ECONOMY

Gazprom eyes Serb energy jewels

BELGRADE (AFP) – Gazprom chief executive Alexei Miller was due to meet with top Serbian leaders here yesterday for talks expected to put the Russian behemoth in pole position for key energy sector privatizations. Miller was to hold discussions with Serbian President Boris Tadic, Prime Minister Vojislav Kostunica and his deputy, Bozidar Djelic, who were expected to push for commitments by the Russians to invest in a gas pipeline. «The key thing for the Serbian side will be that Gazprom accepts that Serbia gets a branch of the pan-European pipeline,» according to the Serbian newspaper Blic. «The exclusive right to decide through which country the Bluestream pipeline runs belongs to Gazprom. If Serbia gets that branch, that would mean not only a better gas supply to our country, but also exceptional long-term investment benefits,» said the daily. Belgrade wants to finalize a deal for the pipeline after Gazprom signed a letter of intent with Serbia in December 2006 to build a -1 billion gas pipeline across the former Yugoslav republic. But, in exchange, Gazprom is keen on securing majority stakes in two of the biggest Serbian companies still up for privatization, oil monopoly Naftne Industrije Srbije (NIS) and electricity counterpart Elektroprivreda Srbije (EPS), it added. Work on the 400-kilometer gas pipeline, from its border with Bulgaria to the frontier with Croatia, was meant to begin in 2007. Serbia had expected income from the project in the form of transit fees, in addition to money earned from construction and maintenance of the pipeline. The pipeline – designed to carry 20 billion cubic meters of gas per year – would ultimately be linked to the Bluestream pipeline, which is to run from Russia to Turkey under the Black Sea. Also in the Russian delegation in Belgrade yesterday was the general director of GazExport, Alexander Medvedev, and an official of Gazprombank, another Gazprom subsidiary. Serbia has increasingly opened up its economy to Russian businessmen this year in a trend that analysts have put down to Moscow’s steadfast support for Belgrade in opposition to Kosovo’s possible independence. Increasingly present in Serbia, Russian companies are being openly lined up to pick off other jewels of the country’s public assets, such as copper miner RTB Bor and flagship carrier JAT Airways. Russian businesses have already snapped up a number of Serbian companies, among them the state’s biggest tourist agency Putnik and Termoelektro, a major industrial engineering company. However, Serbian Energy Minister Aleksandar Popovic denied Russia’s interest in NIS was in any way linked to the issue of Kosovo, a breakaway Albanian-majority province of Serbia. «I cannot prejudice the agenda, but considering that all important energy sector issues will be discussed, it’s realistic to expect that an intention of oil company Gazpromneft… to take part in the NIS privatization tender,» Popovic was quoted as saying in the newspaper Danas. Yesterday’s talks come in spite of the fact that Serbia’s government is yet to formally decide on its privatization strategy for NIS, over which there are divided opinions within the ruling coalition, said Blic. «The cynics might say, perhaps, that Gazprom is going to determine the dynamics of their work,» said the daily.