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Russia may give pipeline operator control of all oil intake terminals after contamination scare

20 August 2019

Russia could transfer the operational responsibility for all oil intake terminals to state-owned pipeline company Transneft, according to a report on a government website relayed by the Reuters news agency, after a privately-owned terminal was blamed earlier this year for contaminating oil supplies.

Transneft storage facility - Image: Shuttestock
Transneft storage facility - Image: Shuttestock

Prime Minister Dmitry Medvedev will ask the government to consider the move, the website said, after Medvedev met Transneft Chief Executive Nikolai Tokarev on August 19.

Most of Russia’s oil intake terminals - hubs that receive oil from fields before it is moved into Transneft’s pipeline network - are controlled by private firms or oil companies.

Tokarev told Medvedev that handing the running of the intake points to Transneft would prevent a repeat of the contamination crisis that hit Russian exports in April, according to a transcript of their meeting on the website.

Prosecutors have accused a small oil transport firm of pumping toxic chemicals via a private oil terminal into Russia’s crude pipeline network that then polluted oil exports to Europe. The crisis led to the suspension of flows through the Druzhba pipeline and hit Russia’s reputation as a supplier.

It has also led to tensions between Transneft, the world’s biggest oil pipeline network operator, and Russian oil companies, particularly over quality controls.

Tokarev told Medvedev that chemical laboratories handling analysis of oil received at the intake points should be certified and accredited by regulatory authorities, according to the transcript.

He also said Transneft was continuing talks on compensation for customers who received tainted oil, large volumes of which remain in Russia as the company works to improve its quality.

TASS, the Russian state news agency, said Tokarev told Medvedev all the chloride-contaminated oil had been returned to Russia where it was being treated.

In mid-April, the Belarusian concern Belneftekhim reported a sharp deterioration in the quality of Russian oil running through the Druzhba pipeline, which supplies oil to Belarusian refineries and provides its transit to Europe via Belarus, Poland and Ukraine. Transit and refining were suspended.

Minsk and Moscow started intergovernmental talks on compensation issues in May. Clean oil pumping from Russia to Belarus resumed in May.

On June 19, a new source of oil contamination was registered in the pipeline segment running from Belarus to Poland. Oil throughput over the segment controlled by Poland’s pipeline operator PERN was suspended and restarted on June 20.

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