A $24 million contract for the construction of part of an oil pipeline to carry early production from a concession in the Azeri sector of the Caspian Sea has been awarded, although a decision on the main pipeline’s route has been delayed. The contract was awarded to the local Tekfen and its Azeri partner Azfen by the concession consortium, the Azerbaijan International Operating Company (AIOC).

Work involves construction of a section of a pipeline from Baku to the Georgia port of Supsa, and a 47-kilometre section of 20-inch pipeline between the Georgian border and Agstafa. The contract also includes the rehabilitation and completion of about 421 kilometres of pipeline starting at Shak Gaya to connect with the new section of pipeline to Agstafa. Construction will start in June for overall completion in March 1998. New Zealand’s McConnell Dowell will build the Georgian section (MEED 2:5:97).

The Baku-Supsa pipeline is one of two routes selected in 1995 for the export of early oil production from the concession. However, a decision on an export routing for main oil production from the concession will not now be taken in 1997 as was expected, because of instability in the Russian Federation and the need to assess demand for crude in the Black Sea region, Gregory Rich, AIOC deputy chairman, told an investment conference in Baku.