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The Government of the Republic of Serbia

In the service of citizens

Construction of gas pipe line largest greenfield investment in Serbia

Belgrade, 21 December 2006

Serbian Minister of Energy and Mining Radomir Naumov said today that the signing of the Memorandum of Understanding on the construction of a gas pipeline through Serbia is a turning point in the overall development of Serbian economy and society.

Radomir Naumov

Author: Fonet

Naumov told a press conference that the signing of this document will allow Serbia to turn from only a consumer and final user to a country of transit, which will provide regular supplies with natural gas.

At the same time, for GazpromExport, this memorandum means expansion and diversification of natural gas supply roads in Europe.

The Minister stressed that natural gas will be delivered from Russia through Turkey, Bulgaria, Serbia and Croatia to northern Italy and added that this will be the largest greenfield investment in Serbia estimated at $1.3 billion or €1 billion.

According to him, this investment will create new jobs and fully engage all domestic professional, technical and other operatives.

Naumov said that this document confirms the fact that Serbia has become a country that is politically and economically stable.

He stressed that Russian President Vladimir Putin and Serbian Prime Minister Vojislav Kostunica deserve most credit for this agreement as they practically set the route of this gas pipe line in their recent meeting.

Naumov said that Serbia is fully prepared for this project considering that projects of parts of the Dimitrovgrad-Nis line are prepared and that all property relations are solved.

At the same time, he added that it is expected that a project group will be formed. The group will comprise representatives of the Serbian government, GazpromExport and Srbijagas, which is to prepare all necessary documentation within six to seven months, i.e., by July 1, 2007.

Serbian Minister of Capital Investment Velimir Ilic pointed out that the construction of the pipeline through Serbia will provide new employment adding that works can start right away.

Ilic said that these investments will help employ tens of thousands of people in Serbia in 2007.

He called on citizens to get prepared for investments that are to come, highlighting the need of the re-training of personnel for future jobs.

Milan Parivodic

Author: Tanjug

Serbian Minister of International Economic Relations Milan Parivodic said that this is a greenfield investment of huge importance for mobilising the economy of Serbia, enabling it to become a strategic partner of European countries.

Parivodic said that he and Minister Naumov will sign the Agreement on clearing debt with Russia, with which Serbia's debt to Russia for gas will be cleared, but also a significant investment for reconstruction of Djerdap will be secured, as well as for the construction of an accelerator in Vinca.

He pointed out to the importance of ratification of a free trade agreement between Russia and Serbia in the Russian Duma, which will give even more security to investors.

Speaking as a coordinator of the Ministry of Finance, Parivodic said that this Ministry has definitely rescheduled and written off 60% of bilateral debts with members of the Paris Club of creditors, with which Serbia's foreign debt has been significantly reduced.

He added that this Ministry will present a decentralisation bill to the Serbian government next week or in 14 days at the latest, which will help Serbia become a more modern and liberal country for business.