MOL, Slovnaft complain to EC about Janaf imposing new conditions for oil supplies - reports
MOSCOW. Nov 21 (Interfax) - Hungarian oil company MOL and its Slovak refiner Slovnaft on Thursday sent a letter to the European Commission's Directorate-General for Competition expressing concerns about the actions of Croatian pipeline operator Janaf, which controls the Adriatic oil pipeline, European media outlets reported.
MOL and Slovnaft claimed Janaf notified them that they will receive oil that is already purchased and scheduled for delivery only if they agree to buy additional amounts to inject into Janaf's system as technical reserves, Croatian website HVG reported.
MOL and Slovnaft said such terms are not stipulated in their contract and may directly contradict the document.
They said Janaf was recently unable to deliver ordered amounts on time and also indicated that similar conditions will be applied to future supplies. MOL and Slovnaft fear that Janaf is using its infrastructure position to unilaterally make changes to the contract regulating access to transportation of non-Russian oil.
In addition to known problems with throughput capacity and prices for transportation along the Adriatic pipeline, this recent development again casts a shadow of uncertainty and calls into question the reliability of the southern pipeline system, Serbian publication NIN reported MOL as arguing. This is very important for the feasibility of the European Union's proposed gradual phase-out of Russian oil, it said.
However, the companies said they believe it is possible to return business relations with Janaf to a path of professional cooperation, transparency and fair market conditions.
At the end of October, Janaf urged MOL in a statement on its website "to increase the operational use of the pipeline capacities, as current utilization by the MOL Group is significantly below the contracted level and standard business practice in the pipeline oil transport industry."
Janaf management board member Vladislav Veselica told TV channel N1 that the company has to apply huge efforts to supply oil to MOL refineries. A contract for 2.1 million tonnes was signed for this year, but they are not even close to meeting the promised amounts, he said. The contract provides for fines against MOL in the event of a large amount of unused capacity due to insufficient deliveries, but in reality this is very difficult; they were supposed to take two tankers per month, but they do not have them, Veselica said.
