Baku-Novorossisk pipeline through the prism of Transneft

Since 2002 Azerbaijan failed to honor its commitments in the agreement between the Russian Federation and Azerbaijan Republic on transit of Azerbaijani oil through Russia signed on January 18, 1996, reads statement of Transneft posted on the official web site of the company.

"According to the agreement, the annual volume of Azerbaijani oil transit should be at least 5 million tons, but in practice the volume is much lower," the company said.

The company reported that from 2002 till now the volume of transit was higher than 4 million tons only in 2005 and 2006, in 2008 it was 1.39 million and in 2004 - up to 2.77 million tons.

"In 2012 transit of Azerbaijani oil was 2 million tons. In 2013 the volume of Azerbaijani oil should be 1.8 million tons of oil. During 4 months, 2013 570,500 tons of Azerbaijani oil was transported via the Transneft's pipelines (reduction by 13% against the same period in 2012).

The fee of $15.67 per 1 ton of Azerbaijani oil transit was based on the volume of transportation of at least 5 million tons of oil a year, therefore the Baku-Novorossiysk pipeline remains unprofitable for Transneft, because of the above-mentioned violations. During 2012 Transneft received less $47 million of profit from transportation of Azerbaijani oil, reads the statement of Transneft.

Transneft stated that the company has repeatedly made an effort through cooperation with the Russian Ministries of Energy and Foreign Affairs to solve the problem through negotiations, but the efforts were not crowned with success. "Termination of the agreement is not the legal basis for suspension of Azerbaijani oil deliveries through the Baku-Novorossiysk route. There is an agreement between the economic subjects and the transportation fee must be approved by the Russian agencies," reported Transneft.-0-