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Georgia: BP reopens Georgia gas pipeline

BBC News
August 15th, 2008

BP has said it has resumed pumping gas through a pipeline that runs through Georgia after an EU-brokered truce between Russian and Georgian troops.

But a spokeswoman for the firm said a key oil pipeline that runs through the country remains shut as BP assesses the security risks to the surrounding area.

The oil pipeline can carry up to 90,000 barrels a day.

Disruptions to exports from the region have supported the oil market, though prices fell on Thursday.

US sweet, light crude dropped $1.24 to $114.76, while London Brent crude fell 83 cents to trade at $112.64. The falls erased gains of more than $1.40 for both measures.

It had been hoped that transporting oil through Georgia would make the West less dependent on supplies from Russia.

But the outbreak of violence showed the precarious nature of the country as an energy transit route, the International Energy Agency (IEA) said in its monthly report released earlier this week.

Security risk

BP said it had resumed pumping gas through the South Caucasus pipeline - which runs from the Caspian Sea, through Georgia, into Turkey - earlier on Thursday.

It was shut on Tuesday amid the military conflict between Russia and Georgia over the secessionist territories of Abkhazia and South Ossetia.

The Western Route Export Pipeline (WREP), which runs from Baku on the Caspian Sea in Azerbaijan to the Georgian Black Sea port of Supsa was also closed earlier this week and remains out of action.

Another BP pipeline that runs through Georgia - the Baku-Tbilisi-Ceyhan (BTC) oil pipeline - has been closed since early August following an explosion on the eastern Turkish section of the line.

The current conflict could delay its reopening, scheduled for September, according to the IEA.

The world's second-largest pipeline, of which BP has a 30% stake, runs from Azerbaijan through southern Georgia into Turkey. It can transport up to 1.2 million barrels of oil a day.

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