On November 4, 2003, the Board of the International Finance Corporation (IFC), the private sector arm of the World Bank Group, approved lending to the Baku-Tbilisi-Ceyhan (BTC) pipeline and the Azeri-Chirag-Deepwater Gunashli (ACG) Phase 1 oil field.
The BTC pipeline is a dedicated crude oil pipeline system, which will extend from the ACG field through Azerbaijan and Georgia to a terminal at Ceyhan on the Mediterranean coast of Turkey.
The pipeline can transport up to 1 million barrels per day, and at 1760 kilometers is one of the longest of its kind in the world. The BTC pipeline will complement oil transport from two existing pipelines—the Northern Route pipeline to Novorossiyk, Russia, and the Western Route pipeline which ends in Supsa, Georgia—whose transportation capacity is limited.
The BTC pipeline will transport oil from landlocked Azerbaijan to the port on the Mediterranean Sea, bypassing the environmentally sensitive Black Sea and the Bosphorus Straits.
IFC's investment in the BTC pipeline consists of a loan up to $125 million for its own account and a loan of up to $125 million in commercial syndication. The total project cost of BTC is approximately $3.6 billion.
The ACG Phase 1 oil field involves developing an oil field off Azerbaijan in the Caspian Sea. IFC's investment in ACG Phase 1 consists of loans of up to $30 million for its own account and further loans of up to $30 million to be commercially syndicated. The total project cost of ACG Phase 1 is approximately $3.2 billion.
