Page 16 - EurOil Week 26

EurOil POLICY EurOil

Russia mulls lifting fuel

import ban early

RUSSIA RUSSIA’S Federal Antimonopoly Service (FAS) more fuel to the domestic market to ensure this
has proposed the early lifting of a ban on fuel demand is met. The ministry has said it will con-
Russia imposed the imports, its head Armen Khanyan told Interfax sider lifting the import ban early. But doing so
ban to protect domestic on June 25. now would be premature, it noted in a statement
refiners. The ban came into force on June 2, and was on June 25, as fuel demand in Russia this month
aimed at shielding Russian refiners from for- is still 10-15% lower than the level a year ago.
eign competition. Russian fuel prices remained “The [ministry] continues to monitor the
comparatively high during the height of the feasibility of maintaining the import ban and,
coronavirus (COVID-19) pandemic, despite under normalising market conditions, will con-
a steep fall in demand, because of a so-called sider the possibility of early termination of the
“damper mechanism” in Russian oil taxation. restrictions,” it said.
This resulted in European suppliers seeking to Russia typically imports hardly any gasoline,
capture higher-margin sales in Russia, hurting with volumes amounting to only 1,000 tonnes
domestic refiners. last year, according to customs data. More die-
The ban had been due to remain until Octo- sel is imported, with shipments reaching 62,000
ber 1. However, Khanyan said even though the tonnes in 2019.
embargo had successfully supported domestic The “damper mechanism” was introduced
suppliers, its early termination should now be after a series of spikes in Russian fuel prices
considered. The government decree imposing in 2018. It compensates producers for sell-
the ban provides an option for its early lifting on ing fuel domestically, when international oil
July 15. prices are high, but when prices are low, as
Russian fuel demand has recovered from they were during the crisis, it requires pro-
record lows in April, and the energy ministry ducers to pay extra tax on domestic sales,
has called on suppliers to cut exports and send propping up prices. ™

PROJECTS & COMPANIES

OMV Petrom confirms licence

award in Georgia

GEORGIA AUSTRO-ROMANIAN oil and gas group OMV company’s strategy to expand its activities in
Petrom has confirmed winning a tender held by the Black Sea region. “This is another milestone,
Georgia wants to Georgian authorities for the offshore Block II. It after signing a contract to enter the Han Asparuh
replicate the success of will receive rights to the 5,282-square km area exploration licence offshore Bulgaria,” Zeilinger
other Black Sea states. once a production-sharing agreement has been said.
negotiated. OMV Petrom agreed in December to take a
Giorgi Tatishvili, head of the Georgian Oil 30% stake in the Total-operated Han Asparuh
and Gas Agency, the authority that handles oil block from its parent OMV. The block is adja-
and gas licences in Georgia, said that OMV cent to Romania’s Neptun Deep site, where
Petrom would next need to provide a $1.67mn OMV Petrom and its partner ExxonMobil are
guarantee within 30 days, as well as corporate looking to exploit a 84bn cubic metre (bcm) gas
registration documents. Once these are sub- discovery.
mitted, negotiations will start and will need Georgia produces very little oil and gas, but
to be concluded within six months, Tatishvili it wants to spur offshore exploration for fields
said. in the hope of replicating the successes of other
The official estimated that the project could Black Sea littoral states. The latest tender started
involve up to $30mn of investment. in January and the deadline for bids was April.
OMV Petrom’s upstream director Peter Georgia’s economy ministry announced its result
Zeilinger said the block would be part of the on June 25.™

P16 www. NEWSBASE .com Week 26 02•July•2020