Germany: Padlock on Russian oil refinery in Svend?

There has been a lot of talk lately about the Svend refinery in the town of the same name, located on the Odira River and bordering Poland. In an interview with ZDF’s second television network, Chancellor Olaf Solz expressed particular concern about the closure, in the context of sanctions proposed by the European Commission. Why; Let’s start from the beginning. The refinery, 100 km away from Berlin, is accustomed to “storms”. It was normally supplied with oil from 1962, via pipelines from the Soviet Union, until 1990. But what would happen next? Nobody knew. However, he managed to survive thanks to the support of Helmut Kohl.

Panic in residents

But financial problems that followed raised the unemployment rate in Svend around 25% and caused serious social unrest. Many residents fear the same thing could happen again if the refinery is sacrificed on the altar of the Russian oil embargo being prepared by EU member states as part of the 6th round of sanctions. Locals say that “when the refinery, Svend’s biggest employer, coughs, the whole city catches the flu.” Now that the European Commission is proposing a gradual embargo on Russian oil, its days seem numbered. “I know some of my friends who work there and they are afraid of losing their jobs, I can hope that the energy policy makers in Berlin will not make hasty decisions that will hurt us here,” a young woman told Deutsche Welle. “Closing the refinery would not only be horrible news for the workers there, but for the whole city,” adds the owner of a small downtown food business. “We are talking about thousands of employees and suppliers, many of whom are regular customers.”

Germany managed to reduce the rate of oil imports from Russia from 35% before the start of the war in Ukraine to 12% so far. The refinery is the only “customer” of Russian oil in Germany. Energy experts say that cutting off Svend’s supply of Russian oil should not necessarily mean a lockout. But how could this be done? Taking oil from tankers through the port in Rostock in the Baltic and covering up to 60% of its needs through the Polish port in Gdansk. These supplies could include slightly different grades of oil, which would require some technical adjustments to the refinery. Stephen Buckold, of EnergyComment’s research and consulting firm, told DW that it was curious that when it came to possible refinements at the refinery, some referred solely to oil qualities that were not suitable for the refinery, such as oil from Venezuela or Venezuela. Saudi Arabia. “This is what politicians are saying and they are trying to make us believe it,” said one woman, who asked not to be named. refinery functionality.

At some point the end will come

This in turn could have a devastating effect on fuel supplies in some German L .nder. Currently 9 out of 10 cars in Berlin, Brandenburg and Mecklenburg-Pomerania run on diesel from Svend. Even the new airport in the German capital is supplied with kerosene from the same refinery. Supplying oil from countries other than Russia would most likely lead to higher fuel prices at petrol stations. “Energy market prices are likely to rise for oil-dependent products, but we are not talking about 30% or even 50%, but much less,” said Buckold. There is, of course, another hurdle that needs to be overcome before the refinery can consider operating without Russian oil, as it is largely owned by Russian-owned company Rosneft and would be unlikely to agree to continue operating with oil from other countries. That is why the German government is unlikely to avoid bringing Svend under state control.

The government recently passed a law that greatly facilitates such a process for structures that are considered critical to energy supply. However, none of the Svend residents interviewed by DW were in favor of a change of ownership. “Two mistakes do not make one right.” said the owner of the grocery store, referring to the war in Ukraine and the expropriation of the refinery. “I would not like the idea of ​​someone coming and simply seizing my property,” he says characteristically. As things stand, Svend will have to live for a long time in a period of uncertainty. As the mayor of the city Anekatrin Hope said “at the moment there are more questions than answers”. Stephen Buckold, however, points to the short-term and long-term prospects. “I do not think the refinery is on the verge of closing with all the alternatives, now that the EU is proposing a gradual oil embargo,” he said. “But in general, however, the fossil fuel refineries will have to close at some point if we are to be serious about our climate protection goals.”

Hardy Grupner

Edited by: Irini Anastassopoulou

Source: Deutsche Welle