Djedovic Handanovic: Serbia receives gas from Russian Federation at best price, new contract to be signed soon

Minister of Mining and Energy Dubravka Djedovic Handanovic has told Happy TV that Serbia receives gas from the Russian Federation at the best possible price, and that she expects a new long-term contract for gas supply from the Russian Federation to be agreed on by May 31.

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"The Russian Federation is a good partner and Serbia should use that partnership in the best way, we get gas at the best possible price and the citizens should know that. It's very good that President Vucic was in Moscow (for Victory Day), because the two presidents discussed many topics, including the long-term gas supply contract. The contract expires on May 31 and we are working to get everything agreed on by that date, and if something's unresolved, we have good and daily contact with Russia and we will find solutions," said Djedovic Handanovic.

The minister added that the contract will cover several years, as well as that the amount of gas deliveries will be increased with new conditions.

"The goal is to sign a gas supply contract lasting more than three years, and we will see whether it is adequate that it is five or ten years, like the one Hungary has. We need to see what is best for us, what the Russian side thinks about it, as well as to have the necessary flexibility, especially in the summer, because we spend more in the winter. We expect it to be up to 12 million cubic meters per day, maybe even increase the amount of gas from 2 to 2.5 billion per year," she said.

When asked about the price of gas that will be defined in the new contract, Djedovic Handanovic stated that in the previous period Serbia had a good price ratio and that this is expected to remain the same.

"This winter, the price of gas on the market reached up to 600 dollars per 1,000 cubic meters, while we purchase Russian gas for less than 300 dollars per 1,000 cubic meters. Based on that, we have been able to save between 300 and 500 million dollars annually. That money can be used to build highways, hospitals, schools, and pay pensions. I expect that the price ratio will remain good in the new contract," the minister said.

Djedovic Handanovic added that the completion of works on the expansion of the Banatski Dvor underground gas storage facility is expected in the next two years.

"The expansion of the Banatski Dvor underground gas storage facility is very necessary for us, because we will increase gas stocks that we store in our territory. The work has started, the first rigs have been completed and that will be worked on, full steam. There are long deadlines for the delivery of the equipment, which depends a lot on the completion of the project, but we will strive to finish it in the next two years," she said.

The minister noted that energy security and safety is always a current issue, and that the energy transition must be carefully planned.

"There have been power outages in Spain, Portugal, and even in our region last year, which did not affect Serbia. We need safe basic energy supply, which at the moment can come from thermal power plants and gas power plants, in addition to renewable energy sources, and we need a strong, safe transmission grid.

We have been investing more and more in the transmission grid since 2015, but we are also increasing production capacities. Last year, a new thermal block was launched in Kostolac, and we will also build more gas power plants. It is a transitional fuel which can easily balance the whole system of green energy, that is unstable because it depends on weather conditions," the minister said, and concluded:

"We must carefully plan the energy transition and we will not rush in and be the champions of global trends - that could end up endangering our citizens."

(Telegraf.rs)