Rosneft does not rule out reverse oil pumping via Baku-Novorossiysk pipeline
Russian state-owned oil company Rosneft does not exclude reverse flow of Urals crude through the Baku-Novorossiysk northern route pipeline, which was earlier announced by Azerbaijan's state energy company SOCAR.
Rosneft President Igor Sechin said that initially the Baku-Novorossiysk pipeline was built for oil flow in the direction from Russia to Baku, Prime agency reported.
"Perhaps what is happening [transportation of oil from Azerbaijan to Russia] is the reverse," Sechin told reporters.
SOCAR head Rovnag Abdullayev earlier said his company was in talks with Rosneft on a possible reverse flow of Urals crude through the Baku-Novorossiysk pipeline in the amount of 5 million tons per year.
If the talks succeed and the cost-effectiveness of operations under consideration is approved, part of the oil will be processed in Azerbaijan, and some of it will be delivered via the Baku-Tbilisi-Ceyhan (BTC) pipeline and shipped from the Ceyhan terminal in Turkey on the Mediterranean Sea. Evaluation of the effectiveness and the negotiations will be completed by late this year.
Sechin went on to say that in his opinion "use of all possibilities is simply the effective work in the market".
SOCAR has set terms before Rosneft on oil pumping via the Baku-Novorossiysk pipeline in the reverse mode with a sulfur content of less than one percent, which does not affect the quality of the oil transported through the BTC oil pipeline, and will allow the shipment of Azeri Light oil from the Ceyhan terminal.
According to the standing agreement, in case the program is implemented, the profits will be shared equally between the parties.
Rosneft will itself resolve the issues on operations relating to the oil transportation via the Baku-Novorossiysk pipeline and the project implementation with Russian oil pipeline monopoly Transneft.
The contract on the transit of Azerbaijani oil through the territory of its giant northern neighbor, which had been in effect for 17 years, was revoked in early May.
The Baku-Novorossiysk pipeline (also known as the Northern Route Export Pipeline) is an 1,330-kilometer oil pipeline, which runs from the Sangachal Terminal near the Azerbaijani capital Baku to the Novorossiysk terminal at the Black Sea coast in Russia.