ANALYSIS: Moldova, Ukraine squabble over oil transfer terminal (07/19/98)

ANALYSIS

Moldova, Ukraine squabble over oil transfer terminal

by Stefan Korshak
RFE/RL Newsline

KYIV - Plans to build an oil transfer terminal in Moldova are stirring opposition in Ukraine, which is worried about its adverse environmental impact.

The $38 million project is scheduled for completion next year. The European Bank for Reconstruction and Development (EBRD) is providing a $25.5 million credit for the construction of the terminal, which will allow Moldova to transfer petroleum to and from tankers plying the Danube, bringing considerable savings for the small landlocked country.

"This is just the kind of project we need," noted Moldova Deputy Premier Minister Ion Gutsu at a recent EBRD conference. "It will create critical infrastructure ... and enable our economy to grow."

Ukraine sees the terminal in a very different light. "Our experts recently went to the site and inspected the project," said Odesa Regional Administration spokesman Yuri Shiroparov, "and they found many things wrong with it."

Situated on the Danube's left bank, south of the village of Dzhurdzhulesht and snug up against the Ukrainian border, the terminal could transfer 2.1 million tons of oil annually, giving Moldova an alternative to Russian energy deliveries.

Ukraine has no problem with that. However, Kyiv is arguing that because the terminal is only a few kilometers upstream in the middle of Europe's largest wetland, the project endangers the environment. "One of the most important problems our experts found is that [the terminal] threatens our ecology and vulnerable wetlands," Mr. Shiroparov said. "We need to make sure that our interests are protected."

The Danube Commission, composed of representatives from countries bordering the river, could have been a forum to iron out differences about the environmental impact of development in the basin. This proved, not to be the case, however.

The Ukrainians charge that the Moldovans may have misled them and brought to near completion a major industrial project without providing full information on the scope of the work.

Moldovan project managers counter that Kyiv has had ample opportunities to learn about the Dzhurdzhulesht Terminal, as far back as 1994.

"Ukrainian and Moldovan commissioners met in Chisinau on November 3, 1994, to discuss the problems of the terminal," said Deputy General Director of the Terminal Yakov Mogorian, in a recent newspaper article. "Results of [an independent Dutch] study were presented in Chisinau on December 9, 1994...[and] on November 23, The Moldovan side invited [Ukrainian ecological representatives] ... but no one came and no one made any comments."

There were several permutations of the project before it was finalized into a Greek/Moldovan/EBRD joint venture. The first funds were obtained in late 1996, and by 1997 Dutch general contractor Fredric R. Harris had begun construction.

Kyiv now demands that Harris's blueprints be approved by its Ministry of Environmental Protection. Protests have been made to the Danube Commission and, more recently, Ukraine has tightened border control near the frontier town of Reni. Dotted with woodlands, lakes and swamps, the Danube frontier near Reni and Dzhurdzhulesht once was a place where hunters could shoot ducks and fishermen could hook pike without much attention to passports. This is no longer the case.

"The Ukrainian border troops' defensive works and barbed wire opposite the terminal construction site are more intense than what you would see on the Tajik-Afghan border," said Mr. Mogorian.

There is little prospect that the dispute will end any time soon.

Stefan Korshak is an RFE/RL correspondent based in Kyiv.