Russia to Lithuania oil pipe to remain closed

23 November 2007 16:47  [Source: ICIS news]

PRAGUE (ICIS news)--An oil pipeline serving the Mazeikiu Nafta refinery in Lithuania will not be repaired after being closed last year due to an apparent leak, the Russian industry and energy ministry said on Friday

 

Poland’s PKN Orlen now faces having to lower its profit forecasts for the oil and petrochemicals complex it plans to create at its subsidiary, a company currently solely focused on refining.

 

Feasibility studies found that repairing the Russia to Lithuania link would not be cost-effective, a ministry spokesman said.

 

PKN Orlen previously said it was prepared to wholly turn to higher-cost seaborne crude deliveries to make its plans for Mazeikiu viable. The company was unavailable to comment on Friday.

 

Russian authorities closed the pipeline in late 2006, claiming there had been an oil leak.

 

Analysts have suggested that the link was shut because a non-Russian company had been allowed to acquire Mazeikiu Nafta. This has been denied by Russian authorities.

By: Will Conroy
+44 20 8652 3214

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