Explosion stops crude flow via Turkey's BTC pipeline

Istanbul: An explosion on the Baku-Tbilisi-Ceyhan (BTC) pipeline on Tuesday night in eastern Turkey prompted authorities to halt the oil flow along the pipeline, a senior official at the Turkish Energy Ministry said.

A spokeswoman for British Petroleum, shareholder in the pipeline, said oil flows have been halted after a fire damaged a valve on a section in eastern Turkey, but exports from the Ceyhan port terminal continued from storage.

She also said BP and its partners continued to produce crude from their Azeri fields for stockpiling until flows can resume.

"The incident didn't stop oil production on the Caspian and exports from Ceyhan are going in line with the schedule. [Turkish state firm] Botas is taking all necessary measures to put the fire out," she added.

The pipeline, one of the world's biggest, pumps over one million barrels per day from fields in the Azeri sector of the Caspian Sea to the Turkish Mediterranean coast, covering over one per cent of global oil supply.

The BTC is an alternative to the Baku-Novorossiisk pipeline that takes Azeri oil to Russia, from where it is sold on to Europe.

Brent crude oil futures rose a dollar to $118.70 a barrel after the stoppage, after sharp losses this week.

The fire was still burning yesterday morning, state-run news agency Anatolian reported. The cause of the explosion was not immediately known.

"Whether it is sabotage or some other reason, we still don't have that information. At this point all our efforts have been focused on putting out the fire completely," said the Energy Ministry official, speaking on the condition of anonymity.

An explosion on a pipe-line between Turkey and Iran halted gas exports for five days in March. Responsibility for the blast was claimed by the separatist Kurdistan Workers Party (PKK) guerrilla group.

A news agency close to the PKK said there were claims that the latest blast could have been caused by the separatist rebels.

The lion's share of the pipeline's oil comes from the Azeri-Chirag-Guneshli offshore project in the Caspian Sea, before being routed through Georgia and Turkey.

BP owns 30.1 per cent of the BTC, while Socar holds 25 per cent. Other shareholders include US Chev-ron and ConocoPhillips, Norway's StatoilHydro, Italy's ENI and France's Total.