Serbian oil monopoly Naftna Industrija Srbije, majority held by Russia’s Gazprom Neft, is planning to take the lead in regional fuel production and exports, a top company official said.
“As of 2012, production will be expanding,” Kiril Kravchenko, a Gazprom Neft-appointed CEO of the NIS, said in an interview with a selected group of reporters on Tuesday. “We will have 50% of our production slated for exports ... we will try to make Serbia a base for exports to the region and elsewhere.”
In February, Gazprom Neft paid €400 million ($529.4 million) for a 51% stake in NIS and pledged additional investment of €547 million, as part of a wider energy deal between Serbia and Russia. NIS holds a monopoly on crude oil processing in Serbia and it owns the country’s only two refineries.
Kravchenko said the new company’s leadership “will be seeking diversification of Serbia’s crude oil supplies”. Serbian media reported this week NIS and the government would negotiate the rise of fuel prices this month.
Earlier this week, NIS invited bids for the purchase of processing machinery for the Pancevo plant, its first investment after the takeover by Gazprom Neft. The company would not immediately invest in the other refinery in Novi Sad which had newer technology, Kravchenko said.
The Russian company was also considering whether it should buy a controlling stake in the Petrohemija chemical plant which is a part of Serbia’s oil industry to settle a $70 million NIS debt or “seek other ways of debt restructuring”. “Petrohemija facility is (technologically) linked with the Pancevo oil refinery ... we have to discuss this with the Serbian side,” Kravcenko said without elaborating.
The NIS envisions 2008 unaudited revenues of about RSD 3 billion ($4.17 million) while audited figures will be announced on June 1. Under a bilateral energy deal in December, Serbia and Russia also agreed to develop part of the South Stream pipeline to transport natural gas via Turkey, Bulgaria, Serbia and then on to European markets, bypassing Ukraine.
Like other European countries reliant on Russian gas deliveries, Serbia was also hit hard during the January gas row between Ukraine and Russia and the pipeline is expected to help Serbia diversify its gas supplies. (Reuters)