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Impossible to Launch Odessa-Brodi Pipeline in Averse Regime by End of 2008: Ukraine’s Ministry of Fuel & Energy States

Oil&Gas Materials 18 November 2008 13:35 (UTC +04:00)

Ukraine, Kiev, 18 November/ Trend corr. Z.Novosvitskiy/ The Ministry of Fuel and Energy of Ukraine is studying an issue on launching Odessa-Brodi oil pipeline in averse regime, whilst states about physical impossibility to realize the project by the end of 2008, Yuriy Prodan, the Ukrainian Minister of Fuel and Energy said, UNIAN reported.

"It is physical impossible to realize the project by the end of 2008, whilst we will do some work in 2009," Prodan said. There are two proposals from companies on organization of work of oil pipeline in project regime. One is from Sarmatia and another - from offshore company.

However, according to Prodan, these proposals do not include concrete conclusions on origin and amount of resources. Moreover, so far, offshore company has not yet provided the Ministry of Energy and Fuel with feedbacks on draft agreement.

At the beginning of January, leadership of the Galichina Oil Refinery Complex (ORC) Open Joint Stock Company (OJSC) and Neftekhimik Prikarpatya OJSC applied with official letter to Ukrainian President Viktor Yushchenko, Premier Yuliya Timoshenko and Chairman of Board of Neftogaz Ukraini company Oleg Dubin with request to make decision on averse functioning of Odessa-Brodi oil pipeline. Particularly, leaders of these enterprises mentioned that they got commercial proposals to deliver light Caspian oil for development of at least 5mln tons a year at plants. The enterprises have technical possibility to receive and develop this amount of oil.

Earlier Yushchenko stated that Ukrainian Premier Timoshenko would not agree to use Odessa-Brodi oil pipeline in averse regime. Operation of Odessa-Brodi oil pipeline in reverse regime is a considerable political issue and it does not include economic aspects.

Use of Odessa-Brodi oil pipeline in averse regime was envisaged with its construction project.

Oil and transport project Odessa-Brodi was planned to diversify oil deliveries to the Ukrainian Oil Refinery Plant and to develop transit opportunities of the country. Construction of Odess-Brodi oil pipeline finished in May 2002. Main is in 674km length and diameter of the pipe - 1,20mm. The first turn capacity of oil pipeline and terminal amounts to 9mln-14mln tons a year.

Odessa-Brodi oil pipeline was planned to use for pumping of the Caspian oil to Europe. Ukraine unsuccessfully has sought to agree on transportation of the Caspian oil via this pipeline in direct route within two years since its construction. Not getting concrete proposals by companies, the Ukrainian Government allowed using the pipeline to transport the Russian oil in reverse direction at the end of June in 2004.

Thus, the pipeline has been used in reverse direction since its construction, which envisages transportation of the Russian oil from Brodi to Odessa and further - with tankers via the Black Sea straits.

The correspondent can be contacted at [email protected]

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