Russian Analysts Say Oil Export via Baku-Tbilisi-Kars Railway Possible
Azerbaijan, Baku / Trend corr A. Badalova / It is not ruled out that the Baku-Tbilisi-Kars railway may be used for oil products transportation, an analyst in the Russian Antanta Capital Timur Khayrullin said.
"Traditionally, oil transportation via the railway is more expensive than that via the pipeline. Nevertheless, if there is no alternative, the railway may be used," he said.
Even if the railway is used for oil transportation, the specific weight of oil exported will not be high, Khayrullin said.
The launching ceremony of the construction of Baku-Tbilisi-Kars to connect the transport systems of Georgia, Azerbaijan and Turkey took place in Georgia this week. Implementation of the project is considered by those involved as a revival of the Great Silk Route going from Asia to Europe but omitting Russia.
According to an analyst in the Russian Alfa Bank Andrey Fedorov, oil transportation via the railway is the most interesting in terms of development of the Caspian region.
"Railway transportation is more expensive than via the pipeline, but as there are many searches for alternative ways, it may be interesting," he said.
The Baku- Tbilisi-Akhalkalaki- Kars project includes the construction of a 105km-railway line with a 76 km section running via Turkey and a 29 km section via Georgia. Moreover, the 183 km section of Akhalkalaki-Marabda-Tbilisi railway will be also reconstructed to improve the carrying capacity to 15mln tons of cargo per year. There are plans to build in Akhalkalaki a place for the trains to switch track in Georgia to the European one.
The project is estimated at $422mln and taking into consideration the accompanying infrastructure its cost will comprise $600mln. Azerbaijan allocated a $200mln loan for the Marabda-Kartzakhi Railway line over 25 years with a 1% interest rate. The loan will be repaid with funds received from the use of the railway.