Russian Energy Ministry to Give Priority to the Baltic Oil Export Route

The Russian Ministry of Energy believes it expedient to focus attention on the development of two directions of the oil and oil product export routes from the North-Western Region. RIA learned this in the ministry shortly before the cabinet discussion of the development of the oil and gas complex of the region.

The ministry experts call for giving priority to the Baltic Pipeline System (BPS), whose annual throughput capacity is 12 million tons and is to be increased to 50 million tons. The second priority direction is the Kstovo-Yaroslavl-Kirishi-Primorsk pipeline, which calls for stepping up the development of the Primorsk terminal to the annual capacity to 25 million tons.

As for the construction of a pipeline to the Murmansk port, the ministry experts think this calls for a careful analysis of possible routes and evaluation of potential volumes of oil, a part of which would be channelled to Asia Pacific and via the BPS's increased capacities.

The construction of a pipeline to Murmansk is on the agenda of May 22 session of the government, which will be convened to discuss the energy strategy of Russia for a period until 2020.

The ministry experts said about the oil and gas complex of North-Western Russia that the initially recoverable resources of the region, which includes the Nenets Autonomous Area, the Republic of Komi, the Kaliningrad Region and sea shelf, amount to 6.7 bln tons of oil and 26.4 trillion cu m of gas. Prospected oil resources amount to 1.3 bln tons on dry land and 62 mln tons on the shelf. The preliminary estimate of oil resources on dry land 570 mln tons and 344 mln ton on the shelf. The preliminary estimate of gas resources on dry land equals 90 bln cu m on dry land and 1.3 trln cu m on the shelf.

In 2002 the North-Western Region produced 14.7 mln tons of oil and 3.8 trln cu m of gas. It is planned to increase oil production to 55-57 mln tons by 2020.

The intensive variant of the programme calls for the investment of 65 bln dollars until 2020, including 5 bln dollars on prospecting, 50 bln dollars on field development, and 10 bln dollars on the development of pipelines and terminals.

The ministry experts have calculated that if oil production reaches 55-57 mln tons, the budgets of all levels would earn over 40 bln dollars (less the money spent on the construction and exploitation of oil pipelines).