Statoil to Lend $170 Million to BTC Pipeline

Statoil will provide $170 million in financing for the construction of the Baku-Tbilisi-Ceyhan pipeline. The BTC pipeline has recently run into delays in raising funding because financial institutions have prolonged their decision-making timelines.

Shareholders in BTC - which also include Socar, Unocal, Eni, Total SA and ConocoPhilips - have agreed to finance 30% of pipeline construction. The other 70% is to be financed externally. Earlier, BP said it was ready to extend $500 million in loans for external financing. External financing is to come from four sources: international financing organizations such as the World Bank and European Bank for Reconstruction and Development, export credit agencies, commercial banks and shareholders in the role of financial intermediaries.

Pipeline construction is estimated to cost $2.95 billion, or $3.7 billion including interest and financing expenses.