The legal regime of pipelines is located in the transportation block of the Law of Georgia on Oil and Gas: it regulates the use of land allotments for a pipeline, the construction of non-trunk pipelines, access to the trunk network, the accessibility of transportation, the licence and the tariff. This page explains these rules for investors and carriers and shows how the land, capacity and pricing questions of a pipeline project are resolved.
The Land Question and Eminent Domain
Under a general licence for the use of oil and gas resources and the respective contract, the Agency hands to the investor a document, prepared by the National Agency of the Public Registry, confirming the right to use a land allotment. Where the plot needed for operations belongs to a natural or legal person, the investor must, before signing the contract, conclude with the owner an agreement on the transfer of the exclusive right to use the plot and submit it to the Agency in the established manner.
Where no agreement is reached, the mechanism of eminent domain applies: the investor has the right to apply to the Agency to start an eminent domain case; the Agency starts the case by filing an application in court, while all costs — including the compensation determined by the court, which is transferred to the landowner — are borne by the investor. Every participating party has the right to take part in the public hearing of the case: to present arguments, witnesses and documents, to criticize the arguments of the other party, to request cross-examination and the verification of evidence.
Construction of Pipelines and Access to the Trunk Network
The construction, operation and use of non-trunk pipelines and buildings connected with oil and gas operations are carried out in accordance with the legislation of Georgia and the contract. The investor has the right to negotiate the commercial use of the free capacities of the trunk pipelines owned by the state, and also — taking into account the requirements of the legislation — to build and use, for connection to an existing trunk pipeline, a pipeline for its contractually defined share for export purposes.