Russian senators ratify agreement on petroleum products pipeline construction in Congo
MOSCOW. June 4 (Interfax) - The Federation Council ratified a cooperation agreement with the Congo on constructing the Pointe-Noire - Loutete - Maloukou - Trechot petroleum product pipeline in the African country during its Wednesday session.
The agreement was signed in Moscow on September 28, 2024, and provides for the creation of favorable conditions for implementing construction.
According to the document, the authorized organizations responsible for implementing the project are Zakneftegazstroy-Prometey LLC and the National Petroleum Company of the Congo (acting as the customer). They will create a joint venture, in which Russia will hold a 90% stake and the Congo 10%.
The agreement aims to create a sanctions-proof channel for the supply of petroleum products while establishing Russia as the region's strategic energy security partner, Russian Deputy Energy Minister Dmitry Islamov said.
"The implementation of the agreement will enable the Congo to ensure uninterrupted and stable supplies of petroleum products to the capital region, reduce logistics costs, gain the status of a key player in ensuring the region's energy security - including the Democratic Republic of the Congo and the Central African Republic - and create additional jobs," Islamov said while presenting the bill to the State Duma.
"For Russia, this means expanding high-tech exports, creating an additional sanctions-resistant petroleum products distribution channel, and securing status as the region's strategic energy security partner," he said.
To implement the project, a concession agreement will be concluded in the form of build-own-operate-transfer (BOOT) with the joint venture for constructing and operating the pipeline for 25 years, with a guaranteed tariff for pumping, which will ensure the pipeline's utilization and return on investment.
It is planned that the petroleum product pipeline will be built within three years, and the overall operation of the pipeline is expected to last 30-40 years, Islamov said.
The agreement also "enshrines a number of obligations of the country, including providing the Russian side with the necessary permits and approvals, and granting the most preferential tax and customs regimes," Islamov said.
"The responsibility of the Russian authorized organization is to attract commercial financing, so no additional expenditures from federal or local budgets will be required," he said.
Previously, Russian Ambassador to the Congo Georgy Chepik said that the main pipeline would run between the largest cities of the African country - Pointe-Noire and the capital Brazzaville.
The agreement stipulates that dispute resolution at the discretion of the Russian side will take place in Dubai (UAE) - either through the Dubai International Arbitration Centre (UAE) or in an ad hoc arbitration court administered by the mentioned arbitration center.
According to the Unified State Register of Legal Entities, the owner of Zakneftegazstroy-Prometey is Alexander Ilyin.
