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2008 January 31   14:23

No official decision on extension of the term of ESPO first phase implementation - Ministry

As of today, there is no governmental decision as regards extension of the term of ESPO first phase implementation, Sergei Mikhailov, head of Industry and Energy Ministry department told journalist Thursday according to Neft Rossii referring to RBC. Mr. Mikhailov says certain changes in terms are to be considered as adjustment rather than extension. As of today, the terms correspond to earlier governmental decrees.

Earlier, deputy Minister of Industry and Energy Andrei Dementjev told Transneft proposed extension of the term of ESPO first phase implementation. According to him, the implementation was proposed to be postponed to the end of 2008 (for almost a year) without the project appreciation.

In early November 2007, Nikolai Tokarev, new President of Transneft, said the first phase is not likely to be put into operation in the second half of 2008. In late November, Transneft management pointed out that the construction works had fallen considerably behind the schedule and the first phase was likely to be put into operation in QIII of 2009 without any rise in the project value. According to Mr. Tokarev, the contractors failed to fulfill the majority of the works in time. Besides, the construction of specialized sea oil port in Kozmino Bay may not be started as the state expertise of feasibility study has not been completed yet.

The ESPO oil pipeline is the main project of Transneft for the nearest future. ESPO is to pump up to 80 million tonnes of oil per year. The project’s first phase envisions construction of a pipeline capable of pumping 30 million tonnes of oil per year. ESPO length exceeds 4,770 kilometers. The pipeline’s end point will be a new specialized sea oil port in Kozmino Bay (Primorsk territory). The construction of the first phase started in April 2006.

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