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Ukrtransnafta estimates weekly revenue loss from suspension of oil transit at EUR 1 mln

14 May 2019

JSC Ukrtransnafta as of May 2, 2019 saw a revenue loss of UAH 29.2 million (around EUR 1 million) due to the suspension of transit of Russian oil to Slovakia, the Czech Republic and Hungary since the evening of April 25, the company has told Interfax-Ukraine.

"In view of the current situation, as well as taking into account the need for Russian companies to fulfill their contractual obligations, Ukrtransnafta expects that the unfulfilled oil supply plans of Russian shippers will be made up by increasing the volume of pumping in subsequent reporting periods before the end of this year."

Ukrtransnafta said that oil with high chlorine content during transportation does not harm the company's pipelines, and the absence of direct damage to infrastructure today makes irrelevant the issue of such compensation.

"At the same time, if Ukrtransnafta incurs any non-standard costs during the technical work related to the solution of the current situation, the customer will be compensated for such costs in accordance with the applicable contractual conditions," the company said.

According to the company, the potential volume of transit oil with changed quality characteristics in the pipeline system and tank farms in the Ukrainian section of the Druzhba main oil pipeline is about 500,000 tonnes. In general, the total nominal capacity of the Ukrtransnafta's tank farms involved in oil transportation is 883,000 cubic meters, of which 257,000 cubic meters is the nominal capacity of the tank farms of the Druzhba system of the company.

The action plan agreed upon by the participants of the process implies the launch of the Druzhba pipeline system to normal operation by May 20, 2019.

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