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    Bulgaria Seeks TurkStream Financing


Sofia aims to finish the pipeline by the end of the year

by: Joseph Murphy

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Bulgaria Seeks TurkStream Financing

Bulgarian gas grid operator Bulgartransgaz has launched a tender to attract €400mn ($452mn) in financing for the Balkan Stream and other investment projects.

Balkan Stream will serve as an extension of one of the TurkStream's two 15.75bn m3/yr strings, carrying Russian gas through Bulgaria and Serbia and into Hungary. Bulgartransgaz secured €200mn ($223mn) in short-term credit from a group of lenders in October to fund advance payments to contractors for construction.

The operator is now seeking up to €400mn in loans with a six-year repayment term, including a one-year grace period, with an interest of up to 3.9%. Banks have until the end of the month to submit bids.

"The aim is to secure financial resources for the investment programme of the company, aimed at diversifying gas sources, increasingly security of supplies and establishing the country as a regional gas hub," Bulgartransgaz said in a statement. Besides Balkan Stream, funds will be used to build a gas link with Serbia, expand the underground gas storage facility in Chiren and construct transmission pipelines to provide more industrial and household consumers in Bulgaria with gas.

Bulgarian prime minister Boyko Borissov said on June 1 he hoped work on Bulgaria's 474-km section of Balkan Stream would be complete by the end of 2020, despite disruptions caused by the coronavirus (Covid-19) pandemic. The lead contractor is a consortium led by Saudi Arabia's Arkad, which won €1.1bn ($1.2bn) in September.