Let's do without transit

Alexander Lukashenko is threatened by an oil pipeline bypassing Belarus

Belarusian President Alexander Lukashenko is not giving up attempts to continue the discussion around the supply of Russian oil to Belarusian processing plants . On Friday, he said that an agreement on February deliveries has not yet been concluded, since the Russian side allegedly demands that the price be higher than the world price. “This is no good, and there is nothing like it anywhere in the world,” Interfax quotes Mr. Lukashenko. - Therefore, I gave direct instructions to the delegation that is negotiating today: those companies that will offer such contracts at such prices here (in Belarus. - Ed. ) when pumping oil to Europe will be subject to an additional duty so that we can compensate for your losses." The president did not specify how such a mechanism could work. Representatives of all oil companies supplying raw materials to Belarus either did not comment on the situation or were unavailable over the weekend.

However, the words of the Belarusian president are somewhat at odds with what was said last Thursday at the Ministry of Economy of the Republic. According to Interfax, officials claimed that from February the price of oil would be calculated using a new formula. Its essence lies in linking the price of supplies to Belarus not to the domestic Russian price, but to the world price, from which the costs of freight, port fees and other transportation costs are subtracted. As a result, taking into account the Russian export duty on oil for Belarus in the amount of $53 per ton, the supply price according to the new formula will be approximately $230-240 per ton. This is comparable to the price of supplies to Belarus in October-December 2006, that is, before the introduction of the export duty. The price for supplies to Belarus based on the domestic Russian price, taking into account duties, as is the case in January, is $273-275 per ton. It is quite possible that the delay in drawing up contracts for pumping Russian oil to Belarusian plants is connected precisely with the approval of this formula.

In addition, at the end of last week it became known that among the proposals that Transneft sent to the government in early January at the height of the conflict with Belarus, when the pumping of Russian oil to Europe through the Druzhba oil pipeline was stopped, there was also a project for the construction of a branch from the oil pipeline - from Unecha, Bryansk region to the St. Petersburg port of Primorsk, with a length of about a thousand kilometers and a capacity of 50 million tons of oil per year. For comparison, about 80 million tons of oil per year are currently pumped in transit through Belarus, plus about 21 million tons per year are supplied to Belarusian factories. Thus, this branch “insures” half of the volume of supplies via Druzhba from the so-called Belarusian transit risk. And although Transneft vice-president Sergei Grigoriev claims that “no government instructions have been received to develop such an oil pipeline project” (and the Ministry of Industry and Energy refused to comment on this issue), it is nevertheless obvious that if it is received, the company will not mind proceeding to construction. In this case, all the work, according to experts, will take a year and a half, the cost of the issue will be 2-2.5 billion dollars. Along with this, as is known, the Minister of Industry and Energy Viktor Khristenko proposed increasing the capacity of the Baltic pipeline system with the current 65 million tons per year to 110 million, in his opinion, work could take about two years. Mr. Grigoriev says that Transneft considers this project to be the main one in solving the problem of transit risks, however, he points out, there is no government decision on it yet.

Transneft notes that the reorientation of oil flows from Druzhba to the port of Primorsk should not cause major technical complications. “Oil, as through Druzhba, will be supplied to Poland and Germany,” noted Mr. Grigoriev. - And for oil supplies to Ukraine (now it is supplied through Belarus to Brody, and from there to Odessa. - Ed. ) we have several different options, for example, a branch to Lisichansk (Samara-Novorossiysk oil pipeline. - - Ed. )". The fears of Sweden and Denmark about a possible increase in the level of environmental pollution in the Baltic Sea, according to Mr. Grigoriev, are in vain: “Primorsk is one of the cleanest ports in Europe,” he assured.

Belarusian experts predicted tension over Russian oil supplies to Belarus and transit through it to European countries back in 2003. With the introduction of the Baltic pipeline system, local media wrote then, it became clear that now the conditions for transporting export raw materials are dictated not by the countries of the former USSR through which the oil pipelines pass, but by the supplier - Russia. And they gave a clear example of what a short-sighted policy of transit relations can lead to. In 2000, Russia had two routes for transporting raw materials from Western Siberia to the port of Novorossiysk: Samara - Tikhoretsk - Novorossiysk and Samara - Lisichansk (Ukraine) - Tikhoretsk - Novorossiysk (which Mr. Grigoriev is talking about now). At the same time, the first route had a small capacity, and therefore the main flow of oil exported by Russia was pumped through Ukraine, at the same time providing supplies to local refineries (primarily Lisichansky, owned by TNK, which had not yet merged with BP). As a result, oil companies were forced to pay for transportation not only to Transneft, but also to Ukraine for transit. At the same time, the issue of transit rates has always been political, and serious battles flared up on this issue every year. As a result, Transneft decided to build the Sukhodolnaya-Rodionovskaya bridge along the border with Ukraine with a length of 260 km and a capacity of 26 million tons per year. This project was implemented within a year and cost the monopoly $240 million. As a result, oil workers saved on transport tariffs, and Russia’s strategically important oil exports through Novorossiysk ceased to depend on the political relations between Moscow and Kyiv.

As a result, the Lisichansky Oil Refinery was on the verge of shutdown. TNK tried to transport oil by rail, but it was very expensive, which eventually began to affect gasoline prices in Ukraine. Due to a sharp decrease in pumping volumes, the Dnieper Trunk Oil Pipelines ceased to be profitable. As a result, within two months there was progress in relations between Russia and Ukraine: transit rates were significantly reduced, and a dialogue began on the terms of commissioning the Odessa-Brody oil pipeline, which was designed to ensure the transportation of Caspian oil. Now the oil pipeline through Ukraine to Novorossiysk is almost fully loaded.

Similar problems arose in the Baltic countries. After the construction of the BPS, pipeline supplies of Russian oil to Ventspils ceased, as a result of which the port was idle for some time (and, accordingly, brought losses). True, Latvia did not lower tariffs or otherwise attract Russian oil workers - according to some information, Transneft laid claim to Ventspils Nafta, and the country was not ready to give up the strategic enterprise to Russia. With the expansion of the BPS, this direction has become not particularly attractive for Transneft, as a result of which the Latvian port works mainly to receive oil (primarily for the Lithuanian Mazeikiu Nafta plant).

Thus, a branch from Druzhba towards Primorsk for Transneft would be a consistent step in the policy of reducing transit risks. And they could not have foreseen such a development of events in Minsk. “The practice of recent years suggests,” the Belarusian Market newspaper wrote in 2003, “that any actions that lead to infringement of the interests of oil producers, be it a decrease in the reliability of the transit corridor or an unjustified tariff policy, are encouraged by Russian companies are looking for alternative solutions for the transit of their oil. It is in the interests of any state to prevent such developments.” Therefore, it turns out that Mr. Lukashenko hoped for many years that Moscow would continue to treat him as an ally and that controversial issues would not arise in the transit of Russian oil through the territory of Belarus. Practice shows that Russian oil companies are not looking for political allies, but for reliable and at the same time profitable routes for transporting raw materials. It is now impossible to call the Belarusian direction reliable. It is unlikely that it will be possible to make it profitable for Mr. Lukashenko in the current conditions. Therefore, in the case of the construction of a pipeline from Unecha to Primorsk, Minsk has two options - Ukrainian and Baltic. Mr. Lukashenko does not yet appear to be eager to make a choice.

Nikolay GORELOV, Anna GORSHKOVA