Bulgaria is pulling pipes to the sea – Newspaper Kommersant No. 8 (7453) dated 01/18/2023
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Bulgaria, in the context of the EU embargo on imports of Russian oil, is trying to find options for providing its refinery in Burgas with raw materials. One of them may be the resumption of the Burgas-Alexandroupolis pipeline project, frozen more than ten years ago, which this time is planned to be deployed in reverse for supplies from Greece to Bulgaria. But experts, taking into account the cost and the lack of guaranteed pumping volumes, doubt the expediency of the project.
Bulgaria and Greece agreed to urgently resume the construction of a pipeline to transport oil from the Greek port of Alexandroupolis to Bulgarian Burgas. This was stated by Bulgarian President Rumen Radev at the forum “Bulgarian Energy: Strategy 2023-2053”. He explained that this is necessary to provide the country’s largest oil refinery in Burgas (owned by LUKOIL) with raw materials, as well as other refineries in the Black Sea region, “which will be able to receive oil from all over the world” in the context of a ban on imports of Russian raw materials to the EU.
According to the Minister of Energy of the country Rosen Hristov, the relevant memorandum of understanding with Greece will be signed in the coming weeks, which will allow to start work on the project. At the moment, the refinery in Burgas continues to receive Russian oil, since Bulgaria received the corresponding exemptions from the European embargo until the end of 2024. LUKOIL did not comment on the situation.
The original project emerged in March 2007 and involved the supply of oil, mainly from Russia, through Bulgaria to Greece in the amount of up to 50 million tons per year. Its cost was then estimated at about €1 billion. The essence of the project was to avoid passing through the extremely busy Bosphorus, where tankers regularly encounter traffic jams.
In 2008, Trans-Balkan Pipeline BV was established for construction, where Russia owned 51%, the rest of the shares were equally divided by Bulgaria and Greece. But in 2012, Sofia unilaterally withdrew from the agreement, the project was frozen.
Experts are skeptical about his resurrection. According to Igor Yushkov, an expert at the Financial University under the Government of the Russian Federation, there is a need to build such an oil pipeline against the backdrop of Bulgaria’s fears regarding Turkey, which may limit the passage of ships through its straits in the future. But, Mr. Yushkov notes, there are doubts about the economic feasibility of the oil pipeline with rather small volumes of consumption in Burgas: Bulgaria will have to buy oil on the world market, deliver it to Greece, pay for transshipment and pumping through the pipeline.
In the original version of the Burgas-Alexandroupolis oil pipeline, the sources of supplies in Russia and their recipients in the Mediterranean basin were clear, adds Vyacheslav Mishchenko, head of the Center for Analysis of Strategy and Technologies for the Development of the Fuel and Energy Complex of the Gubkin State University. According to the expert, at the moment there is no such certainty.
Mr. Mishchenko sees in Bulgaria’s plans to a greater extent a political statement about its intention to become independent from supplies from Russia.
Under the conditions of the oil embargo against the Russian Federation, not only Bulgaria is trying to find a way to provide raw materials for factories owned, among other things, by Russian companies. Thus, Serbia, in order to supply two refineries that are part of the local oil company NIS (56.15% owned by Gazprom structures), expects to build, in partnership with Hungary, a 128-kilometer branch, worth €83 million, from the Druzhba oil pipeline. Deliveries through Druzhba, at the insistence of Hungary, are excluded from EU sanctions until the end of 2024. Now Serbia receives oil via an oil pipeline from the Croatian port of Omišalj.
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