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Slovakian-Ukrainian refined products deal nearly complete

Slovakia is close to an agreement to export oil products such as diesel to Ukraine after European sanctions take effect in February, Economy Minister Karel Hirman said on Friday.

The country's main refiner Slovnaft, part of Hungarian energy firm MOL, will no longer be able to export products refined from Russian oil to most markets when EU sanctions take effect on February 5.

The plan would allow Slovnaft to export oil products to Ukraine, which is facing severe electricity and heating shortages this winter as Russia attacks critical infrastructure.

A Slovnaft spokesman said the company was exporting unspecified amounts of products to Ukraine at the moment but the EU sanctions threaten to halt these.

Hirman, returning from a visit to Kyiv, said in a news conference shown live on television that talks were under way in Brussels and with Ukraine and MOL to arrange the exports.

"We are close to an agreement that after February 5, the Slovnaft refinery will be able to export to Ukraine its products from Russian oil, which flows to us through the Druzhba pipeline," Hirman said.

"In this situation, supplies of diesel for diesel generators are a question of life and death," he said.

Hirman added that supplies would be on a commercial basis, as well as potential supply of electricity to Ukraine.

Slovakia receives nearly 100% of its crude oil from Russia via the Druzhba pipeline that passes through Ukraine, but Slovnaft plans to cut the proportion to around 60% next year to keep its export possibilities to other markets open.

The Slovnaft refinery currently exports a substantial part of its 124,000-barrel-per-day production.

A separate short-term exception will also allow Slovnaft to export Russian oil-based products to the Czech Republic next year.

The company said earlier it was testing various blends to replace part of its Russian supply.

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