Belarusian Oil Market to Become a Battlefield for Russian Companies

By Vladimir Shlychkov, October 4, 2013

a common asset with Gazprom Neft) and more than 40 fuel filling stations. This is the only company that cooperates with two refineries at once – Mozyr Oil Refinery and Naftan in Novopolotsk. Finally, some persons, which are quite influential in Belarus, like, for instance, Andrey Kostin, the Head of VTB Bank, which has a subsidiary here in Belarus, and Sergey Chemezov, the Head of Rostec, rank among the members of the company’s Board of Directors.

LUKOIL (second place in terms of the volume of supply) entered the Belarusian market earlier than the rest of market players, as early as in 1992. The company supplies oil to Mozyr Oil Refinery. A part of oil products is exported and another part is sold in the internal market. LUKOIL owns a network consisting of 81 fuel filling stations, as well as LLK-Naftan, a joint venture producing oil additives.

Gazprom Neft supplies crude oil to Mozyr. Refinery products are exported to European countries and are sold via a network of proprietary fuel filling stations in Belarus (more than 40 stations).

Surgutneftegas and Tatneft, which is actively developing its retail business (8 fuel stations, planning to increase the number of stations to 40), supply oil to Naftan.

Russneft cooperates with Naftan via Slavneftekhim, its subsidiary. The latter supplies the resources of Bashneft to Belarus, as well. A small part of Novopolotsk refinery throughput is provided by Rusvietpetro.

Does Minsk Have a Lobby in Russia?

“There are many pro-Belarusian lobby groups in Russia itself, and Igor Sechin belongs to one of them”, – believes Alexander Sinkevich, a Belarusian economist. Their emergence is a sign of new realia in the relations of the neighbours. German Gref, the Head of Sberbank of Russia, and Alexey Miller, the Head of Gazprom, have recently been named among the most influential “lobbyists”. Obviously enough, the commitment of the aforementioned persons to Belarusian independence is not the point here. It’s much simpler. Firstly, Igor Sechin is willing to become an informal manager of economic relations between the countries in general: for instance, in the area of acquiring major Belarusian enterprises (such as MAZ, BelAZ, Grodno Azot and others) by Russian strategic investors. The opportunities of potential “support groups” have been demonstrated quite convincingly.
Situation: Transition to Standby Mode

The reduction of Russian oil supply to Belarus in September was insignificant. According to Igor Demin, a spokesman for AK Transneft, as a result of Rosneft active position, the company adjusted the repair schedule and made use of a new supply route via the Surgut-Polotsk pipeline. This allowed to pump additional volume for Rosneft in the first place, and after a short period of time, for LUKOIL, Gazprom Neft and other partners, too. As a result, the reduction of oil supply to Belarus amounted to 233 thousand tons against the previously anticipated 400 thousand tons. The total volume of supply amounted to 1.465 million tons.

The pipeline supply plan for the IV quarter remains unchanged and makes provisions for the supply of 3.1