The Russian state-run gas group aims to pay €400m ($590m, £290m) for 51 per cent of Petroleum Industry of Serbia, or NIS, without facing rival bidders.


The terms of the offer, which the government has confirmed is under negotiation, would be sweetened by Gazprom's promise of a branch of the South Stream gas pipeline running through Serbia, ensuring lucrative transport fees and lower gas prices for the country for decades to come. But the branch's limited capacity of 10bn cubic metres would just cover local needs, while larger-scale gas shipments to Hungary and western Europe - which earn substantial revenues - would not go via Serbia, critics said.

The Russians have also promised to boost Serbian "energy stability" by activating a gas storage site. In return, Gazprom, its subsidiary Gazpromneft, and NIS would retain a monopoly on refining and a protective ban on private-sector oil and gas imports for five years.