Works on South Stream expected to start in July

Works on South Stream expected to start in July

Contractors will be hired in three weeks' time at the earliest, while a contract on a loan from Gazprom to Serbia's public gas enterprise Srbijagas for the construction of the pipeline section should be signed in the next two weeks, he pointed out.

Siromyatin told reporters at a conference on Serbia's role in the Balkan energy market held at the Serbian Chamber of Commerce (PKS) that he expected the construction to begin in July.

"There are ongoing talks about the loan from Gazprom to Srbijagas, and the interest rate will be lower than that on the market," he noted.

There are few companies that would grant a loan with a four percent interest, he remarked.

Commenting on the effect of the Ukrainian crisis on the pipeline project, he said the project was going according to a dynamic plan, and that the crisis in Ukraine had only shown that it had been the right choice to start the South Stream project.

When asked if the EU could stop the project, he responded that the European Commission should first present their objections along with their arguments against the project.

There are ongoing talks with the EU on the application of the Third Energy Package on South Stream , Siromyatin stated, stressing that he hoped the issue would be resolved.

Commenting on the recent statement by Russian President Vladimir Putin that South Stream could be revised if the EU continues to pressure the countries taking part in the project, and that this revision would concern "only those countries that are not EU members" - Serbia being one of those - Siromyatin said that depending on the situation, the path of the pipeline "can be altered."

"Crucial"

The construction of the South Stream pipeline will be crucial for energy security and economic stability of the host countries, president of the Serbian Chamber of Commerce (PKS) Zeljko Sertić said on Thursday.

"One of the biggest investments in Serbia over the past several decades, worth nearly EUR 2 billion, will bring direct and indirect benefits to the country's economy and encourage new investment and job creation," Sertić said at the opening of the energy forum on Thursday.

He pointed out that the benefits for the economy of Serbia and the region will be visible as soon as the works commence, as they will include direct engagement of several thousand people and indirectly, a much larger number of workers, construction companies, equipment manufacturers, project organizations and institutes, as well as companies in the service sector.

Numerous experts will be engaged in the gas pipeline maintenance during the exploitation, and after the completion of works, Serbia will benefit from the transport, electricity and energy infrastructure and other related facilities, noted Sertić.

"In the long run, the implementation of the South Stream project will enable a stable and sustainable development of the local economy and economy of the region, in particular the industries that use natural gas as energy source or feedstock in their production activities,” PKS president said.