OMV and Yukos sign 28 million Euro crude deal

Austria's OMV and Russia's Yukos have signed an agreement for the annual supply of five million tonnes of crude oil via a new, 28 million Euro pipeline.

The proposed pipeline, which will supply crude oil to Austria, will be constructed between Bratislava in the Slovak Republic and Schwechat in Austria.

'The signed Memorandum represents a new step on our way of developing the long-term mutually beneficial relationship with OMV,' said RM Mikhail Brudno, acting president of Yukos. 'When implemented, this large-scale project will enable our partners to significantly diversify crude shipments, and will allow Yukos to increase export deliveries to the promising European market.'

'For OMV the Memorandum is of high strategic value as it clearly supports our organic growth strategy,' said OMV CEO Wolfgang Ruttenstorfer. OMV has stated that it wants to double its 2001 market position by 2008 in refining and marketing as well as exploration and production.

The capacity of the pipeline is expected to amount to approximately 3.6 million metric tons per year, increasing to five million metric tons per year through the addition of pumping facilities.

The 60 kilometre long pipeline is scheduled to be commissioned by the end of 2005 with crude oil shipments beginning in January 2006 for an initial period of 10 years.