Hungarian oil group MOL expects its refineries to be able to process both Russian and non-Russian crudes by the end of 2026, a year later than expected because some adjustment projects were delayed, a top official said. responsible for MOL.
Following Russia’s invasion of Ukraine in 2022, the European Union banned its member states from importing Russian oil, but exempted Hungary, Slovakia and the Czech Republic to allow them to find other routes and other sources of supply.
However, some EU members, including European Commission President Ursula von der Leyen, said Hungary had not done enough to move on from Russian oil and gas.
MOL, whose two refineries in Slovakia and Hungary are supplied with Russian crude by the southern branch of the Druzhba pipeline, has invested in the technology needed to shift away from Ural oil, but progress has been slower than expected.
Viktor Sverla, MOL’s vice president for strategy and sustainability, told Reuters on Thursday that MOL could refine up to 30-40% of non-Russian crude at its refineries in Slovakia and Hungary.
“Investments are underway to increase this percentage to 100% by the end of 2026,” Mr Sverla said.
MOL Executive Chairman Zsolt Hernadi told Reuters in April 2023 that MOL would be able to choose between Russian or non-Russian crude for its refineries by the end of 2025 or the beginning of the year. 2026.
Mr. Sverla said the delays were due to unforeseen complexities in the execution of 24 planned projects to upgrade refineries and the need for additional logistical investments in storage and blending capacities.
He added that MOL could complete the projects over the next two years at a cost of $500 million, the low end of the $500 million to $700 million investment range it gave in 2023.
CONTRACT FOR THE ADRIATIC OIL PIPELINE
Mr Sverla also said MOL was in talks with Croatian pipeline operator Janaf over a long-term contract to transport crude via the Adriatic pipeline, but he declined to comment on planned volumes or to expand on transit costs, which MOL criticized for being too high.
“We are not really happy with the current transit fees and we hope to be able to reduce them in the future, but it is even more important for us to have a long-term contract,” he said.
“However, the Druzhba pipeline is vital for us and our goal is to have a diversified supply of crude oil, using both Russian and non-Russian oil.
Asked about MOL’s preparation for the December 5 expiration of the European Union’s exemption for Slovakia for the export of fuel produced from Russian oil, Sverla said MOL could increase its share of non-Russian crude in its Slovak refinery.
