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Where there is no law, but every man does what is right in his own eyes, there is the least of real liberty
Henry M. Robert

Caspian Oil and Ukrainian Slyness

2 March, 1999 - 00:00

There was fresh smell of Caspian oil in Ukraine last week. The last seam
of the oil pipeline starting at Baku was welded last Monday at Supsa, a
small Georgian settlement on the Black Sea.

In a matter of days this pipeline will start carrying so-called early
Caspian oil, filling storage facilities. Georgi Chanturiya, President of
the Georgian Oil Corporation taking part in the opening ceremony, told
journalists that the first tanker will bring oil from Supsa to Ukraine
by early April, reports Interfax Ukraine. In all, over a million tons of
oil will be delivered from Supsa during 1999.

In the meantime Premier Valery Pustovoitenko met with Azerbaijani Premier
Arthur Rasi-zade in Brussels last week and then told Interfax Ukraine that
Mr. Rasi-zade "wholeheartedly supports" the Ukrainian route of transporting
this strategic fuel.

This news and the expected arrival of an oil tanker in Odessa - for
the first time in the history of independent Ukraine - can only gladden
one's heart. However, if truth be told, the Ukrainian Premier is being
smart. For one thing he declared that the Odesa oil terminal is ready to
receive Caspian oil - about 10 million tons a year - and that this oil
will be processed primarily at the Lysychansk oil refinery. Experts point
out that Mr. Pustovoitenko must have meant not the oil terminal which is
still under construction at the Pivdenny (Southern) Port, but the old one
at Odesa. In which case, they continue, Ukraine would have to stop Russian
oil transit via Odesa.

As for pumping oil to Lysychansk, these experts believe this a purely
hypothetical possibility, if and when the Dnipro oil traffic is altered
or the direct Lysychansk-Tikhoretsk oil line is reversed, cutting short
oil supplies to Novorossiysk.

The Ukrainian Premier was also being somewhat sly saying that work is
being done to build the Ukrainian section of the Eurasian oil transport
corridor. Indeed, the Odesa-Brody oil pipeline is under construction, being
financed by the joint stock company Naftorpovid Druzhba (Friendship Oil
Pipeline). Experts estimate its readiness at 56%. But the Pivdenny oil
terminal project is laid by and its readiness can by no means be estimated
at "about 30%" (courtesy Premier Pustovoitenko). Experts firmly place it
at 20%.

 

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