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Vucic: MOL, the Hungarian oil company, offered to pay up to 1 billion Euros for Serbia's NIS Oil firm.

Aleksandar Vucic, the Serbian President, said that MOL of Hungary had agreed to pay as much as 1 billion euros to purchase a majority stake in Serbia's NIS oil company from its Russian owners. MOL announced on January 19 that it had entered into a binding contract to purchase the 56.16% of NIS owned jointly by Gazprom and Gazprom. The price was not disclosed. In October, the United States placed NIS on sanctions because it was targeting Russia's energy industry over Moscow's conflict in Ukraine.

In a live broadcast by Belgrade's Blic TV, Vucic stated that the price for 56% of the company was between 900m and a billion euros.

The Office of Foreign Assets Control (OFAC), a U.S. government agency, must approve the transaction. The Russian?companies had until 24 March to?divest ownership.

Vucic stated that Serbia was willing to pay Gazprom & Gazprom Neft twice the agreed price. However, he refused to explain why this deal failed as it would "threaten Serbian interests".

U.S. sanctions led to the halting of oil deliveries via Croatia's Janaf, and the shutdown of NIS, the only refinery in the Balkans, which threatened winter fuel shortages. After the tentative agreement, OFAC granted NIS a reprieve from sanctions until February 20. This allowed it to import crude.

Gazprom holds 11.3% of NIS and Gazprom Neft 44.9%. The?Serbian Government owns 29.9% of NIS, and the rest is owned by small shareholders and employees.

NIS, apart from its oil refinery located in Pancevo in northern Serbia, supplies 80% the fuel needed by Serbia. It also has petrol stations in neighboring Bosnia, Bulgaria, and Romania.

(source: Reuters)