Bloomberg News

Transneft East Siberia Oil Pipe to Start Reverse Supply Oct. 4

October 01, 2008

OAO Transneft plans to start pumping oil westward through a pipeline from eastern Siberia on Oct. 4 as Russia's oil pipeline monopoly continues the link's construction to the Pacific Ocean.

The pipe will initially have a maximum capacity of 160,000 or 180,000 barrels a day, with oil flowing westward through the trunk network, Transneft Vice President Mikhail Barkov said by phone from Moscow late yesterday.

Transneft eventually plans to use the pipeline to bring oil from eastern Siberia to Asian markets, including China, and the link should reach Skovorodino, near the Chinese border, by late 2009. Capacity will then jump to 600,000 barrels a day, and the company will send the oil flow eastward.

Regional output will at first be lower than capacity and Transneft expects to pump an average of 5,000 barrels a day through the end of the year, Barkov said. OAO Surgutneftegaz will supply the pipe initially from its Talakan development, he said.

Surgutneftegaz plans to raise production from Talakan to roughly 6 million metric tons a year (120,500 barrels a day) during the next five to six years, spokeswoman Raisa Khodchenko said today by phone. The TNK-BP-led Verkhnechonskoye field, which is linked by pipe to Talakan, plans to resume commercial production in October, TNK-BP (TNBP) spokeswoman Marina Dracheva said.

To contact the reporter on this story: Stephen Bierman in Washington DC at sbierman1@bloomberg.net.


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