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Today's paper. Last Updated: 05/29/2012

Russia Signs Oil Export Plan

VIENNA -- Russia and the World Bank have signed a memorandum outlining new procedures for oil exports after the planned abolition of export quotas and licenses in 1995, Deputy Fuel and Energy Minister Yevgeny Morozov said Wednesday.


The memorandum was drafted at talks in August and September between World Bank experts, representatives of the fuel and energy and economics ministries and state pipeline operator Transneft, Morozov said at an international oil and gas conference. "The document determines in principle the way oil and oil-product transportation will be governed in 1995," he said.


Russian oil producers and Western firms operating in Russia have expressed concern that scrapping quotas and licenses could lead to a battle for pipeline access that smaller companies or joint ventures would stand little chance of winning.


Morozov said the memorandum, which still needs to be approved by the government, proposed measures for fair access to the Transneft crude oil pipeline monopoly. He declined to give details, saying exact procedures would not be decided until the fuel and energy and economics ministries completed forecasts for development of the oil and gas complex in 1995.


"I think we will work out a certain model, rules of the game for access to the pipeline system," he said.


The deputy minister said the World Bank and ministerial experts had drawn up basic guidelines for participation in export operations, starting from Jan. 1, 1995, when quotas and licenses are to be scrapped.


He said the three main points were that quotas would not be applied, that oil producers as opposed to traders should have priority access to pipelines and that producers should also be given export rights.


Access to the pipeline system for producers will be based on their percentage share of total oil output, he said. This would mean the oil giant Lukoil would be allocated the most space in Transneft's monthly pumping schedules.


But the Foreign Trade Ministry believes that only the most experienced and qualified operators, such as the main exporter Nafta-Moskva, should be given export rights in order to improve efficiency and cut down on trade abuses.




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