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Thursday, January 25, 2007

Russia Says Pipelines across Caspian Sea Floor Unacceptable

25/01/2007 - RZD News - Any gas or oil pipelines across the floor of the Caspian Sea would be environmentally unacceptable, an official with the Russian Natural Resources Ministry said Thursday. Since the early 2000s, the ex-Soviet republics of Kazakhstan and Azerbaijan have been considering projects to lay natural gas or oil pipelines across the bed of the Caspian Sea and bypassing Russia. However, Moscow has consistently opposed the idea, citing environmental concerns. Although Russia opposes any pipeline projects across the floor of the Caspian Sea, it has been constructing a natural gas pipeline under the $10.5-billion North European Gas Pipeline (NEGP) project to supply Western Europe with gas via a pipeline leading from Russia to Germany across the floor of the Baltic Sea, reports RIA Novosti.

Belarus Wants Russia to Pay Rent for Land Under Pipelines

Photo from MosNews.com archive24.01.2007 - MosNews - Russia’s western neighbor Belarus will demand that Russia pay rent for the land under pipelines that it uses to pump oil and gas to Europe, Belarusian President Alexander Lukashenko said on Tuesday, Jan. 23. As MosNews has reported, the conflict between Russia and Belarus began when state-controlled gas giant Gazprom demanded that Belarus pay higher price for Russian gas or face the cutoff. The conflict threatened to repeat the situation in January 2006, when Russia temporarily cut gas supplies to Ukraine over a similar gas price conflict, while Ukraine cut transit deliveries to Europe, undermining Russia’s reputation as a reliable supplier. Moscow and Minsk were able to solve the gas price issue two minutes prior to New Year’s midnight, securing gas supplies to Western Europe. However, Alexander Lukashenko decided to avenge himself and imposed a transit duty on Russian oil going to Europe. The conflict even led Russia to shut down the Druzhba oil link to Belarus for three days. The situation was resolved, but now the authoritative and unpredictable Belarusian leader came up with another idea of how to milk Russia for money. “Without fuss or ambitions, we will take corresponding measures in line with international law and will demand that they pay us,” Lukashenko was quoted by the UPI agency. At present time Belarus only collects rent for land under compressor stations. But the country’s State Property Committee told Interfaxt agency that Russia “should pay for the forest lands under the pipelines, because they are not being used for their original purpose”. The Belarusian official said that “the draft of the law has been prepared that will set the rent for these lands”. Belarus is a transit territory to Gazprom’s Yamal-Europe gas pipeline, Druzhba oil link and Zapad-Transnefteproduct oil product pipelines. According to the Belarusian government, all the pipelines occupy a territory of 40,000 hectares of Belarusian land.

Russian Oil Supply Through Druzhba Pipeline Resumed

22.01.2007 - [Neftegaz.ru] - Disrupted Russian oil supply to the Europe through the Druzhba pipeline via Ukraine is expected to restart on Friday, the Interfax news agency reported. The oil supply will resume in full at 12:00 a.m. on Friday, Alexander Dikusarov, advisor to the Ukrtransnafta CEO, was quoted as saying. He said the shortfall in supply, about 10,000 tonnes, to those affected countries including Slovakia and Hungary, will be compensated on Friday and Saturday. The halt came after power supplies to the pipeline was cut off by storms in the Lviv region at about 10:00 p.m. (2000 GMT) on Thursday, Dikusarov said.

Results of tender for Nord Stream pipeline to be known in March

ST. PETERSBURG, January 24 (RIA Novosti) - The results of a tender to supply pipes for the Nord Stream natural gas pipeline to link Russia to the EU via the Baltic Sea will be finalized by March 30, the project operator said Wednesday. Sergei Serdyukov, technical director of Russian-German consortium Nord Stream AG, said at least three out of six enterprises invited to take part in the tender will be selected to supply large-diameter pipes for the project. "Each will submit a bid by January 30. The results [of the tender] are expected to be finalized by March 30," he said. The Nord Stream pipeline, which is expected to come online in 2010, will connect Russia's Portovaya bay on the Gulf of Finland, near St. Petersburg, to Germany's Greifswald via the Baltic seabed. The project to build the pipeline, stretching over 1,200 kilometer (750 miles), is designed to minimize transit risks associated with Russian gas supplies to Western Europe. Serdyukov said the project operator had sent invitations for the tender to three Japanese pipe producers (Sumitomo, Nippon Steel and JFE), Germany's Europipe, and two Russian companies - the Vyksy Metallurgical Works and the Izhora Pipe Plant. The technical director said Nord stream AG also intends to finalize the results of a tender for a vessel to lay pipes under the Baltic Sea in late March. Nord Stream AG, originally called the North European Gas Pipeline Company, was renamed in October last year. Russian energy giant Gazprom owns 51% of the consortium, while Germany's E.ON Ruhrgas AG and Wintershall AG each hold 24.5%.

Wednesday, January 10, 2007

Russia considers scaling back oil output

Putin told his cabinet on Tuesday to guard the interests of Russian companies. January 9, 2007 - International Herald Trubune - by Michael Schwirtz - MOSCOW: An unyielding President Vladimir Putin on Tuesday urged his cabinet to discuss with Russian companies "the possibility of scaling down the extraction of oil, given problems in transiting crude across Belarus," and he raised the possibility of diverting oil transit routes away from that country. Putin's comments, in a meeting with cabinet ministers, came a day after Moscow cut off pipeline deliveries of crude headed to Europe through Belarus. His hint at scaling back production indicated that Russia might not have unlimited storage for oil that is being produced but not exported. Any change in Russian oil routes, meanwhile, which would be years in the making, would cut Belarus out of any role in the transshipment of oil to Europe, without offering Western European customers any immediate assurance that their supplies were reliable. The two-day cutoff of supplies has affected Ukraine, Germany, Poland, Hungary, the Czech Republic and Slovakia. It is the second stoppage of Russian energy shipments to Europe since last winter. Officials in Moscow accused Belarus on Monday of siphoning about 79,000 tons of Russian oil bound for Europe, and Russia subsequently cut off the supply though the Druzhba pipeline. The 4,000-kilometer-long pipeline pumps 1.2 million barrels a day to Eastern and Central Europe. One arm runs to Poland and Germany, the other to Ukraine, Hungary, Slovakia and the Czech Republic. Russia is eager to prevent Belarus from taking oil purchased earlier from Russia under the previous duty-free arrangement and re-exporting it at higher prices, and imposed an export duty after the conflict was well under way. In general terms, Putin told his cabinet ministers to do whatever was necessary to guarantee the interests of Russian companies as well as the interests of Western countries dependent on Russian energy supplies. He also said the government must continue negotiations with Russia's "Belarussian partners." Belarussian officials flew to Moscow to negotiate, but Russia was in no hurry to talk. Earlier in the day, one delegation submitted a draft agreement to the Russian Economic Development Ministry, Interfax reported. According to Belarus's deputy economic minister, Vladimir Naidunov, the agreement could "make it possible to mutually settle issues concerned with levying customs duties on oil and with duties for oil transportation through Belarus." It was unclear throughout the day when or whether negotiations would begin, as Russian officials tried to formulate their starting positions. German Gref, Russia's minister for economic development and trade, told a news conference Tuesday evening that Russia would start talks only after Belarus had lifted transit duties and resumed oil transit. On Jan. 1, Russia began charging Belarus a duty of $180 a ton on oil sold to Belarus, in addition to more than doubling the price it charges the country for natural gas. Minsk responded last week by imposing a $45-a-ton transit fee on Russian oil destined for Europe. It also siphoned off about 79,000 tons of Russian oil bound for Europe, perhaps to bolster its domestic supply. "Belarus's reserves of cheap oil will last a few days, a week at most," Yaroslav Romanchuk, an economist in Belarus, told The Associated Press. "After that it will have to buy oil taking into account Russian export duties." The Russian oil export monopoly Transeft filed a suit on Tuesday against Belarus in response to the alleged theft. In a news conference, the Russian industry and energy minister, Viktor Khristenko, said that, given time, Russia would be able to reroute oil around Belarus, possibly by increasing the capacity of the Baltic pipeline system or hurrying the completion of the East Siberia-Pacific Ocean pipeline. In the short term, he said, Russia may have to ship more oil by rail and river. "If these measures aren't enough, it could be necessary to reduce oil output," he said. Such a move would effectively cut Belarus out of Russia's energy equation, depriving the Belarussian economyof much-needed revenue.

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