Russia has suspended operations at a fuel export terminal suspected of being hit by a Ukrainian drone

By Andrew Osborne and Maxim Rodionov

(Reuters) – Russian energy company Novatek said on Sunday it had been forced to halt some operations at a Baltic Sea fuel export terminal after a fire that Ukrainian media said was a drone attack.

Located in the Gulf of Finland, 170 km (110 mi) west of St. Petersburg, the giant Ust-Luga complex is used to ship oil and gas products to international markets. It processes standard gas condensate – a type of light oil – light and heavy naphtha, kerosene and diesel for seaborne shipping.

It is unclear how long the disruption will last, how many tankers will be idled outside the port, and what impact it will have on international energy markets.

Interfax-Ukraine news agency, citing unnamed sources, said the fire was the result of a special operation by Ukraine's security forces.

“The Ust-Luga oil terminal in the Leningrad region is an important facility for the enemy. Fuel is refined there and, among other things, supplied to Russian troops,” a source was quoted as saying.

“A successful attack on such a terminal not only causes economic damage to the enemy, deprives the aggressors of the opportunity to earn money to wage war in Ukraine, but also significantly complicates fuel logistics for the Russian military.”

Reuters has not confirmed that the fire was caused by a Ukrainian drone strike.

If it happens, such an attack would demonstrate Kyiv's ability to launch attacks deeper into Russia than usual using what are believed to be homegrown drones at a time when it is on the defensive on the battlefield and struggles to secure Western funding. likes

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Such an attack, the latest in a series of apparent strikes targeting Russian energy facilities in recent days, would raise serious questions about the quality of Russian air defense systems around key infrastructure facilities.

At least 25 people have been killed in what Russia says is a Ukrainian artillery attack on civilians in a Russian-held town in eastern Ukraine, prompting a wider Russian response in a war that shows no sign of ending.

Alexander Drostenko, governor of the Leningrad Region, said on the Telegram messaging app that there were no casualties at the Ust-Luga terminal and that all workers had been evacuated safely.

Russian news agencies said two storage tanks and a water station were damaged, but the fire was brought under control.

Novatek, Russia's largest liquefied natural gas producer, said in a statement that it had halted some operations after the fire, which it said was the result of “external influence”.

“The technical process at Novatek-Ust-Luga has been stopped, and an operational headquarters has been established to eliminate the effects. A damage assessment will be carried out later,” the company said.

Russian news agency Shat reported that local residents heard drones operating nearby following several explosions.

Russia and Ukraine have targeted each other's energy infrastructure with strikes designed to disrupt supply lines and logistics, with each side seeking to undermine the other's morale.

On Friday, a drone strike hit an oil depot in Bryansk, a western Russian region bordering Ukraine, which Moscow blamed on Kyiv. A day after an attack on a Russian Baltic Sea oil terminal, Russian officials said they had failed.

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BASA, a Russian news agency known for its security service connections, posted footage on Telegram on Sunday of what appeared to be an industrial complex with large flames shooting into the sky.

Three international tankers were anchored near the Ust-Luga terminal, although there were no reports of damage from the fire, the St Petersburg-based Fontanka outlet reported.

Drostenko said a “high alert regime” had been introduced and officials had gathered for an emergency meeting.

Novatek processed 3.4 million tons of fixed gas condensate at the complex in the first half of 2023, up 0.6% from the same period a year earlier, according to the latest data.

(Reporting by Maxim Rodionov and Andrew Osborne Additional reporting by Vladimir Soldatkin, Pavel Polydyuk and Lydia Kelly; Writing by Andrew Osborne Writing by William Mallard, Hugh Lawson and Susan Fenton)

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