Gazprom to extend Serbia EUR 175mn loan at 4.25% interest for South Stream in Q1 2014

By bne IntelliNews November 12, 2013

Russia’s Gazprom is going to extend a EUR 175mn loan to Serb state-owned gas firm Srbijagas in the first quarter of next year for the development of the South Stream pipeline project, the head of Srbijagas told broadcaster RTS in an interview on Nov 12.

The funds will be extended at the same terms offered by Gazprom to Bulgaria, or at a 4.25% interest, Dusan Bajatovic said. He added that at the same time Gazprom would provide another EUR 175mn to the joint company, which will run the project in Serbia.

Furthermore, by the end of this year Srbijagas will secure a EUR 75mn state-guaranteed loan and Russia will inject the same amount via a capital injection in South Stream Serbia. (It was not immediately clear who will provide the state-guaranteed loan – Bajatovic said the credit agreement is pending a government and parliament approval.)

He summarised that in February or early March 2014 the Serbian daughter company will have EUR 500mn for the South Stream section construction.

The construction of the 470-km stretch in Serbia is estimated to cost EUR 1.7bn. The pipeline will probably have separate legs to Macedonia, Bosnia and Kosovo as mentioned earlier this week during a meeting of Serb government officials with Gazprom CEO Alexey Miller in Belgrade.

Works are expected to begin on November 24. The end of construction works and the start of first gas supplies to Serbia are planned for 2016.

Related Articles

Montenegro to speed up re-nationalisation of power firm EPCG

Montenegro’s government has decided to speed up the acquisition of Italian A2A's stake in the power firm EPCG, paying €68.9mn for a ... more

Croatia reportedly receives just one bid to lease capacity at planned LNG terminal

LNG Hrvatska has reportedly received just one binding offer to lease capacity at the planned planned liquefied natural gas (LNG) terminal on the Croatian island of Krk, unnamed sources ... more

Finland gives final nod to construction of Nord Stream II

Finland has issued a second and final permit for the construction of the controversial Nord Stream II pipeline that is to pump gas from Russia directly to Germany via a Baltic Sea route, the Regional ... more

Dismiss