(26 Jan 1997) Russian/Nat
Chechnya's separatist leaders are determined to be independent of Russia, both politically and economically.
They believe the tiny, land-locked territory can succeed economically if it exploits its own oil reserves and gets a cut of foreign oil transported across its land.
But to do so, the Chechen government will have to get the refineries up and running again.
They need to repair major pipelines and get rid of the hundreds of small-scale illegal refineries that sprang up in the anarchy of war.
Chechnya's oil industry has always been the republic's life blood.
But since the devastating two year war with Russia, this tiny republic has been reduced to buying its petrol in flagons from the roadside.
Most petrol now sold in Chechnya is produced illegally. Every day about 25-thousand tonnes of illegal crude oil is refined.
Now the government looks set to crack down on this illegal enterprise, believing its main hope for achieving economic independence from Russia lies in exploiting its profitable oil fields.
But the government faces the expensive task of getting the official refineries up and running -- as well as shutting down what for many has become a lucrative black market industry.
Hundreds of roadside refineries, like this one at Tsotsin-Yurt, sprouted up across the country during the war, as enterprising Chechens tapped into the region's oil fields as well as the republic's major pipeline.
The tiny refineries helped supply Chechnya's guerrilla army as well as the civilian population.
At a set-up like this one, 12 tonnes of crude oil produces about 4 tonnes of petrol and 7 tonnes of diesel and some kerosene.
Homemade petrol will leave deposits and eventually damage a car's valves, but these ad hoc oilmen insist their petrol is good quality.
SOUNDBITE: (Russian)
"On TV they say a car will only run for two or three days before the engine seizes up. But we've been using this petrol for several years without a problem. Of course it's good quality petrol. There's no difference between ours and the pure-grade stuff the refinery
produces."
SUPERCAPTION: Ilias Musayev, illegal oil refiner
The state oil refinery in Grozny is one of the few refineries in Chechnya actually managing to produce petrol. But it is working far below maximum capacity.
Before the war Chechnya refined about two million tonnes of oil annually. Now the Grozny plant is only managing to pump out 5-thousand tonnes per day.
During the two years of bitter fighting between Chechen rebels and Russian forces most of Grozny was obliterated.
Storage tanks at the refinery burnt down and pipes and equipment were damaged by fire and shelling.
But while the rest of Grozny was reduced to dust, the refineries remained relatively unscathed.
Now its workers are eager to get back to full-scale production.
SOUNDBITE: (Russian)
"Our crude oil is good quality but we haven't been able to refine it since the equipment burnt down. Before the war we had good equipment but it got damaged. Now people are repairing it and I think that quite soon we'll be producing good quality petrol again."
SUPERCAPTION: Magomed Ryezayev, Grozny oil refinery worker
On Wednesday, the Chechen government announced a plan to construct a network of pipelines in the Caucasus for future export of Caspian oil through Chechnya to the Mediterranean.
An estimated 3 (b) billion dollars is required to implement the plan.
But Chechnya doesn't have the money to pay for basic reconstruction or for wages and pensions, let alone new pipelines.
SOUNDBITE: (Russian)
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