Eric Watkins
Senior Correspondent
LOS ANGELES, Oct. 3 -- Azerbaijan, Georgia, Ukraine, Lithuania, and Poland, in an effort to bypass Russia, will sign a joint agreement this month to extend the Odessa-Brody pipeline to include Plock and Gdansk, Poland.
Neringa Pazusiene, a department director at the Lithuanian Economy Ministry, said the five countries expect to sign the agreement during the Vilnius Energy Security Conference scheduled for Oct. 10-11 in Lithuania. "This will be the last step to be taken in order to get the project started," Pazusiene said.
A recent meeting of energy ministers in the Georgian capital of Tbilisi served as a catalyst for the agreement. Energy ministers instructed the companies involved in the project to bring new shareholders into the operator Sarmatia Pipeline Co., which was founded by Poland's Enterprise of Oil Pipelines Operation (PERN) and Ukrtransnafta, the state-owned oil pipeline transportation and management unit in the Ukraine.
In mid-July Sarmatia shareholders approved increasing the company's authorized share capital to 12 million zlotys from 2 million zlotys in order to accommodate Azerbaijan's Socar, Georgia's GOGC and Lithuania's Klaipedos Nafta (Klaipeda Oil) in the project.
The full-length Odessa-Brody-Plock-Gdansk line is planned to be the first oil pipeline to bypass Russia and directly link the Baltic Sea consuming region with the Caspian and Black Sea producers.
Last month Azerbaijan tentatively agreed to supply oil for the 674-km Odessa-Brody pipeline, along with the planned extension of the line to Poland (OGJ Online, Sept. 27, 2007).
Contact Eric Watkins at [email protected].