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Work begins on USD 4bn Russian pipeline

19th March 2012

New Russian pipeline could open up oil supplies to Asia or Europe

488km pipeline
Russian pipeline will cross the polar circle

Russian oil pipeline operators, OAO Transneft (TRNFP), have begun building a 488km link from uptapped oil deposits in Arctic Siberia to the main pipelines grid.

The pipeline will allow crude oil to flow from the Purpe transit hub to Zapolyarye, crossing the polar circle, at a cost of USD 3.83bn.

The pipeline will be able to carry 45m tons of crude a year, produced by TNK-BP, OAO Gazprom Neft, OAO Lukoil and OAO Novatek.

This is almost 9 per cent of Russia’s world leading output of 511m tons last year, or 10.3m barrels a day, Bloomberg reported on 19 March.

Transneft aims to complete the first stage of the pipeline by the end of 2014, the second stage by the end of 2015, and the third stage in the fourth quarter of 2016, according to industry insiders.

Transneft will finance 30 per cent of the cost from its own cash and use existing credit lines for the remainder, Transneft President Nikolai Tokarev said at the time.
 
Russian Energy Minister Sergei Shmatko in October mooted the pipeline at the opening of the Purpe-Samotlor pipeline, which connects the region to the East Siberia Pacific Ocean link.

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