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Serbia energy – Private sector

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Private Sector

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Given that the liberalization of the Serbian energy sector started relatively recently, the Serbian energy market is still largely dominated by public enterprises. The gradual liberalization of the energy market has brought private companies into the Serbian energy sector, but their presence is currently limited to a participation in energy trading, mostly of electricity, oil and natural gas, whilst the production, transportation and distribution of energy remains, at least for now, in the public domain.

Notwithstanding the above, the liberalization of the energy market and the planned integration of the Serbian energy market into the energy market of the European Union under the auspices of the Energy Community Treaty have resulted in increased interest from foreign energy companies regarding investment in Serbia’s energy sector. In that respect, a number of major energy companies are currently surveying the potentials of the Serbian energy sector, whilst some of them have entered informal agreements with the Serbian government regarding investments in major infrastructural energy projects.

The interest of the private sector in Serbia’s energy infrastructure is notable particularly in the area of renewable resources. Serbian renewable energy resources have attracted a number of local and foreign companies which have applied for a variety of specific energy permits. These have mostly related to the construction of small hydro power and wind power plants as well as the exploitation of biomass fuels. Their presence in the private sector is also visible in the gas sector where private companies are participating in the development of the natural gas distribution network.


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The largest Czech producer of electricity has long been striving to acquire the leadership position in the electricity market of South-Eastern Europe. ČEZ has been present in Serbia through its fully owned subsidiary “Čez Srbija d.o.o.” since 2006 and is currently looking for acquisition opportunities in the Serbian electricity sector. It has acquired a license for the trading of electric energy and is an active participant in the Serbian electricity trading market.


German company “RWE” has not yet established any formal presence in Serbia, although it has been involved in intensive discussions with the Government about investment possibilities in the Serbian energy sector. The result of these activities has been the execution of a memorandum of understanding between the EPS and the Government envisaging the future cooperation between RWE and EPS on the construction of the HPP “Djedrap III”, and the cascade HPPs on the river Morava and on the river Drina on Serbia’s border with the Republic of Srpska.


The “Energy Financing Team” is a company owned by private investors and is the largest trader of electricityin South East Europe.


The Russian company “Gazprom” is currently the single largest investor in the Serbian oil and gas sector. In 2009 its subsidiary “GaspromNeft” bought a 51% share in NIS, the largest oil company in the Southeast Europe. It is involved in the exploitation, processing and sale of both oil and oil derivatives as well as the production of natural gas. NIS’s exploitation capacities include 1 million tons of oil equivalents annually. Its processing capacities include two oil refineries, with one in Pančevo and one in Novi Sad. These have a total processing capacity of 7.3 million tons annually. It manages the retail network for the sale of oil derivatives in Serbia, consisting of some 480 sales outlets.

“Gazprom” is now the major player in the planned gas expansion of Serbia. Through the company “Yugorosgaz” where it holds a majority 50% share (another 25% is held by “Srbijagas” and remaining shares are held by the “Austrian Central ME Energy & Gas GmbH”), it holds the concession for the construction of the natural gas transportation system section from Niš to Dimitrovgrad which should connect the Serbian gas transportation system to the Bulgarian natural gas transportation system.

“Yugorosgaz” has also acquired the concession to construct the 123 km long natural gas transportation system from Niš to Prokuplje to-Priština which will allow it access to the gas market in Kosovo. After it finalizes the Niš to Dimitrovgrad gas line, “Yugorosgaz” will be able to sell gas directly to customers in the south of Serbia, Kosovo and in Montenegro.

So far, “Yugorosogaz” has completed the 62 km long section from Niš to Pojate. In addition it operates the parts of the distribution network that connect Niš, Ražanj, Aleksinac and Aleksandrovac. “Yugorosgaz” holds a license for the trade of natural gas and holds a major share in the sale of natural gas imported from Russia.

Finally, with “Srbijagas”, “Gazprom” will participate in the financing and construction of the Serbian section of the “South Stream” pipeline through Serbia, which is probably the single largest investment project in the Serbian energy sector. The two companies have already established a joint company in Switzerland for this purpose, where “Srbijagas” holds 49% of the shares and where “Gazprom” has a 51% shareholding.


“Telefonija” a.d. is a Serbian company involved in, amongst other things, in the development of the natural gas distribution network. To date, Telefonija has constructed a natural gas distribution network most of which is located in the Vojovodina region, but it has plans to expand its gas distribution network to other regions in Serbia.


“Rafinerija Nafte Beograd” is a company that produces oil derivatives. It currently operates as part of the “Neochimiki group”.


“FAM Kruševac” is the only domestic producer of lubricants with a significant export business. It is a part of the “NIBENS Group”.


There are a number of both domestic and international companies that have a developed network of retail outlets to facilitate the sale of oil derivatives including “OMV”, “MOL”, “Lukoil”, “Hellenic Petroleum” and others.


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