|TOPIC OF THE ISSUE|
|REFINING PROFESSIONALS JOIN FORCES|
Cooperation in the Face of Common Problems
A conference of refining industry chief engineers and research centre heads in the Belarusian city of Mozyr from 10 to 12 November focused on the problems plaguing the sector. The Association of Refiners and Petrochemists of Russia (ANN) did not choose the venue lightly: Mozyr refinery is a model of how state assistance can advance the development of the industry. Yet favourable treatment could not shelter the facility from problems caused by imported equipment and technology. To pursue common interests and solve common problems, the refiners proposed the establishment of a refining industry association that would include all post-Soviet refineries.
|PERSON OF THE ISSUE|
|STANDING BETWEEN THE PAST AND THE FUTURE|
Yulia Timoshenko, one of the key players in Ukraine's «Orange revolution», was in the media spotlight during November and December 2004. The former «gas princess» of Ukraine aroused mixed feelings in camps of supporters and opponents alike by shrugging off the insults while demonstrating phenomenal grip on the events and the ability to consolidate hard-working professionals for achieving her objectives. There is no doubt that if Victor Yuschenko wins the Presidential race, Yulia Timoshenko would become one of the major players in the new Ukrainian government, possibly even the Prime Minister. What will be the impact of this scenario on Ukraine’s fuel and energy sector development, Ukraine's relations with its neighbours both from the CIS and the EU, the plans on Russo-Ukrainian gas consortium, sustainability of oil and gas transit shipments, and future of Russia's investments in Ukrainian energy sector, all those questions seem to be most intriguing following tectonic power shifts in Kyiv. The time will tell.
|PHOTO OF THE ISSUE|
LOOKING TO THE FUTURE
Arnold Schwarzenegger has long since become a Superman-like figure for many ordinary citizens. California's governor, better known to the masses as Terminator, is also an advocate of US hydrogen fuel development programme. In November, Schwarzenegger opened Shell-owned hydrogen fuelling station in Washington. Currently the station fuels gasoline cars as well as hydrogen vehicles, but the Terminator is certain that the future looks bright for the new type of fuel. The only thing is to be patient for several decades… The OilMarket expresses gratitude to California Governor's press office for supplied picture and wishes all the best to the successful actor and politician for the New Year.
|EXPLORATION AND PRODUCTION|
|ORMEN LANGE PHENOMENA|
The development of UK and Norway North Sea fields has propelled this region to the top ranks in the world in terms of technologies used, work efficiency and environmental standards. Still, the new Ormen Lange project, which is being designed by Norsk Hydro and other companies, could add a brand new chapter to offshore fields development know-how. The project could also help Russia's breakthrough in Arctic oil&gas projects.
|WHERE THERE'S SMOKE, THERE'S... SMOKE|
Rumours about Ukraine's energy crisis are, as usual, a bit stretched
Things remain tense on Ukraine's energy market but it is still a long way from the picture of total collapse painted by some Russian and Ukrainian media. The actual facts are being distorted to an astonishing degree, drastically changing readers' perceptions.
|LOOKING FOR BYPASSES|
Increased Turkish restrictions on shipping through the Bosporus and Dardanelles combined with absence of alternative export routes to the Mediterranean market and seasonal worsening of weather conditions put mounting pressure on Russian crude exporters.
The trickiest issue in the accounting of oil products is the difference between an actual quantity of the product and its quantity indicated in accompanying documents. While easily found at measurement point, this difference can hardly be explained just by the influence of objective and subjective factors, and is even more difficult to compensate. As a result, the end user has to bear losses.
|PUMPING UP THE VOLUME|
Slip in exports profitability won't suppress shipments growth
Downfall of benchmark blends prices in US and the North Sea in late November - early December put pressure the outright price of Russia's crude as well. Urals prices soaring above $40/bl remained a fond memory of the peak driving season in US. Second half of November and beginning of December also witnessed deteriorating profitability of Russia's oil exports. This failed to halt yet another expansion of volumes scheduled for shipments in 1Q 2005.
|THE DRIVING FORCE|
Marketing as the key element behind Mazeikiu Nafta's success
OilMarket has already focused on the successful marketing of Lithuania's 300,000 b/d Mazeikiu Nafta (MN) refinery (OilMarket 2004, No. 10). It is the marketing staff which dictates the pace of refinery operations and enables the unit to be flexible enough to meet market needs. Combined with an advantageous geographical location, this makes the MN refinery one of the dominant players on the regional products market. Today we focus on key elements in MN's marketing success.
|CHINA: GAS INDUSTRY IN TWO STEPS|
PART TWO: STIMULATING DEMAND
To move the natural gas market out of its infancy, the communist regime has taken it upon itself to stimulate demand. Historically, natural gas has been an almost insignificant variable in China's energy equation. Until the mid-1990s, it primarily was used for fertiliser production. Currently, only 10% of gas consumed in the country goes to the utilities sector, that is household consumption and small power-generating units.
|THE YUKOS LEGACY|
To evade possible effects of the Houston Court ruling, St. Petersburg clan made Yukos key producer Yuganskneftegaz changing several hands.
|AZMOL on the crossroads|
On 17 November Ukraine's state property fund (FDM) approved privatisation terms for the 92.41% stake in Berdyansk Azmol lubricant facility on the Azov sea coast of Ukraine. The FDM changed the privatisation terms several times, effectively narrowing down the list of potential winners to single company — Russo-Ukrainian JV Ukrtatnafta operating Ukraine's largest 320,000 b/d Kremenchuk refinery. Still, the privatisation of Azmol has never lured much interest from potential bidders.
|MOZYR BLUEPRINTS OF SUCCESS|
The launch of a catalytic cracking facility at the 220,000 b/d Mozyr refinery in Belarus, marked the end of the fourth stage of the refinery's modernisation. The upgrades fulfilled during the four stages have enabled the refinery to integrate into the EU oil products market — production quality put the refinery on par with EU-based suppliers on Poland's diesel market. At the same time, eliminating weak links in the production chain would help the refinery leap into other European markets as well. OilMarket discussed production details and export possibilities with Anatoliy Kupriyanov, general director of the Mozyr refinery.