Ministry sees no worsening of Russian crude’s quality to 2017

TOGLIATTI, Samara Region, Jan 22 (PRIME) -- The Energy Ministry monitors the level of sulfur in Russian oil exports and does not expect the quality of crude to worsen dramatically until 2017, Deputy Minister Kirill Molodtsov told reporters Friday.

“We have a factor of sour crude with the level of sulfur of up to 1.8, now (the Urals) oil has the factor of about 1.4–1.6. I have named a rather wide range, it is measured in hundredths of a point, so the issue of such a change, of a drastic change…of sulfur supplied from the Komi (Republic) and the Volga region…we are in control of that,” he said.

“Our expectation is that in the period of 2016–2017 the factor will be kept unchanged in compliance with contract liabilities.”

The ministry will monitor the level even after 2017. “We have three possible options to solve the problem…these are a separate export flow (for sour crude), processing on the territory of Russia, and solution of tasks connected with production technologies,” he said.

In December 2015, oil major Lukoil’s CEO Vagit Alekperov said that traditional buyers of Russia’s Urals oil, Hungary’s MOL and Finland’s Neste, complained that the quality is falling. Sergei Andronov, a vice president at oil pipeline monopoly Transneft, warned that the quality of Russian export oil blend may fall even further.

In 2014, Transneft suggested a transfer of high-sulfur crude into a separate, 23 million tonne export flow to the Ust-Luga port to create a new oil blend with the quality equal to the Kirkuk and Basrah blends. Transneft will have to spend about 2.5 billion rubles on the transfer because it will use the existing pipeline infrastructure of the Druzhba and BTS-2 pipelines.

(83.5913 rubles – U.S. $1)

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