Nano–Saxe-Coburg–and Macedonia’s Vlado Buckovski shaking on the deal Tuesday.
SOFIA (AP/Balkanalysis)–Bulgaria–Albania–and Macedonia gave political support on Tuesday to a $1.2 billion private trans-Balkan oil pipeline project that aims to allow alternative ports for the shipping of Russian and Caspian oil–which normally goes through Turkish ports.
Representatives from the three small Balkan states signed a declaration giving the green light to the US-registered Albanian Macedonian Bulgarian Oil Corp.–AMBO–to launch the 912-kilometer pipeline between Bulgaria’s Black Sea port of Burgas and Vlore–on Albania’s Adriatic coast.
"This is one of the most important infrastructure projects for regional–EU–and Euro-Atlantic integration for the western Balkans," Albanian Prime Minister Fatos Nano told reporters.
Tankers ferrying oil to the Mediterranean and further west are currently subject to frequent and costly delays as they travel through the Bosporus and Dardanelles straits.
The long-delayed underground line–expected to begin operation in early 2008–will be able to move up to 750,000 barrels of oil per day. The first obstacle was the preoccupation of relevant parties during the Clinton Administration with the massive Baku-Tbilisi-Ceyhan pipeline in Anatolia. Then came the wars in Kosovo and Macedonia in 1999 and 2001–which left investors jittery. Now that the situation seems to have stabilized–however–the future looks bright for AMBO.
AMBO said it had already secured some $900 million from the US government development agency Overseas Private Investment Corp.–US Eximbank–and through a syndicated loan arranged by Credit Suisse First Boston.
The remaining 25 percent of the funding will be raised by attracting private equity investors and a new company–which will operate the pipeline on behalf of the shareholders in one year’s time–said AMBO President Ted Ferguson.
Oil giants operating in the Caspian region like ChevronTexaco–ExxonMobil–and BP–have long sought alternative routes to the Bosporus and Dardanelles straits.
The pipeline was first discussed in 1994–but was delayed due to a lack of political backing by the countries involved. The construction of the pipeline–expected to start in a year–will not preclude another pipeline to carry Russian oil from Burgas to the northeastern Greek port of Alexandroupolis which is now under discussion.
"We all know that Bosporus will sooner or later reach a point of saturation–so any bypass will be welcome," Bulgarian Prime Minister Simeon Saxe-Coburg said.
That pipeline–a 256-kilometer route with capacity of 700,000 bpd–should be built and run jointly by Bulgaria–Russia–and Greece–but so far the three countries have failed to reach agreement on how to structure the 700 million euro ($954.7 million) project.