November 13 (SeeNews) - Serbian state-owned gas monopoly Srbijagas was handed on Wednesday a location permit for the construction of the local section of the South Stream gas pipeline, Belgrade-based media reported.
The building permit for the first lot of the project will be issued on November 14 after which all the conditions for the start of the construction works would be in place, news agency Tanjug reported, quoting Serbian construction minister Velimir Ilic.
The project in Serbia will be carried out by the joint-venture company South Stream Serbia AG, in which Srbijagas holds a 49% stake and Russia's Gazprom controls the remaining 51%.
The construction works, set to be formally launched on November 24, will cost 1.93 billion euro ($2.6 billion) with the pipeline seen operational in late 2015, Tanjug quoted Srbijagas director general Dusan Bajatovic as saying.
He added that Gazprom unit Gazprom Export will lease 100% of the capacity of the Serbian section for 25 years, meaning there will be zero risk for Serbia on this project
The Serbian section of the pipeline will ultimately have an annual capacity of 40.5 billion cubic metres of gas while stretching for 422.4 kilometres.
The Gazprom-spearheaded South Stream aims to diversify gas routes within the European Union and to provide stable gas supplies from Russia to Central and Southern Europe. Intergovernmental agreements have been signed with Bulgaria, Serbia, Hungary, Greece, Slovenia and Croatia in order to implement the onshore gas pipeline section.
($=0.7447 euro)
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