1/11/2014 13:28
RIA Novosti

Russia

PM Fradkov orders second leg of Baltic Pipeline System - 1

16:06 21/05/2007
(Adds details, background after paragraph 1)

MOSCOW, May 21 (RIA Novosti) - Russian Prime Minister Mikhail Fradkov has signed a resolution for the construction of a second leg of the Baltic Pipeline System (BPS), the government's press service said Monday.

Proposed by the Russian Industry and Energy Ministry, the new pipeline, which will have an annual capacity of 50 million tons (about 370 million bbl), will run from the Russian town of Unecha, near the Belarusian border, to the Primorsk terminal bordering on Finland, and will pump Siberian oil from Russia to Germany across the Baltic seabed and on to the rest of Europe and the United States, bypassing Belarus and Poland.

The prime minister ordered the industry ministry and state-run oil pipeline operator Transneft to prepare the necessary documentation for the construction of the BPS-2, while the Federal Agency for Construction and Housing and Communal Services will provide a state assessment of the documentation.

The new pipeline will connect Unecha with the oil terminal in the Baltic port of Primorsk through Velikie Luki, allowing Russia to stop pumping oil to Europe via the Druzhba (Friendship) pipeline. It will also increase the capacity of the port at Primorsk to 150 million tons (1.1 billion bbl) per year.

The Druzhba pipeline extends for almost 2,000 kilometers (1,300 miles) across Belarusian territory and pumps on average up to 80 million tons (about 590 million bbl) of Russian oil per year to Germany, Poland and Ukraine.

Russia halted deliveries to Europe via the pipeline January 7 saying Belarus was illegally tapping oil following a tit-for-tat price and tariff dispute.

Belarus imposed a transit levy of $45 per metric ton of crude after Moscow doubled the price of natural gas and introduced a duty on oil supplies to Belarus as of January 1.

The interruption in supplies affected Germany, Poland, Hungary, the Czech Republic and Slovakia, and further damaged Russia's reputation as a core energy supplier to Europe following a similar energy row with Ukraine involving natural gas this time last year.

Russia agreed to resume supplies after receiving a Belarusian government resolution abolishing the transit levy on Europe-bound Russian oil.

Russian President Vladimir Putin said February 1 that the country would look for ways to reduce its dependence on transit nations for its oil and gas exports to Europe.

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RIA NovostiPM Fradkov orders second leg of Baltic Pipeline System - 1

16:06 21/05/2007 Russian Prime Minister Mikhail Fradkov has signed a resolution for the construction of a second leg of the Baltic Pipeline System (BPS), the government's press service said Monday. >>

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