Azerbaijan, Baku, Dec. 13 / Trend E.Ismayilov /
The State Oil Company of the Azerbaijan Republic (SOCAR) will not participate in the process of transporting Azeri Light oil from Ukraine to Belarus, a senior SOCAR representative said today.
The Belarusian, Venezuelan and Azerbaijani sides have agreed to swap supplies, the source said. Specifically, 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.
Negotiations currently concern 5 million tons per year. Working on the basis of replacing Venezuelan oil with Azerbaijani oil will save on transportation costs, the source said.
"This is beneficial not only to us, but for everyone," the source said.
The source added that the implementation of operations under this project provides for delivering Azerbaijani oil on a CIF basis to Ukrainian ports, and does not relate to its further transportation.
"Oil will be transported via the Odessa-Brody oil pipeline or by rail," he said. "We will not take part in the further transport of this oil in any case."
According to the source, Belarus and Ukraine have signed an intergovernmental agreement on the delivery of oil to Belarusian refineries. The issue of the further transportation of Azerbaijani oil will be decided not by SOCAR, he said.
The Odessa-Brody oil transportation project sought to diversify oil supplies to Ukrainian refineries and develop the country's transit potential. The pipeline's construction was completed in May 2002. Its trunk has a length of 674 kilometers, with a pipe diameter of 1,020 millimeters. The capacity of the pipeline and the terminal is 9-14 million tons per year during the first stage.
Over the two years since the pipeline's construction, Ukraine unsuccessfully negotiated the transportation of Caspian oil in the forward direction. As the country was unable to receive any concrete proposals from companies, the Ukrainian government authorized the use of pipeline for transporting Russian oil in the reverse direction in late June 2004.