azeri and Georgian sections is still being arranged. Credits from international financial organizations are expected to finance 70% of the cost, with the remaining 30% coming from the pipeline sponsor group, which will become the Main Export Pipeline Company (MEPCO). Currently, seven of the ten members of the AIOC consortium are members of the sponsor group, with only Lukoil, ExxonMobil, and Devon Energy not members. SOCAR, which originally had a 50% stake in the sponsor group, sold ENI (Italy)–a non-member of AIOC–a 5% share in the pipeline project in October 2001.
After failing to come to agreement with other energy companies to join the sponsor group, in March 2002 SOCAR reduced its stake in the pipeline project to 25%, distributing 20% among other group members. In June 2002, SOCAR sold an additional 5% share to TotalFinaElf (France-Belgium), but rejected a proposal from ChevronTexaco to join the sponsor group. At the end of June 2002, the head of the sponsorship group, Michael Townshend of BP, said that the pipeline ownership group was complete. Shares in MEPCO are as follows: BP (38.21%), SOCAR (20%), Unocal (9.58%), Statoil (8.9%), TPAO (7.55%), TotalFinaElf (5%), ENI (5%), Itochu (3.4%), and Delta Hess (2.36%). .
North and Northwest, via Russia
Prior to the breakup of the Soviet Union, there was only one major crude export pipeline–the 240,000-bbl/d Atyrau-Samara pipeline from Kazakhstan to Russia–that connected Caspian Sea oil production to the Russian crude oil export pipeline system and world markets. However, the current proliferation of proposed export routes has put Russia in the position of having to compete with other export outlets for Caspian oil. Thus, Russia is looking to become a transit center for Caspian region oil. In June 2002, Kazakhstan and Russia signed a 15-year oil transit agreement under which Kazakhstan will export at least 350,000 bbl/d of oil annually via Russia, in addition to flows via the CPC.
Tengiz-Novorossiisk
In March 2001, the Caspian Pipeline Consortium (CPC) commissioned its $2.5 billion, 1.34 million-bbl/d-capacity pipeline, sending oil flowing 990 miles from Tengiz to Novorossiisk. After several customs problems and technical delays, the first oil was loaded onto a tanker in Novorossiisk in October 2001, and in November 2001, CPC shareholders decided on a transportation tariff of $26.32 per 1,000 tons ($3.59 per barrel) per 100 kilometers (62.5 miles). The CPC exported approximately 240,000 bbl/d in April 2002, with volumes expected to rise to 400,000 bbl/d by the end of 2002 once additional pumping stations and pipeline links are completed.
Preliminary plans are to increase exports to 520,000 bbl/d in 2003, but the pipeline is not scheduled to reach its full capacity until about 2015. ChevronTexaco, which operates the Tengizchevroil joint venture that currently is supplying the majority of to the pipeline, has estimated that during its 35 to 40 year expected life, the pipeline could bring in $8 billion in taxes for Kazakhstan, and development of the Tengiz field and operation of the pipeline would earn about $150 billion for Kazakhstan and Russia.
Since both Kazakh and Russian oil will be piped via the line, creating a new “CPC Blend” of oil, Kazakh and Russian officials created a “quality bank” to compensate higher-quality Kazakh oil exporters whose oil quality is diluted by the new blend. The Tengizchevroil joint venture will transport approximately 240,000 bbl/d via the pipeline in 2002, with future plans to export an additional 120,000 bbl/d per year via the pipeline from the Karachaganak field in Kazakshtan.
Turkey has raised concerns about the ability of the Bosporus Straits to handle additional tanker traffic that will be necessary to handle the planned volume of Kazakh oil to be exported via the CPC pipeline. Turkey has expressed its concern that the Straits, already a major chokepoint for oil tankers, cannot handle the strain of additional traffic, raising environmental concerns about a collision leading to an oil spill in the Straits. Although Kazakhstan has argued against limiting oil tanker traffic through the Straits, a number of “Bosporus bypass” options are under consideration or being developed in southeastern Europe. In addition, Ukraine already has constructed a new pipeline, the Odessa-Brody pipeline, specifically to transport oil from the Caspian Sea region to European markets.
Atyrau-Samara
In recent years, Kazakhstan’s oil exports, which compete with Russian oil exports, have been limited by Kazakhstan’s annual oil export quota through the Atyrau-Samara pipeline and the Russian pipeline system. (The CPC pipeline is not part of the Transneft-controlled Russian pipeline system.) With oil production in Kazakhstan on the rise, Kazakhstan is interested in gaining improved access to oil terminals in the Baltic Sea for its oil exports via the Atyrau-Samara pipeline. Although Kazakhstan has supplied a small amount of oil to Lithuanian terminals, deliveries have been delayed due to the lack of an agreement with Russia on transportation tariffs.
Since Kazakhstan now has an alternate oil export route via the CPC pipeline, Russian pipeline monopoly Transneft is looking to attract more Kazakh oil via the Atyrau-Samara pipeline. Russia recently completed an expansion of the 432-mile pipeline that increased its capacity to 310,000 bbl/d, and Russia has increased Kazakhstan’s export quotas and lowered its pipeline tariffs.
With the opening of Russia’s new Baltic Pipeline System (BPS) in December 2001, Russia is keen to export Kazakh oil through its own Baltic Sea terminal at Primorsk. In an effort to fill the BPS and to profit from Kazakh oil transiting its territory, Russia allocated a 100,000 bbl/d quota of Kazakh oil for the BPS. The June 2002 transit agreement between Kazakhstan and Russia guarantees Kazakhstan the ability to pipe 300,000 bbl/d through the Atyrau-Samara pipeline.
Baku-Novorossiisk
The 100,000-bbl/d-capacity Baku-Novorossiisk pipeline, also known as the “northern route”, opened in 1997. The pipeline runs 868 miles from Baku via Chechnya to the Russian Black Sea port of Novorossiisk. Initial exports through the pipeline were limited to approximately 40,000 bbl/d, however, owing to pumping limitations, disputes over transit tariffs, and the conflict in Chechnya. Up to 70,000 bbl/d of oil was forced to bypass Chechnya by rail from Dagestan to Stavropol.
The ongoing conflict and instability in Chechnya prompted Russian pipeline operator Transneft to construct a 120,000-bbl/d Chechnya pipeline bypass (160,000 bbl/d including rail links). In 2000, Azerbaijan’s SOCAR committed itself to throughput of 46,000 bbl/d, but in the end only transported around 10,000 bbl/d, prompting Transneft to accuse Azerbaijan of not fulfilling its commitment to export oil along the bypass. In addition, the AIOC, which also was expected to export via Baku-Novorossiisk, has been reluctant to pipe its oil along this route, since it is longer and more expensive than the Baku-Supsa route, and also because the northern route mixes AIOC crude with other crude oils while in transit to Novorossiisk, reducing its value.
SOCAR exported approximately 50,000 bbl/d via the Baku-Novorossiisk route in 2001, and plans to maintain that rate in 2002. According to SOCAR, 2001 exports via the northern route increased because SOCAR refined 40,000 bbl/d less than in 2000; as Azerbaijan imported Russian natural gas, SOCAR significantly reduced production of fuel oil for local power stations and exported all of the surplus crude oil via the Baku-Novorossiisk pipeline. Russia says the the capacity on Baku-Novorossiisk can be increased to 300,000 bbl/d, but SOCAR will not have sufficient volumes to fill the pipeline, even at its present capacity, in the next few years.
A 1996 oil transit agreement between Russia and Azerbaijan is scheduled to terminate at the end of 2003, but the agreement will remain valid until one of the sides withdraws from it. Neither side is happy with the deal, however, and both sides want to resolve disagreements on oil quality, tariffs, and pumping volumes. For its part, Transneft wants to have a guaranteed amount of oil for several years in advance, so Russia has offered to pay for an increase in capacity in the Baku-Novorossiisk pipeline if Azerbaijan commits to shipping larger volumes of crude oil through the system over the long term.
SOCAR officials, on the other hand, are unhappy with the high tariffs and the absence of an oil quality bank for the Baku-Novorossiisk pipeline. SOCAR Deputy Chairman Ilham Aliyev has said that, due to differences in tariffs between the Baku-Supsa and Baku-Novorossiisk pipeline, Azerbaijan loses $13 million per every million tons (20,000 bbl/d) transported via the Baku-Novorossiisk route.
In addition, because the northern pipeline mixes high-quality Azeri Light with low-quality oil from other regions, Azeri oil exported via Novorossiisk is sold at a discount to Azeri oil exported via Baku-Supsa. Azeri officials would like to introduce an “oil quality bank” for the Baku-Novorossiisk pipeline, in which shippers who pipe low-quality oil via the pipeline would compensate Azerbaijan for the reduction in price of its high-quality Azeri Light at the pipeline’s terminus. Currently, neither the Russian government nor the other exporters who use Baku-Novorossiisk compensate Azerbaijan for mixing their oils with Azeri oil and reducing its value.
Thus, with exports of 50,000 bbl/d in 2001, Aliyev estimated that Azerbaijan lost between $40 million and $50 million in added revenues by exporting via the Baku-Novorossiisk pipeline. Nevertheless, Russia insists that future Azeri oil should run to its port of Novorossiisk on the Black Sea, pointing out that Baku-Novorossiisk can be expanded and the transit costs via the pipeline could be a little as half the $3 per barrel that the proposed Baku-Ceyhan is expected to cost. However, future Azeri oil production, mainly from the AIOC, is slated to be exported via the Baku-Ceyhan pipeline.
Additional Export Options
In addition to the Baltic Pipeline System, Russia could export Caspian region oil to world markets via its pipeline system using Adriatic ports. By connecting the southern Druzhba pipeline with the Adria pipeline in Croatia, then reversing flows in the Adria, Russia could ship oil via the Croatian port of Omisalj, thereby allowing oil exporters to bypass the Bosporus Straits.
The Russian Transport Ministry also has proposed shipping oil via barge and tanker from Turkmenistan and Kazakhstan to Russian Caspian Sea ports such as Makhachkala and Astrakhan. From there, the oil could be sent by rail to the Russian ports of Novorossiisk and Tuapse on the Black Sea; Kazakh rail exports from the Tengiz oil field through Russia totaled approximately 100,000 bbl/d in 2000. The Transport Ministry said that total shipments from Turkmenistan could increase to 240,000 bbl/d as port facilities in Kazakhstan and Turkmenistan are upgraded and expanded. Turkmenistan is planning to export about 20,000 bbl/d via Makhachkala-Novorossiisk pipeline in 2002.
South, to the Persian Gulf via Iran
The Islamic republic of Iran has long maintained that routes through Iran to the Persian Gulf are evidently the shortest and most economical for exporting oil from the Caspian Sea. In addition, the Persian Gulf routes would transport oil to Asia, where the demand for oil is projected to grow faster and command a higher price than the Mediterranean markets that most of the competing pipelines would serve.
Oil could be exported via Iran in two ways: by direct transportation by pipelines that pass through Iran en route to the Persian Gulf, or by oil swaps. However, any large investment in Iran’s oil sector would be problematic due to direct U.S. economic sanctions and additional sanctions as dictated by the Iran and Libya Sanctions Act.
Oil Swaps
Iran has been promoting oil swaps via its proposed 370,000-bbl/d pipeline from its Caspian Sea port of Neka. Under this arrangement, oil will be shipped to Iran’s Caspian Sea ports and transported via pipeline, rail, and tanker trucks to refineries located in northern Iran. In exchange, Iran would deliver a similar volume of crude oil to its Persian Gulf Coast, where Caspian exporters could ship their oil to consumers.
Under a 1996 agreement, up to 120,000 bbl/d of Kazakh oil was to be delivered by tanker via the Caspian Sea to the Iranian port of Neka, where it would travel by pipeline to a refinery at Tabriz to be refined and consumed locally. In exchange, Kazakhstan would receive a similar volume of crude ready for export at an Iranian port in the Persian Gulf. Kazakhstan and Iran have been trying to negotiate a supply deal for years, but previously Kazakh crude has proved incompatible with Iranian refineries and there have been disagreements over price.
Volumes also have been limited by contract and technical issues, including the initial problems by Iranian refineries in processing Kazakh crude oil. In the first quarter of 2002, Kazakhstan began making test deliveries to Neka of about 1,600 bbl/d. Kazakh officials hoped to increase the swaps to 17,000 bbl/d, but that appears to be unlikely at this time.
Turkmenistan increasingly has turned to swap agreements with Iran in order to export its oil, with Turkmen oil being delivered to the Iranian Caspian port of Neka. The oil swaps began in July 1998. Dragon Oil, which produced approximately 7,000 bbl/d in 2001 in a production-sharing agreement with Turkmenistan, has exported its share of this production through a swap deal with Iran since 1998, and in April 2000 the company signed a new 10-year swap agreement with Iran.
However, a major problem with swaps is the U.S. sanctions against Iran. U.S. economic sanctions on Iran have prohibited American oil companies with investments in the Caspian Sea region from participating in large-scale oil swaps with Iran; in April 1999, ExxonMobil’s application for a license to swap Turkmen oil for Iranian oil was denied. The Iran-Libya Sanctions Actseeks to penalize non-U.S. firms from doing business with Iran, and as a result, it remains to be seen whether Kazakhstan and Turkmenistan will choose to increase swaps with Iran.
Kazakhstan-Turkmenistan-Iran
Several possibilities are available for direct transportation of Caspian oil to the Persian Gulf. One proposed pipeline would carry Kazakh oil via Turkmenistan to the middle of Iran, then connect to Iran’s existing pipeline network and transport oil south to Iran’s Persian Gulf ports. Iran has suggested that Azerbaijan also could transport its oil via this pipeline by shipping oil eastwards across the Caspian to the port of Turkmenbashi, Turkmenistan, where it could connect with the proposed Kazakhstan-Iran pipeline
In April 2002, Kazakh President Nursultan Nazarbayev, in a meeting with Iranian President Seyyed Mohammed Khatami, stated that an oil pipeline route through Iran would be the most economical way to export Kazakh oil. Kazmunaigaz, the new Kazakh state oil and natural gas company, currently is in talks with TotalFinaElf to prepare a feasibility study for a pipeline from Kazakhstan to Iran. The proposed 900-mile, $1.2-billion pipeline would have a capacity of 1-million bbl/d.
Iran-Azerbaijan
Iran also has proposed a pipeline that would transport oil from Baku via a proposed 190-mile pipeline to northwest Iran, where it would connect with the existing Iranian pipeline network and refineries. TotalFinaElf, which has a large presence in Iran, has proposed building a pipeline with capacity of between 200,000 bbl/d and 400,000 bbl/d, and in May 2001, Iran’s oil ministry authorized the construction of a refinery close to the Caspian sea near the border with Azerbaijan. However, Azerbaijan has indicated that progress on disputes with Iran concerning the division of the Caspian would need to occur before such a project moved forward, as well as Iranian progress towards improved relations with the West.
Southeast, to Pakistan via Afghanistan
Turkmenistan has signed a memorandum of understanding with Afghanistan and Pakistan to build a 1-million bbl/d pipeline to carry oil to Pakistan and world markets via Afghanistan. In October 1997, a tripartite commission comprising Afghanistan, Turkmenistan, and Pakistan was formed to start work on building the so-called “Central Asian Oil Pipeline” (CAOP).
However, no progress has made on the pipeline due to the instability in Afghanistan. Following the August 20, 1998, U.S. bombing raids on suspected Afghan strongholds of suspected terrorist Osama bin Laden, Unocal announced that it was suspending work on the pipeline, and in December 1998, it withdrew from the consortium formed to build the pipeline.
Since the Taliban government’s ouster in December 2001, discussions regarding the Central Asian Oil Pipeline have resurfaced. U.S. Deputy Secretary of State Elizabeth Jones, during a January 2002 visit to Ashgabat, stated that the U.S. would support private companies that chose to undertake trans-Afghanistan pipeline projects if they were considered to be beneficial and commercially viable. Continuing unrest in Afghanistan has stalled any progress on the CAOP.
East, to China
Kazakhstan also is considering the Chinese market. Kazakhstan exported 50,000 bbl/d to China by rail in 1999, and Tengizchevroil has made test deliveries to China by rail. In June 1997, the China National Petroleum Corporation signed an agreement with Kazakhstan for a proposed $3.5 billion, 1,800-mile pipeline to China that would be financed by China. A feasibility study for the pipeline was undertaken, but the study was halted near its completion date. In order to make the project economically feasible, Kazakhstan would have to guarantee 500,000 bbl/d per year through the pipeline, a level to which Kazakhstan said it could not commit.
Trans-Caspian Sea Routes
The amount of oil that is sent by barge across the Caspian Sea is expected to rise further with expansions to pipeline, port, and rail infrastructure in Caspian region countries. In addition to the large volume of oil that already is being shipped by barge across the Sea, several trans-Caspian oil export pipeline options have been proposed.
As Caspian region production increases, trans-Caspian pipelines could bring increasing volumes of oil from Kazakhstan and Turkmenistan across the Caspian. The trans-Caspian pipelines would connect with other export pipelines from the Caspian region, such as the proposed Main Export Pipeline. Eventually, the cross-Caspian pipelines could be connected on the east with export routes flowing eastward as well. In December 1998, Royal Dutch/Shell, Chevron, and ExxonMobil signed an agreement with Kazakhstan to conduct a feasibility study for twin oil and natural gas pipelines that would pass across the Caspian Sea from Aqtau in western Kazakhstan to Baku.
However, the the idea of constructing trans-Caspian pipelines thus far has met with resistance. In addition to the legal issues relating to use of the Sea, Russia and Iran have raised environmental concerns about the impact of pipelines on the seafloor. Both countries have stated their oppostition to the laying of trans-Caspian pipelines on ecological grounds. Territorial disputes need to be resolved as well.
Oil Export Routes and Options in the Caspian Sea Region
| Name/Location | Route | Crude Capacity | Length | Cost/Investment | Status |
| Atyrau-Samara Pipeline |
Atyrau (Kazakhstan) to Samara (Russia), linking to Russian pipeline system | Recently increased to 310,000 bbl/d | 432 miles | Increase in capacity cost approximately $37.5 million | Existing pipeline recently upgraded by adding pumping and heating stations to increase capacity. |
| Baku-Ceyhan (“Main Export Pipeline”) |
Baku (Azerbaijan) via Tbilisi (Georgia) to Ceyhan (Turkey), terminating at the Ceyhan Mediterranean Sea port | Planned: 1 million bbl/d | Approximately 1,038 miles | $2.9 billion | Detailed engineering study began June 2001. Construction scheduled to begin in 2002, with completion targeted for 2004. |
| Baku-Supsa Pipeline (AIOC “Early Oil” Western Route) | Baku to Supsa (Georgia), terminating at Supsa Black Sea port | Currently: 100,000 bbl/d; proposed upgrades to between 300,000 bbl/d to 600,000 bbl/d | 515 miles | $600 million (before upgrade) | Exports began in April 1999; approximately 90,000 bbl/d exported via this route in 2000. |
| Baku-Novorossiisk Pipeline (Northern Route) | Baku via Chechnya (Russia) to Novorossiisk (Russia), terminating at Novorossiisk Black Sea oil terminal | 100,000 bbl/d capacity; possible upgrade to 300,000 bbl/d | 868 miles; 90 miles are in Chechnya | $600 million to upgrade to 300,000 bbl/d | Exports began late 1997; exports in 2000 averaged only 10,000 bbl/d. |
| Baku-Novorossiisk Pipeline (Chechnya bypass, with link to Makhachkala) | Baku via Dagestan to Tikhoretsk (Russia) and terminating at Novorossiisk Black Sea oil terminal | Currently: 120,000 bbl/d (rail and pipeline: 160,000 bbl/d); Planned: 360,000 bbl/d (by 2005) | 204 miles | $140 million | Completed April 2000. Eleven-mile spur connects bypass with Russia’s Caspian Sea portof Makhachkala. |
| Caspian Pipeline Consortium (CPC) Pipeline |
Tengiz oil field (Kazakhstan) to Novorossiisk Black Sea oil terminal | Currently: 565,000-bbl/d; Planned: 1.34-million bbl/d (by 2015) | 990 miles | $2.5 billion for Phase 1 capacity; $4.2 billion total when completed | First tanker loaded in Novorossiisk (10/01); exports rising to 400,000 bbl/d by end-2002 |
| Central Asia Oil Pipeline | Turkmenistan and Afghanistan to Gwadar (Pakistan) | Proposed 1 million bbl/d | 1,040 miles | $2.5 billion | Memorandum of Understanding signed by the countries; project stalled by regional instability and lack of financing. |
| Iran-Azerbaijan Pipeline | Baku to Tabriz (Iran) | Proposed 200,000 bbl/d to 400,000 bbl/d | N/A | $500 million | Proposed by TotalFinaElf. |
| Iran Oil Swap Pipeline | Neka (Iran) to Tehran (Iran) | 175,000 bbl/d, rising to 370,000 bbl/d | 208 miles | $400 million to $500 million | Under construction; oil will be delivered to Neka and swapped for an equivalent amount at the Iranian Persian Gulf coast. |
| Kazakhstan-China Pipeline | Aktyubinsk (Kazakhstan) to Xinjiang (China) | Proposed 400,000 bbl/d to 800,000 bbl/d | 1,800 miles | $3.0 billion to 3.5 billion | Agreement 1997; feasibility study halted in September 1999 because Kazakhstan could not commit sufficient oilflows for the next 10 years. |
| Kazakhstan- Turkmenistan-Iran Pipeline | Kazakhstan via Turkmenistan to Kharg Island (Iran) on Persian Gulf | Proposed 1million bbl/d | 930 miles | $1.2 billion | Feasibility study by TotalFinaElf; proposed completion date by 2005. |
| Khashuri-Batumi Pipeline | Khashuri (Georgia) to Batumi (Georgia) | Initial 70,000 bbl/d, rising to 140,000 bbl/d-160,000 bbl/d | Rail system from Dubendi,Azerbaijan, to Khashuri, then 105-mile pipeline from Khashuri to Batumi | $70 million for pipeline renovation | ChevronTexaco has canceled plans to rebuild and expand the existing pipeline. |
| Trans-Caspian (Kazakhstan Twin Pipelines) | Aqtau (western Kazakhstan, on Caspian coast) to Baku; could extend to Ceyhan | N/A | 370 miles to Baku | $2 billion to $4 billion (if to Ceyhan) | Feasibility study agreement signed in December 1998 by Royal/Dutch Shell, ChevronTexaco, ExxonMobil, andKazakhstan; project stalled by lack of Caspian Sea legal agreement. |