FACTBOX - Georgia as energy route

(Reuters) - The entry of Russian troops into Georgia on August 7 has brought into sharp focus its status as a key transit point for oil and gas supplies into Europe and the lack of alternative routes for Caspian supplies.

THE PIPELINE POINT

Two major energy pipelines transit Georgia -- the Baku-Tbilisi-Ceyhan oil pipeline (BTC) and the Baku-Tbilisi-Erzurum gas pipeline (BTE).

The BTC has a capacity of 850,000 barrels a day and is the first pipeline to carry large volumes of Caspian oil without crossing Russia.

The BTE, opened in 2007, will eventually be able to carry 20 billion cubic metres of gas.

Both pipelines were built to deliver gas and oil to Europe in order to reduce the continent's dependence on Russia, which has in the past shut off gas to Ukraine, with knock-on effects for shipments to the European Union.

Georgia also has a rail network for transporting oil. The railway line runs from Tbilisi to the Black Sea ports of Poti and Batumi and to just short of the Turkish border.

This month's fighting has raised the prospect of an extreme scenario of Russia reasserting control over its former satellites and their energy transit links.

In Georgia, that could mean Russia not only controlled the BTC and BTE pipelines, but also ports such as Sukhumi in the disputed region of Abkhazia, and Supsa, where smaller gas pipelines terminate.

"It is not that you're not going to get the gas, it's just that it would give Russia more power in negotiation of prices," said Simon Wardell, oil analyst at Global Insight.

IRAN, AN UNLIKELY ALTERNATIVE

While the amount of energy flowing through Georgia to Europe is relatively limited now, it is hugely important for the European Union as an alternative to Russia, especially when there are few other options.

The only other route from the Caspian to western Europe that could avoid Russia can run through Iran, which, for many, is no alternative at all.

Iran, an OPEC oil producer, sits on top of the world's second biggest gas reserves after Russia, but is subject to U.S. and United Nations sanctions. This affects its ability to invest adequately in oil and gas exploration. In spite of its huge reserves, Iran is a small net importer of gas.

But for the security risks, a new pipeline connecting Iranian Caspian gas and oil, or a pipeline from Baku transiting Iran, to Europe via Turkey, would be an effective alternative.

"You can use terminals in the east of Iran, but U.S. sanctions and political instability, the fear of U.S. strikes against Iran and other uncertainties make it difficult," said Andrei Kortunov, President of the New Eurasia Foundation in Moscow.