Russia to divert petroleum transit away from Baltic ports (6)

The Port of Tallinn (Postimees/Scanpix)
9/13/2016 1:40 PM
Source: BNS/ERR
Category: Business

Russia will follow through with its plan to divert petroleum products currently shipped via ports in the Baltic states to its own ports. Port of Tallinn chief executive Valdo Kalm says that the decision will affect Estonian business only marginally.

“In keeping with the government’s instructions, we are diverting cargo flows from the Baltic ports of Ventspils and Riga to Baltic ports of our own, namely Ust-Luga and Primorsk, and to Novorossiysk,” head of pipeline operator Transneft Nikolai Tokarev said at a meeting with Russian President Vladimir Putin.

Tokarev added that where last year some nine million tons of petroleum products were shipped through ports in the Baltic countries, this year it would only be around five million tons. By 2018 they would reduce cargo flows through the Baltic states to zero. “We will be using our own ports because they have surplus capacity,” he said.

According to Transneft, their refineries allow them to load up to 32 million tons into their trunk product pipelines. They would use some of the remaining capacity for crude oil products, Tokarev said.

He added that they would ship up to 25 million tons of diesel to Primorsk, as well as towards Novorossiysk, from the Volgograd refinery and the group of refineries in the Krasnodar area.

Port of Tallinn: Russian decision has only small impact

Port of Tallinn CEO Valdo Kalm told ERR on Tuesday that this decision wouldn’t have a big impact on their business. The Russian decision to phase out transits until 2018 affected Latvian ports a lot more.

The petrol products their customers were dealing in mostly didn’t get transported through pipelines. Kalm also pointed out that the most noticeable drop in pipeline transits had taken place in 2015, and that the share of highly refined petrol products in Port of Tallinn’s business was less than 10%.

The loss of that particular Russian transfer business had already been compensated with the handling of timber and container freight, Kalm said.

About the Russian decision, Kalm said that he saw it as a pragmatic rather than a political measure. A lot had been invested in the port of Ust-Luga, which made it quite natural to try and fully use the capacity of its facilities.

Editor: Dario Cavegn

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