Azerbaijan, Georgia address security threats to BTC pipeline

By an OGJ correspondent

NICOSIA, Jan. 20 -- Concerns are rising over the security of the Baku-Tiblisi-Ceyhan (BTC) pipeline following reports from government officials in Azerbaijan and Georgia of increased threats to the project.

Azerbaijan's Defense Minister Safar Abiyev last week told British government officials that Armenia's "aggressive policy" posed an "actual threat" to security in the region, including the BTC pipeline.

Arms and hardware accumulated by Armenia pose a serious threat to the BTC pipeline that should be eliminated, Abyev told Britain's Ambassador Andrew Tucker and its military attaché, Christopher John Nunn.

Officials at the United Kingdom's Foreign & Commonwealth Office declined to comment on the report when contacted by OGJ.

Azerbaijan and Armenia have been involved in a long-running military standoff over the enclave of Nagorno-Karabakh.

Competing claims to Nagorno-Karabakh sparked a 5-year war between Armenia and Azerbaijan in the early 1990s, which left about 30,000 dead and forced a million people to flee their homes.

The area is under de facto Armenian control, and its rulers are pressing for it to be recognized as an independent entity, but Azerbaijan insists Nagorno-Karabakh is part of its territory and wants it back.

In April 2002, Azerbaijan's President Heidar Aliyev ordered the creation of a special state security service to protect the BTC pipeline, along with the existing Baku-Novorossiisk and Baku-Supsa pipelines and the massive Azeri-Chirag-Guneshli (ACG) offshore oil field.

Baku-Supsa line damaged
Meanwhile, Giorgi Chanturia, president of the Georgian International Oil Corp. (GIOC), said on Sunday that the Baku-Supsa oil pipeline was deliberately damaged Jan. 18 in an effort to create obstacles for implementation of the 244 km sector of BTC pipeline project in his country.

"The only aim was to harm the operation of the Baku-Supsa oil pipeline project, which would have had consequences for the BTC oil pipeline," Chanturia told Georgian television.

"Our guess is that, after that, the investors would have been told that Georgia was incapable of dealing with security issues, (and) that the (BTC) oil pipeline would be damaged," he said.

The attack, which Chanturia said was the "second incident of this nature," took place in the village of Sveneti in the Gori District. Chanturian said only a small amount of oil was lost due to the quick response of pipeline technicians.

The attack could be seen as an embarrassment to Georgian President Eduard Shevardnadze, who announced on Jan. 14 that the Georgian Special Protection Service (GSPS) would guard Georgian sections of the BTC pipeline and the Baku-Tbilisi-Erzurum gas pipeline.

Shevardnadze said GSPS protection of the Baku-Supsa oil pipeline had proven "efficient," and he was hoping that "it will be possible to attract additional resources from companies engaged in those projects and interested in their security."

Shevardnadze's statement coincided with a scheduled visit to Georgia by BP political advisor John Gerson concerning measures being undertaken to guarantee the security of the Georgian stretch of the BTC pipeline.

Gerson said the purpose of his visit was to become acquainted with the situation in Georgia and the steps being taken by authorities to guarantee security of the pipeline's construction and operation.

Gerson, who met with Georgian Minister of State Avtandil Dzhorbenadze and Security Council Secretary Tedo Dzhaparidze, said he had familiarized himself with the authorities' plan and that Georgia was doing everything possible to ensure the pipeline's security.

GIOC's Chanturia earlier announced that the protection would involve Georgian servicemen trained by US military instructors (OGJ Online, Jan. 7, 2003). He said the US would allocate $11 million to the project, in addition to a $64 million "Train and Equip" program already under way.

According to Chanturia, the training of the 400-man special pipeline protection battalion, which will coordinate with the GSPS, is due to begin in February.

Georgia also is involved in talks with Northrop Grumman of the US over electronic surveillance systems aimed at increasing security of the pipeline and its adjacent areas.

A NG spokesman told OGJ that officials of the firm's Baltimore-based Electronic Systems sector and GIOC signed an MOU in September 2001 to investigate "possible cooperation" on the development of technology-based security measures for the BTC pipeline.

"Discussions by both parties have been under way since that time and are continuing," the spokesman said, adding that "it would be premature to speculate as to which technological solutions may ultimately be agreed upon."

US, Japan visits slated
The alleged attack on the Baku-Supsa pipeline also coincided with plans for the departure of Georgian Security Minister Valeri Khaburdzania on a 9-day visit to Japan and the US for discussions with security officials over cooperation on anti-terrorism measures.

Khaburdzania said he would meet with FBI Director Robert S. Mueller to discuss the issue of technical assistance to Georgia's Security Ministry, while he expected to discuss BTC pipeline security with Japanese colleagues.

Khaburdzania told local media that several Japanese nationals have been arrested in Georgia, one of whom is suspected of links with terrorist organizations and has been handed over to the Japanese.

Shared responsibilities
Under terms of the BTC agreement, individual firms are responsible for the operational integrity of the pipeline, while host government agreements for Azerbaijan, Georgia, and Turkey commit the governments to a number of open-ended expenditures.

These include the full costs of ensuring security for the pipeline and the costs of compensating the BTC consortium for any losses incurred as a result of the introduction of new social and environmental laws over the next 40 years.

Work on the 1800 km BTC pipeline is scheduled to start this spring, with completion set for the beginning of 2005. When complete, the pipeline is expected to carry 1 million b/d of crude oil from Baku to Ceyhan via Tbilisi.

Participants in the BTC project are: Operator BP Group LLC 30.1%, State Oil Co. of the Azerbaijan Republic (SOCAR) 25%, Unocal Corp. 8.9%, Statoil ASA 8.71%, Turkish Oil Corp., i.e., Turkiye Petrolleri Anonim Ortakligi (TPAO) 6.53%, ENI SPA 5%, TotalFinaElf 5%, Japan's Itochu Corp. 3.4%, ConocoPhillips 2.5%, Tokyo-based Inpex Corp.2.5%, and Amerada Hess Corp. 2.36%.

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