Construction has begun on a multi-billion euro US-backed oil pipeline destined to stretch from the Caspian Sea to the Mediterranean.
The project will break the Russian domination of Caspian oil. The Caspian area is reckoned to have the third-largest oil deposit in the world, after the Middle East and Venezuela.
When completed, the new pipeline will stretch 1750km across the three nations, transporting up to a million barrels of crude oil per day.
This project is to bypass Russia and to break the monopoly that Russia has in that area.
But now there’s still a questions over the commercial viability of this pipeline. There are some skeptics as in recent years the exploration success of Azerbaijan and the Caspian Sea has been pretty minimal and pretty poor. So some of the companies have decided not to participate in the pipeline.
At the same time BP, which is the operator of the pipeline and main oilfield which will supply it, is very confident that in fact the commerciality is now proven, that there are sufficient reserves in place right now for the pipeline to go ahead.