Supreme Court of Latvia rescinds arrest of disputed oil in Polotsk-Ventspils pipeline

MINSK, 10 August (BelTA) - The Supreme Court of Latvia rescinded the ruling to arrest the disputed process oil from the Latvian part of the oil pipeline Polotsk-Ventspils on 10 August, representatives of OAO Polotsktransneft Druzhba told BelTA BelTA has been told no protective measures regarding the process oil are in effect now. OAO Polotsktransneft Druzhba and OOO LatRosTrans are at odds over the ownership of the process oil in two oil pipelines in Latvia, namely Polotsk-Ventspils and Polotsk- Birzai-Mazeikiai. On 9 December 2011 the Latgalian district court failed to recognize the Belarusian company’s ownership of 110,000 tonnes of the process oil in the oil pipelines located in Latvia. The court also ruled against the recovery of damages caused by OOO LatRosTrans draining 40,000 tonnes of the process oil from the Polotsk-Ventspils pipeline. The ruling did not come into effect because the Belarusian company appealed against it by lodging a petition of appeal with the Civil Affairs Chamber of the Supreme Court of Latvia. In turn, after considering a private complaint of the Latvian company the Supreme Court rescinded the prohibition to displace oil but left the oil arrest in place. On 10 August the Court ruled to rescind the arrest as well. The essence of the case Polotsktransneft Druzhba vs. LatRosTrans was considered in November 2011 after repeated delays, including due to cross-claims of the Latvian-Russian company. The legal proceedings were initiated in December 2010. On 16 November 2010 LatRosTrans released an official statement about its plans to start displacing the process oil from the Polotsk-Ventspils pipeline. The company claimed the ownership of the oil and legal rights to extract it from the pipeline. The same day LatRosTrans unilaterally rescinded the lease agreement of the office the company Druzhba (Polotsktransneft Druzhba at present) rented in Latvia and blocked the access to the Ventspils crude oil delivery and acceptance point. LatRosTrans started draining oil on 25 November. Evaluating actions of the Belarusian-Latvian company LatRosTrans, representatives of the Belarusian state petrochemical concern Belneftekhim said that the concern had documents to prove the Belarusian company’s ownership of the process oil. The documents have been signed, among others, by the Latvian side. The concern does not see any legal grounds to disclaim this right. Apart from that, specialists of the concern believe that LatRosTrans’ plans to replace the oil with a gas mixture will make pumping oil via the Polotsk-Ventspils pipeline impossible. In December 2010 the Daugavpils court accepted the notice of claim from the Druzhba company and arrested the process oil. LatRosTrans was forbidden to displace or move the process oil. Polotsktransneft Druzhba is the legal successor of the Novopolotsk-based oil transportation company Druzhba. Druzhba was converted into Polotsktransneft Druzhba in late 2010. The company specializes in transporting Russian oil from West Siberia, Tatarstan and the Volga region to Belarus (Naftan Oil Refinery). The pipelines the company operates also allow transiting oil to the Baltic states. The LatRosTrans company is a Latvian-Russian joint venture, in which Ventspils Nafta holds 66% of the shares and AK Transnefteprodukt owns 34% of the authorized fund. The company operates oil mains in Latvia. The oil mains are over 700 km long.

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