The pipeline was proposed already in 1993. On 27 December 2004, prime-ministers of Albania, the Republic of Macedonia and Bulgaria signed the latest political declaration, followed by the memorandum of understanding between representatives of Albania, the Republic of Macedonia and Bulgaria and Ted Ferguson, the president and CEO of AMBO. On 30 October 2006, Albania and the Republic of Macedonia signed a protocol to determinate the entrance points of the pipeline. The entrance point will be Stebleve village in Albania and Lakaica village in the Republic of Macedonia. A similar protocol between Bulgaria and the Republic of Macedonia was signed later in 2006.
On 31 January 2007, the Republic of Macedonia, Bulgaria and Albania signed a trilateral convention on the construction of the AMBO pipeline. This document was ratified by the Parliaments of all three countries and governed the construction, operation, and maintenance of the pipelines.
The aim of the 912-kilometre (567 mi) long pipeline was to bypass the Turkish Straits in transportation of Russian and Caspian oil. The pipeline was expected to cost about US$1.5 billion and it would have a capacity of 750,000 barrels per day (119,000 m3/d). There would be four pump stations, two in Bulgaria and one each in the Republic of Macedonia and Albania, constructed along the route. A pre-front-end engineering and design study (FEED) was to be prepared by KBR. The pipeline was expected to be operational by 2011.
The pipeline was to be built and operated by the US-registered Albanian Macedonian Bulgarian Oil Corporation (AMBO). The project was backed by the US government, who financed a feasibility study of pipeline.
Other pipeline projects were the Burgas-Alexandroupoli pipeline from Burgas to the Greek Aegean port Alexandroupoli, and the Pan-European Pipeline from Constanţa in Romania to Trieste in Italy. Compared with Burgas-Alexandroupoli pipeline, the AMBO pipeline would be longer and more expensive, but Vlorë (which is a sheltered, deep-water, all-weather port) could accommodate larger tankers and is more accessible than Alexandroupoli. Also, an oil spill in the Aegean would have a negative influence on Greece's tourism industry.