institutions involved in the pipelines
(Updated April 2005)
BP and its partners secured the US$ 3.3 billion cost of the Baku-Tbilisi-Ceyhan pipeline
through 30% equity (capital provided by the oil companies which hold shares in the project), but primarily
70% from debt (loans from banks). A large proportion of this debt
was sought from public financial institutions (ie lenders of
taxpayers' money), led by the International Finance Corporation
(IFC – the part of the World Bank which lends to companies rather than governments) and the European Bank of Reconstruction and Development (EBRD)
are these international financial institutions?]
In November 1998, BP
boss John Browne stated that the BTC / AGT project would not be
possible unless such "'free public money' was offered by government
to build the line."
In October 2001, BP and
its partner oil companies sent a preliminary informative memorandum
on the project's financing requirements to the IFC, the EBRD and
leading export credit agencies.
Following this, on 11th June 2003, BP and its partner oil companies submitted a
formal application for financing to the IFC and the EBRD. They were asked for $300 million each. Both IFC and EBRD approved loans to the project in November 2003, just weeks after an election in Azerbaijan which was described by official observers as “fraudulent”. The loans were widely seen as an effective endorsement of an election in which many of the opposition candidates had not been allowed to stand, opposition leaders and democracy protesters were arrested, and power was handed from Azerbaijan's long-time ruler Heydar Aliyev to his son Ilham – the Former Soviet Union's first dynastic succession.
Loan agreements were signed by the consortium, with IFC and EBRD, seven export credit agencies and fifteen commercial banks, in February 2004.
The project financiers thus comprise:
Multilateral (public) development banks
International Finance Corporation (IFC)
European Bank for Reconstruction & Development (EBRD)
Export Credit Agencies – political risk insurance (with public money)
ECGD ( UK )
JBIC ( Japan )
COFACE ( France )
SACE ( Italy )
Hermes ( Germany )
Other public financial institutions
MIGA the Multilateral Investment Guarantee Agency of the World Bank
Commercial banks – lead arrangers
ABN Amro ( Netherlands )
Mizuho ( Japan )
Société Générale ( France )
Other commercial banks
Royal Bank of Scotland
KBC ( Belgium )
Dexia ( Belgium )
West LB ( Germany )
Hypovereinsbank ( Germany )
BNP Paribas (France)
Natexis Banques Populaires ( France )
ING ( Netherlands )
San Paulo IMI ( Italy )
Banca Intesa ( Italy )
NOTE: Banca Intesa is selling its stake , over safety concerns. One third of its stake has been sold so far – it is not yet known to whom.
This financial package was largely designed and advised on by Lazards .