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Press Release

Wednesday, February 4, 2004

OPIC Provides $100 Million in Insurance for Loans to Caspian Pipeline Project

WASHINGTON, D.C. – The Overseas Private Investment Corporation (OPIC) is providing $100 million in political risk insurance for commercial bank loans being made for the Baku-Tbilisi-Ceyhan (BTC) pipeline project. The BTC pipeline will provide the infrastructure necessary to transport oil produced in the Caspian Sea safely and efficiently over a distance of about 1,750 kilometers to the Mediterranean Sea, enabling Azerbaijan, Georgia and Turkey to realize a vital economic priority, OPIC President and CEO Dr. Peter Watson announced today.

The BTC pipeline will transport about one million barrels of oil per day, generate approximately $262 million in annual revenues for the three host countries, and will protect the Bosphorus Straits from additional oil tanker traffic. Construction of the pipeline is already underway, and is due to be completed in 2005.

The BTC pipeline is the largest foreign investment currently being undertaken in any of the three host countries. The project will generate nearly 9,800 local jobs at the peak of construction, as well as 700 full-time jobs once operation of the pipeline begins.

Routing of the pipeline was carefully planned, taking into account local and international security, human rights, environmental and social concerns. OPIC is working closely with the borrower, BTC Co. Ltd. and international lenders to ensure the application of best practices in all areas, including public consultation, monitoring and transparency.

“This project establishes an essential energy corridor for exporting Caspian Sea oil to global markets, and does so without adding additional oil tanker traffic to the already-congested Bosphorus Straits,” Dr. Watson said. “In an environmentally-sensitive way, it contributes importantly to the integration of the Caucasus into the global economy, and will thereby provide significant developmental benefits to the people of Azerbaijan, Georgia and Turkey. We at OPIC are pleased to help the region realize a critical part of its economic potential.”


OPIC is the U.S. Government’s development finance institution.  It mobilizes private capital to help solve critical development challenges and in doing so, advances U.S. foreign policy.  Because OPIC works with the U.S. private sector, it helps U.S. businesses gain footholds in emerging markets catalyzing revenues, jobs and growth opportunities both at home and abroad.  OPIC achieves its mission by providing investors with financing, guarantees, political risk insurance, and support for private equity investment funds.

 

Established as an agency of the U.S. Government in 1971, OPIC operates on a self-sustaining basis at no net cost to American taxpayers. OPIC services are available for new and expanding business enterprises in more than 150 countries worldwide. To date, OPIC has supported nearly $200 billion of investment in over 4,000 projects, generated $74 billion in U.S. exports and supported more than 275,000 American jobs.