Bulgaria's Economy and Energy Minister Traicho Traikov signed on March 5 an agreement with Serbia's mining and energy minister Petar Škundrić to speed up the construction of the interconnection between the gas grids of the two countries.

The agreement outlined the next steps of the project and invited the assistance of the European Commission and international financial institutions in preparation of the project and related studies.

"It is our longstanding objective to connect the gas system of the Energy Community to the European energy market. This interconnector is the first major step in the process," European Energy Commissioner Guenther Oettinger said in a statement.

"We hope that the project kicks off without delay and we are ready to support its preparation and implementation, also financially under the regional development and enlargement programmes," he said.

Bulgaria, reliant almost exclusively on gas pumped from Russia through Ukraine, was the European country hit the worst by the halting of deliveries in January 2009. Since then, Sofia has moved to build interconnections with the gas grids of neighbouring countries.

Planned pipeline links with Greece and Romania, two fellow European Union member states, were awarded a total 54 million euro in funding from the EC on March 4.

"This gas interconnector is part of our strategy to link with our neighbours, which also includes interconnections with Romania, Greece and the possibility of physical reverse flow with Turkey. We intend to use part of our allocation from the European Regional Development Fund for this project since we believe this project will contribute greatly to the long term development of our country," Traikov said in the EC statement.

The gas pipeline, starting in Nis and crossing the border near Dimitrovgrad, would be the first interconnector between the transmission systems of Bulgaria and Serbia, contributing to the security of gas supply of both countries as well as the region, the statement said.

The investment required for the 180km pipeline, which would have a capacity of two billion cubic metres a year, was estimated at between 100 million and 120 million euro.The project preparation, as well as the construction of the infrastructure, could benefit from EU funds, the EC statement said.

The project is expected to enter into the feasibility study phase already in autumn 2010, and the first gas could start flowing in 2013.