Estonia's VKG declines to produce diesel fuel from shale
TALLINN. July 2 (Interfax/BNS) - The management of the Estonian industrial concern Viru Keemia Grupp, or VKG, has rejected a project for the building of a plant for the processing of shale oil and production of diesel fuel.
The project was too costly, VKG management board member Jaanus Purga said during an interview with the publication Postimees. "The planned investments of around four hundred million euros are great in scale for both VKG and Estonia in general. All the significant financial investments have to be stable over a lengthy period of time," Purga said.
"The shale-processing plant would be a profitable business project, but the credit burden on the enterprise is so great that yet another credit would not be within its power [to take on]," he said.
A concern engaged in extracting shale could not predict the cost of production, since the Estonian government sharply increased the cost of licensing for the use of natural resources at the end of last year, Purga said.
VKG, which includes the shale-oil producer Petroter, plans to build another three such enterprises, along with a plant for secondary oil-processing and fuel-production. In particular, the roughly 60-million-euro Petroter II is slated to commence operations in mid-2014.
Viru Keemia Grupp possesses shale mines, shale-processing facilities, facilities for the production of construction materials and repairing equipment, transportation and energy enterprises.
