The Gazprom headquarters hosted today a working meeting between Alexey Miller, Chairman of the Company's Management Committee and Dusan Bajatovic, Chief Executive Officer of Srbijagas.

The parties discussed the current issues related to strategically important joint projects appreciating the cooperation deepening between Gazprom and Srbijagas as part of the South Stream gas pipeline and the Banatski Dvor underground gas storage (UGS) facility construction.

The meeting highlighted that commercial operation of the Banatski Dvor UGS facility launched on September 1 was a significant contribution to the sustainability of Russian natural gas supplies to Serbia and Southeastern Europe.

Background

In 2010 Gazprom supplied Serbia with 2.1 billion cubic meters of natural gas.

Founded on October 1, 2005 by the Serbian Government within the reorganization of state-owned Naftna Industrija Srbije – Serbian Oil Industry (NIS), Srbijagas is the Serbian state-owned company dealing with natural gas transmission, distribution and storage in Serbia.

With a view to diversify the natural gas export routes, Gazprom is planning to construct a gas pipeline running under the Black Sea to the countries of Southern and Central Europe – the South Stream project.

Intergovernmental agreements were signed with Bulgaria, Serbia, Hungary, Greece, Slovenia, Croatia and Austria in order to implement the onshore gas pipeline section.

On May 15, 2009 Gazprom and Srbijagas signed the Basic Agreement of Cooperation for the South Stream project in Serbia.

In November 2009 registration of the joint project company, South Stream Serbia, was accomplished. Gazprom holds a 51 per cent stake in the company and Srbijagas – a 49 per cent stake.

In October 2009 the Agreement on Setting up a Joint Venture for the Banatski Dvor UGS Facility was signed.

The joint venture responsible for construction and operation of the UGS facility was registered in February 2010. The joint venture has the following shareholding structure: Gazprom Group – 51 per cent, Srbijagas – 49 per cent.

The Banatski Dvor UGS facility was created on the basis of the eponymous depleted gas field situated 60 kilometers to the northeast of the Novi Sad town. The UGS working gas capacity stands at 450 million cubic meters, the maximum daily send-out capacity – 5 million cubic meters of gas. The UGS facility offers potential for further expansion.