Serbia talks to Gazprom over HIP Petrohemija, NIS purchases

05 December 2008 17:42  [Source: ICIS news]

PRAGUE (ICIS news)--Serbia held talks with Gazprom on Friday to stress how the Russian major would benefit from purchasing petrochemical producer HIP Petrohemija in tandem with national oil company NIS, a government source said.

Gazprom CEO Alexei Miller said a deal for its oil subsidiary Gazpromneft to buy NIS should be concluded by the end of the year.

Miller, speaking after talks in Belgrade with government officials, declined to comment on whether its petrochemical subsidiary Sibur intended to acquire HIP Petrohemija, the source at Serbia's Ministry of the Economy said.

“HIP's management have made it clear that HIP would feel 'orphaned' if [HIP feedstock supplier] NIS was sold but it wasn't,” said the source.

“The Russians could possibly pick it up for around €200m ($256m) on top of what they pay for NIS, but their position on this still remains unclear.”

Serbia has so far demanded Gazpromneft pay around €400m to take control of NIS and invest another €500m in the refiner, but many Serbian MPs say the acquisition package should be worth at least €2.2bn.

The NIS and HIP deals are also contingent on Russia giving cast iron guarantees that it will include Serbia in the South Stream gas pipeline project.

($1 = €0.78)

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By: Will Conroy
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