Logo of Phnom Penh Post newspaper Phnom Penh Post - Russian crude oil imports not on refinery’s wishlist

Russian crude oil imports not on refinery’s wishlist

An oil worker inspects a pumping jack during drilling operations in an oilfield operated in the village of Otrada, Russia, earlier this year. Bloomberg
An oil worker inspects a pumping jack during drilling operations in an oilfield operated in the village of Otrada, Russia, earlier this year. Bloomberg

Russian crude oil imports not on refinery’s wishlist

Russia is looking to expand its crude oil exports to ASEAN countries – including Cambodia – despite the Kingdom being years away from having refinery capabilities.

The announcement made by the Russian Energy Minister Alexander Novak during last week’s Russian-ASEAN summit, comes at a time when Western-backed sanctions and a global fall in oil prices have caused the oil and natural gas giant to seek out new markets.

According to the minister, Russia is looking to create an oil swap scheme with numerous untouched markets.

“Today deliveries are being made as part of swap operations to Malaysia and Singapore. In a perspective, we are also considering deliveries to Thailand, the Philippines and Cambodia,” he said, according to Russian media.

The oil swap schemes could be developed in both long-term and short-term contracts.

“We don’t have reasons for waiving supplies in case there is demand and commercial benefit. We’re ready to supply to the countries that need oil and oil products, this direction is interesting to us,” he said.

Hann Kheing, managing director of the Cambodia Petrochemical Company (CPC), which is building Cambodia’s $2.3 billion landmark oil refinery in Kampot province, said it was unlikely that the company would look towards Russian crude when the facility is completed in 2018.

“Our capacity of 5 million tonnes annually will be very little for the Russian market. And even if the crude remains cheap, long distance shipments are not economical. I don’t think we will take Russian oil because the logistics costs are very high,” he said.

He added that smaller shipments from the Middle East or potentially Northern Europe would make more economic sense.

Chea Socheat, director general of the Ministry of Mines and Energy, said CPC needs to carefully study any agreements for crude oil supply.

“It depends on the company’s decision, but they should consider importing crude from global suppliers very carefully to make sure the transportation costs and the quality of the crude is the most economical for the refinery,” he said.

MOST VIEWED

  • New US bill ‘is a violation of Cambodian independence’

    After a US congressmen introduced bipartisan legislation that will enact sanctions on Cambodian officials responsible for “undermining democracy” in the Kingdom, government officials and the ruling Cambodian People’s Party on Sunday said they regarded the potential action as the “violation of independence and sovereignty

  • Angkor Wat named as the top landmark for the second year

    Travel website TripAdvisor has named Cambodia’s ancient wonder Angkor Wat as the top landmark in the world for the second year running in their Travelers’ Choice Award 2018, an achievement Cambodian tourism operators expect will attract more tourists to the Kingdom. The website uses traveller

  • Ministry’s plan for net sparks fears

    The government has ordered all domestic and international internet traffic in the Kingdom to pass through a Data Management Centre (DMC) that has been newly created by the state-owned Telecom Cambodia, in a move some have claimed is an attempt to censor government critics. Spokesman

  • Hun Sen detractors ‘will die’

    Prime Minister Hun Sen on Wednesday said those who curse or insult him would eventually die without a plot of land to bury their bodies after being killed by lightning, suffering the same fate as those who recently died in Thmar Baing district in Koh