New prospects for Trans-Caspian oil

The fourth energy summit in Baku has produced very optimistic results for Georgia. The country has proved once again its transit capacity and its potential to play a serious role in transporting Caspian and Kazakh oil to Europe.

During the summit agreement was signed on providing Kazakh oil to revive the Odessa-Brody-Gdansk project. The willingness of Kazakhstan to contribute to developing this pipeline is a welcome breakthrough in creating alternative supply routes for Europe, ignoring Russian pipelines and carriers.

Minister of Energy of Kazakhstan Souat Minbaev has stated that Kazakhstan needs new transit routes because it plans to increase its oil production. In 2008 Kazakhstan will produce 70 million tonnes oil, of which 63 million will be exported. By 2015 Kazakhstan will be producing 100 million tonnes of oil annually.

A USD 3 billion contract has been signed between Azerbaijan and Kazakhstan for creating a different infrastructure in Kazakhstan and Azerbaijan to make the new transportation route viable. This will include the construction of special oil terminals in the Caspian Sea. Kazakh oil will also be pumped through the BTC oil pipeline.