Italy’s largest bank, Banca Intesa is seeking to sell its $60 million stake in a controversial IFC-backed oil pipeline from the Caspian Sea. Intesa is so concerned at the reputational and other risks associated with involvement in BP’s Baku-Tbilisi-Ceyhan (BTC) project that it has already sold one third of its share at a loss.
According to a senior spokesperson at the Italian bank, it had only agreed to invest because of the IFC’s involvement. However, it pulled out when major problems came to light in 2004 related to BP’s chosen pipe corrosion protection system, which could lead to severe corrosion and potentially huge oil spills. Intesa are “very disturbed” and “staggered” by the scale of the problem and the lack of due diligence.