Issue 4353. Last Updated: 03/20/2010

OMV May Open New Pipeline

Bloomberg
OMV, central Europe's biggest oil company, wants to open a delayed pipeline between Bratislava and Vienna as early as next year, giving it direct access to Russian oil for the first time and helping to boost refining profits.

The link will connect OMV's main refinery in Schwechat, near Vienna, with the existing Druzhba pipeline from southeast Russia, according to Gerhard Roiss, OMV's head of refining and marketing, who will take over the role of CEO in 2011. Transpetrol, Slovakia's state-run pipeline company, will help to build the 50-kilometer link.

"You have thousands of kilometers of the Druzhba pipeline system and then there's a piece missing that you can hardly see on a map," Roiss, 57, said in a May 26 interview at the company's headquarters in Vienna. The pipeline will "be very important for the security of supply for both countries," as it will allow crude to be pumped in both directions, he said.

Since 2003, OMV has been trying to close the gap in its pipeline system to diversify supplies and gain better access to Russian crude. It currently relies on shipments through the Italian port of Trieste, resulting in high transportation costs that curb profit margins.

Druzhba, the world's longest oil pipeline, was built to supply former communist countries with oil from Russia. It carries oil from eastern Russia to countries such as Slovakia and Ukraine.



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