Czech Republic secures stake in strategic crude pipeline

By bne IntelliNews November 21, 2012

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As expected, Czech state-owned oil pipeline operator Mero announced on November 20 that it has secured a stake in the strategic TAL crude oil pipeline, offering it priority access to the route - the country's only alternative to Russian imports.

Mero had signaled last week that it would announce a "foreign acquisition" on November 20. In a statement on its website, the pipeline operator said it has agreed to buy a 5% stake in TAL from the German unit of Royal Dutch Shell. The value of the deal was not announced.

TAL supplies Europe with oil from Azerbaijan, Kazakhstan and Iran via Italy's port of Trieste. The IKL spur feeds the Czech Republic's two refineries, but one of those facilities was shut down in late October as supplies through TAL were cut due to a lack of capacity.

That only flagged up the country's precarious energy security, and appears to have sent Mero into overdrive in a bid to secure the stake. It claims to have been trying for years. The company also owns and operates the Czech section of Russia's Druzhba pipeline. Traditionally responsible for shipping in around 80% of demand, supplies have dwindled this year as producers employ new alternative routes and push the Czechs on price.

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