The limitation on liquefied natural gas sales to people in Odesa
and the region's enterprises is likely to be revoked early next year.
This is one result of interim talks held late last week between Odesa
mayor Ruslan Bodelan and the president of the European branch of the America's
multinational Conoco Overseas Old Company, Tom Knudsen, in the firm's London
headquarters. They have negotiated for the implementation of a broad project
stipulating delivery of Caspian liquefied natural gas to Ukraine, in particular
to Odesa, and construction of a large capacity gas-terminal near the Odesa
port for its transit further on to neighboring European countries.
"We might be able to sign the agreement on implementation of the American
investment project in January 1999," Bodelan pointed out in an exclusive
interview with The Day after his return from London, "when a group
of Conoco experts, headed by Knudsen comes to Odesa. Our business partners
expressed a wish to familiarize themselves with the Eksimnaftoprodukt state
enterprise specializing in Russian mazut oil transit through Odesa and
examine the region's demand for fossil fuels." According to Bodelan, the
gas supply from Caspian Sea Russian and Kazakhstan gas wells would compensate
for the considerable incomplete fuel oil deliveries to Eksimnaftoprodukt.
The enterprise has been operating at under 15% of its capacity this year:
instead of 15 million tons of fuel oil only 1.5 million tons had been delivered
to Odesa.
The Odesa city mayor pointed out that the Conoco Company had promised
to examine the counterproposals, also - to finance construction of a powerful
heat power station to provide the local businessmen and the population
of city of over one million people with electricity; to examine the opportunities
for repairing the company's fleet, including derricks, in south Ukrainian
shipyards. However, the comprehensive developmental work on this project,
including technical and ecological findings by American and Ukrainian experts,
is yet to carried out. Bodelan specified that the project is not only about
establishing a Ukrainian route for Caspian natural gas delivery to Europe,
but also about its use as raw material resource for Ukraine's petrochemical
industry, in particular for making chemical fiber and other products. Moreover,
Conoco can invest money in building a chain of up-to-date enterprises close
to the gas route.
On Ukraine's part, the American company needs only one thing - secure
and stable legislative requirements for foreign investors. Incidentally,
the gas project is on the same scale as the Pivdenny oil terminal and building
the Odesa-Brody-Adamova Zastava-Gdansk pipeline. The only difference is
that rail delivery of the liquefied Caspian gas along with building the
Odesa natural gas terminal and infrastructure will be carried out at Conoco
Overseas Oil Company's expense, not Ukraine's.






