November 12, 2012 / 5:36 PM / 5 years ago

Czechs close to securing TAL pipeline stake -source

2 Min Read

PRAGUE, Nov 12 (Reuters) - Czech state pipeline operator Mero is likely to take a stake in the TAL pipeline, a government source said on Monday, which could help ensure an alternative source of oil besides Russia, its traditional main supplier.

The Central European nation imports most of its 7 million to 8 million tonnes of crude annually through the Druzhba pipeline from Russia, which has diverted oil away from Druzhba to other destinations including Asia over the past year.

This has increased the importance of TAL for the Czech Republic, which wants to ease its dependence on Russian energy supplies.

Czech operator Mero has sought a stake for years in TAL, which transports crude from the Italian port of Trieste to Germany. From there, the IKL pipeline connects to two principal Czech refineries.

A stake in the TAL pipeline would grant priority access to its capacity, which has lately been constrained and has forced the Czechs to temporarily shut down one refinery due to a lack of crude.

"It seems it will all end up well," a Czech source told Reuters, adding that Mero might make an announcement next week.

Mero in September reached a preliminary deal with Royal Dutch Shell to take over a small stake in TAL, subject to agreement by other shareholders who have right of first refusal to buy any additional shares.

A spokeswoman at Mero declined to comment on the matter.

Officials at the Czech Industry Ministry, which oversees the sector, could not immediately be reached for comment.

The main Czech refiner, Ceska Rafinerska, is 51 percent owned by Unipetrol, controlled by Poland's PKN Orlen . Shell and ENI hold minority stakes in Rafinerska.

A representative for Shell in the Czech Republic could not be reached for comment.

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