MOSCOW, February 5 (RIA Novosti) - Transneft [RTS: TRNF] will build a second leg of the Baltic Pipeline System to increase its annual capacity by 50 million metric tons of crude (1 million bbl/d), the Russian pipeline monopoly's head said Monday.

The system supplies Siberian oil to the Primorsk terminal, bordering on Finland, for export to Europe and the United States, and is another project designed to lessen Russia's dependence on transit countries, with which bitter disputes have caused brief disruptions in supplies to Western countries in the last two years.

The system's capacity was raised to 74 million tons (1.5 million bbl/d) last year.

"We are working to expand the Baltic Pipeline System from Unecha, near the Belarusian border, to Primorsk to raise the capacity by 50 million tons," Semyon Vainshtok said live on Vesti TV channel.

He said the corresponding declaration of intent had been approved and that implementation would begin following presentations February 9 through 15 in the western and northwestern regions, where the branch is to be laid.

Vainshtok said the project's cost had yet to be determined.

The first stage of the pipeline system was opened in 2001, with a capacity of 240,000 bbl/d.