Serbia Considering Alternative to South Stream
After the failure of the South Stream gas pipeline project and Russia’s intention to no longer supply gas to Europe via Ukraine, the Serbian authorities and experts are forced to find alternative supply routes.
Serbia, namely, is now getting Russian gas only from one direction – via Ukraine and Hungary. Russia’s plans to bypass Ukraine in future have forced Belgrade to consider all new gas supply options so as to ensure the country’s energy security. Serbia annually needs some two billion cubic meters of gas.
The debate kicked off on February 8 after a meeting between Serbian Prime Minister Aleksandar Vucic and US Assistant Secretary of State Victoria Nuland on energy and ways for Serbia to obtain natural gas. According to a statement issued by the Serbian government at the time, the US official said that Serbia should look at new options of gas supply and work on its energy security.
Prime Minister Vucic himself also confirmed that the government was rapidly weighing the situation in the energy sector. On February 12, he said that Serbia was open to proposals from the US and Russia on gas supply possibilities and that the best solution would be chosen. The prime minister further said that the current energy situation in Serbia was good, but that it was “best for Serbia to have more options and to choose the best solution.” “The gas supply is running absolutely perfectly, but we must look a few years ahead. I’m interested in what will happen in four, five or six years,” said Vucic.
Belgrade media reported that US officials had offered Serbia two alternatives to Russian gas supply. One is for Serbia to obtain gas from the US, but a prerequisite for that would be the construction of a gas terminal in Croatia, on the island of Krk. The Americans would deliver gas there on special ships, but for that Serbia would have to build connections to Croatia or Hungary on its own.
The second option is to obtain supplies from Azerbaijan, through the Trans Adriatic Pipeline (TAP), which may be completed by 2019. But in that case Serbia would have to build a connection to Bulgaria, in which a leg of TAP would end.
However, for the time being experts are unsure to what extent the US can offer Serbia real alternatives with regard to gas supply. Belgrade Economics Institute fellow Mahmud Busatlija said the US was offering assistance to western Europe in gas supply, but that no one had said yet what exactly America was offering and in what way.
He went on to say that the Americans might be offering shale gas and so-called liquefied gas, which is not of the same quality as natural ground gas. According to him, that liquefied gas could be transported, but certainly not in the quantities needed by Europe, and due to its quality much bigger quantities of the gas would have to be consumed by the European economy than the case would be with Russian gas.
The experts do not think supplies via TAP are a real alternative for the time being, either. “In order to connect to TAP, Serbia has to build a connection to Bulgaria on its own, and it is questionable whether there would be enough gas for us there,” said Jelica Putnikovic of the Balkan magazine.
In her words, the best option is for Serbian officials to ask Russia for help in connecting Serbia to the Turkish Stream. “It would be good for Serbia to find a financier for building a pipeline and connecting to any other pipeline. The best option would be connecting to the Turkish Stream pipeline, as it boasts the biggest capacity of 63 billion cubic meters of gas. We would have both additional amounts of gas and earnings,” said Jelica Putnikovic.
Serbian Minister of Energy Aleksandar Antic says the government is considering all projects and “treating them all equally.” The minister said that among the projects were Turkish Stream, TAP and the project related to bringing liquefied gas from the US.
“None of those projects crucially and capitally depends on Serbia and we expect their implementation and some steps... We will without any dilemma be a part of projects if they are realistic and if they give Serbia a chance to have additional quantities of gas,” said Antic.
The Serbian minister is to meet with his Bulgarian counterpart in February for talks on building a gas interconnection between the two states. Funds for the making of project documentation for that connection have been earmarked in the Serbian budget for 2015, but everyone is aware that the road between that step and gas deliveries from that direction is very long.
Igor Jovanovic