Around $US250 million has been approved for a pipeline being built by BP to carry crude from Azerbaijan to Turkey through neighboring Georgia and another $US60 million would finance development of the Azeri-Chirag-Gunashli deep water oil field off Azerbaijan.

The World Bank's corporate arm, the IFC, will commit half the sum from its own coffers and help raise the rest from private commercial lenders.

However, environmental and human rights groups said the loans should be rejected as the pipeline would fuel corruption, political oppression and environmental disasters in Georgia's important mineral water region.

An IFC statement said that extensive assessments had been conducted and safeguards had been built in, based on the groups' concerns about possible leaks along the pipeline. Azerbaijan's oil revenues will also be audited by an international firm and would be open to public scrutiny.

The pipelines would reap a financial windfall for the region with Azerbaijan earning around $US29 billion in revenue from the projects over the next 20 years. Georgia also stands to raise $500 million in transit revenues and Turkey, $1.5 billion in transit and terminal fees and investments.