Interagency Rivalry in Management of “Druzhba” Oil Pipeline in 1960s

Abstract

This study reconstructs the circumstances surrounding the construction of the “Druzhba-2” oil pipeline using previously inaccessible archival documents that reveal the motives and actions of the agencies overseeing this largescale project. The analysis draws on resolutions by top Soviet Party and state authorities, as preserved in the collections of the Russian State Archive of Contemporary History and the Russian State Archive of the Economy. The paper highlights the competitive struggle between two key Soviet ministries in the oil and gas sector for control over the operation of the strategically vital “Druzhba” pipeline and the construction of its second phase. The study seeks to elucidate the peculiarities of economic management at the highest levels of party and state authority. It is established that the first phase of the “Druzhba” pipeline was built under the supervision of Glavgaz (the USSR Main Gas Administration), owing to the agency’s prior experience in gas pipeline construction. However, upon the project’s completion, the economic and technological rationale for keeping the pipeline under gas industry control became obsolete. While the transfer of the pipeline from gas to oil authorities was met with reluctance, higher-level decisions in this matter are shown to have been prudent and well-founded. The study demonstrates that the phased commissioning of pipeline sections enabled significant savings in oil transportation costs, ultimately offsetting construction expenses.