- Category: Economy
- Published on Wednesday, 01 July 2015 12:14
Romania has invited Serbia to join the AGRI project, which aims to bring gas from Azerbaijan and so help countries in Europe diversify their gas supply.
After Romanian and Serbian energy ministers met in Belgrade, the two officials announced that their countries will work jointly on gas interconnection development to increase energy security.
Serbian Energy Minister Aleksandar Antic said in Belgrade that the AGRI project, involving Azerbaijan, Georgia and Romania, could supply additional gas to the Western Balkans and so provide new sources of gas for Serbia.
Some experts believe that Serbia could expect to receive only small amounts of gas through a gas interconnection with Romania, however - and say it needs more in order to create the conditions for economic development.
Romania's invitation comes at a time when regional officials are working on increasing energy security and on diversifying gas supply routes.
Serbia needs about 2 billion cubic meters of gas annually, and only produces about 20 per cent of that amount domestically. The rest is imported from Russia via Ukraine and Hungary.
The AGRI should have a capacity of 5 to 8 billion cubic meters of gas annually. The system envisages a gas pipeline running from Azerbaijan to Georgia, where it would be turned into LNG and then transported by ship to Romania, and then distributed through a pipeline network to European countries.
After Russia warned that it would stop delivery of natural gas through Ukraine by 2019, Serbian officials start working on gas supply diversification.
Early in June, Serbia and Bulgaria signed an agreement on construction of a gas interconnection, which should enable Serbia to connect with two pipelines from Azerbaijan – the Trans-Adriatic Gas Pipeline, TAP, and the Trans-Anatolian Gas Pipeline, TANAP.
Serbia is also mulling trying join the Turkish Stream pipeline, which should bring Russian gas to Europe through Turkey and Greece.
But the fate of the project is uncertain since the EU effectively stopped construction of another Russian project, the South Stream pipeline, which was designed to supply Europe with Russian gas via Bulgaria and Serbia.
Speaking about the proposed gas interconnection between Serbia and Romania, Antic said it would be 76 kilometres long and the gas companies of both countries would work on further technical details.
"We are interested in a two-way pipeline with a capacity of not less than a billion cubic metres of gas per year," Antic said.
The minister said that after the feasibility study is finished, the two countries would ask the European Commission to include the project among the priorities for financing through European funds.
Romanian Energy Minister Andrei Gerea said a gas interconnection between Romania and Serbia would diversify the supply for both countries.
He noted that Romania obtained 85 per cent of gas from its own sources while the rest comes from imports.
Mahmud Busatlija, from the Economic Institute in Belgrade, told BIRN that the amount of natural gas coming from an interconnection with Romania would not be enough to power dynamic economic development, however.
“The gas from the AGRI project would be more expensive for Serbia since it is in a liquefied state. Serbian officials have to realize that we need much more gas if we want significant economic development. It is questionable whether we can have this through the AGRI project,” Busatlija said.