Chancellor Olaf Scholz’s visit to Kazakhstan has secured extended oil supplies for a key German refinery. The deal aims to ensure energy security and stabilize operations at PCK Schwedt and other refineries.
Extended supply agreement
During Chancellor Olaf Scholz’s visit to Kazakhstan, Rosneft Deutschland signed a follow-up contract to secure longer-term and increased crude oil supplies for the PCK refinery in Schwedt, Brandenburg. The German Federal Ministry of Economic Affairs confirmed this development, stating that the goal is “to ensure security of supply and reliably secure the business operations of Rosneft Deutschland and PCK Schwedt, as well as the Miro and Bayernoil refineries in the long term.”
According to government sources, Kazakhstan supplied approximately one million tons of crude oil to PCK last year. For the current year, 1.4 million tons have been agreed upon. A government spokesperson revealed that the newly signed contracts during Scholz’s visit provide for supply beyond 2024, although specific quantities were not disclosed. It’s important to note that the contracting parties are the company owners, not the federal government.
Christian Görke, a member of the German Bundestag from the Left Party, claimed based on his sources that the contract was only extended by one year with a minimal increase in quantity. He pointed out that Kazakhstan had offered to supply two million tons of crude oil annually. “Why the federal government did not accept the Kazakh offer remains their secret,” Görke commented.
Ownership changes and EU aid
The majority stake (54%) in PCK is held by two German subsidiaries of the Russian state-owned company Rosneft. These subsidiaries have been under the trusteeship of the German government since September 2022. Chancellor Scholz confirmed over the weekend that sales negotiations regarding the Rosneft subsidiaries are ongoing and expected to conclude by the end of the year. According to insiders, Qatar is one of the potential buyers.
The planned change in ownership could influence whether the EU Commission approves a proposed federal aid package for expanding a pipeline from the port of Rostock to Schwedt. Michael Kellner, the responsible State Secretary, said, “The Commission has made a preliminary state aid assessment. Accordingly, the federal government’s funding for the upgrade (of the pipeline) of up to 400 million euros can be justified in principle, among other things, if the Russian Rosneft is no longer an indirect owner.”
PCK supplies large parts of northeastern Germany with heating oil, gasoline, diesel, and other essential products. Since Germany’s move away from Russian oil in 2023, the facility has switched to alternative supply sources. Both the supply contract with Kazakhstan and the Rostock pipeline are intended to contribute to keeping the refinery at capacity and economically viable.
