Kazakh parliament ratifies agreement on Russian oil transit to China
Kazakh Senate (Parliament's upper house) ratified the
intergovernmental agreement with Russia on Russian oil transit to
China, Novosti-Kazakhstan reported on June 26.
The agreement envisages transit through Kazakhstan's territory of 7
million tonnes per year with possible increase to 10 million tonnes
per year for a long-term period.
Russia will have access to the system of main pipelines for oil transporting by Omsk (Russia) - Priirtyshsk (Kazakhstan) - Atasu (Kazakhstan) - Alashankou (China) route.
The cost of transportation of 7 million tonnes of oil per year
will be approved for the entire term of the agreement by
Kazakhstan's authorized state body in USD dollar per tonne on the
basis of the bilateral agreements.
Kazakh side imposes zero VAT rate on Russian oil transit.
In order to ensure supplies to Kazakh refineries, the Kazakh
side is allowed to redirect some volumes of Russian oil to them.
But then it will have to substitute this oil for a Kazakh one.
Kazakhstan produces and exports a large amount of oil, meanwhile it
imports some oil and oil products from Russia free of duty within
the Customs Union.
The need for oil supplies from Russia mainly results from the
specifications of the Kazakh Pavlodar petrochemical plant, which
focuses on refining of West Siberian oil from Russia.
Earlier Kazakh Oil and Gas Minister Uzakbai Karabalin said that
Russia will pay about $9.8 per tonne of transported oil.
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