Bloomberg News

Mol Says Oil Flows Via Ukraine at Contracted Levels

February 09, 2010

Mol Nyrt. (MOL), Hungary’s largest refiner, said crude oil supplies via Ukraine are uninterrupted and volumes are at contracted levels after a dispute between Ukraine and Kazakhstan.

Mol’s partners are replacing missing oil under multiyear contracts that the Hungarian company has with them, Mol said in an e-mailed statement today.

Kazakhstan suspended crude oil supplies to Slovakia and Hungary via the Druzhba pipeline amid a trade dispute with Ukraine, Reuters reported today, citing unidentified traders. Russian oil company OAO Lukoil (LKOH) has stepped in to compensate the lost amount, Reuters said.

OAO Transneft, Russia’s state-run oil pipeline operator, is transporting “the same volumes” via the Russian section of the Druzhba pipeline to Belarus, where the route splits into two branches, one running to Ukraine, Transneft spokesman Igor Dyomin said by phone from Moscow.

“We are only the operator to the border,” he said, declining further comment.

Serhiy Zinkevych, a spokesman for VAT Ukrtransnafta, a unit of Ukraine’s state energy company, declined to comment. The Moscow and Kiev offices of Kazakhstan’s national oil transportation company, KazTransOil, were not available for comments after work hours today.

Polish Flows ‘Stable’

The northern branch of the Druzhba pipeline runs on to Poland and Germany.

“Flows are rather strong and stable and we haven’t noticed any fluctuations in pipeline pressure,” said Roman Goralski, a spokesman for state-owned Polish pipeline operator PERN Przyjazn SA, which operates the Polish segment of Druzhba. He declined to give further comment.

Ukraine and Russia were in a dispute at the end of last year after the two countries failed to reach an oil transit agreement. Ukrtransnafta demanded an increase in transit fees. To end the dispute, Russia agreed to pay 30 percent more to transport oil to Europe via Ukraine in 2010.

To contact the reporters on this story: Edith Balazs in Budapest at Ebalazs1@bloomberg.net. Anna Shiryaevskaya in Moscow at ashiryaevska@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net


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