The FINANCIAL — Wissol Petroleum Georgia and Lukoil Georgia, two leading rival oil importers believe that the war will end soon and it will not affect their oil reserves, vitally important for the tiny country of Georgia.
“Our reserves are enough to supply the whole of Georgia for two month, even without receiving any further petrol,” Samson Pkhakadze, Chairman of the Wissol Board of Directors told The FINANCIAL. He said the company has already received a 2,000 tonne ship loaded with bitumen. “This product will be used for the highway which was spoiled by Russian tanks.” War still remains the main reason for reduced sales indexes,” Lukoil reported.
Wissol and Lukoil decreased gasoline prices by 5 tetri on August 15, 2008. According to Samson Pkhakadze, Chairman of the Wissol Board of Directors, it is a gesture of solidarity expressed by the company in response to the war situation in Georgia.
According to Lukoil, the company has been offering oil products at the following price range since August 15, the company offers the same products at the following prices: Super – GEL Per litre 2.15, Premium – GEL Per litre 2.05, Euro Regular – GEL Per litre 1.80, Euro Diesel – GEL Per litre 2.25. Euro Regular and Euro Diesel are excluded from sales.
According to Wissol Petroleum Georgia, the company has been offering the following products for the following prices since August 15, 2008: Super Manpower – GEL Per litre (VAT included) 2.15, Premium Power – GEL Per litre (VAT included) 2.05, Euro Regular – GEL Per litre (VAT included) 1.95, Euro Diesel – GEL Per litre (VAT included) 2.25. Econom Pack: Diesel Standard – GEL Per litre (VAT included) 2.0 and Regular Standard – GEL 1.85.
Pkhakadze noted that the decrease of the price is not a temporary condition and the company would like to keep prices at that level from now on.
“The price of fuel decreased by 5 tetri in previous days in Georgia. It can only be recognized as a loyal step from oil companies, as we are absolutely dependent on international fuel prices. This effect should spread to not only European fuel but Azeri and Turkish ones too,” Levan Gogichadze, Head of Marketing and PR of Lukoil, declared to The FINANCIAL.
“This is a big enough oil terminal with significant fuel reserves. This terminal gives us the possibility to work with interruption in western Georgia, so all our petrol stations are provided with petrol. Tbilisi and eastern Georgia are provided by the terminal which is situated in Tbilisi. Herewith I want to mention that we were working with our suppliers and Wissol is waiting for additional fuel from Europe,” Pkhakadze said.
“Lukoil’s aim is to provide Georgia with premium class fuel, despite the fact that now the situation is rather complicated as a result of the explosion of the Gori-Tbilisi railroad; the main highway and Poti Port are also blocked. Lukoil hopes that this situation will soon stabilize and the company will not have to find alternative ways for importing oil and fuel,” Gogichadze said.
According to Pkhakadze, the company had some problems connected to import, as no European ships wanted to enter Georgian ports.
“There exists no international insurance company in the world which would insure the ships, as Georgia is now a region of conflict. But fortunately this condition has lightened slightly, as on August 20 Wissol found a company ready to insure loaded ships in Georgia. This additional ship will be in Georgia by the beginning of September and its fuel will add to our reserves,” Pkhakadze added.
“Georgia will not remain dependant on second class fuel. As a rule petrol imported from Azerbaijan and Turkey accounts for more than 50%, so greater changes are not expected in this direction. According to our information, mostly the Georgian population uses second class fuel,” Gogichadze said.
“The current situation raised panic amongst the population, so in the first days the company had enormous sales indexes as of today the sales index have reduced. I state that Wissol reserves are enough for the whole of Georgia for two months, even if we do not receive any extra petrol and even in if people start purchasing petrol at a hysterically high rate as was the case in the first few days of the war,” Pkhakadze declared.
“Lukoil has enough fuel reserves in the retail net. According to last week’s indexes sales indicators were reduced. War still remains the main reason for reduced sales indexes. Lukoil had a standard order of fuel which we were always demanding from providers, but this order has stopped for a while,” Gogichadze said.
Lukoil is rather connected to Russia, but in Gogichadze’s words the company simply represents an international oil company in Georgia which is making commercial business in the country.
According to Phakadze’s statement, Wissol has already received a 2,000 tonne ship loaded with bitumen.
“This product will be used for the highway which was spoiled by Russian tanks. We had a petrol station in Kurta which is situated in the conflict region, according to our information the station is rather damaged. It is not a huge problem as the main thing is to return this village to being under Georgian control, as for me, I promise you that additional stations will be built there by Wissol in the future,” Pkhakadze noted.
“In case the situation gets even more strained in Georgia, Lukoil will think about its staff and their safety first and foremost. Our aim is to defend our population’s interests. We hope the situation will soon be corrected and we will not have to take any radical decisions,” Gogichadze explained.
The Georgian conflict seems to be continuing at this time, but with no direct impact on the Baku-Tbilisi-Ceyhan (BTC) pipeline, which is not far from the fighting.
Crucially, it is the only practical route from this increasingly important producer region that avoids both Russia and Iran.
The 1,770 km (1,100 mile) Baku-Tbilisi-Ceyhan pipeline, which entered service only last year, pumps up to 1 million barrels of oil per day from Baku in Azerbaijan to Yumurtalik, Turkey, where it is loaded on to supertankers for delivery to Europe and the US. Around 249 km of the route passes through Georgia, with parts running only 55 km from South Ossetia.
“BTC pipeline security is ensured by the state pipeline protection department of the Ministry of Internal Affairs. BP is the first pipeline to carry large volumes of crude out of the Caspian without going through Russia. Russian war planes dropped bombs near the pipeline, but there have no losses or damage to the BTC pipeline have been incurred,” Rusudan Medzmariashvili, CSR Team Leader of BP, declared to The FINANCIAL.
“BTC pipeline operations are shut down due to the fire that occurred on one of the block valves on 6 August on the territory of Turkey. Testing of the line has already started before we move to full operations. The Baku-Supsa oil pipeline has been shut down as a precautionary measure. The South Caucasus Gas pipeline is operating,” Medzmariashvili added.
Written by Natia Taktakishvili
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