The Georgian Oil and Gas Corporation (GOGC) has announced an international tender for the procurement of consulting services related to the future of the Baku-Supsa pipeline and its Black Sea oil terminal. This project, one of the country’s key strategic transit corridors, has been operated by the BP-led Azerbaijan International Operating Company (AIOC) under a long-term financial lease since 1996. With the expiration of this agreement approaching, GOGC plans to conduct a detailed assessment to determine the project’s next steps.
BP may no longer remain the operator of the Baku-Supsa pipeline – GOGC is hiring consultants to evaluate the project’s future.
Following the outbreak of war in Ukraine in 2022, oil transportation through the Baku-Supsa pipeline was suspended. Although operations partially resumed in 2023, the pipeline’s throughput in 2024 amounted to just 1 million tons.
What Type of Services Does GOGC Plan to Procure?
According to the tender terms, the selected consulting company will be required to prepare two main reports:
Preliminary Analysis Report:
1. This report must include a comprehensive review of existing legal documentation (including IGA, HGA, and commercial agreements), a detailed analysis of regional transport challenges, an assessment of the technical condition of infrastructure in both Georgia and Azerbaijan, identification of cost reduction opportunities, and a forecast of future market conditions.
Strategic Scenario Report:
2. The second report must present a set of strategic scenarios that can be used to guide future negotiations. Each scenario will be analyzed comparatively, associated risks will be assessed, and a final strategy will be proposed - including for cases where the parties involved fail to reach an agreement.
Why Is This Tender Important?
The Western Route Export Pipeline (WREP) - commonly known as the Baku-Supsa pipeline - plays a vital economic and political role as a transit corridor for Georgia. The pipeline carries oil from the Chirag oil field in the Caspian Sea (Azerbaijan) to the Supsa terminal on Georgia’s Black Sea coast. Commissioned in 1999, the pipeline stretches 830 kilometers, of which 375 kilometers are located within Georgian territory.
