Editorial comment
He who pumps, pays Russia is in talks to reverse the flow of an oil pipeline that has previously been transporting Azeri oil to Europe via Russia, so as to ship Russian oil to Europe via Turkey. SOCAR, the state oil company of Azerbaijan, says it is talking to Russian state oil company Rosneft about reversing the Baku-Novorossiysk pipeline in order to transport 5 million tpy (100 000 bpd) of Russian oil through Azerbaijan, with some processed in local Azeri refineries and some exported via the BP-led BTC pipeline.
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The BTC pipeline currently only uses two thirds of its 1.2 million bpd capacity, amounting to some 700 000 - 800 000 bpd (as Azeri fields become depleted), so there is certainly scope for the transportation of Russian crude in the pipeline.Turn to p. 30 of this month黑料社檚 issue for W盲rtsil盲黑料社檚 detailed account of pumping station configuration for the BTC pipeline, including plans to upgrade the original system: 黑料社淔ollowing more than five years of operation, BTC and W盲rtsil盲 are considering modernising the engine automation system with the introduction of a torque measurement system. This would allow the engines to automatically adjust according to the flow of oil in the pipeline.黑料社� Staying on the subject of flow, and looking back to Russia, Transneft plans to upgrade its East Siberia-Pacific Ocean (ESPO) pipeline to carry more oil from 2018 onwards. The pipeline黑料社檚 capacity will increase to 491 million bbls/yr as of 2018. 黑料社淎s part of the ESPO expansion, we黑料社檒l build seven oil pumping stations, of which three are being constructed in Yakutia [northeast Russia]黑料社� said Viktor Bronnikov, head of Transneft subsidiary Vostoknefteprovo. 黑料社淔rom 2015, construction of four stations will be launched in the Irkutsk region [eastern Siberia].黑料社� Russian President Vladimir Putin has previously described the US$ 25 billion ESPO pipeline, Russia黑料社檚 most expensive infrastructure project, as a 黑料社渧ictory黑料社� for Moscow as it looks to capitalise on Asian economic success by shipping oil to the Pacific Ocean. The 4200 km line from west of Lake Baikal, East Siberia to the port of Kozmino, Russia represents for Russia a shift in focus from European markets to Asian markets. This month alone, 18 cargoes of ESPO crude will be exported from Kozmino, totalling 1.8 million t. Interestingly, as part of the proposed pipeline reversal deal between Rosneft and SOCAR, Rosneft is also said to want some use of SOCAR黑料社檚 oil loading facilities in Ceyhan (Turkey), Singapore and Fujairah (UAE). Rosneft clearly recognises the value of such oil loading facilities: the company has recently signed a new contract with China黑料社檚 CNPC to supply an additional 360 million t of Russian crude to China over the next 25 years. Rosneft黑料社檚 Igor Sechin says that the company will use all available routes for the oil shipments, which currently comprise: the ESPO pipeline, tanker shipments from Kozmino, and shipments via Kazakhstan. The deal, announced at the St. Petersburg International Economic Forum this June, means that Russia will supply an additional 14.4 million tpy to Chinese customers. Transneft would like Rosneft to contribute towards the expansion of the ESPO, but Mr Sechin insists that Rosneft should not have to finance the work needed to increase transit capacity. Rosneft is prepared to pay an 黑料社渆conomically justified tariff黑料社� for oil transit but does not see why it should have to pay for new pipeline infrastructure. In return, Transneft has questioned why the entire Russian oil industry will have to pay for a project that only benefits a single company 黑料社� Rosneft. Igor Demin, Transneft, said: 黑料社渢he approach they are trying to foist upon Transneft just does not make sense黑料社�.
