Medvedev and the Russian Bear tie up Serbian / South Stream / Gazprom Neft / INS deal to make inroads into Europe's soft underbelly

Finally, after talks lasting 11 months,( see Saturday, January 26, 2008 Putin plays the power card (again) in the Balkans ) Russia and Serbia have a mega bucks energy deal so that Russian state gas monopoly Gazprom Neft will now purchase 51% Serbia's oil monopoly NIS in exchange for building a gas pipeline through Serbia.

The deal was finalised today in the Kremlin between Dmitry Medvedev, the Russian president, and Boris Tadic, the Serbian President.

Alexander Dyukov, the Gazprom Neft president, said that his company would need to seek approval of Serbia's anti-monopoly agency for the deal to buy NIS, the Russian Interfax news agency reported. This means that if approval is given - and they have 130 days to think about it, the deal will be completed by May.

Not everyone is happy and economy minister , European leaning Mladjan Dinkic,of the panty waisted neo-liberal G-17 Plus has resigned. Critics point out that there are no guarantees that Russia will build the South Stream pipeline by 2015.

The US$13bn pipeline under the Black Sea would carry Russian natural gas to Bulgaria and Serbia before branching out to points in western Europe.

Others say that US$550 million (400 Mn Euros) for NIS is a giveaway and is really a hidden kickback for Russia's support of Serbia's bid to retain its claims on Kosovo. For what their opinion is worth Independent consultants Deloitte valued the whole company at 2.2 billion euros in September.

As part of the deal, Russia agreed to invest 550 million euros to modernize Serbian refineries and build a gas storage facility.

Reuters report that Vyacheslav Bunkov, an oil and gas analyst at Aton brokerage said that under the deal Gazprom essentially had received control of "all of Serbia's oil processing and sales network."

"Gazprom Neft begins its integration into Europe," he added.

One thing is certain , the guys in Camp Bondsteel in Kosovo and their masters will be none too happy with Mr Tadic.