Azerbaijan, Baku, Jan. 29 / Trend /
Trend agency deputy head Seymur Aliyev
The constant supplies of Azerbaijani oil via the Odessa - Brody oil pipeline through Ukraine to Belarus for Mozyr oil refinery will be launched today.
Baku and Kiev have recently signed documents to transport Azerbaijani oil and gas to Ukraine.
It is the next stage of diversifying energy supplies from Azerbaijan to the world markets.
Azerbaijan and Ukraine are also active participants of the project to create the Eurasian oil transportation corridor. One of the main routes is the Odessa-Brody oil pipeline and the project of its extension to Plock and Gdansk.
Along with the new supply route for energy resources, transportation of oil via this route significantly enhances the efficiency of trade in Azerbaijani oil and expands the geographical scope of its supplies.
Oil supplies to Belarus through Ukraine opens the market of the Caribbean basin and the US for Azerbaijan due to the fact that Belarus, Venezuela and Azerbaijan have the agreement on "swap" of supplies.
Venezuela has obligations to Minsk for the supply of oil to provide Belarusian oil refineries. However, this project requires significant investments in the transportation of crude oil.
The swap contract allows to deliver oil from Azerbaijan to Belarus and deliver Venezuelan oil to SOCAR in South America.
Specifically, the State Oil Company of the Azerbaijan Republic (SOCAR) is interested in acquiring Venezuelan Santa Barbara oil to sell on the U.S. market. SOCAR would supply oil to Belarus and receive the same amount from Venezuela.
A tanker with Azerbaijani oil, which will replace Venezuelan oil according to the swap agreement, has been already moored to the seaport. It is planned to pump about 4 million tons of hydrocarbon raw material on the similar scheme this year.
There is great interest in the delivery of Azerbaijani oil to Ukraine and transit through this country in terms of SOCAR's entering the Ukrainian market as a retailer of oil products.
The company opened several filling stations in Ukraine in the second decade of January. It is planned to expand in the next five years. During this period, the number of filling stations, that will operate in Ukraine under SOCAR brand, will reach 500 units.
Entering the retail market of Ukraine opens up the possibility for the company to further operate on the European markets. SOCAR has already announced its intentions to enter the retail market of oil products of Romania. It means entering the EU market. This process can be more supported by long-standing intentions of SOCAR to buy oil refinery in Ukraine or one of the countries of Eastern Europe.
The sides also signed a memorandum on cooperation in organizing liquefied natural gas supplies to Ukraine following the talks of the presidents of Azerbaijan and Ukraine in Davos.
Ukraine has recently become a "stumbling block" in the gas conflicts between the EU and Russia. These issues also impact on Kiev, which is almost entirely dependent on imported Russian gas.
Today, Ukraine considers various alternatives to Russian gas supplies. In particular, Kiev was the initiator of White Stream project, which involves the transportation of Azerbaijani gas via Georgia and through the Black Sea to Ukraine. However, this project requires big investments. It is not clear who will invest them.
Ukraine has recently passed to a new project of gas supplies and, in particular Azerbaijani gas, which involves the construction of the terminal for receiving liquefied natural gas on the Black Sea coast.
This project is more real especially amid the project Azerbaijan-Georgia-Romanian Interconnector (AGRI), which is under realization. It involves the supply of liquefied gas from Azerbaijan via Georgia and the Black Sea to Romania.
The capacity of the AGRI Project is considered in three variants - two billion cubic meters of gas per year, five billion cubic meters and eight billion cubic meters. According to preliminary data, depending on the capacity of the project, the cost varies from 1.2 billion to 4.5 billion euros.
The project involves transporting Azerbaijani natural gas through pipelines to the Black Sea coast of Georgia, where the gas will be liquefied at a special terminal, and then will be shipped by tanker through the Black Sea.
Azerbaijan is interested in a large number of different projects for transporting energy to new markets. Despite the fact that the republic has virtually ensured its energy security through the production of sufficient quantities of hydrocarbons and the presence of multi-vector routes of their transportation, the search for new areas of cooperation increases the efficiency of export and economic component of this process.