By Xinhua
Moscow : Russia and Serbia signed an oil and natural gas cooperation agreement on the construction of the Serbian section of the South Stream gas pipeline system, Russian news agencies reported on Friday.
South Stream is designed to supply natural gas to the Balkans and on to other European countries from Russia across the Black Sea.
The South Stream agreement with Serbia envisages transportation of 10 billion cubic meters of Russian gas annually, Russian gas giant Gazprom CEO Alexei Miller was quoted by the RIA Novosti news agency as saying.
Russia’s Gazprom Neft signed a deal on the purchase of a 51 percent stake in the Serbia’s state-owned oil monopoly Naftna Industrija Srbije (NIS) during talks between the two countries’ leaders in Moscow on Friday.
Miller said Gazprom will remain Serbia’s reliable partner in energy deliveries.
Gazprom has reportedly offered 580 million U.S. dollars for a 51 percent stake in NIS amid fears in Europe of perceived growing energy dependence on Russia.
Russian First Deputy Prime Minister Dmitry Medvedev described the newly signed Russian-Serb energy agreements as “a brilliant breakthrough.”
“The mutually beneficial investment that will be made as a result of these protocols ensures the interests of our countries, our peoples, and is ultimately aimed at strengthening the energy security system in Europe,” the RIA Novosti news agency quoted Medvedev as saying.
The joint construction of a stretch of a natural gas pipeline with Russia’s Gazprom under the South Stream project will turn Serbia into a regional economic leader, Serbia’s prime minister said.
The South Stream pipeline proposed by Russia’s Gazprom and Italy’s Eni is a rival project to the Nabucco pipeline which is backed by the European Union (EU) and the United States and will pump Central Asian gas to Europe via Turkey bypassing Russia.
The pipeline will run from Russia’s Black Sea coast under the sea to Bulgaria, where it will branch off to different destinations in the EU, supplying 30 billion cubic meters of gas annually.
Serbia initially planned to sell a 25 percent stake in NIS for 300 million dollars and obliged the buyer to invest another 250 million dollars in the development of the company. The company is estimated as being worth 1.2 billion dollars.