Serbia Splits Up Gas Utility

Serbia will break up its natural gas monopoly, Srbijagas JP, agencies report.

Sbrijagas will be divided, separating trade and distribution from storage and transportation. The reason is growing company debt became and reduced liquidity.

The government will “prevent the financial collapse” of Srbijagas and any of its new borrowing. Debt has reached almost €1.2 billion, and liquidity was just 1% of short-term liabilities, Energy Minister Zorana Mihajlovic told reporters in Belgrade.

“The situation brings the country into serious danger of disruption of the gas supply” coming from Russia, Mihajlovic said, presenting a plan to overhaul the Novi Sad, Serbia-based company. “We will engage in talks with commercial banks to reschedule loans given to Srbijagas.”

The gas entity is one of the partners in the construction of the South Stream pipeline.