Russia starts paying Belarus compensation for dirty oil

MOSCOW: Belarus has started to receive compensation from Russia over the contaminated oil crisis in 2019 and expects to receive $60 million in total, state energy company Belneftekhim said on Friday.

The payment is a further show of support from Russian President Vladimir Putin to Belarusian leader Alexander Lukashenko, whose win in August's presidential election is being challenged by street protesters.

The compensation for the dirty oil, which showed up in the Druzhba pipeline in April 2019 and rattled European oil markets, comes on top of other recent agreements between Moscow and Minsk, including on oil and gas supplies.

Belneftekhim said the Mozyr oil refinery had received the first tranche of payments, 1.045 million roubles ($13,969), from Russian oil producer Lukoil on Jan. 21.

The total payment will equate to roughly $15 per barrel, the highest possible level of compensation promised by the Russian oil pipeline monopoly Transneft.

Russia has already paid some compensation to companies from Kazakhstan, as well as to French energy giant Total and Hungary's MOL.

Last month Transneft said it expected to complete the compensation payments by around the middle of the year and that it had already paid out more than $143 million, more than half of the amount due.