EX-IM Bank Approves $160 Million Guarantee To Support Baku-Tbilisi-Ceyhan Pipeline

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December 30, 2003

The Export-Import Bank of the United States (Ex-Im Bank) today approved a $160 million long-term guarantee to support the export of U.S. equipment and services for construction of the Baku-Tbilisi-Ceyhan Pipeline project (BTCP). The Bank acted after referring the transaction to Congress and the expiration of a statutory 35-day waiting period during which no comments were received.

The 1,094-mile pipeline, with a capacity of one million barrels per day, will transport crude oil from the Sangachal terminal near Baku, Azerbaijan, through Azerbaijan, Georgia and Turkey, to a marine export terminal at Ceyhan, Turkey, on the Mediterranean. The pipeline will be the main export route for the significant oil volumes to be produced from the Azeri, Chirag and Gunashli offshore fields in Azerbaijan (the ACG Field), as well as other potential oil fields in the Caspian region.

"U.S. participation in the project will support thousands of U.S. jobs among exporters and suppliers," said Ex-Im Bank Chairman Philip Merrill. "In addition, this pipeline will benefit many countries as it allows direct export of oil from the Caspian Sea region to Western markets via the Mediterranean."

U.S. companies will supply engineering services, control systems and pump systems for the project. Major U.S. suppliers may include companies located in California, Illinois, Nevada, Texas and Vermont.

In reviewing environmental aspects of the project, Ex-Im Bank collaborated with the International Finance Corp. (IFC), the European Bank for Reconstruction and Development (EBRD), and other nations' export credit agencies (ECAs) to ensure that the project meets international standards.

In addition to Ex-Im Bank's support, financing for the $3.4 billion project involves six other ECAs, the IFC, the EBRD, the U.S. Overseas Private Investment Corp. (OPIC), and four arranging commercial banks.

Baku-Tbilisi-Ceyhan Pipeline Co. is owned by 11 sponsors, including three from the United States, which are major oil companies that are investing in the project. BP Plc of the United Kingdom and the State Oil Company of Azerbaijan together account for more than 55 percent of the project company's ownership.

Next year, Ex-Im Bank marks its 70th year of helping finance the sale of U.S. exports, primarily to emerging markets throughout the world, by providing loan guarantees, export credit insurance, and direct loans. In fiscal year 2003, Ex-Im Bank, an independent federal agency, authorized financing to support approximately $14.3 billion of U.S. exports worldwide. For more information on Ex-Im Bank, visit www.exim.gov.

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