Russia's Local Facility Gears Up To Export More Oil

As OPEC tries to persuade global oil producers - particularly Moscow - to limit crude output, Russia is quietly preparing to launch a pipeline that will increase the country's export capacity by about 240,000 barrels per day. The pipes of the Baltic Pipeline System, or BPS, were filled with oil last week, and the new export link built by the state-owned Transneft pipeline monopoly is due officially to be opened Dec. 25. On Sunday, workers finished loading oil reservoirs at the Primorsk port, BPS's final destination on the Gulf of Finland while carrying out system checks and some final fine-tuning. Before year's end, the first tanker full of Russian export crude oil will set sail from Primorsk. BPS, a project that kicked off in 1999, is designed to allow Russia to reduce dependence on existing oil terminals in the Baltic states of Latvia and Lithuania. Russia has had no Baltic Sea oil port since the breakup of the Soviet Union. Most of the country's oil exported through the Baltic goes through the Latvian port of Ventspils. BPS's initial capacity of 12 million tons of crude a year is just a start. Eventually, the pipeline is to ship about 30 million tons of oil a year from Siberia and Timan-Pechora in the north of European Russia. The first phase of the pipeline runs 270 kilometers from Kirishi to the newly-built terminals in Primorsk, located 120 kilometers north of St. Petersburg. Although initially planned as a political response to the separation of the Baltic states from the Soviet Union, BPS now appears to have a solid economic foundation. The project is expected to cost $1.8 billion and is likely to be finished by 2004, Saint Petersburg Times wrote.