VZCZCXRO9383
RR RUEHAST
DE RUEHAK #3100 1461428
ZNR UUUUU ZZH
R 261428Z MAY 06 ZDK
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 6031
INFO RUCPDOC/USDOC WASHDC
RHEBAAA/DEPARTMENT OF ENERGY WASHDC
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHAH/AMEMBASSY ASHGABAT 1893
RUEHTA/AMEMBASSY ALMATY 2192
RUEHGB/AMEMBASSY BAGHDAD 0646
RUEHDA/AMCONSUL ADANA 0817
RUEHKB/AMEMBASSY BAKU 1377
RUEHSI/AMEMBASSY TBILISI 3042

UNCLAS ANKARA 003100 
 
SIPDIS 
 
USDOE FOR CHARLES WASHINGTON 
USDOC FOR 4212/ITA/MAC/CPD/CRUSNAK 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ENRG EPET EINV SENV TU
SUBJECT: TURKEY: BTC FIRST OIL - ALMOST THERE 
 
REF: A) ANKARA 2899 
 
B) ANKARA 2009 
C) ANKARA 1705 
 
Sensitive But Unclassified.  Please handle accordingly. 
 
¶1.  (SBU)  SUMMARY:  BTC has struck a deal with BOTAS to 
pay all of the disputed cost over-runs in exchange for 
three-year management control of the pipeline operating 
company BIL.  A "cold tap" on the pipeline has delayed 
line fill and first tanker loading to the week of May 29. 
BP shares the Turkish Government's hope for high level 
USG representation at the July 13 inauguration ceremony. 
End Summary. 
 
--------------------------- 
BTC and BOTAS Strike a Deal 
--------------------------- 
 
¶2.  (SBU) In a May 26 meeting with DCM, BTC CEO Michael 
Townshend said that the BTC consortium had initialed an 
agreement with BOTAS to cover all of the disputed cost 
over-runs ($330 million; reftels) in exchange for BTC 
gaining management control of BOTAS International (BIL), 
the BTC pipeline operating company, for three years.  The 
agreement also identifies and clears up all cost over- 
runs, so there will be no more surprises.  The tariff 
payments will not be affected. 
 
------------------------------------------- 
First Oil at May 30 - Worries about Tapping 
------------------------------------------- 
 
¶3.  (SBU) Townshend said discovery of a "cold tap" (pipe 
intrusion in the dry pipe) had delayed line fill for a 
few days.  He said the first tanker arrives at Ceyhan on 
May 26 and oil from the pipeline will arrive at the 
terminal a few days later.  After a few days for filling 
the oil tanks, the first tanker will finally take on oil. 
In an ironic twist, Townshend revealed that the customer 
for the first tanker load would be an EXXON tanker headed 
to a refinery in Italy.  Noting that this had been the 
second tap intrusion in the pipeline in Turkey, Townshend 
said that he had expressed concern to Energy Minister 
Guler.  According to Townshend, Guler said the government 
would take appropriate measures, but new EU rules 
constrained their capacity.  A cartoon in the May 26 
daily "Sabah" newspaper depicted "cold tappers" 
complaining about the opening ceremony interfering with 
their activities. 
 
------------------------- 
July 13 Ceremony and Gala 
------------------------- 
 
¶4.  (SBU) Ref A conveyed Post's recommendation that 
Energy Secretary Bodman attend the expected July 13 
inauguration ceremony (about 11:00 to 14:00 in an air- 
conditioned tent) in Ceyhan and gala dinner in Istanbul. 
Both the Turkish Government and BP are hoping for high 
level USG representation at this prominent event.  The 
Turkish MFA told us they hope to send formal invitations 
early in the week of May 29. 
 
WILSON