DUBAI (Zawya Dow Jones)--BP PLC (BP) is taking "all necessary precautions" to protect its Baku-Tbilisi-Ceyhan oil pipeline amid the ongoing violence between Georgian and Russian forces in South Ossetia, the company said Sunday.
The pipeline, which starts on Azerbaijan's Caspian coast and passes nearby the Georgian capital Tbilisi on its way to the Turkish coast, was shut down early Wednesday following a fire. Its throughput has averaged over 850,000 barrels a day in recent months.
BP expects the fire to be extinguished "within a day or so," a company spokesman said Sunday and is now taking all "necessary precautions" to protect it from further damage as the conflict between Georgia and Russia in South Ossetia threatens to escalate.
Oil traders will be watching closely when crude markets reopen Monday to see if the conflict in the region will have any impact on oil supplies from the Caspian.
"We have made it clear to the Russians that if the disproportionate and dangerous escalation on the Russian side continues, that this will have a significant long term impact on US-Russian relations," Jim Jeffrey, deputy National Security Advisor, told reporters in Beijing Sunday.
The 1,774-kilometer pipeline, which runs about 100 south of the troubled breakaway Ossetian capital through southern Georgia, has capacity to transport 1.2 million barrels a day of crude.
BP, which holds a 30% stake in the BTC pipe, and its partners are presently pumping all crude through a supplement pipeline running from Baku to Supsa on the Georgian Black Sea coast, where it is being stored, the spokesman said.
The fire, which isn't related to the events in south Ossetia, was caused by an explosion in eastern Turkey for which Kurdish separatists claimed responsibility.
BP plans to set up a loop around the damaged portion of the BTC line to resume exports to Ceyhan as soon as the fire is extinguished, the spokesman added.