Serbia to invest 100 mln euro in oil pipeline with Hungary

Officials of state-owned oil storage operator Transnafta, which will carry out the construction work on Serbian territory, will start talks on the technical details of the project with representatives of the Hungarian side, the energy ministry said in a statement.

The 128-km pipeline will link the northern Serbian city of Novi Sad to Adje in the south of Hungary.

Further details about the project were not disclosed.

"The implementation of this project would ensure the diversification of crude oil supply and increase the security of supply to the Pancevo oil refinery," energy minister Dubravka Djedovic was quoted as saying.

The Pancevo refinery is operated by Serbia's sole oil and gas group NIS [BEL:NIIS], majority-owned by Russia's Gazprom.

Furthermore, the total cost of transporting crude oil would be lower compared to transport via the Omisalj oil terminal in Croatia, Djedovic added.

In December, NIS signed a crude oil transportation deal with Croatian oil pipeline operator Janaf [ZSE: JNAF], reserving Janaf capacities for transportation of 6.2 million tonnes of crude oil, plus or minus 10%, for the period from January 1, 2023 to December 31, 2024.

In August, Zorana Mihajlovic, energy minister at the time, said that Serbia will no longer be able to import Russian crude oil from November 1 as a consequence of the sixth package of EU sanctions against Russia.

Serbia is already importing oil from Iraq and other countries. Russian imports meet about 50% of the country's needs, 30% comes from other suppliers, and 20% is covered by domestic oil, she said at the time.

($ = 0.9299 euro)