Planned to begin operations only late next year, an oil transfer terminal at Moldova's south-most tip has already produced a nasty spat between Kyiv and Chisinau.
The European Bank of Reconstruction and Development (EBRD) is providing a $25.5 million credit for the $38 million project.
Once up and running, the terminal would allow Moldova to transfer petroleum to and from tankers plying the Danube. That means energy independence for the small landlocked country, its leaders say.
'This is just the kind of project we need,' said Moldovan Deputy Premier Ion Gutsu at the EBRD board meeting in Kyiv in May. 'It will create critical infrastructure … and enable our economy to grow.'
But Ukraine, downriver on the other side of the international frontier, sees the terminal in a very different light.
'Our experts recently went to the site and inspected the project,' Odessa Regional Administration spokesman Yuri Shiroparov told the Post. 'And they found many things wrong with it.'
Sited on the Danube's left bank, south of the village of Dzhurdzhulesht and snug up against the Ukrainian border, the terminal will, once operational, transfer 2.1 million tons of oil annually. That would go far toward giving Moldova an alternative to Russian fossil fuels and the political strings Moscow attaches to energy deliveries.
Also far from energy rich, Ukraine has no problem with that. But Kyiv is now arguing that since the terminal would service tankers only a few kilometers upstream of Europe's largest wetland, the project endangers the environment.
'One of the most important problems our experts found is that [the terminal] threatens our ecology and vulnerable wetlands,' Shiroparov said. 'We need to make sure our interests are protected.'
The Danube Commission, a council made up of representatives of countries that the river passes by or through, would be the logical forum to iron out differences of opinion about the environmental impact of development in the Danube basin.
But in the case of the Dzhurdzhulesht Oil Terminal,the Commission has served more as an arena in which opponents trade shots.
The Ukrainians charge that the Moldovans effectively tricked them, bringing to near completion a major industrial node without providing their Ukrainian neighbors information on the project through the Commission or any other source.
In the absence of information from the Moldovan side, an Odessa Region environmental protection team had to inspect the site from across the river, Shiroparov said.
Moldovan project managers counter that Kyiv has had ample opportunity to learn about the Dzhudzhulesht Terminal, since as far back as 1994.
'Ukrainian and Moldovan [members of the Danube Commission] met to discuss the problems of the terminal in Chisinau on Nov. 3, 1994,' wrote terminal Assistant General Director Yakov Mogorian in a recent Zerkalo Nedeli article. 'The results of [an independent Dutch] study were presented in Chisinau on Dec. 9, 1994 … on Nov. 23 the Moldovan side invited [Ukrainian ecological representatives] … but no one came, and no one made any comments.'
The project went through several permutations before finalizing into a Greek-Moldovan-EBRD joint venture. Cash began flowing in late 1996, and by 1997 Dutch general contractor Fredric R. Harris had begun construction.
Having seemingly ignored the possible ecological threat for three years, the sight of cranes in action across the border seems to have finally brought a reaction from Kyiv.
Besides demanding that Harris' blueprints be blessed by its Ministry of Environmental Protection and protesting to the Danube Commission, Ukraine has responded by tightening up border control near its border town of Reni.
Dotted with woodlands, lakes, and swamps, the Danube frontier near Reni and Dzhurdzhulesht used to be a place where hunters could shoot ducks and fishermen hook pike without too much attention paid to passports. Not any more.
'The Ukrainian border troops' defensive works and barbed wire opposite the terminal construction site are more intense than what you would see on the Tajik-Afghan border,' Mogorian said.
Ukraine's objections to an oil terminal a bit upstream the Danube may not be only ecologically based. Blessed with customs officers reputed to be the most vindictive in Europe after Serbia's, Ukraine is one of the most difficult countries in the world through which to ship freight.
When it comes to oil, Ukraine still gets its share of transit business, in great part because Soviet-built pipelines to Siberian and Caspian oil fields terminate in Ukrainian ports such as Odessa and Mariupol.
A Moldovan oil terminal would not only compete for that action, but stand to grab a huge chunk of Ukrainian oil transfer business for the simple reason that Moldovans would likely provide better service than Ukrainians used to operating as oil export monopolists.
'If it wasn't for oil, this argument wouldn't be taking place,' Mogorian said.
