revista presei pe energie 16 noiembrie – part IV

2010/11/16 South Stream: Bulgaria, Russia Ink Long-Anticipated Deal

Bulgaria and Russia have signed an intergovernmental agreement for the construction of the Bulgarian section of the South Stream gas transit pipeline in the presence of their Prime Ministers, Boyko Borisov and Vladimir Putin, in Sofia.

The two state delegations of Bulgaria and Russia formally signed the South Stream agreement, consisting of two documents,which had been prepared in advance in the past few weeks.

It was inked by the CEO of the Bulgarian Energy Holding (BEH), Maya Hristova, and the CEO of the Russian energy giant Alexei Miller.

The deal stipulates the establishment of a joint venture, South Stream AD, which will manage the construction and the operation of the South Stream gas transit pipeline on Bulgarian territory – which will be the most crucial land section of the pipe. BEH and Gazprom will each have a 50% share.

“I would like to thank Prime Minister Borisov for the invitation, our dialogue is a friendly one,” Russian Prime Minister Vladimir Putin stated at the joint news conference of the two state leaders after the signing of the South Stream deal and two other intergovernmental agreements.

Novinite: Bulgarian PM: Russian Gas for Bulgaria Will Be Cheaper

Bulgarian PM Boyko Borisov has stated that his country will be buying Russian gas at lower prices, just a day after talks with Russian PM Vladimir Putin appeared to end at stalemate on that matter.

PM Borisov spoke to the Bulgarian National Radio from the western village of Gigintsi, where he is present at the first service at the new church of the St. Anargyroi and Miracle-Workers Cosmas and Damian monastery.

“The price of Russian natural gas is falling and will continue to fall,” said the Bulgarian PM.

Although at the time of the Saturday visit in Sofia ITAR-TASS had published information that Gazprom is ready to offer lower prices to Bulgaria, statements by Putin after the meeting suggested that not much has been achieved in that area.

It was hoped that Bulgaria might request lower gas prices in return for contributing for the swifter development of Russian-sponsored South Stream natural gaspipeline project.

Saturday Vladimir Putin had deflected the question of lower gas prices by saying that the two matters are not related and that Gazprom receives only a fraction of the price paid by Bulgaria.

Sunday when asked on that topic Bulgarian PM Borisov confirmed that prices are indeed going to fall, but somewhat contradictorily stated that he must not discuss the matter, for that was the wish of companies involved lest the market should be affected.

This explains why no further details to PM Borisov’s statement were given.

Novinite: Bulgarian Energy Minister: Russia ‘Ready to Sponsor’ South Stream

In case Bulgaria faces problems with the financing of its section of the South Stream gas line, Russia can secure an advance amount, without having the right to obtain shares and assets.

The statement was made by Bulgaria’s Economy and Energy Minister, Traicho Traikov, who spoke Monday for journalists, after meeting with representatives of the Bulgarian Business Leaders Forum.

It was reported Saturday, during the visit of Russian Prime Minister, Vladimir Putin, to Sofia that the Russian side had declared readiness for advance funding. Earlier Monday, Bulgarian PM, Boyko Borisov, said in an interview for the TV channel bTV, the initial financing will come from the Russian energy giant Gazprom in order for Bulgaria to avoid gaping deficit while the total price to be paid by the country is EUR 400 to 500 M.

Meanwhile, in an interview for the Bulgarian National Radio, BNR, the CEO of the Bulgarian Energy Holding (BEH), Maya Hristova, rejected reports the CEO ofGazpromAleksey Miller, had stated his company was ready to provide the initial financing for South Stream.

Traikov clarified the issue had been brought up the bilateral energy talks and it had been agreed on that the financial assistance would not lead to increasing Russian shares or giving Russia ownership on the pipes on Bulgarian territory.

The Minister further explained the exact amount is yet to be determined and forecasted it at EUR 800 M to 1 B.

The financing of the pre-investment study for the construction of the Bulgarian section of South Stream, on which the two sides agreed on Saturday, will be provided by the joint company “South Stream Bulgaria” to be managed by Georgi Gergov, a former member of the Bulgargaz Board of Directors and now member of the Board of the municipal company “Sofia Properties.”

Novinite: Bulgaria to Amend Russian South Stream Deal to Fit EU Law

Bulgaria is to amend its original 2008 South Stream gas transit pipeline deal withRussia in accordance with what is described as “advice” from the European Commission.

After on Saturday Bulgarian PM Borisov and his Russian counterpart Vladimir Putinsigned in Sofia two documents for setting up a joint venture for the construction of the Bulgarian section of South Stream, an EU spokesperson announced Monday that EU executive is pressing Bulgaria to make sure that third-party companies are given access to South Stream to the future pipeline.

An agreement on gas transit signed by Bulgaria and Russia in 2008 ‘needs to be changed to be in line with European law,’ European Commission spokespersonMarlene Holzner, speaking for EU Energy Commissioner Guenther Oettinger.

‘We have a principle which says third-party access, which means that energy infrastructure … needs to make sure that other companies can also use this pipeline and we’d like to see this stated very clearly’ in the Russian-Bulgarian agreement, Holzner said as quoted by DPA.

She made it clear that Bulgaria has given assurances that the 2008 agreement will be modified to come into line with EU rules. The verbal promise came after the commission wrote to Sofia in April to ask about the gas deal, without reply, she said.

EU rules say that pipelines must, in general, be made open to all companies which want to use them. However, firms building new pipelines can reserve some capacity for their own uses, as long as they ask for commission clearance first.

The EU is keen to bring more competition to its energy markets and reduce its dependence on Russia for imports of natural gas. South Stream, which would bring gas across the Black Sea, is a Russian-led project designed to bypass the traditional transit route of Ukraine.

Holzner has assured that the EC remains committed to the construction of South Stream‘s competitor, the EU-sponsored pipeline Nabucco, which also passes through Bulgarian territory, because Nabucco provided for diversifying the energy sources for Europe – something which South Stream fails to do.

The South Stream gas transit pipeline is supposed to be ready by 2015. Its construction is expected to cost between EUR 19 B and EUR 24 B. It will be transporting 63 billion cubic meters of natural gas annually, or 35% of Russia‘s total annual natural gas export to Europe.

The South Stream pipe will start near Novorosiysk on the Russian Black Sea coast, and will go to Bulgaria’s Varna; the underwater section will be 900 km long.

In Bulgaria, the pipe is supposed to split in two – one pipeline going to Greece and Southern Italy, and another one going to Austria and Northern Italy through Serbia, Croatia and Slovenia.

The project was initiated by Gazprom and the Italian company Eni, and the French company EdF is also planned to join as a shareholder. It is seen as a competitor to the EU-sponsored project Nabucco seeking to bring non-Russian gas to Europe.

At a recent meeting in St. Petersburg, Berlusconi and Putin welcomed the idea of having German companies join in as shareholders. There is no indication as to how the joining of RWE or some other German company would re-apportion the stakes. TAPI pipeline agreement takes shape

Officials from countries participating in the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline agreed Friday on a final working draft document on the project which includes gas to be supplied by Turkmenistan.

The agreement was reached during the eighth meeting of the TAPI Technical Working Group in Ashgabat.

Turkmenistan offered during the meeting to use the gas from its huge South Yolotan gas field in the Caspian Sea to supply its pipeline partners, the Russian news agency Itar-Tass reported on Sunday.

The Turkmen government says the field contains 21 trillion cubic meters (tcm) of gas.

Expert participants at the meeting, which also included a representative from the Asian Development Bank (ADB), incorporated Turkmenistan’s offer into the draft agreement, the Trend news agency reported on Saturday.

Representatives from Pakistan also gave a presentation detailing how they will secure the pipeline in the participating territories.

The four partner states are expected to sign a formal agreement at the December summit of TAPI states in Ashgabat, Itar-Tass reported.

All remaining issues will be resolved at the ninth working group meeting in December, Turkmen news agency reported on Sunday.

The TAPI pipeline is sponsored by the ADB and was first conceived in the 1990s, but is only now making inroads towards development due to years of conflict in Afghanistan.

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