Distribution channel problems could affect Estonia's new oil plant
The Enefit 280‑2 oil plant in Auvere — Estonia's third — cost nearly 400 million euros to build, and production is expected to begin this April. However, supply‑chain issues have become a problem for selling the output.
Enefit 280‑2 is Eesti Energia's third and most modern oil plant, built at a cost of nearly 400 million euros.
Test runs at Auvere in Ida‑Virumaa county began last December, and the facility is now ready for commissioning. Oil production will begin at the end of April.
According to Lauri Karp, a member of Eesti Energia's management board, the plant is currently completing the final cold‑ and hot‑start procedures and undergoing certification. Once this is finished, the plant will be brought online.
In the oil industry, production is usually sold 12 months in advance. The output of the new plant will be put on the market once the start‑up challenges have been overcome.
"If this oil plant reaches full capacity at the end of August, then of course planning sales becomes much more secure," Karp said.
The price of shale oil is directly linked to the price of crude oil, and Karp describes the current price level as moderately good, since oil producers are used to large fluctuations. The real problem has turned out to be selling the finished product.
"The world's oil production and transportation supply chains are broken. This does not automatically mean that oil can be easily sold everywhere. We also have to work hard to ensure that certain fractions find buyers," Karp said.
Once operating at full capacity, the plant — with its 150 employees — could produce up to 250,000 metric tons of shale oil per year.
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Editor: Märten Hallismaa, Argo Ideon
