EIB backs Bulgaria-Serbia gas link

The European Investment Bank (EIB) has increased the EU's support for the construction of a gas pipeline between Bulgaria and Serbia with the issue of a €25mn ($30.5mn) loan, it said on May 20.

The 171-km Nis-Dimitrovgrad pipeline will help diversify Serbia's energy mix, which currently relies heavily on gas supplies from Russia, and strengthen the southeast European energy network, the EIB said. Earlier the EU issued a €49.5mn grant for the pipeline, which it lists as a project of common interest.

Construction is scheduled to start this year and finish in 2023, the EIB said, noting that the pipeline would allow Serbia to tap gas supplies from LNG terminals in Greece and Azeri gas running through the Southern Gas Corridor network. Serbia already has a pipeline connection with Bulgaria, but this is used to receive Russian gas arriving in Europe via the TurkStream. 

Serbia relies on coal for over half of its total energy supply, according to the International Energy Agency, although gas comes in second, accounting for around 15%. The government wants to build a series of new gas plants along with renewable energy facilities in order to reduce coal use, however.

The Nis-Dimitrovgrad gas pipeline will be one of the last gas infrastructure projects to enjoy support from the EIB, as the bank plans to cease oil, gas and coal funding at the end of this year.