Polskie Radio (Poland): the feasibility of dreams Belarus on diversification?

Interview with the portal “Business alert” Mariusz Marszalkowski (Mariusz Marszałkowski).

Polskie Radio: In the last days there were many reports that may indicate that Belarus is trying to prepare for the process of diversification of sources of oil supplies. Could it be ever a real prospect? Minsk is highly dependent on Russia, led to this policy of Alexander Lukashenko.

Mariusz Marszalkowski: We see some changes. In January of this year, the Belarusians faced with the prospect of ending a regular supply of oil from Russia: they are unable to negotiate with the Russians about the prices of the raw materials and the conditions of its sale. The reason was an argument on the effects of the tax maneuver and awards to Russian suppliers. Russia began to implement the tax maneuver in 2015, it is that it gradually reduces to zero export duties for all foreign buyers of its oil, and at the same time increases the tax on mineral extraction. Minsk is not profitable, because it will lose preferential rates. Belarus received a substantial income from the sale of petroleum products, but that was then, when she could buy oil cheaper than other countries. Another controversial issue is the award that Belarusian companies paid Russian. This is compensation for the fact that they could sell their raw materials to other customers more.

— Now an important additional factor was the pandemic coronavirus and the decline in oil prices on world markets.

— Belarus decided that since its income from the sale of petroleum products decline sharply, so the formula is using the outdated premiums. Russian concerns, in turn, agree with it not wanted. The dispute continued, and within a few months of regular supplies of Russian oil to Belarus was not. Belarusians began to look for raw materials in other areas. They brought him through Klaipeda and Odessa. There was also the topic of oil supplies from the Polish territory oil pipeline “Druzhba”.

— And the problem is the reverse.

— To supply oil through Poland do not allow the technical ability of the “Friendship” to pump oil it is possible only in one direction. In late February the Commissioner of the government of Poland on strategic energy infrastructure, Piotr Naimski (Piotr Naimski), while in the United States, expressed readiness of our country to mediate in the sale of American raw materials in Belarus. The next day after his statement, the operator of the transport system company “the Company operating oil pipelines” (PERN), announced that it intends to establish technical conditions to reverse in the segment between the bases in płock and Adam’s.

— Informed about the possibility to cover 100% of the Belarusian oil demand told U.S. Secretary of state Mike Pompeo, that winter, visited Belarus.

— During his visit to Minsk Pompeo announced that the US is ready to cover all the needs of Belarus at competitive prices. However, you will need to find appropriate ways of transportation of raw materials. Now oil from Klaipeda in fact can only be transported by rail, which slows down the delivery and increases the cost. This route is, however, the pipeline “Druzhba”, but for these purposes can not be used. There is still Odessa, oil pipelines Odessa — Brody and Brody — Mozyr, but, for instance, gdańsk is much closer from the Mozyr refinery. In addition, the port of Yuzhny oil terminal is located 30 kilometers from Odessa, there is sufficient capacity to produce the required volumes of oil and its transfer.

In this context, appears the Polish version. We have a large oil terminal in Gdansk, able to make 35-40 million tons of oil and liquid fuels per year, as well as the Pomeranian pipeline, which from Gdansk oil can be directed into the system of “Friendship”. It reverse she could go to Belarus, but first, the pipeline will have to upgrade than willing to engage in his Polish operator PERN.

The modification will allow for the pumping oil in two directions. On the one hand, “Friendship” go transit supplies (it should be recalled that it provides not only Polish market, but also German), they need to maintain at the appropriate level. On the other hand, you need to create the opportunity for reverse supply to the oil was going in the other direction.

So far in this direction she moved only once in the past year at the turn of June and July, when contaminated with organo-chlorine compounds the oil was pumped back to Belarus. At that moment the idea on supply from the Polish side. Then transit to the West was suspended, and now, when it was restored, at the same time to transport oil in both directions is impossible.

— The idea is very good.

— She did not appear yesterday, and already in 2010, when the Belarusian and Polish side negotiated the purchase of Venezuelan oil, which would be received in a port in Gdansk, and then went to Belarus. Unfortunately, the company PERN has announced that it sees no possibility to use capacities of oil terminal in this way. It was about the energy security of Poland. The second reason was technical limitations: in order to supply oil to Belarus, oil terminal had to be upgraded.

I want to note that negotiations with Minsk should be approached with caution. In 2011, when there was talk about the reverse, Belarus agreed with the State Oil Company of the Azerbaijan Republic on the purchase of 4 million tons of oil that was to be delivered through the Ukrainian port “South”. Operators, that is, “Ukrtransnafta” and “Gomeltransneft”, signed the contract, agreeing on possibilities and rates. Azeri oil began to flow to Ukraine, but instead of 4 million tons of Belarusians received only 900 thousand tons.

In the end, between the Ukrainian and Belarusian operators dispute broke out: in the transport system of Ukraine remained oil, and improve upon one that delivered on the territory of Belarus. It was the fact that before the beginning of the supply pipeline had to be filled with oil, and first used technical raw materials. When the supply was suspended, the Ukrainian system was more high-quality Azerbaijani oil. The Ukrainian side has filed a lawsuit against the Belarusian, accusing her that she had violated the terms of the contract and did not choose raw materials in the ordered volume. Belarus demanded a refund for the oil that was in the Ukrainian gas pipeline. International arbitration court at the Belarusian chamber of Commerce and industry acknowledged that both sides are to blame, but the Ukrainians had to pay several million dollars.

It should be remembered that the relations of Belarus always puts in first place the political aspects, and the economy coming in second. Minsk is closely connected with Russia, to weaken these ties very difficult. However, this should do it, because at stake including our own security. The diversification of sources of oil supply would be a very important event: Belarus would be able to turn to the world. In addition, if the raw materials will arrive in Gdansk terminal, and then be transported through the Polish pipeline system, we will get ports, work the Polish operator PERN. It should be noted that we are talking about small volumes. Belarusian sources reported that with the mediation of PERN Belarusians would buy about 100 thousand tons of oil per month, this is one large tanker.

— Oil has always been used as one of the main instruments of pressure on Belarus.

— Disputes between Russia and Belarus on the theme of energy continued for fifteen years. Every two or three years breaks another conflict on the soil of oil, gas, customs duties and taxes. Within one to two months is usually able to come to an agreement, but for every discount Belarus paid its sovereignty. Let me remind you that she gave Gazprom its gas transportation system. The diversification of sources of gas supply there is not saying.

— At least not yet spoken.

— For the supply of gas would be needed to build new pipelines. With oil the situation is different. If in 2024 Minsk will pay for Russian oil the same as for Norwegian, you can create a new infrastructure.

— Belarus has established tariff for oil transportation for reverse supply from Poland. This gives hope?

— Approval of rate base, without which it is impossible to begin deliveries of a certain standard. In late February, the operator of the “Gomeltransneft” also set the rates for the length of the Ukrainian border. The appearance rate for the segment between Adam’s and Mozyr — the phenomenon is unprecedented. We received a signal that Minsk intends to take real steps and not only uses this topic for debate with Moscow on the subject of oil prices.

— The question remains about how the technical capabilities will allow such steps to do.

— In what period of time everything can be solved is not yet known, PERN doesn’t give such information. The money in his budget to be allocated, the funds are certainly there, but I guess early June deliveries will not begin.

— This is really an unprecedented situation, but whether the project is successful?

— I think, an important role can be played by the political support of Washington. USA are interested in is to find a market for its raw materials.

— The creation of a counterweight to Russia in the region is a difficult task, so this support will be so important?

— During the Munich security conference, the Americans announced that it will establish a Fund in the amount of billions of dollars for energy projects in the participating countries “Initiative of the three seas”. This money can be directed, for example, the creation of additional infrastructure, connecting our transport systems with those of Ukraine and Belarus. The idea is to give them economic support, but at the same time allow to overcome the dependence on Russian raw materials.

— Russia is showing greater resolve, in an effort to keep certain countries in its sphere of influence, so it is important that the concept of energy release had the support of a broad political front.

— Political support of the United States is very important. The Americans, in this case driven by both geopolitical and economic interests. 20 million tons of oil that Belarus needs, it is quite a large amount. Its role in this process could play Poland. I will add that in Ukraine we are witnessing attempts to start buying us gas.

— Essential economic aspect, that is, the price of oil.

— Still it was the most important, but in 2018, when Russia began to exert on Belarus pressure, achieving a deeper integration, there are other priorities.

© RIA Novosti, Viktor Tolochko | go to photobacteria refinery— in addition to prices on world markets dropped significantly.

— It should be noted, however, that until now, for nearly 20 years Lukashenka has not done anything that would strengthen the independence of Belarus. On the contrary, it has become dependent on Russian energy. Now, building a nuclear power plant in Ostrovets, it will be connected also with the Russian nuclear power. Lukashenko has joined the geopolitical projects of the Moscow Customs and Economic unions to the organization of the collective security Treaty. He used these relations own country was his tool that allows for private interests.

— In Belarus even have the ability to hold free elections.

— The situation is changing in Russia: because of the sanctions, crisis it can no longer subsidize Belarus in the same volume. Before she could afford to sell Lukashenko oil at prices 50% below the world, and now this difference, according to various estimates, is 25%. Gas Belarus Russians sold on the same terms as in the domestic market, and now it costs her more than European countries. Minsk pays for 1тысячу cubic metres of $ 127, and on exchanges in Europe it is from 50 to 170 dollars.

Belarus will be difficult to get rid of dependence, because Russia for many years working to subjugate it.

— Now Russia, perhaps, there is no such amount of money to a big way to subsidize the Belarusian economy. You need to look for elements that will change the situation. Of great importance including gestures of goodwill assistance to Belarus in combating coronavirus.

— We set an example of solidarity.

— Poland for many years he performed in the West, the lawyer of Ukraine. Belarus is weaker, its economic potential is not as great as Ukrainian, there are more complex social and cultural situation, so that the Polish support her all the more necessary.