The FINANCIAL — BP Georgia’s operational expenditure on BTC/SCP and Western Route Export Pipeline (WREP) totalled USD 111.6 million in 2007. BP Georgia’s total 2007 spend across all of its activities in Georgia was well over USD 200 million. In 2007, BP Georgia’s payments to local companies totalled USD 79.4 million.
The BTC Co. shareholders are: BP (30.1%), AzBTC (25.00%), Chevron (8.90%), Statoil (8.71%), TPAO (6.53%), ENI (5.00%), Total (5.00%), Itochu (3.40%), INPEX (2.50%), ConocoPhillips (2.50%) and Hess (2.36%).
According to Mr. Hugh McDowel, General Manager of BP in Georgia, oil flow rates through BTC have steadily increased, bringing around 600,000 barrels of oil per day (bpd) to world markets and increasing towards the pipeline’s current capacity of one million barrels of oil per day. BTC throughput in 2007 was approximately 212 million barrels of oil in Georgia.
“For the 1Q 2008 it has reached 65.8 million barrels or more than 8.8 million tons, increasing towards the pipeline’s current capacity of one million barrels of oil per day.” Hugh McDowel, General Manager of BP in Georgia, declared to The FINANCIAL.
BP is one of the world’s largest energy companies, and it has been operating in Georgia since 1996. The company’s business is primarily about the safe transportation and delivery of energy, while operating in a manner which is truly sustainable.
BP operates three major oil and gas pipelines through Georgia as well as an aviation fuelling business at Tbilisi airport.
As McDowel noted, since the first tanker lifting at Ceyhan in June 2006 a total of 426 tanker loadings have been completed from the marine oil terminal at Ceyhan on the Turkish Mediterranean coast including 91 tanker loadings in the 1Q 2008.
“In its first full year of operation, we improved the operating efficiency of the BTC pipeline in Georgia. Efficiency rates, measured by the extent to which we successfully transported the oil delivered through the Georgian section of the pipeline, reached 100% for the last four months of 2007 and for the 1Q of 2008,” McDowel added.
Following the commissioning of SCP in 2006, the first commercial gas was delivered to the Georgian market in January 2007. Volumes delivered after start-up were as required and at the contracted values. The successful delivery of SCP gas into Georgia was a major step forward.
The SCP Co. funding shareholders are: BP (technical operator – 25.5%), Statoil (commercial operator – 25.5%), the State Oil Company of Azerbaijan, Republic (SOCAR – 10%), LUKoil (10%), NICO (10%), Total (10%) and TPAO (9%).
Shareholders of the Western Route Export Pipeline (WREP) are: BP (operator – 34.1%), Chevron (10.3%), SOCAR (10%), INPEX (10%), Statoil (8.6%), ExxonMobil (8%), TPAO (6.8%), Devon (5.6%), ITOCHU (3.9%) and Hess (2.7%).
“We made progress with the additional ‘special project’ facilities linked to the BTC/SCP pipelines in the Kodiana region which were requested by the Georgian government,” McDowel said.
BP Georgia secured a number of permits from government authorities, and acquired land rights where necessary. These approvals enabled construction to begin on the BTC/SCP secondary containment sites (settlement basins and dams with sluice gates to contain oil safely in the unlikely event of a pipeline rupture) and on the Emergency Drain Down Facility (the EDDF – an 8,500m3 steel tank constructed within a secondary underground concrete tank for the draining and storage of oil from any Kodiana section of the BTC pipeline in certain emergency situations).
As McDowel noted, BP Georgia has completed the construction of the first phase of the Kodiana security base, handing over the accommodation facility to the government’s Strategic Pipelines Protection Department (SPPD).
“We are planning to complete all work on this projects in 2008. In addition, we repaired community roads and bridges that had been affected during pipeline construction, and constructed new permanent access roads to valve stations along the BTC/SCP pipeline. Further reinstatement work, planting approximately 175,000 saplings and carrying out grass seeding, was undertaken along the pipeline right of way and a biodiversity monitoring programme initiated,” McDowel declared.
BP Georgia acquired a site near Rustavi for the construction of a permanent landfill facility for the non-hazardous waste generated by the company’s activities.
According to McDowel, significant progress was made in 2007 to fulfil BP Georgia’s internal commitment to adhere to EU standards of waste management for the BTC pipeline and associated facilities.
“Following an open tender, we appointed an international engineering consulting company to develop plans for the facility’s construction and operation. Permitting, impact assessments and project designs have begun and our plan is to have the site constructed and operating in 2008. We are also committed to assisting the local authority in developing a municipal facility adjacent to the BP landfill site which will serve the local community,” McDowel said.
BP Georgia has also made progress with arrangements for managing hazardous waste, appointing an international contractor to negotiate and manage its export, given that no EU-compliant hazardous waste facilities exist in Georgia. The first deliveries of this waste, which are being received by facilities in Germany and the Netherlands, took place early in 2008.
BP Georgia took steps in 2007 towards obtaining certification against the international environmental management system standard ISO 14001 for the BTC/SCP pipelines and associated facilities.
BP Georgia continued work to restore the land along the BTC/SCP pipeline right of way, and in other areas such as camps, pipe yards, and access roads, borrow pits and rock disposal sites. The work involved continuing the restoration of topsoil and vegetation to reduce erosion and carrying out vegetation cover and species diversity monitoring as part of an approach to monitoring bio-restoration.
“Although we have no formal requirement to do so, we began a photo-landscape monitoring programme at selected locations to demonstrate progress in restoring the landscape, including the use of high-resolution satellite imaging. While initially used for the project area and adjacent margins, its use will be extended to cover areas exhibiting high erosion risk, slower than expected vegetation re-growth, or elements of both. We have also undertaken habitat restoration projects in locations on the western route pipeline,” McDowel added.
According to McDowel, Air BP continued to provide service to its customers at Tbilisi international airport. Operations throughout the year 2007 were carried out without reported recordable injury.
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