Ursula Patz opposes Russia’s war on Ukraine. However, she is also against anti-Moscow sanction that she believes will endanger her town.
“Sanctions that end up hurting you more make no sense,” the 76-year-old said. An oil embargo “won’t harm Russia — they’ll just sell the oil to someone else”.
Patz worked for 16 years at an oil refinery in the north-east German town of Schwedt that risks becoming collateral damage in Europe’s campaign of punitive measures against Russia.
At issue is the EU’s ban on imports of Russian oil, which is designed to deprive President Vladimir Putin of revenues to fund his war in Ukraine. The measure, which comes into force on January 1, has broad support in Germany but has thrown the future of Schwedt’s refinery into doubt.
“People here feel they are a pawn that is being sacrificed in some game,” said Jens Koeppen, a Christian Democrat MP who represents the town.
At issue is the refinery’s reliance on Russian oil. It sits atop the “Druzhba” pipeline, which carries crude some 4,000km from Almetyevsk in central Russia directly to Schwedt. And the plant is configured to work with Russia’s main high-sulphur “Urals” grade of crude.
The most problematic aspect of the matter is that it is Russian-owned. Rosneft, a Kremlin-controlled Russian oil company, controls 54% of its shares. It has no interest in processing crude oil from other sources.
Many in Schwedt worry that the PCK refining plant will be closed if it loses access Russian oil. “That would be a nightmare scenario,” said the town’s mayor, Annekathrin Hoppe. “People here fear for their existence.”
Schwedt’s biggest employer, PCK has a workforce of 1,200. Hoppe stated that there are hundreds more jobs in ancillary services. These include making heat exchangers, cooling units, and pipelines for the plant.
“All those jobs would be affected, and all those people have families,” she said. Furthermore, “around 80 per cent of the town is supplied with district heating from PCK’s power plant”. She said that it is not clear how homes would be heated if the power plant goes out of business.
The residents of Schwedt fear that the economic turmoil experienced in the region following German reunification in 90 could happen again. “They’re facing a second deindustrialisation of east Germany,” said Koeppen. “And they won’t take it lying down.”
Schwedt reflects the region’s highs and lows. The Soviet advance in the second world war almost destroyed the town. Then in the 1950s young people from all over East Germany converged on Schwedt to rebuild the town and erect the PCK, short for “petrochemical kombinat” or combine.
Schwedt became the symbol of the close ties that existed between Russia and the GDR. Local newspapers reported in the 1960s the excitement that PCK was connected to Druzhba’s newly-built pipeline in 1963.
“The oil has arrived!” said a front-page headline in the PCK publication “Young Builder”. “Glory and honour to the builders of the longest pipeline in the world!”
Druzhba, which continues to provide a quarter of Germany’s crude oil, always had positive connotations for Patz. “It means friendship in Russian — such a lovely word,” she said. “It means something good.”
Soon after it came online in 1964, PCK established itself as the region’s main supplier of petrol, diesel, jet kerosene and fuel oil. Big consumers — such as Berlin’s international airport — still depend on its products.
The embargo was met with widespread anger in Schwedt. Many wondered why Germany had not followed the lead of Hungary, Slovakia, and the Czech Republic, which are also tied to Druzhba, but negotiated temporary exemptions to the import ban citing the lack of alternative oil.
“People just can’t understand why Germany voluntarily decided on this embargo,” said Hoppe. “Everyone condemns this war, but people are also fighting for their jobs.”
Populists of the right and left have taken advantage to discontent. The hard right Alternative for Germany has put up posters in the town with the slogan: “If PCK dies, so does Schwedt”.
Chancellor Olaf Scholz insists the government is working to safeguard PCK’s future. Officials have assured that it will continue to refine oil next year, 2024, and that jobs will be preserved.
They are looking at other options to supply the refinery with oil, primarily via a pipeline from the northeastern port Rostock.
But Koeppen, the MP, said that won’t solve the problem. He stated that the pipeline could only transport 19,000 tonnes of oil per day, which is less than what PCK requires.
“Rostock port is also not deep enough to accept oil tankers,” he said. He added that the oil would need to imported into Wilhelmshaven in the North Sea and then transferred on to smaller ships. “And we don’t have the ships.”
PCK hopes to also receive oil from Kazakhstan and is investigating supplies via Gdansk, a Polish port. “But the Poles say they don’t want to supply us while the plant is still owned by Rosneft,” said a worker at PCK, who declined to be named. “And we can’t just brush that aside.”
Longer-term Berlin wants to secure PCK’s future by transforming it into a “green refinery”. Two companies — Enertrag, a wind energy firm, and Verbio, a biofuels producer that already has operations in Schwedt — have expressed an interest in taking stakes in PCK.
Hoppe said with their involvement, the refinery could produce “green hydrogen” which could be combined with CO₂ captured from the atmosphere to make sustainable synthetic fuels — including “e-kerosene” for planes.
It will take many years for PCK, however, to make the transition. A temporary oil embargo could have dire consequences for the refinery.
“Three months have passed [since the embargo was agreed] and we’re still hearing the same promises,” said Hoppe. “Time is running out.”
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