Transhipping Volumes Grow by 1 Million Tonnes Monthly at Primorsk Oil Terminal

The January-May 2002 turnover of the oil terminal at the town of Primorsk, Leningrad Region, amounted to 5.071 million of crude. According to the administration of the Seaport of St. Petersburg, the transhipping volume has been growing by 1 million tonnes every month, on the average. The new Primorsk oil terminal that became operational on December 26, 2001 is expected to be capable of assimilating the annual flow of 16 million tonnes of crude, that is, 24% of all Russia's petroleum exported by tankers at this time handled by the port of Ventspils, Latvia.

The oil terminal at Primorsk is located at the end of the 455 km-long Baltic Pipeline System. The construction of its first run cost USD 460 million. The project was directly financed through the added USD 1.43 per tonne purposive investment tariff of the Transneft oil transporting company. The first run is expected to pay for itself in 4.5 years. For that period, the Federal Energy Commission of Russia has set oil transportation tariff at USD 6.5 per 1 tonne, that is, about 10% below what is charged in Venspils.

The construction of the second run of the Baltic Pipeline System is supposed to begin late in 2002. Once it is completed, the annual throughput of the system should increase to 18 million tonnes. Added to the system will be 245 km-long pipe connecting the city of Yaroslavl with the town of Kirishi, Leningrad Region, and additional 400,000 tonnes storage tanks in Primorsk. The total estimated cost of this project amounts to USD 7.8 billion.