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    Bulgaria Secures Russian Gas Price Cut: Report


Bulgaria is expanding its access to alternative supplies, while also assisting Russia in its TurkStream project.

by: Joseph Murphy

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Bulgaria Secures Russian Gas Price Cut: Report

Bulgaria has secured a 40% cut in the price it pays for Russian gas, its prime minister Boyko Borissov told reporters on March 3 according to Reuters.

As part of an EU antitrust settlement in 2018, Gazprom pledged to introduce more competitive gas pricing in eight eastern European countries where Brussels accused the Russian gas supplier of abusing its dominant market position. Bulgaria is the last of the affected countries to get a price cut.

"This morning Gazprom sent us the signed contract, which has the biggest price cut from all the countries that renegotiated their contracts. We have a 40% decrease," Borissov said.

Bulgaria has a long-term contract for up to 2.9bn m3/yr of Russian gas which runs until the end of 2022. Bulgaria bought more than the contractual volumes in 2017 and 2018, with supplies totalling 3.33bn and 3.17bn m3 respectively. But shipments came to only 2.4bn m3 last year, according to Gazprom's data, as Bulgaria took 0.5bn m3 of LNG via the Revithoussa LNG regasification terminal in Greece.

Bulgaria's gas transmission operator Bulgartransgaz agreed in January to buy a 20% stake in a new Greek terminal due to start up near Alexandroupolis in 2022, in order to gain access to some of its supply.  Bulgaria and Greece are also building a 3bn m3/yr gas link that will enable Sofia to expand LNG shipments and also source Azeri gas from the Southern Gas Corridor (SGC). SGC is expected to start flowing gas to Europe this autumn, at around the same time that the Bulgaria-Greece interconnector should come online.

 At the same time Bulgaria is assisting Russia in extending the TurkStream pipeline into southeast Europe. The extension will pass through Bulgaria before running through Serbia and into Hungary.

Sofia originally said it would complete its 474-km section of the pipeline by the end of 2019. But Bulgartransgaz only signed a contract for its construction in September, with a consortium led by Saudi Arabia's Arkad, after a previous award to another group was blocked by regulators.

Russia has been irked by Bulgaria's delay, with president Vladimir Putin Vladimir Putin threatening in December to reroute the pipeline around the country. Neighbouring Serbia has just finished its 403-km section of pipeline, Serbian energy minister Aleksandar Antic announced on February 28, although it still needs to build the link's support infrastructure.

As part of efforts it harness its position as a crossroads for gas supplies, Bulgaria launched its own gas trading platform on January 2. It has also signed a memorandum with Greece, Hungary and Romania on establishing a vertical gas corridor.