Armenia and Georgia are relatively small producers and consumers of energy, however important oil and gas transit routes cross these countries. Georgia has very small proved reserves estimated at 0.3 billion barrels, from which the country produced 2,000 barrels per day (bbl/d) of crude oil in 2004. Oil consumption was 42,200 bbl/d in Georgia in 2003.
On March 8, 1996, Georgian President Eduard Shevardnadze and Azerbaijani President Heydar Aliyev signed a 30-year agreement whereby a portion of the Azerbaijan International Operating Company (AIOC)'s "early oil" will be pumped via Georgia. Specifically, oil will flow to Georgia's Black Sea ports of Supsa and Batumi located 25 miles apart from each other. The Georgian International Oil Company, a subsidiary of the AIOC, made substantial upgrades to the existing 515-mile pipeline along this route and built the $565-million Supsa terminal on the Black Sea. In January 2003, the pipeline was shutdown for two days from an explosion near the Georgian village of Sveneti, roughly 40 miles from T'bilisi.
