BAKU - An Iranian energy official downplayed the significance of a new US-backed pipeline designed to carry oil from the Caspian Sea to Western markets on Wednesday, saying routes through Iran make more economic sense.
Speaking at an oil and gas conference in Baku where the four-billion-dollar Baku-Tbilisi-Ceyhan pipeline was inaugurated in May, the director for Caspian Sea Oil and Gas Affairs in Iran's petroleum ministry, Mahmood Khagani, said: "Iran's route is the shortest, cheapest and potentially the most lucrative."
"People try to say Iran is unhappy with the BTC," Khagani said, but the creators of the pipeline will have to put politics aside and face the economic costs of getting oil out of the landlocked sea.
Azerbaijan, which plans to pump its oil to the Mediterranean coast of Turkey through the pipeline when it goes online later this year, is wooing Kazakhstan on the other side of the Caspian to commit oil from its fields to delivery through the route.
The United States has expressed its support for Kazakhstan's participation, a senior US energy official calling it a "logical" step in May, but Khagani said the central Asian nation could benefit, too, from shipping its oil to the Persian Gulf through Iran.
"The Kazakh government is of the opinion that like a fox, an oilman needs more than one route," he said.
The BTC pipeline gives Caspian oil producers independent export routes that sideline traditional paths through Russia but has been seen as an affront to Teheran.
The Caspian region produces a high-quality light crude but has suffered from its distance from the world's major consumers: North America, Europe, China and Japan.
The British oil giant BP holds a leading 30 percent stake in the consortium running the BTC pipeline. Other consortium members include Azerbaijan's state oil company SOCAR, Amerada Hess, ConocoPhillips, Eni, Inpex, Itochu, Statoil, Total, TPAO and Unocal.
06/08/2005 17:31 GMT