Main page > Investment opportunities and economic information > Principle Federal Projects > Baltic Oil Pipeline The Baltic Pipeline System – the key federal project in the Leningrad Region
 The Baltic Pipeline System (BTS) is one of the most promising projects in the whole of the Russian Federation. It was designed for a new direction of oil exports from the Timan-Pechora region, West Siberia, and the Urals-Volga region, as well as oil exports from the CIS states, mainly Kazakhstan.
The Baltic Pipeline System has been established in compliance with the President's Decree No. 554 of June 6, 1997, entitled 'Providing cargo transit via the coastal areas of the Gulf of Finland' and the Russian Federation Government Decree No. 1325 of October 16, 1997, entitled “Design, construction, and operation of the Baltic Pipeline System”.
The system complies fully with national economic and political interests, as currently the port in Novorossiisk is Russia's only deepwater port.
The Baltic Pipeline System will:
Establish an independent and promising new export route via the Russian oil terminal at the Baltic Sea;
Make Russia more influential in the Baltic region;
 Provide tax earnings for the budget. According to the evaluations, during 20 years of system operation, the Treasury will receive US$400 million, a quarter of which will go to the federal budget and three quarters to regional budgets. Most of the latter, US$259.6 million, will be paid to the Leningrad Region’s budget;
Attract investment to the fuel and energy sector;
Increase oil exports from the CIS states via Russia.
Oil transportation via the Baltic Pipeline System will enable Russia to stop using the expensive services of the transit countries. The transportation costs in the Baltic Pipeline System will be US dollars 3 – US dollars 4 per ton lower that the costs at the routes going via Ventspils, Latvia, or Odessa, Ukraine.
The project will be implemented in several stages.
At the first stage, a new transport route with a capacity of 12 million tons per year will be established on the base of the existing Transneft's main pipeline system, new loopings at the existing Yaroslavl-Kirishi pipeline, and a new pipeline from Kirishi to Primorsk with an oil terminal in the Gulf of Finland. The project will cost US dollars 460.2 million.
|
No. |
Index name |
Units
of measurement |
Value |
|
1 |
Capacity of the Kirishi-Primorsk pipeline |
Million tons per
year |
12 |
|
2 |
Length of new pipelines |
Km |
453.3 |
|
3 |
Total investment costs.
Including:
The Yaroslavl-Kirishi main pipeline,
The Kirishi-Primorsk main pipeline
Oil terminal in Primorsk |
US dollars million |
460.2
127.4
163.2
169.6 |
|
4 |
Directive construction time, approximately |
Months |
18 |
|
5 |
Payback period |
Years |
12 |
|
6 |
Budget earnings:
Total
Federal budget
Local budgets |
US dollars million
|
401.5
106.0
295.5 |
The Baltic Pipeline System Implementation Concept
 The implementation concept for the first line of the Baltic Pipeline System implies the following steps:
Starting the construction of an oil terminal in Primorsk, financed by the investment tariffs collected in 1999.
In 2000 - 2001, reconstructing and expanding the Yaroslavl-Kirishi pipeline with 175-km loopis.
Organizing the financial resources for building the linear part of the Kirishi-Primorsk pipeline and completing the terminal.
In the future, the pipeline capacity may be increased if additional oil volumes exceed 12 million tons per year.
Special attention will be paid to environment protection.
The environmental program of the Baltic Pipeline System includes a set of measures for protecting the water, land, and biological resources, atmosphere control, ecological monitoring, waste collection, processing, and utilization, and a number of others. The technologies for overcoming large water obstacles will be environmentally oriented. Under the Neva river, the pipeline will be laid by the micro-tunneling method with the pipeline placed in a protective coat, and then in a micro-tunnel located no less than 10 meters from the river bottom.
 Large water obstacles like the rivers Kotorosl, Volga, Mologa, or Volkhov will be overcome by the controlled directional drilling method.
Therefore, the pipeline construction will neither change the natural state of the river nor harm the fishery. Coast-protecting works will not be necessary either.
Due to the stricter environmental requirements, the pipeline category is no lower than II, which implies stricter requirements to the pipe quality, test pressure, test time, and the nondestructive control volume for pipeline welds.
According to the project, all the objects will be equipped with automation, telemechanics, and computer equipment, which will increase their reliability and allow diagnosis on the state of the equipment and the pipeline. There will be full control over the environment state and environment protecting measures.
Mandatory tests include strength and water-proofing tests for the main pipeline and pumping station equipment. Before the opening of the objects, the main pipeline, the reservoirs, oil-pumping stations, and other equipment will be diagnosed.
The principal features of the Baltic Pipeline System are its geopolitical value, benefits for national security, economical feasibility, environmental safety, and technical feasibility. |
