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Russia’s Transneft delays Siberian oil pipeline project

By RIA Novosti

Khabarovsk : Transneft, which manages the construction of an oil pipeline from East Siberia to the Pacific Ocean, said on Thursday the project’s commissioning would be delayed from late 2008 to late 2009.

The ambitious East Siberia-Pacific Ocean (ESPO) pipeline is slated to pump up to 1.6 million barrels of crude per day from Siberia to Russia’s Far East and then on to China and the Asia-Pacific region. The project’s first leg, estimated at $11 billion, was expected to be commissioned in December 2008.

“It seems it will be possible to complete work and commission the first stage of the ESPO project only in the fourth quarter of 2009,” Transneft President Nikolai Tokarev said, adding that the project’s first leg was now only 46% ready, while according to the schedule it should have been 67% complete.

Tokarev said the harsh conditions in which the pipeline is being built, the delayed start to the project’s implementation and the extension of the pipeline’s route due to environmental concerns were the main reasons for the delay. He also said that some subcontractors had failed to meet their obligations on time.

However First Deputy Prime Minister Dmitry Medvedev, who is on a working visit to Russia’s Far East, criticized the project organizers for the delays, saying the project had been hampered by bureaucracy.

The ESPO first stage envisages the construction of a 2,757-kilometer (1,713-mile) section with a capacity of 30 million tons (220.5 million bbl) of oil per year. The project’s first leg will link Taishet, in East Siberia’s Irkutsk Region, to Skovorodino, in the Amur Region, in Russia’s Far East.

The second leg will stretch for 2,100 kilometers (1,304 miles) from Skovorodino to the Pacific. It will pump 367.5 million barrels of oil annually. The second stage also envisages an increase in the Taishet-Skovorodino pipeline’s capacity to 588 million barrels.