Visitors:
Can the AMBO pipeline make everyone happy?
Overview of the project and its potential impacts on the environment
The AMBO project (Albanian Macedonian Bulgarian Oil Corporation) consists of the construction of an oil pipeline from the port of Burgas (Bulgaria) through Bulgaria, Macedonia, and Albania to the port of Vlore (Albania). The 894.5 km long pipeline has been designed to facilitate the transfer of crude oil from the Caspian region to the Adriatic Sea and further – to Europe and the US. Some 30-40 million tonnes per year would be transferred via Bulgaria and Macedonia to the Albanian port of Vlore. The debate around the project has so far taken 13 years and is not over yet. Total project costs are estimated to be USD 1.8 billion.
On January 31, 2007 a tri-lateral convention for the construction of AMBO was signed in Skopje. This tripartite agreement awaits Parliament ratification in each of the countries. Project Companies would then be established in the partner countries.
Environmental studies (SEA and EIA) are expected to be completed within 2 years and the construction itself would take another 3 years. Albania and Macedonia lack secondary legislation on SEA and experience in SEA and EIA procedures, giving rise to concerns that the process may not result in an adequate level of public participation. In Bulgaria experience of SEA is also limited and so far has not inspired confidence about the thoroughness of the process.
The project might be portrayed by the AMBO Corporation as safe, necessary for the region, bringing economic development and new jobs, but in reality, as any other pipeline construction, it will pose a significant threat to the environment.
Increased risk of oil spills in the Bourgas Gulf area
The port of Bourgas is already heavily polluted with various substances, including quite regular oil spills from the crude oil tankers. In 2006 Lukoil paid the regional environmental inspectorate just under EUR 1.5 million in fines for damage to the environment. There is also pollution from the pipeline leading from the port to the Naftochem refinery, caused by leakage and illegal draw-outs. In addition, there is an unknown amount of war-mines on the seabed in the Bourgas Gulf, which may cause safety problems during digging works.
Public opposition to Vlore oil complex
AMBO would be an integral part of the “Vlore Energy Park”, comprising in total seven new thermal power plants (on refined oil), an oil refinery and an oil storage facility. The oil complex is to be situated on the Vlore Riviera, which until now has been Albania’s most popular tourist area, and would encroach on Narta Lagoon National Park. For several years there has been strong opposition from Albanian citizens and as a result the Albanian government has requested the AMBO Corporation to change the location of the oil terminal. The EBRD and IFC have already approved financing for the first oil thermal power plant in spite of extreme problems with public participation, which resulted in an Aarhus Convention ruling in favour of the Alliance to Save Vlore Bay.
Crossing protected areas
The proposed route would cross important conservation protected areas with a significant number of endangered animal and plant species. The ecological sites include:
§Gorge of Peshti Monument of nature, Macedonia
§“Atanasovo” Lake Reserve, Bulgaria
§“Vitosha” Nature Park, Bulgaria
§“Ostrica” Reserve, Bulgaria
§“Rila” National park, Bulgaria
Seismic activity on the pipeline route
The whole area of the proposed AMBO route is known to be seismically active, and it is unlikely that the effects of serious earthquakes on an underground pipeline could be mitigated by any known measures. The option of building the pipeline above ground, which is the safest option from the point of view of seismicity, entails other risks such as illegal draw-outs.
Questionable economic and social benefits
Experience from the EBRD-financed Thessaloniki-Skopje pipeline from Macedonia to Greece shows that employment benefits for local people were minimal and very short-term. The majority of professional staff were brought in from abroad and the local people who worked on construction and as guards were employed on a very short-term casual basis.
The economic benefits for Macedonia from the Thessaloniki-Skopje pipeline are similarly dubious. In 2005 a dispute arose over the revenues from the oil transport, in which the government of Macedonia claimed it was being deprived of revenues and alleged that Hellenic Petroleum was falsely claiming that it had no profit for that year in order to avoid revenue payments.
Climate change
The amount of oil that would be delivered by the AMBO pipeline would induce more than 100 millions tons of CO2 per year. This exceeds the annual Bulgarian, Macedonian and Albanian CO2 emissions combined.
Conclusions and recommendations
It is likely that AMBO will cause serious environmental damage, including biodiversity loss, the risk of oil spills and adverse climate impacts. The benefits of the project for the transit countries are largely unproven. Transit revenues may not be sufficient to cover losses in the tourism sector and the costs of potential accidents. Other benefits claimed for the project, such as increased employment, are unlikely to be significant enough to justify the environmental damage and economic damage to the tourist sector.
In view of the above, it is clear that the EBRD and other IFIs should not use public money to finance AMBO.