Increased oil flow in the Caspian Sea is intensifying competition between Russia's Volgotanker and Caspar of Azerbaijan, the two major tanker operators in the region.

According to Andrei Kleimenov, head of marketing for Volgotanker, the total crude oil production in the Caspian this year will increase by more than 15 percent. He said the volume growth comes from greater output from the region's onshore and offshore oilfields.

"Our main competitor in the Caspian is Caspar," Kleimenov told The Russia Journal. "But Caspar operates only about 14 vessels in the Caspian Sea, and only some of them are double-hulled. Meanwhile, all Volgotanker maritime tankers are double-hulled and double-bottomed."

He added that Volgotanker will have 25 vessels available for tankerage during the winter season which the company intends to start in October. Additional sea barges are being planned for construction to add capacity to the fleet.

Volgotanker's principal Caspian Sea oil-tanker routes run from Turkmenbashi in Turkmenistan and Aktau in Kazakstan to the Russian port of Makhachkala; and from Aktau and Astrakhan in Russia to the Iranian port of Neka.

Ilya Katsnelson, managing director of Copenhagen-based Volgotanker Marine Services A/S, said that bulk carriers will be used to carry metals from Astrakhan to Neka and petroleum products from Aktau to Makhachkala on the return journey. Neka is one of three main Iranian ports in the Caspian. The other two are Anzali and Nowshehr.

At present, Neka is the "only one that specializes in oil and petroleum product transshipment," Kleimenov said.

According to Kleimenov, "in the past our clients wanted to charter Volgotanker vessels both in summer and in winter in the Caspian Sea.

"But in line with previous policy, Volgotanker did not want to have any operations there in the summer because it was less profitable than the Russian river system.

"The new policy stands for a long-term commitment to customers. We cannot lose the Caspian market because in the long run, development of the Caspian oilfields will lead to an increase in demand for crude oil and petroleum products transportation by sea. Now we are going to stay in the Caspian Sea year round."

The shift from freeze-limited river routes in Russia to year-round transportation on the warm-water routes will raise Volgotanker's Caspian oil cargo almost threefold. In the winter navigation season, November 2000 to March 2001, the company reported volume of 300,000 tons.