* Volumes to rise from 1.5 Bcm/year from start of 2018
* Contract signed in 2013 valid until end of 2021
* Serbia almost entirely dependent on Russian gas
Russia's Gazprom has agreed with Serbia's Srbijagas to increase the contacted volume of gas supply as of next year to 2 Bcm/year from the current 1.5 Bcm/year, Gazprom said Tuesday.
Serbia -- which is almost entirely dependent on Russian gas imports -- has been importing above its contracted volume in 2016 and 2017, with the additional volumes supplied under supplementary agreements.
Last year, Serbia received 1.75 Bcm/year of Russian gas -- above its 1.5 Bcm/year contracted volume -- and this year it already exceeded that level in mid-November.
Russia supplies gas to Serbia under a deal signed in 2013 that is valid until the end of 2021.
The increased volumes are part of an addendum to the existing medium-term deal signed in Moscow in the presence of President Vladimir Putin.
The Balkan region suffers from relatively poor gasification but with the startup of new supplies to southeastern Europe via pipelines from Azerbaijan and potential new LNG terminals in the region, it is hoped it can become a bigger gas user both in the industrial and power generation sectors.
The EU last week pledged Eur102 million in funds to help support the construction of an offshore LNG terminal on the Croatian island of Krk, which it said would "bring diversification in the region mostly dominated by one single source of supply."
"It will thus improve energy security and price competitiveness in the region," it said.
The project -- which in a first phase will consist of a small, 2 Bcm/year floating LNG import facility -- is one of the main pillars in the EU's plans to improve diversification of gas supply in the poorly connected southeastern European region.
