BELGRADE, Sept 27 (Reuters) - Serbia's NIS oil monopoly, majority owned by Russian group Gazprom Neft (SIBN.MM: Quote), will double planned investments in its drive to become the regional market leader by 2020, NIS said on Monday.
NIS Chief Executive Kiril Kravchenko said the company would invest around $1 billion by 2014. Half of this will be spent on its oil refinery in Pancevo and the rest on boosting oil inventories and modernising fuel stations.
Gazprom Neft would lend NIS a major part of the investment to be injected in 2010 and 2011. The rest would be financed from NIS revenues, Kravchenko said without elaborating.
NIS has held a monopoly in oil derivatives processing since 1999, when NATO bombing heavily damaged its two refineries. The monopoly, approved by the government to give NIS time to recover and become competitive, expires in January 2011.
"The complete realisation of NIS's strategy is not an easy task, but I am confident that by 2020 we will become the regional market leader," Kravchenko told an energy workshop organised by the Serbian government.
He said its strategy focused on increasing refinery output, modernising petrol stations and increasing its share of the wholesale market to 75 percent.
Gazprom Neft paid 400 million euros ($533.8 million) last year for 51 percent of NIS as part of an energy pact between Serbia and Russia. It pledged to invest 500 million euros in the Serbian company.
The Serbian government holds 29 percent of NIS. The remaining 20 percent belongs to former employees and about 4.8 million citizens who got shares as a part of the government's plan to distribute stock of public companies.
NIS posted a 9.6 billion dinar ($122.1 million) first-half loss, mostly due to the weakness of the Serbian currency, but expects a 1.9 billion dinar profit in 2010, it said in August. (Reporting by Maja Zuvela and Ivana Sekularac; Editing by Michael Shields) ($1=.7494 Euro)
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