Friday, May 22, 2009

Srbijagas and Gazprom to Sign South Stream Deal

(May 13 2009) Serbian state owned gas company “Srbijagas” and Russian gas company “Gazprom” are going to sign a contract on Friday May 15, for the construction of a part of the South Stream gas pipeline. According to General Director of Srbijagas Dusan Bajatovic , with this agreement it will be formeda joint venture for the part of the South Stream pipeline that will go through Serbia. The predicted length of the pipeline through Serbia is estimated to be around 450 kilometers and it could carry around 23.1 billions of cubic meters of gas annually, Mr. Bajatovic added.The Gazprom-led project aims to bring Russian, Caspian and Central Asian gas to Europe and is a rival to the EU-backed Nabucco pipeline, which aims to reduce European reliance on Russia for its energy supplies.According to the agreement on the South Stream construction, signed on 24 December, 2008 in Moscow, Gazprom will owe 51 per cent and Srbijagas 49 per cent of the property of the joint venture for the pipeline’s construction. The two companies will also form a subsidiary company in Serbia for gas distribution. The date when this company will be formed is not yet determined.The signing will be followed by a feasibility study that will determine the gas pipeline's exact course. Serbia's government will discuss the proposed agreement Thursday. The pipeline through Serbia is scheduled to be finished by December 31, 2015.

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