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The Government of the Republic of Serbia

In the service of citizens

EU interested in construction of Nis-Dimitrovgrad oil pipeline

Belgrade, 1 July 2005

Serbian Minister of Energy and Mining Radomir Naumov said today that EU countries included the construction of the Nis-Dimitrovgrad oil pipeline in their list of priorities in the development of gas infrastructure since that route would enable them a reliable supply of gas from the Caspian region.

Speaking at a press conference following the Ministry's delegation’s return from the visit to Brussels, Naumov said that the European Commission supported all energy projects presented by the Ministry's delegation, and specified that these projects concern the re-organisation of the energy sector and development of gas infrastructure.

During the talks with EU Energy Commissioner Andris Piebalgs and representatives of the institutions for financing the construction of gas infrastructure in southeastern Europe, the Minister received assurance that the EU will assist the construction of the Nis-Dimitrovgrad oil pipeline and other projects in that field with substantial funds.

The talks also focused on measures for environmental protection. Representatives of the Ministry's delegation requested assistance in meeting the EU's ecological standards, such as reduction of sulphur in liquid fuels and the emission of carbon dioxide.

Naumov said that the delegation presented its final preparations for signing the agreement on the energy community, as well as the Serbian government's activities on the reform of the energy sector at the legislative, institutional and structural level. He added that the European Commission representatives welcomed the Serbian national energy development strategy to 2015.

The Minister said that a middle-term budget of the European Union for the period between 2007 and 2013 is under preparation, which envisages funds for pre-accession assistance. It should be available to all candidates as assistance in the building of institutions, judiciary and administrative capacities, and regional and trans-border cooperation.

Naumov said that he had asked those he met with to help Serbia with regional development and development of human resources, villages and the economy because it would significantly accelerate the economic and political stability of the entire region.

EU Commissioner for Energy Andris Piebalgs pointed out that Serbia could now utilise instruments provided by the EU to solve such problems.

Naumov announced that future meetings of the working group for financing the oil pipeline will take place in Serbia, as well as the Athens forum energy week scheduled for September this year.

During their visit to Brussels, Naumov and representatives of the Serbian Electric Power Industry (EPS) and the Oil Industry of Serbia also talked with Special Coordinator of the Stability Pact for South Eastern Europe Erhard Busek.

Speaking about the increase in electricity prices, which is less than had been demanded by the EPS, the Minister said that the EPS must revise its business plan.

He said that the Serbian government has made a promise to the EPS to write off some of the company’s debts to the state, however that is not enough to fulfil all planned obligations.

There is a possibility to adjust the electricity prices in Serbia one more time by the year’s end, he added.

The Minister also said that the disruption in the oil derivatives market in Serbia will probably be removed within seven days, considering that the government has approved emergency import of diesel fuel, and the Serbian market should be properly supplied with this oil derivative.