Updated at 23:19,25-10-2016

Russian mass media: Moscow to finish off Minsk by Baltic pipeline

12-06-2009, 10:10

Experts estimate losses of Belarus after launching the Baltic Pipeline System-2 at about 600-700 million dollars a year.

As noted by the Russian "Nezavisimaya Gazeta", not a day passes without news about another exacerbation of tensions between Moscow and Minsk. Yesterday, on the heat of milk war, a Russian company "Transneft" stated that the second trunk line of the Baltic Pipeline System-2 (BPS-2) has been started to be constructed. This pipeline is to become an alternative to present ways of Russian oil transporting to Europe, which pass through Ukraine and Belarus.

"Thanks to this project all risks connected to the factors which could influence sustainable deliveries of our energy resources, are reduced," stated vice prime minister of Russia Igor Sechin at the ceremony of beginning of construction of the BPS-2.

He noted that the project BPS-2 is to remove part of risks related to Ukraines implementing projects of Odessa-Brody pipeline, which could inflict direct losses on Russian oil companies because the southern trunk of "Druzhba" pipeline would be closed, and later the northern one. In his turn, "Transneft" president Nikolay Tokarev explained that the new system could be filled in particular by accumulating oil from other directions with a volume about 30 mln tons.

The route of the pipeline is to connect the town of Unecha in Bryansk region with the Baltic port Ust-Luga. It is expected that the throughput capacity of BPS-2 will be about 50 million tons of oil annually. The total length of BTS-2 to reach 1,300 km.

The new route bypasses Belarus, through which major part of Russian oil had been delivered to the West so far. In particular, to "Druzhba" pipeline, which capacity is about 100 mln tons a year. However, experts state that in recent years it transported about 80 mln tons annually.

However, as noted by "Nezavisimaya Gazeta", by starting the BPS-2 construction, Moscow would not only damage the economy of Belarus, but would become safe from possible caprices of Minsk. The newspaper is sure that the beginning of construction of the BPS-2 has coincided with the milk war between Moscow and Minsk by accident. The decision to build the oil pipeline bypassing Belarus was adopted in January 2007. Then Russia suspended oil deliveries to Europe through "Druzhba" pipeline after Belarus sudden imposing taxes for oil transit via Belarusian territory. The conflict was solved only after Russian-Belarusian intergovernmental agreement signing, but Moscow drew conclusions, the newspaper writes.

Experts are sure that construction of the alternative oil route would considerably strengthen Russias position in the European market, allowing reducing dependence on transit countries. "From this point of view, the BPS-2 fully correspond to the chosen strategy of minimizing transit risks," Pyotr Kyuyev, an expert of the assessment department of "2K Audit-Delovye Konsultatsii" company said. "Besides, absence of intermediary when transporting energy resources would allow Russia to avoid reputation injury". In addition, as said by him, from the economic point of view the project has benefits too. "The BPS-2 would allow discharging northern ports of Russia, which means a strong impulse for this regions development," the analyst believes.

According to the leading analyst of the Financial Bridge foreign company Dmitry Alexandrov, after implementing the BPS-2 Russias dependence on oil transit via the territory of Belarus would go down about 8-10 times. "In case of successful realization of the project Minsk is to lose 50 mln tons of transit oil annually," the expert said. "With the present tariff for oil pumping equal to $2 per 100 km, losses of Belarus are to make about from $600 to 700 mln a year".