Transneft enters joint venture with railcar maker

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Sept. 3 -- Russia’s state-owned pipeline monopoly OAO Transneft has agreed to form a joint venture with railcar manufacturer Uralvagonzavod to transport oil in connection with the East Siberia-Pacific Ocean pipeline project.

The new entity, Vostokneftetrans, based in Nakhodka in the Primorye region, will use Transneft’s existing rail infrastructure and rolling stock built by Uralvagonzavod to include 5,400 new tank cars over the next 10-12 months.

The ESPO line is being constructed in two phases: Phase 1 (ESPO-1) extends from Taishet to Skovorodino, while Phase 2 (ESPO-2) will extend from Skovorodino to Kozmino on the Pacific Coast.

ESPO-1 will transport a total of 30 million tonnes/year of oil, with 15 million tpy to be delivered by a 67-km pipeline spur from Skovorodino to China under an agreement worked out in the past year.

Starting from 2010, the new joint venture will rail the remaining 15 million tonnes to Kozmino for export to Asia-Pacific markets. Transneft will hold 51% of the new joint venture, while Uralvagonzavod will hold 49%.

Contact Eric Watkins at [email protected].