Bulgaria Energy Minister: I Can't Believe Borisov Said That

Energy | June 11, 2010, Friday // 14:32|  views

Bulgarian Energy Minister Traicho Traikov (L) is pcitured here during together with his Russian counterpart Sergei Shmatko during their meeting in Sofia on February 19. Photo by BGNES

There has been no official decision to scrap the pipeline project Burgas-Alexandrupolis or Belene nuclear power station, said Bulgarian energy minister Traicho Traikov, minutes after PM Boyko Borisov strongly suggested that Bulgaria will pull out of both projects.

The Council of Ministers has not adopted any resolution to stop the Burgas-Alexandrupolis projects, said Traikov.

Traikov expressed extreme surprise at claims that Borisov said Bulgaria will give up the two high-profile energy projects, exclaiming “I can't believe he said that!”

Bulgaria's prime minister surprisingly announced earlier Friday that the country will dump the Burgas-Alexandroupolis oil pipeline project over fears that it is unprofitable and damaging for the country.

Borisov also stated that Bulgaria is freezing the construction of its second nuclear power plant at Belene because of the lack of guarantees for the profitability of the project.

Bulgaria, Greece and Russia had agreed to build a pipeline between Burgas and Alexandroupolis, taking Caspian oil to the Mediterranean skirting the congested Bosphorus, in 2007 after more than a decade of intermittent talks.

The agreement for the company which will construct the Burgas-Alexandroupolis oil transit pipeline was signed by Bulgaria during Russian President Putin's visit to Bulgaria in 2008.

The 280-kilometer pipeline, with 166 kilometers passing through Bulgaria, would have an initial annual capacity of 35 million tonnes, which could be later expanded to 50 million tonnes. Its costs are estimated at up to USD 900 M.

After its initial start in the late 1980s, the Belene project was restarted in 2008 by the Socialist government of Sergey Stanishev. It was estimated to cost about EUR 4 B, half of which were supposed to come from the German energy company RWE in exchange for a 49% stake in the plant.

After the Borisov government took office in the summer of 2009, Bulgarian officials estimated the price of the plant at about EUR 10 B. In the fall of 2009, RWE withdrew from the project, prompting the Borisov government to start searching anew for a strategic foreign investor.

The Russian government, whose company Atomstroyexport is supposed to construct the future nuclear plant, has offered Bulgaria state loans on a couple of occasions – EUR 4 B in the spring of 2009, and EUR 2 in the spring of 2010, in order to keep the construction going until Bulgaria finds an investor.

However, those offers have been rejected by both the Stanishev and the Borisov governments. Prime Minister Borisov has explicitly made it clear that Bulgaria will not construct the new 2000 MW plant unless it finds a strategic investor from Western Europe. 

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Tags: pipeline, oil and gas supplies, nuclear power, energy project, Belene NPP, Burgas Alexandroupolis, Traicho Traikov, Boyko Borisov


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