Kyiv, 15 September 2005

The proceedings of the Working Group were attended by Ukraine, Poland, Kazakhstan, the Czech Republic, Slovakia and the European Commission. United Kingdom, as EU presidency welcomed the participants.

The meeting of the Joint Experts Working Group exchanged views and analysis on the current situation of the international oil market and took notice of the fundamental changes which have recently taken place in them and their significance in the prospects for the commercial operation of the Odessa-Brody-Plock oil corridor.

The Working Group was informed about the agreements signed by Kazakhstan last week in Kyiv in order to maximise the throughput of Kazakh-origin oil through Ukraine. The Working Group welcomed the participation of Kazakhstan in the Working Group as the coordinator of the private oil supplies from this country.

Moreover, the Working Group took note of the on-going discussions with Azerbaijan in order to add its oil resources to the list of potential suppliers of Caspian oil to the Odessa-Brody-Plock pipeline.

The European Commission notified the Working Group about the deployment of a team of international experts for finalising the technical, economical and legal studies required for the construction of the Odessa-Brody-Plock pipeline. The team presented its detailed work plan up-to the end of 2005, by when the framework of the business plan allowing initial construction plan of the pipeline will be submitted.

In the immediate future, the team of experts will work together with Ukrainian, Slovak and Czech companies to put in place the technical conditions necessary for the transit of light sweet oil from Brody to the Central European market. The working Group took notice that these conditions will be in place before the end of 2005.

Background: In May 2003 the Joint Declaration of the Cabinet of Ministers of Ukraine, the Council of Ministers of the Republic of Poland and the European Commission on support of the Euro-Asian Oil Transport Corridor Project” was signed. This declaration established the Trilateral EU-Ukraine-Poland Joint Expert Working Group for the development of the Odessa-Brody-Plock Oil Transportation System. At the Industrial Round-table “Odessa-Gdansk: Northern Dimension for Caspian Oil”, the state oil companies of Poland (PERN “Przyjan” S.A.) and Ukraine (JSC “Ukrtransnafta) agreed to form a Partnership for developing the project concept for the oil pipeline extension between Brody and Plock.

In November 2003 the Intergovernmental Agreement between the Cabinet of Ministers of Ukraine and the Government of Republic of Poland relating to the use of facilities of the Odessa-Brody Hydrocarbon Transportation System and its integration with the Polish facilities was signed by the Ukrainian and Polish Governments and witnessed by the European Commission. Finally, on July 2004, representatives of «Ukrtransnafta» OJSC and PERN “Przyjazn” concluded the registration for the establishment of “International Pipeline Enterprise Sarmatya, LLC”.

On 1 August 2005, the European Commission awarded a two-million euro contract for finalising the technical, economical and legal studies required for the construction of the Odessa-Brody-Plock oil pipeline to a consortium of European companies. This technical assistance will complete the requirements necessary for starting the construction of the oil pipeline.

For further information please contact Anje Schubert, Press Officer, Tel: 253 3020 or anje.schubert@ec.europa.eu