Pipeline to tighten Russian grip on energy

The Russian government approved plans on Monday for an oil pipeline that could enable the country to bypass Belarus and tighten Moscow’s grip over much of Europe’s energy supplies.

The proposal by Transneft, Russia’s oil pipeline monopoly, to build a new 1m barrel per day spur across Russian territory to a key Russian oil terminal in the Baltic port of Primorsk will boost the terminal’s capacity as a hub for supplies to Europe to 2.5m b/d.
Transneft said it expected the pipeline to be operational in 18 months.

Analysts have said the new spur could eventually end shipments through the Druzhba, or Friendship, pipeline via Belarus to Poland, Hungary, Slovakia, the Czech Republic and Germany. Russia has halted shipments through two other spurs of the Druzhba, to Lithuania’s Butinge terminal for the past 10 months and Latvia’s Ventspils terminal since 2003.

“Russian diplomacy is quite strong, quite experienced, and they are trying to divide us. That’s obvious,” said Gediminas Kirkilas, Lithuania’s prime minister, speaking at the Royal United Services Institute in London.

Despite the European Union’s ambitions to forge a common energy policy towards Russia, in practice bilateral energy deals had “the upper hand”, he added.

Financial Times