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Transneft says US sanctions won’t harm pipeline business

Published by , Senior Editor
World Pipelines,

New US sanctions imposed on Russia will do no harm to Russia's pipeline monopoly Transneft, Transneft CEO Nikolai Tokarev said yesterday, echoing a similar optimistic statement by the head of Russia's largest oil firm Rosneft.

US President Donald Trump grudgingly signed into law new sanctions against Russia on Wednesday, a move Moscow said amounted to a full-scale trade war and an end to hopes for better ties with the Trump administration.

"This will not affect us in any way. We have already considered and studied all this," Tokarev told reporters, commenting on the US sanctions law. "I believe these sanctions will not acquire a painful and sensitive form to hurt us."

About 94% of the equipment used by Transneft is produced in Russia, while some electronic equipment that the company need it buys in the Asia Pacific region, Tokarev said.

"Furthermore, we do not attract external financing, we take no loans, we have enough of our own funds."

Igor Sechin, Chief Executive Officer of Russia's largest oil producer Rosneft, also played down on Thursday the impact of the US sanctions, saying they would rather have negative consequences for the US and backfire on US energy majors.

On 2 August, Trump signed the bill envisioning tougher sanctions against Russia, Iran and North Korea. Trump later said the law was flawed and some of its provisions stood at variance with the US Constitution.

“The sanctions are beginning to backfire on those who are introducing them, which is positive,” said Igor Sechin, Chief Executive of Rosneft, Russia’s largest oil producer. “[Sanctions] are starting to work against our American partners,” he said, adding that Rosneft is in a position to take advantage. 

The sanctions bill, which had the overwhelming support of Congress before it reached Trump’s desk, in particular bans the providing of “goods, services, technology, information or support” to both the construction and the “modernisation or repair” of Russian energy export pipelines.

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