SERBIA GAS PRIORITY

After Russia dropped the construction of the South Stream gas pipeline, Serbia is ready to look for new supply sources, and the priority according to Serbian officials, will be the interconnection with Bulgaria.

Speaking at a meeting titled Regional Energy Prospects recently held in Belgrade, Serbian Minister of Mining and Energy Aleksandar Antic said that the Serbian government would try to be part of all projects that may provide new gas supply sources and routes.

According to Minister Antic, the first priority is the connection of Serbia and Bulgaria by a two-way pipeline, with the money already earmarked in the 2015 budget for the making of a spatial plan. The minister added that there had already been talks with the Bulgarian partners about the pipeline's capacity and that Serbia could quickly enter a stage when it would seek sources for funding the start of construction.

The interconnection with Bulgaria could give Serbia access to gas supplies from Azerbaijan via the Trans-Anatolian Natural Gas Pipeline (TANAP), the construction of which began in March. Serbia started considering gas supply alternatives after Russia abandoned the South Stream pipeline project, which for the Serbian officials opened a number of questions about future gas supply.

"We must no longer be enamored of any energy project or rely on just one supply source. That will be the Serbian government policy," said Antic, adding that the government will favor projects enabling Serbia to become a transit country for fuel supply.

However, Dusan Bajatovic, the CEO of Serbia's state-owned gas monopolist Srbijagas, said at the same meeting that the state would have serious problems in gas supply if Russian gas deliveries via Ukraine stopped.

"Serbia currently has no supply alternative," said Bajatovic. In his words, none of the gas interconnections Serbia might take part in will secure stable supply of the country and the whole region by 2025, unless it is backed by Russian gas deliveries or the construction of serious facilities for liquefied natural gas.

"Serbia lacks the funds to build pipelines on its own. If someone is asking us to have different ways of gas supply and I say the Serbian economy doesn't have the money to finance it, I don't understand why someone is banning our projects," said Bajatovic, who on the Serbian side was at the helm of the company that was to build South Stream with Russian partners.

Bajatovic also said that over the next two decades Europe would be highly dependent on Russian gas. Russia earlier announced that it would stop delivering gas via Ukrainian territory after 2019.

At the meeting, certain participants expressed hope that Serbia would be involved in the Russian-Turkish project called Turkish Stream. Srbijagas Executive Director Jovica Budimir said a feasibility study was being done for Turkish Stream and that the final route and value of the pipeline would be unveiled in May. Budimir also said that the preliminary study envisaged the new pipeline including Turkey, Greece, Macedonia and Serbia.

According to him, the length of the continental part of Turkish Stream in Turkey's territory will be 100 kilometers, 304 in Greece, 521 in Serbia and 162 in Macedonia. Budimir went on to say that South Stream's old route would, if built, in one part in Serbia match the route of Turkish Stream.

EU representatives have also expressed concern for Serbia's energy security. EU Delegation to Serbia representative Freek Janmaat announced that the EU would attempt to include Serbia as much as possible in the completion of the Energy Union and to financially support projects important for connection in the region. Janmaat further said that according to the financial plan until 2020 Serbia was to have 200 million euros per year at its disposal from IPA funds, while loans from the European Investment Bank will also be available for energy projects. As he put it, the EU is also ready to support the Serbian-Bulgarian interconnection project. "Serbia is dependent on Russian gas imports and it would be good for it to have other supply sources, too," said Janmaat.

naturalgaseurope.com