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Serbia govt drafts loan guarantee bill for Bulgaria-Hungary gas link

Author Radomir Ralev
Serbia govt drafts loan guarantee bill for Bulgaria-Hungary gas link milosljubicic/

BELGRADE (Serbia), April 17 (SeeNews) – Serbia's government said it has proposed to parliament to issue a 70 million euro ($79.2 million) loan guarantee for the construction of a natural gas pipeline in the country stretching from Bulgaria to Hungary.

The guarantee will be issued on loans extended by Societe Generale Serbia, Komercijalna Banka and Vojvodjanska Banka to state-owned gas monopoly Srbijagas for the construction of the pipeline, according to the government's draft bill published on the website of Serbia's Parliament.

The loans to be issued by Societe Generale Serbia and Komercijalna Banka amount to 30 million euro each, while Vojvodjanska Banka will lend 10 million euro, according to the draft bill. 

On Monday, Serbian prime minister Ana Brnabic said the government has started preliminary work on the construction of the natural gas pipeline and plans to issue building permits for the first sections in April.

Russia's Gazprom plans to build a string of its Turk Stream pipeline for transit of natural gas to Europe from Turkey via Bulgaria, Serbia and Hungary. The future pipeline on the territory of Serbia, approximately 400 km in length, will link the Serbian natural gas transmission system to those of Bulgaria and Hungary.

Last month, Serbia's Gastrans, a subsidiary of Swiss-based South Stream Serbia, invited binding bids for booking of capacity for the transit of natural gas via the planned pipeline. The total volume of available annual capacity is 395.2 GWh/day at the link with Bulgaria,124.2 GWh/day at exit points in Serbia and 271.02 GWh/day at the interconnection with Hungary, Gastrans said.

Gastrans is 100%-owned by Swiss-based South Stream Serbia, according to data from Serbia's commercial register. Gazprom owns a 51% stake in South Stream Serbia, while Srbijagas holds the remaining 49%, according to Gazprom data.

($ = 0.883785 euro)