World
  |
|
Five ex-communist countries sign oil pipeline deal bypassing Russia
AP /Mindaugas Kulbis
Ukrainian President Viktor Yushchenko, Azerbaijan President Ilham Aliyev, Polish President Lech Kaczynski, Lithuanian President Valdas Adamkus, Georgian President Mikhail Saakashvili and Minister of energy and mineral resources of Kazakhstan Sauat Mynbayev, from left, are seen during a news conference on the first day of the Energy Summit in the President's palace in Vilnius, Lithuania,Wednesday, Oct. 10, 2007.
VILNIUS
Petroleumworld.com 10 11 07
Five former communist-bloc countries signed a deal Wednesday to extend an oil pipeline that bypasses Russia, in a move that could diversify supplies and cut Moscow's energy clout.
The presidents of Azerbaijan, Georgia, Poland, Ukraine and host nation Lithuania looked on as government ministers and state oil company bosses inked an accord creating the "Sarmatia" consortium, which is to build the new network.
Most ex-communist countries -- and much of the rest of Europe -- rely heavily on energy imports from Russia.
Many are seeking to diversify their energy suppliers amid fears that Russia is increasingly exploiting its oil and gas market dominance to try to tame governments which fail to toe Moscow's line.
"This indicates the unity and commitment of the entire region for progress, self-determination and a guarantee for sovereignty," Lithuanian President Valdas Adamkus told reporters after the ceremony.
His Georgian counterpart Mikheil Saakashvili, who has regularly fallen foul of the Kremlin because of his pro-western stance, said the deal was a sign of "new strategic ties".
"This is a big change not only in the energy policy of Europe but I think also in wider geopolitics, in the wider configuration of the post-Soviet and post-communist space," Saakashvili said.
Ilham Aliyev of Azerbaijan said the deal would "lead only to more predictabilty, more cooperation and more mutual assistance between our countries."
Polish President Lech Kaczynski acknowledged that the project "has both an economic nature .. and a huge political impact."
He added, however, that "this agreement is not made against any other country."
The specific goal of the five governments is to create a new oil route linking the Caspian and Baltic Seas, based on an existing pipeline running through Ukraine, with the aim of opening the taps by 2011.
The Ukrainian pipeline currently ships Russian oil from the Black Sea port of Odessa to Brody, near Ukraine's western border with Poland.
The plan is to extend the pipeline to the central Polish city of Plock, home to the country's largest refinery, allowing new supplies to be shipped onwards to the Baltic Sea port of Gdansk.
Lithuanian authorities have also said that another branch of the pipeline could eventually run to the country's own oil export hub of Klaipeda.
The goal of the Sarmatia network is to enable oil to be pumped from energy-rich Azerbaijan -- and potentially Kazakhstan, which sent Energy Minister Sauat Mynbayev to the Vilnius talks -- through Poland and on to western European markets.
"These countries constitute one of the leading locomotives that can help build the prospects for the European energy market," said Ukrainian President Viktor Yushchenko.
Ukraine has been under pressure from Russia's state gas giant Gazprom and on Tuesday signed an agreement to settle a debt dispute that had raised fears in Europe of possible disruptions in supplies.
The Odessa-Brody pipeline was initially built in 2001 to reduce Ukraine's dependence on Russia for oil and carry supplies from the port towards the rest of Europe.
But when Ukraine failed to clinch the necessary oil supply deals with other countries it grudgingly agreed in 2004 to transport Russian oil in the opposite direction, for export from Odessa's tanker port.
The five governments plan to meet again in 2008 in the Ukrainian capital Kiev to set down the "entire schedule" of the pipeline deal, including its precise route and funding, Yushchenko said.
"Today, I cannot see any serious problems, neither financial nor commercial," he said.
Story by Jonathan Fowler of AFP
AFP 101724 GMT 10 07
Copyright© 2007 Petroleumworld. All rights reserved.
Your
feedback is important to us!
We invite all our readers to share with us
their views and comments about this article.
Write to editor@petroleumworld.com
Any
question or suggestions, please write to:
editor@petroleumworld.com
Best
Viewed with IE
5.01+
Windows
NT 4.0, '95, '98 and ME +/ 800x600 pixels