Greek-Bulgarian Natural Gas Pipeline Project Speeds Up
The Greek-Bulgarian interconnector pipeline received a boost recently when the Bulgarian Ministry for Energy announced that the construction process will commence by March 2012.
The interconnector project, known as IGB, will connect the regions of Komotini and Stara Zagora.
The Bulgarian Prime Minister Boyko Borisov commented that there had been delays over the previous period as a result of the findings of some 80 archeological sites within the route of the IGB, but this issue has been resolved so far.
Vice president of the Greek natural gas company DEPA, Spyros Paleogiannis stated in the Greek press that "As far as IGB is concerned we cannot be 100% sure of the timetable due to ongoing environmental and licensing obstacles, but we can definitely say that the whole project is back on track".
The Athens based IENE energy institute estimates that IGB will be complete by the end of 2013 and will be fully operation in the beginning of the following year.
The engineer contractor for the project is the British company Pens Pen, which specializes in natural gas infrastructure. The company has subcontracted agents in Greece and Bulgaria and is in process of forming the environmental studies needed to implement IGB.
The total project cost is estimated at 150 million Euros, out of which 45 million Euros will be awarded by the European Union which strongly supports IGB as an implementation of the EU's natural gas diversification strategy in the Southeastern European region.
It is important to note that DEPA officially strongly correlates IGB with the ITGI project and plans to use it as an ideal transfer route of Azeri gas into Bulgaria. When the project was conceived in 2009 the Greek side made overtures for a second phase of IGB that would include Romania as well, a plan that still exists on a theoretical basis.
The shareholders of the Athens-based venture will be the "Poseidon" consortium in which DEPA and Edison SpA will participate, together with Bulgarian Energy Holding (BEH) from the Bulgarian side. According to a high-level source at DEPA, the most likely scenario would result in a 51% shareholding for Poseidon, but negotiations are still underway for that aspect.
The selection of the industrial company that will supply the pipeline with all necessary material is expected in early 2012. The cost is calculated as 35-40% of the overall budget and 12 industrial companies have expressed their interest in bidding. A short list will follow before final selection in the coming weeks.
The importance of the IGB lies mostly on the diversification policies as implemented by the EU and that directly correlates with Azerbaitzan's final decisions on which project will be selected in the Southern Corridor process to deliver Azeri gas to Europe. Thus the timing of IGB's construction process correlates with the information from Baku that a selection will be made in Spring 2012.