Ukraine is preparing to pump Caspian oil to Poland since 2009
Ukraine continues to insist on using the Odessa-Brody oil pipeline in obverse mode (that is, in the forward direction). At the end of last week, the country's President Viktor Yushchenko instructed the government to prepare the pipeline for such work by the end of the year. Thus, according to Kyiv’s plans, Europe will gain access to Caspian oil, which will help it be less dependent on Russian raw materials, and Ukraine will become the main transit center. However, who will fill the pipe is still unclear. Indeed, in particular, Kazakhstan is experiencing both production difficulties (the Caspian Pipeline Consortium is not able to satisfy the appetites of Ukraine) and political ones - Nursultan Nazarbayev stated back in the spring that before joining the Odessa-Brody pipeline, “it is necessary to negotiate with Russian oil transport organizations " And Russian Deputy Prime Minister Igor Sechin said a month ago that the turnaround of the Ukrainian oil pipeline would “ensure more stable work” for Russian oil workers - as you know, Vladimir Putin has been actively advocating for the development of the ports of Primorsk from the first days of his premiership.
Viktor Yushchenko, by his decree, approved the decision of the National Security and Defense Council (NSDC) to begin operation of the Odessa-Brody oil pipeline in reverse mode. “Having considered the situation that has developed in the oil transportation and oil refining industries, the National Security and Defense Council notes the presence of systemic threats to national interests in this area,” Interfax quotes the text of the decision. “Domestic oil refining capacity, capable of processing over 50 million tons per year, is not fully used, and individual oil refineries are on the verge of bankruptcy due to a lack of raw materials.” At the same time, the decision does not mention plans for the transit of oil through Brody to Poland.
The first stage of the Odessa-Brody oil pipeline was put into operation in 2001. Its capacity was 9 million tons per year, and its length was 674 km. Initially, the oil pipeline was built for the transit of Caspian oil from Kazakhstan from the Black Sea coast to Europe: from the Yuzhny sea terminal in the Odessa region, it was delivered to the Druzhba system in the Brod area in the Lviv region. However, the pipeline was not used for three years, as oil refineries in Ukraine and Europe were unable to reach an agreement with suppliers of Caspian oil. In 2004, after negotiations between Ukrtransnafta and TNK-BP, it was launched in reverse mode. At the end of 2006, the Ukrainian company entered into an agreement with Transneft to pump about 9 million tons of Russian oil per year to Odessa. The main initiator of the launch of the Odessa-Brody oil pipeline in reverse mode is the President of Poland Lech Kaczynski. In order to extend the oil pipeline to Poland, a joint venture was created back in 2004 between Ukrtransnafta and the Polish company PERN. It was planned to complete all work by 2011. At the beginning of this year, oil companies from Azerbaijan, Georgia and Lithuania also joined the joint venture.
Now about 80% of the capacity of the Odessa-Brody oil pipeline, through which 9.6 million tons passed in 2007, is filled in TNK-BP and LUKOIL. After the decision of the Ukrainian leadership, their contractual obligations are at risk. TNK-BP and LUKOIL did not officially comment on the situation yesterday. True, Vremya Novostey’s source in one of the companies said that “no one is afraid of such plans.” “The Ukrainian authorities make such statements quite often. But there will be nothing to fill the pipeline if it works in reverse mode, because we still need to come to an agreement with Kazakhstan,” he said.
It is noteworthy that the Ukrainian leadership itself again does not agree on the implementation of the project to operate the pipeline in reverse mode. The scheme approved by President Yushchenko involves several offshore companies, which causes mistrust among Prime Minister Yulia Tymoshenko. “Under no circumstances can Ukraine support any strange schemes for the functioning of Odessa-Brody,” Ms. Tymoshenko said. In her opinion, the participation of offshore companies in the project could lead to the loss of state control over the pipeline. “We will never support such shadow cooperation and, in fact, shadow privatization of the oil pipeline through offshore companies, which deprive Ukraine of the right to influence this project, and Europe of the opportunity to have a normal corridor for the diversification of oil supplies,” she said.