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08/12/2016

Serbia to diversify its energy suppliers

Energy

Serbia to diversify its energy suppliers

The Trans Adriatic Pipeline.

[Independent Balkan News Agency]

During a visit to Tirana on 27-28 May, Prime Minister Aleksandar Vu?i? said that Serbia would join a US-backed pipeline that would transport gas from Azerbaijan, while Minister of Energy Aleksandar Anti? said that a gas interconnection with Bulgaria are priorities. EurActiv Serbia reports.

Although Anti? insisted that energy should not be “politicized,” these decisions are significant in the context of tensions between Moscow and the West, which is heavily dependent on Russian gas.

On the other hand, at the meeting of the European Business Congress in Belgrade, on 28-29 May, chaired by Gazprom head Alexei Miller, Srbijagas chief Dusan Bajatovi? accused Europe of obstructing the construction of energy infrastructure in Serbia.

During his time in Tirana, Vu?i? said that Serbia was ready to use gas from several sources, which “is very important for our American friends, too”. Washington has been working for a while now on encouraging Balkan countries to turn to alternative gas sources, rather than waiting for the construction of Turkish Stream, which would send Russian gas to the Balkans.

>>Read: UK sketches out Europe’s energy alternatives to Russia

Vu?i? also answered a question about the balance in relations between Russia and the EU. “Our strategic goal is the EU, and we are very firmly on that road,” said Vu?i?. “On the other hand, we would like to maintain good relations with Russia,” he added.

The day after making that statement, on 29 May, Vu?i? downplayed the political importance of gas-related decisions. “Serbia won’t destroy its friendship with Russia, nor (the) US. There is no shift in its orientation. We are responsible in politics, protecting national interests,” Vu?i? told.

According to Vu?i?, there is a need to discuss gas supplies with the US, as Russian gas won’t be able to come to Serbia after 2019 if the EU doesn’t give it the green light, while the gas from Azarbaijan is expensive, and the supply is not guaranteed.

Anti?: No politics, please

The meeting of the European Business Congress iwas another opportunity to discuss new information about Serbia’s gas supplies. Energy Minister Aleksandar Anti? told reporters that when it came to decisions on energy, there was no politics, but rather a desire to find different gas supply sources, which, he said, “no one has a reason to like or dislike”.

Asked whether Serbia’s obtaining gas from several sources would invite a negative response from Russia, Anti? said that Russia did not want to supply Southeast Europe only through Ukraine and Hungary. Anti? stated that he expected Russia to understand that Serbia wanted to have additional supply sources.

In the context of the Ukraine crisis, it is difficult to fully separate energy decisions from politics. Serbia, like the EU, depends on Russia for a significant portion of its gas. This gives Moscow both influence and revenue, but it can also become a means of blackmail. Europe’s sensitivity to Moscow’s gas-related decisions became apparent in late 2008, when Russia halted gas deliveries to Ukraine over a price dispute, subsequently creating a supply problem for most of Eastern Europe.

Russia’s dominance is one of the main reasons why the EU has made the diversification of gas sources a priority.

Anti? reiterated that Serbia’s priority was the construction of a gas interconnection with Bulgaria, with an annual capacity of two billion cubic meters of gas. This is also a project that the EU insists on, precisely because it would provide Serbia with another supply source, given that Bulgaria, which is completely dependent on Russian gas, is signing up for the TAP project, for Azerbaijani gas.

>>Read: TAP pipeline to start construction in 2015

“Funds have been earmarked in the budget for 2015, for the making of a spatial plan for the investment, and Srbijagas is working on the rest of the project documentation,” he said, adding that the financing of the project will be defined over the course of this year, voicing hope that construction will start in 2016.

Serbia, according to Anti?, wants to take part in gas projects in line with the Third Energy Package, which as of December 2014 together with the new Energy Law, became part of Serbia’s energy legislation and is harmonized with EU regulations.

“As far as Turkish Stream is concerned, we still have not had any serious talk related to financing that project,” said Anti?, confirming that the government was considering the project, as well as others that are to bring gas to the region.

The Russian perspective: Bajatovi?

On the same day, Srbijagas General Manager Dusan Bajatovi? said that the European Union was the one who was using ideologically-based administrative bans to obstruct the construction of gas supply infrastructure in the region.

At the the European Business Congress meeting, he said that the lack of gas supply infrastructure was getting “Southeast Europe in big trouble.”

“I hope that the EU will consider that. I think that in the future, we will not have administrative bans and problems based on ideology or mistrust,” said Bajatovi?, who is known for being close to Russia.