Serbia and Russia sign 10-year natural gas deal

, News Serbia Energy

Serbia and Russia have signed a ten-year agreement on the deliveries of Russian natural gas to Serbia.

According to the deal Serbia can now purchase Russian gas at the price of USD 399 per 1,000 cubic meters, Assistant to the Serbian Energy Minister Petar Stanojević told Tanjug on Thursday.

The price of gas for Serbia should drop to around USD 370 this year due to the oil price drop on the global market in the previous period by 10 to 12 percent on grounds of which the price of gas is defined, Stanojević stated.

He specified that Serbia’s public natural gas company Srbijagas signed the agreement on gas with Gazprom representatives last week.

During the session of the Serbian parliament Committee on Economy which passed the bill on the long-term agreement on deliveries of Russian gas to Serbia, Stanojević noted that Serbia has an old debt for Russian gas worth USD 40 million.

Serbia will pay the debt which dates back to the period from the 1990s to 2001 in two instalments. It will transfer the funds from the first instalment this year and the second instalment will be paid in 2014, Stanojević said and added that USD 175 million of the debt has been paid to Russia already.

The ten-year agreement on the delivery of Russian gas to Serbia will make it possible for the country to purchase 5 billion cubic meters of gas annually, which is 2.5 times more than now, Stanojević said.

He specified that this would make it possible for Serbia to increase its energy security and it will open new development possibilities and construction of several gas power plants for combined production of electricity and heating.

Source B92