Serbia: South Stream delays, implications of Crimea and Ukraine gas routes

3. April 2014. / News Serbia Energy

The crisis in Ukraine indicates more the necessity of building the pipeline, which will supply the southern part of Europe. Is the Russian-Ukrainian dispute over Crimea could really jeopardize the construction of “South Stream” and whether the ability to stay without another alternative route for gas supplies is real threat hanging over Serbia, and entire Balkans and Europe?

Is Paolo Scaroni, chief of the Italian oil company ENI, which with 20 percent is participating in the construction of “South Stream”, is right when he says that the construction of the pipeline is under question because of Crimea?

While some are in fear, others in the region are well aware of this danger. Bulgaria received a warning if the crisis in Ukraine does not stop, but additionally indicates the importance of “South Stream” project, making it obvious that it is important to provide gas to the citizens and industry, for the EU whole, as well as for Bulgaria.

Mr. Milojko Arsic, professor of Faculty of Economics  expresses  his doubt that the crisis in the Crimea could delay the implementation of this project. He pointed that further relation of Russia and NATO and EU members could create obstacles for the construction of “South Stream”.

– Until  agreement is final achieved that the whole “South Stream” been realized  the pipeline won’t be laid through Serbia that is located in the middle of the route – said Arsic.

Yesterday although none of the officials of the Technical Government refused to comment on how and whether the crisis between Russia-Ukraine is reflected on the “South Stream” in Serbia, the fact is nothing is happening in Serbia. It is only awake memory of welded pipes in Sajkas, after which it was announced further funds will be provided for the continuation of the works in February. .
Mr.Vojislav Vuletic, president of the Association of Serbian gas, said the announcements of the Ukrainian crisis stopping  the “South Stream”  are empty talk. This pipeline is not 100 percent Russian project, but also  Germans, French and Italians, as they  all need gas.

If America was involved in the ” South Stream “, negative echoes would not exist. The fact  that the negotiations between Russia and the European Commission have stopped  over the  third energy package, of Russian insisting  to be the owner of the pipe and gas, there is no question that the project will be abounded because the need for gas in Europe is constantly growing. This is the only way to meet all needs –said  Vuletic , categorically who supports the fact that about 15 percent of Russian gas was delivered last year. Europe will need more gas,  especially once nuclear power plant are closed. The current consumption of Europe is 165 billion cubic meters of gas per year.

When asked to comment why the Serbian activities works are stopped, Vuletic says the construction season in Serbia is about to beginning, and due to the winter season from November to April in Serbia little work and construction  is done.

The Russians say that will 100 percent finance gas pipeline through Serbia. Company “South Stream Serbia” should be given a government guarantee of 70 million dollars to have the initial capital to work, but it will not delay the work – according to Vuletic.

According to his information, the Russians are doing their part of the shares as planned. The works are still on the ground and are going towards laying pipes under the Black Sea, he said.

The fact is that Serbia, but also the rest of the continent, is to achieve energy security only once the “South Stream” is build, or when Russian gas starts to flowing through the Black Sea, bypassing Ukraine.

Until then, we can only speculate.

Source; Serbia Energy

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