The German town of Schwedt, in the east of the country, is served by a branch of the gigantic Russian Druzhba pipeline, built between 1960 and 1963 during the Soviet Union to supply oil to communist Eastern European countries, including the German Democratic Republic. (RDA). From that time, Schwedt inherited the PCK refinery, which processes Russian crude oil and thus provides employment and prosperity to the entire region.
The war launched by Vladimir Putin against Ukraine has brutally impacted the scheme that made this city of 30,000 inhabitants happy next to the Polish border. The Government of Germany, initially opposed to a rapid embargo on Russian oil by the EU, has changed its approach after managing to reduce its energy dependence on that source from 35% to 12% in a few weeks.
Germany wants to cut off its imports of Russian black gold as soon as possible, since shedding its dependence on Russian gas will take much longer. That 12% flows via Schwedt through the Druzhba pipeline, which means friendship in Russian, a name that embodies Soviet and post-Soviet paradoxes now that the link has been blown up.
In Schwedt, a quiet village where even the ugly Plattenbau-type apartment blocks – built with precast concrete slabs, a method widely used in the GDR – look neatly spruced up, there is great concern about the future of the refinery. On a local level, Schwedt's anguish encapsulates the general realization that the war in Ukraine will force countries to make drastic changes in many areas, and that the population will have no choice but to adapt.
“When the war broke out in February, it became clear to me what awaited our city, because we are 100% dependent on Russian oil; but we are also surprised by the sudden change of times in the Government –says the mayor of Schwedt, the Social Democrat Annekathrin Hoppe, in an interview in her office at City Hall–. What was first a warning, an objective, a wish, has become that you have to say goodbye to Russian oil in weeks; Of course, people are very worried." 1,200 people work at the PCK refinery, another 1,200 have indirect jobs and another thousand provide services. "The refinery is the economic heart of the region," says the mayor.
To make matters worse, the majority shareholder of the refinery is the Russian oil company Rosneft (54%); the British Shell owns 37%, and the rest is from the Italian Eni. Rosneft's silence on the matter is deafening, but experts warn that the Kremlin-controlled company is unlikely to accept the federal government's plan to save the refinery when the embargo becomes a reality. The idea is to replace Russian crude oil with oil from other countries, which would arrive through a pipeline that connects Schwedt with the port of Rostock, in the Baltic Sea. Another possibility would be the Polish port of Gdansk. In both cases, everything would be more expensive, and state financial aid would be needed.
In case Rosneft, as expected, vetoes non-Russian oil being processed in Schwedt, the Government and Parliament are studying the possibility of placing energy companies under state tutelage or even expropriating them.
Economy Minister Robert Habeck, an environmentalist, held a tumultuous meeting with employees at the PCK refinery in early May, many of whom defended their jobs on the grounds that giving up Russian oil would not serve to stop the war. “What is happening in Ukraine is a seismic event for peace in Europe; if you want your children to grow up in peace and freedom, injustice must not prevail,” Habeck told them, sitting at a table near the canteen. “I would like you to not consider me an enemy, but someone who tries to preserve this place as much as possible and lead it into the future,” he assured.
The Schwedt refinery is one of the few survivors of the drastic dismantling of eastern industries that occurred in the 1990s with the reunification of Germany. Located a hundred kilometers from Berlin, it refines 12 million tons of Russian crude per year and supplies 90% of the fuel consumed by the capital and the eastern Länder of Brandenburg and Mecklenburg-Vorpomerania, including kerosene for Berlin airport.
“I am against the oil embargo, it cannot be that we just close everything; after all, we all drive cars,” says Janine Klopsch, a 39-year-old insurance employee, in a central square in Schwedt. Her husband works as a firefighter at the refinery. “The embargo is the wrong way, I am in favor of considering another strategy; without the refinery, Schwedt would not look like it does today, the refinery is our future,” says this neighbor, who says she distrusts Minister Habeck. "I don't think he understands the existential fear that people in this city feel."
At the gate of the refinery, which is five kilometers away, the bad mood of the workers who leave in the afternoon after their working day is evident. Those responsible for PCK refused to have an interview with this correspondent. “I don't work at the refinery, but as a resident of Schwedt I know the problem well; fear spreads among the people, because PCK is the biggest employer in the area and what happens to it affects us all”, says Volker Krepel, 60, who works in social work with young people and has come to pick up friends .
There is another refinery connected to the Druzhba pipeline: Leuna, in Saxony-Anhalt, a land that was also part of the GDR. But it is owned by the French company Totalenergies, which plans to leave Russian oil by the end of the year or even earlier. Likewise, Russian crude arrives in western Germany by ship, but they also negotiate with other suppliers there. Only Schwedt is trapped by the circumstance that its refinery is controlled by Rosneft. In the city there is a paper factory with a thousand workers, which would also suffer from a total or partial closure of the refinery.
Mayor Hoppe points out that there is no emotional attachment. “It is not that we are attached to Russian oil; the important thing is to keep the jobs, where the oil will come from is irrelevant. The emotional side is the fight for employment and for this industrial area”. From her office window, Hoppe points to the flats across the street. “80% of the heating in our houses comes from the exhaust heat of the refinery; and in the paper mill 100% old paper is used to produce new; I mean by this that there is an ecological base here”.
For two years, the City Council and local businessmen have been planning a transformation, since the objective of gradually reducing the use of fossil fuels in Germany already existed before the war. “We will build an innovation campus, in which experts study what alternative materials can be used and what other products could be made, such as synthetic kerosene, green hydrogen, plant-based materials…”. The project will last for years, unexpectedly spurred by the Russian attack on Ukraine. "Innovation -says the mayor- is now more urgent than ever".
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