Azernews.Az

By Gulgiz Dadashova

Azerbaijan's state energy company SOCAR and Russian oil pipeline operator Transneft signed a new deal on resuming oil shipments via Russia after exports were halted for technical reasons.

SOCAR will resume oil transportation via the Baku-Novorossiysk pipeline on March 1, Russian media quoted Igor Demin, Transneft president’s advisor, as saying on February 25.

“Initially, it was planned to transport around 1.3 million tons of oil [via the pipeline]. However, as the agreement will be effective only from March, transportation volumes will be less,” Demin explained.

Azerbaijani oil is being shipped from the Novorossiysk port under the name of the Russian export blend, Urals.

Urals -- a mix of heavy and high-grade oil of the Urals with light oil of western Siberia supplied through the Baku-Novorossiysk pipeline and the Druzhba pipeline system -- is traded on world exchanges at a price of $4 or $5 per barrel lower than the Azerbaijani crude.

Noting that the volumes will be defined for every month, Demin said the agreement is similar to the ones signed in previous years.

SOCAR transported 1.27 million tons of oil via the Baku-Novorossiysk pipeline in 2015, compared to 932,160 tons in 2014.

The Baku-Novorossiysk pipeline is 1,147 kilometers long. The length of its Azerbaijani section is 231 kilometers and Russian section - 916 kilometers. The pipeline was filled with oil in October 1996. Its highest capacity stands at 105,000 barrels a day.

Azerbaijan exports its oil through the Baku-Novorossiisk pipeline via Russia, the Baku-Tbilisi-Ceyhan (BTC) pipeline via Georgia and Turkey, and the Baku-Supsa pipeline via Georgia and by rail via Georgia.

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