Barwil General Presentation

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Murmansk Presentation by Henrik Falck Barwil
Russia, 2004.
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Russia USA map
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Russia River System
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Russia Barents Sea
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Why Murmansk ?

• Only 20/30 of Russian export is done through
  Russian ports today. President Putin wants this
  percentage to increase to 50. A decision which
  is strategically understandable.
• Rail tariffs (will revert later).
• Baltic has ice problems as well as problems with
  Finland and Denmark.
• Black Sea has problems with bad weather and
  Bosporus.
• Kaliningrad has problems with transit through
  neighboring country (Lithuania) and low draft.

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Rail Tariffs (all figures provided using RZD
rail-cars park)

• Samara to Ventspils (Latvia)
• Samara to Kaliningrad (Russia)
• Samara to Tallinn (Estonia)
• Samara to St. Petersburg (Russia)
• Samara to Odessa (Ukraine)
• Samara to Novorossiysk (Russia)
• Samara to Archangelsk/Vitino/Murmansk

USD 78 pmt USD 25 USD 82 (for fuel) USD 29 (for
fuel) USD 52 USD 28 USD 33/40/41
- Representative Loading Place - (Bezenchuk)
THUS INTERNAL TRANSPORTATION STRONGLY FAVOURS
RUSSIAN PORTS
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Port of Murmansk
It is a dirty mix of people who deals in the port
today

• Military
• Security Services
• Fish Ministry
• etc.

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Port of Murmansk Sources of supply

• Rail from middle of Russia via
• fish port to floating storage
• Feeder ex Vitino
• Feeder ex Archangelsk
• Rail (pipeline?) from
• Vankor (2007)
• Feeder ex Dikson (2006)
• Feeder ex Prirazlomnoye
• River vessels (not applicable).

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Archangelsk

• Large oil terminal operated by Rosneft
• Two feeders operated by Femco (Rosneft) of 15 000
  dwt
• One feeder able to lift 800 000 mt per year
• 5 feeders necessary to lift expected volume for
  Belokamenka.

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Vitino
Crude and products arriving by rail and loaded
into storage tanks. Then 20 000 dwt to
Murmansk or 40 000 dwt to the World market.
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River Shipment
Insignificant volumes, basically no action this
year.
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Dikson
Expected start in 2006
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Prirazlomnoye
Shuttle expected to start in 2006 with 20 or 70
000 dwt vessels???
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Port of Murmansk Future Volumes
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Summary

• I have given you a quick lesson in Russian
  geography.
• I have explained why Murmansk is an interesting
  place with great
• future potential for oil export.
• I have shown you the sources of supply.
• and I have shown you the expected future volumes
• NOW, LET US HAVE A LOOK AT THE PORT ITSELF.

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Belokamenka
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Other Floating Storages

• RPK 1 is a 130 000 dwt serving mainly Aframax
  vessels for
• transshipment. Operated by Murmansk Shipping
  Company.
• Main supplier is Yukos.
• RPK 2 is a 130 000 dwt which was removed in
  March 2004.
• Operated by White Sea Complex (Vitino) .
  Uncertain if it will be replaced.

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Fish Port
Crude and products arriving by rail to the fish
port where 6.8 m draft. Loading from rail to
vessel. Then transshipped with Murmansk
Shipping Company vessels of 5 10 000 dwt to
the floating storages. Then shipped in Aframax
/ Suezmax to World market.
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Mokhnatkina Pakhta Terminal

• Operated by Progetra
• Floating storage moored alongside existing berth
• (transshipment from rail to vessel)
• Terminal able to handle Aframax as well as 40-50
  000 dwt vessels
• Expected volumes 25 million mt. However rail
  congestion
• is expected as the rail line leading up to
  Murmansk
• will need major reconstruction/expansion to
  handle
• such larges volumes. Realistic volumes next year
  is 6/7 million mt
• of products.

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Future
Pipeline to Murmansk? today the answer is
no tomorrow who knows? A volume of 100 million
MT is needed to make such a pipeline viable
commercially.
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Murmansk Place in North West Europe
I have previously explained the importance of
internal Russian transport and the huge
advantages of finding Russian outlets/ports. I
have also touched upon the advantage/disadvantage
with other Russian outlets in the Baltic/Black
Sea. Now let us look at Murmansk in a European
and US perspective Sailing distances Murmansk
to Rotterdam 1625 nautical miles or 5 days
sailing Primorsk to Rotterdam 1247 nautical
miles or 4 days sailing (ice problems) Murmansk
to Philladelphia 4238 nautical miles or 13.6
days sailing Primorsk to Philladelphia 4442
nautical miles or 14.2 days sailing (ice
problems) Rotterdam to Philladelphia 3552
nautical miles or 11.3 days sailing. In this
perspective one can clearly see that Murmansk is
not so hopelessly located as it appears by
looking at the map.
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Conclusion

• It is premature to estimate the real future
  volumes from this area
• We can conclude that they will be substantial
  and an estimate of
• 20 million mt per year in the nearest future
  could be realistic.
• This represents about 130 Suezmaxes per year or
  one every third day
• A pipeline will dramatically increase the
  volumes
• Barwil intend to play an active role in this
  development and are
• scheduled to start our operation in Murmansk
  and Archangelsk
• within 1st quarter of 2005
• Thank you for your attention.