Russia to increase oil export to China via Kazakhstan in 2014

Russia is planning to increase its oil supplies to China via Kazakhstan in 2014, Kommersant writes. Currently Rosneft and Transneft are supplying 15 million tons of oil per year via Eastern Siberia-Pacific Ocean (ESPO) pipeline. The agreement on the supplies was signed in 2010 and Russia has to supply 300 million tons of oil by 2030. Rosneft also agreed to construct an oil refinery in Tianjin in 2010. It will be able to process 13 million tons of oil per year with 9 million tons of the oil supplied from Russia. In this relation, Russian government has supported Rosneft’s plans to increase the oil export by at least 9 million tons. However, ESPO allows to increase the supplies by 1.5-2 million tons only. The plan is that starting from 2014 Rosneft will be able to supply the remaining 7 million tons of oil to China via Kazakhstan. The supplies of Russian oil to China should double in the end and exceed 30 million tons of oil a year. According to the newspaper’s sources, Russia and Kazakhstan are in talks about making it a swap deal: Rosneft will supply 7 million tons of oil to Kazakhstan oil refinery in Pavlodar and KazMunaiGas will supply the same amount of oil to China via Atassu-Alashankow pipeline. This information has been confirmed in by representatives of the secretariats of first Vice-PM of Russia Igor Shuvalov and Kazakhstan Vice-PM Kairat Kelimbetov. However, the final decision has not been approved yet.