Romania Invites Serbia to Join the AGRI Project
Romania has invited Serbia to take part in the AGRI project, which is to deliver liquefied natural gas from Azerbaijan to the Western Balkans, and the two states agreed to also work together on developing a gas interconnection.
After the June 29 meeting between the Serbian and Romanian ministers of energy in Belgrade, Serbia was invited to join the AGRI project, which could bring new quantities of gas from Azerbaijan to the Western Balkans.
Serbian Minister of Energy Aleksandar Antic said that participation in the project “is a way for Serbia to secure new gas supply sources.”
The AGRI system (interconnection Azerbaijan – Georgia – Romania) is to have the annual capacity of 5 to 8 billion cubic meters of gas. The plan is for the system to transport Azerbaijani gas by a pipeline to Georgia, where it will be liquefied and then shipped to Romania by sea, and from there by pipelines to European countries.
The project is now at the initial stage and a feasibility study is being prepared. Serbia has been invited to participate in a meeting of the countries involved in the project, including Georgia, Azerbaijan, Romania and Hungary, this coming fall.
According to the Serbian Energy Minister, Serbia’s participation in the project is also important because of plans to build an interconnection between Serbia and Romania. The pipeline would be 76 kilometers long and would boast the capacity of at least one billion cubic meters of gas per year.
“This project could be strategically important for both states. We will task people from (the gas companies of Serbia and Romania) Srbijagas and Romanian Transgaz with defining the technical parameters for the project as soon as possible, so that the two governments may continue talks on the matter and present the project to the European Commission, to discuss its financing,” said Antic.
Romanian Minister of Energy Andrei Gerea said that Romania was meeting 85 percent of its gas needs from its own sources, but that it was still important to provide secure supply from additional sources.
Gerea also said that the start of gas exploitation in the Black Sea was important for Romania, whereas there was no interest in involvement in the Turkish Stream project, which is to bring Russian gas to European consumers via Turkey.
Romania’s invitation came at a time when Serbian officials were trying to find new gas supply routes and new suppliers.
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. After Russia announced it would stop to deliver natural gas through Ukraine by 2019, Serbian officials started the search for new gas supply routes.
Early in June, Serbia and Bulgaria signed an agreement on the construction of a gas interconnection which should give Serbia the possibility of receiving certain quantities of the gas flowing through the Trans-Adriatic Gas Pipeline (TAP) and the Trans-Anatolian Gas Pipeline, but also the liquefied natural gas (LNG) terminal in Alexandroupolis, which will be connected to TAP.
Serbia also wants to join the Turkish Stream project, which would prior to entering its territory stretch through Turkey, Greece and Macedonia.
But some economists warn that gas interconnections with Romania and Bulgaria could only bring small quantities of gas to Serbia, which would not be enough for stronger economic development.
Belgrade Economics Institute fellow Mahmud Busatlija said that the gas from the AGRI project would be more expensive for Serbia, as it would be transported by ships in liquid state.
“The quantities of gas gained from that project would hardly be enough for major economic development. That is why other gas supply sources should be sought, too,” said Busatlija.
Serbian Gas Association head Vojislav Vuletic said that Serbia and the EU actually had no alternative to Russian gas supply.
According to him, a gas interconnection with Bulgaria wouldn’t provide Serbia with gas supply security, either, because Bulgaria also receives Russian gas.
“No one wants to understand that Bulgaria’s supply runs through Romania, which receives its supply from Ukraine, and in 2019 not a single cubic meter of gas will go through Ukraine, hence there will be no gas for Bulgaria or Romania. That interconnection is just a waste of money,” said Vuletic.
He added that according to an estimate of the International Gas Union, gas consumption in Europe will by 2030 rise from the current 430 billion cubic meters per year to 600 billion and that, apart from Russia, new supply sources for Europe cannot be found in the next 10 years.