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UKRAINE SEEKING CASPIAN OIL TRANSIT
Russia seen impeding energy deal
Azernews, September 13, 2006
 Ukrainian President Viktor Yushchenko paid his first visit to Azerbaijan last week for talks on multi-lateral cooperation, despite suggestions that relations between the two countries have cooled down after the break-up of the Soviet Union.
The two-day talks focused on cooperation in the energy field, with Ukraine proposing its own pipe to transport a part of Azeri oil that is being exported to world markets by the US-backed Baku-Tbilisi-Ceyhan (BTC) pipeline.
The Odessa-Brody pipeline, which links Brody, near Ukraine's western border with Poland, to the country's Black Sea port of Odessa, was built five years ago in a bid to reduce dependence on Russian oil. But when Ukraine failed to clinch the necessary oil supply deals with other countries, it grudgingly agreed in 2004 to transport Russian oil through the conduit.
Yushchenko said after a two-hour meeting with his Azeri counterpart Ilham Aliyev on Thursday that his country is interested in establishing joint ventures with Azerbaijan to be involved in production, refining and sales of oil. He said exporting Caspian oil via the Odessa-Brody route should be the next step in Azeri-Ukrainian energy cooperation.
"We are interested in opportunities for taking Azeri and Kazakh oil to European markets via the pipeline as well as gas supplies through approximately the same route," he said, adding that up to 5m tons of oil is required annually to ensure the efficient operation of the pipe.
Yushchenko said Ukraine has the capacity to act as a transit country for Caspian oil through the Brody-Plotsk-Gdansk route and via the Druzhba (Friendship) pipeline to Slovakia.
He suggested that his country and Azerbaijan's state oil company jointly operate 600 gas-filling stations of Ukraine's state oil company Ukrtatnafta.
President Aliyev said Azerbaijan is interested in diversifying the supplies of its energy resources. He said that 50m tons of oil will be exported annually via the BTC by 2008. With the increasing oil output, alternative routes for supplies will be "of more interest".
Yushchenko's visit apparently did not result in reaching agreement with his Azeri counterpart on the transit of Caspian oil, says an expert from the Kiev-based Center for Political and Economic Research
Vladimir Saprikin said the issue is rather
political, as Russia is not interested in the emergence of alternative sources for oil supplies.
"Certainly, the appearance of new directions for oil flows is largely a political issue. Most of oil is produced in Azerbaijan by Western companies, i.e. independent producers, which consider economic viability of any project crucial."
The analyst said the project' could be successful only if the Ukrainian pipe is extended to Plotsk, Poland, opening access for Caspian oil to European markets. Poland is refusing to finance its share of the construction operations and hopes that the European Union will soon allocate funds for the purpose, Saprikin said.
The president of the Foundation for Political Research of Caspian states, Vafa Guluzada, agreed that Moscow is the key opponent impeding an agreement between Baku and Kiev on oil exports via a new route.
"Ukraine is certainly interested in ridding
itself of dependence on Russian oil, and Azerbaijan could be of much assistance in this."
Guluzada said that the implications concern Russian-Azeri and US-Azeri relations.
"Whereas Russia is vehemently opposed to Azerbaijan's supplies to Ukraine, America is for it. Therefore, the arguments that there is not enough oil to fill the BTC pipeline could delay a decision on the matter. But I believe that it will be made anyway, if not the first time, then during the ensuing stages," the expert said.
Former president of Azerbaijan's state oil company SOCAR, Sabit Baghirov, believes that taking Azeri oil to world markets via a new pipe is possible in principle. However, given that the country is already exporting its oil through the BTC pipeline and considering other factors, this option is acceptable only in terms of political considerations, he said.
"BTC is more Drofitable for the exports of
oil. However, the Azeri government, considering partnership with Ukraine and other political factors, could deliver part of oil through the South Brody Pipeline," said Baghirov.
Agreements
Azerbaijan and Ukraine inked seven documents during Yushchenko's visit, covering a wide range of issues, including cooperation between the two countries' agriculture ministries, state oil companies and one between Ukrainian Nuclear Clearance Committee and the Azeri Ministry of Emergencies on radiological safety.
The two governments also committed to joint activity on international transportation of cargo and environmental protection. An agreement on training diplomats between the foreign ministries and a declaration of the two presidents were inked as well.
The two leaders discussed joint implementation of prospective economic projects and ways of expanding relations in the energy, transport and trade sectors.
The two countries praised the dynamics ot bilateral trade relations in recent years. The commodities turnover grew 37% last year and almost 30% this year. The trade turnover amounted to $260m in 2005, of which $223m was made up by imports of Ukrainian goods.
The Ukrainian president said the two countries maintain mutually beneficial strategic partnership. "I am confident that my visit will further strengthen our ties," he said.
President Ilham Aliyev, in turn, said bilateral relations reached a high level in the political, economic, cultural and other fields after the two countries gained independence.
Aliyev and Yushchenko passed a decision to establish the Presidential Council. As part of the advisory body, a strategic plan on cooperation will be developed.
The Ukrainian leader said the document will outline the most important issues concerning bilateral ties. The two countries' relevant ministries and government agencies have been instructed to tackle the activities.
Aliyev regarded the document as "a rare format for coordinating control over the relations and decisions passed", which will be regularly exercised by the Presidential Council.
PRESIDENT SUPPORTS OIL COOPERATION WITH AZERBAIJAN
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October 2006,
Issue No. 42
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ANNUAL FILM FESTIVAL STARTS IN BAKU
AssA-Irada, September 4, 2006
The eighth annual East-West International Film Festival started in Baku on Monday.
Movies shot in the CIS and Baltic states as well as other countries in 2005-2006 and films that won different international contests were shown free of charge in cinemas of the capital and the Ibrus Theater during the six-day event, the Union of Cinematographers said.
Three Azerbaijani documentaries and several feature films were shown during the festival.
Cinematographers from more than 10 countries have arrived in Baku to attend the event at the Heydar Aliyev Palace. The Azerbaijani film "Good bye, southern city" directed by Oleg Safaraliyev was screened on the first day of the event.
The closing ceremony of the festival took place at the Azerbaijan Cinema on Saturday.
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