Thank you very much. I am delighted to be here, I’ll address the questions you raised. I actually came with a different talk prepared so I’ll compress the first talk and talk about the second.

I wanted to talk about the future of energy, the first half of the topic today. In January 1998, the oil price touched 10 dollars a barrel and the economists predicted that it would fall to 5, seven, eight years later it is 70 dollars a barrel and none of us predicted that. So I am going to make some predictions now but it is worth bearing in mind that none of us got the current state of affairs right.

There are 3 predictions that I am going to make and what is interesting is that Turkey is not effected by the changes in the world as much as the rest of the world. So I’ll come back to that later.

This is a fascinating graph; this shows the GDP per capita maps against primary energy use for different countries across the number of years. All you need to take away from it is that the slope is upward sloping as income rises energy consumption rises and right at the bottom there you have the fast growing economies of India and China. When you put together that correlation, which is very robust across a very large number of countries with forecast population growth the most certain prediction you can about energy is that demand is going to rise. That’s my first prediction.

The second prediction is about the current oil price and essentially you have a situation where demand grew faster then expected some of the suppliers like Venezuela and Iraq fell of the market. The margin of spare capacity was eroded. There are two things, the first thing it meant that OPEC had market power again and was able to set a floor to the oil price. The second thing is that the margin of spare capacity is less then production in one of the more volatile oil producing region such as say Nigeria or Venezuela so you have OPEC to set up a floor for the oil price and margin of uncertainty because a geo-political event may reduce supply. So given the lag on the supply side it takes a long time to find oil, develop a project, bring it on stream and the ongoing growth and demand it would take number of years before that margin of spare capacities rebuilt in another words we have an extended period of high oil prices. In BP we are thinking in terms of at least 40 dollars a barrel until 2010, so that’s my second prediction.

And that brings me to third prediction, which is about the supply side. This is where the world is really changed. The first thing that changed is of course the price. That makes alternatives and substitutes now competitive. In Brazil half of the fuel used in cars is now ethanol. In China number of provinces are now mixing 20% of methanol into their petrol. Coal to liquids and gas to liquids become competitive at about 35 to 40 dollars a barrel. That is in the transport sector where we always thought of oil as having a dominant role. In the power sector you have a much wider range of choices, you have nuclear, renewable, gas and you have coal very few people still have oil. And added to fact that you have interfuel competition on the basis of price you also have energy policy re-emerging from a long sleep. And there are at least two objectives that energy policy is trying to achieve in a much more systematic way globally. The first is what is called security by which people mean diversity of fuels and geographies, no excessive dependence on one source of supply. And the second is green, something environmental that can be local air pollution, which becomes more important, people like to spend money on it as their income rises and it may also be bit a carbon price in the long run. These policy interventions will affect the energy markets and the opportunities that emerge so on the supply side we have great certainty that demand for energy will grow but on the supply side we have great uncertainty and openness about what will happen as a result about policy and prices.

So that’s the world, for Turkey the situation is a bit different because of your farsighted multi-pipeline policy. You already have diversity of supply in gas so may be that in the rest of the world gas is no longer the fuel of the future in the US demand is stagnant and it has been for 5 years but in Turkey you have abundance of supply from multiple sources which should keep your price low and mean that you are not dependent on any supplier so I think Turkey is paradoxically perhaps because of your investment policies still in the energy world of yesterday to a large extend rather then the more open energy future to the rest of the world faces. Although what the minister was saying about switching to coal suggested those economic forces are also affecting your supply choices.

The impact of BTC on the global supply situation, we calculate that it will meet 25% of incremental world oil demand over the next 2 years, which is a very substantial amount. The interesting thing for BP as the operator of the pipeline was we had to negotiate three sets of agreement with three governments, first an inter-governmental agreement as a framework, then a host government agreement or in the case of Turkey of course turn key contract with BOTAS and then the tariff so three complicated set of negotiations, it took about 5 years of real negotiation to achieve and the secret t finding a solution that would be viable for a 50 year project, 10 years of negotiations, 40 years of operation across what will be over that course of time in three countries very wide range of political circumstances is to make sure that commercial interest of the project is aligned with the long term interests of the society. If you don’t get that right then the project will come on stuck at some point. So that is the first thing that you have to do.

The second thing you have to do is you must make sure that it is also a commercial project because at some point you have to go out into the capital markets and raise the finance for the investment and the bankers that you raised finance from will demand a certain rate of return. So those are the two crucial constraints that you have to meet if you design a sustainable long-term project. It is going to be aligned with the interests of the country it goes thru and it’s got to be fundamentally commercial.

Mehmet Öğütçü: Just a question before you finish, how far do you thing BTC line could go to increase its volumes to be shift because we know that Kazakhstan will be able to provide Kasagan field some volumes thru Acto and Kazak President actually was suggesting whether we should be considering changing the name from BTC to ABC, Acto, Baku, Ceyhan?

I don’t actually know where the discussions are at this point so I can’t shed light on that.