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The Bulgaria Government: The Turk Stream doesn’t cross Bulgaria

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This revelation was shared with the media by Energy Minister Temenuzhka Petkova yesterday. The frivolous interpretation is certainly not hers, as the leading authority in all that pertains to energy is the Bulgarian Prime Minister.Here is the gist of the official Bulgarian narrative on this ghost project that enters as Turk Stream, proceed further as Turk Stream, but is not Turk Stream in Bulgaria?The project traverses the Black Sea, Turkey, Serbia, and Hungary. In Bulgaria, however, it suddenly adopts a different name – the Balkan Stream.All parties involved in interpreting the Turk Stream – Russia, the EU, and the US refer to the Bulgarian segment of the pipeline as an integral part of Turk Stream. The only exception to the shared reading is the PM and the Energy Minister of Bulgaria.The Bulgarian government erroneously claims that the Balkan stream is not a transit project, backing its thesis with an elusive ‘evidence’.What makes a project transit?There are many indicators for a transit project – often leaving ample room for varying interpretations – but none that would fit into a dedicated 90 percent exit and 100 percent on the entry capacity in Serbia. These facts indicate a reality where Gazprom gas is being transferred from Turkey to Serbia, with a secured monopoly status in Serbia. Such a move directly violates EU gas directives. The EC will inevitably have the final say in licensing the different segments of the Turk Stream, including the Bulgarian sections.The futile attempts to portray the Balkan Stream as detached from the Turk Stream has been the brainchild of the legal teams, working for Gazprom, that advise on Nord and Turk Stream. They also provide legal counsel to the Bulgarian government on how to avoid EC regulation of the project. Their ‘innovation’ is to present the project as an innocent expansion to the national transmission system, therefore subject to regulatory approval by the Bulgarian Commission of Energy and Water Regulation.As the Turk Stream traverses two EU member states and its gas flows will have an impact of the whole regional gas market, EC level regulation becomes both indispensable and unavoidable.The attempt by the government of a member state to escape EU regulatory framework for a project that affects the EU gas market is in direct violation of the common market rules and the anti-trust legislation. In addition, the European Court of Justice explicitly ruled in the case of Poland vs the EC on the Opal gas pipeline capacity allocation, that forced Gazprom to reduce its capacity use from 90 to 50 percent. This means that the entry and exit capacities booked by Gazprom in Bulgaria under the transit contract with Bulgartransgaz are in direct violation of this court ruling.Under the existing EU legal framework and under the current terms in the transit contract, the operation of the Turk or Balkan stream through Bulgaria seems impossible.The US authorities also have strong reservations as the current transit contract in the Bulgarian section of the Turk Stream represents an unfriendly act under the WTO rules, taken against the interests of American companies, as US or any other LNG is denied equal treatment and access to the Serbian and Bulgarian markets.Whether the Bulgarian Turk – Balkan Stream – is a predominantly national or transit project, further depends on Gazprom’s distinction between the share of the gas that goes via this designated pipeline for domestic Bulgarian consumption – the 3 bcm and the percentage destined to Serbia – 4 times more!?This matrix applies to the reverse flows through the Trans-Balkan pipeline, the transmission system, and the interconnectors with Greece, Romania, and North Macedonia.Gazprom has made it explicitly clear it is not going to trade any gas via the Balkan Gas Exchange, which could have given some credence to the Balkan Stream and ‘expansion of the grid’ theory.Furthermore, the essential new 484 km stretch from CS New Provadia to Zaječar at the Serbian border is also dedicated line exclusively build to serve Russian gas flows.The segment of the Trans-Balkan pipeline from CS Strandjata to CS Provadia is blocked solely for the transit flow of Russian gas. The other line in this section that could be used to ship gas is part of the national transmission system but is not part of Turk-Balkan Stream.The exclusive use of this segment of the TBP proves beyond doubt – the Turk-Balkan Stream is not an expansion to the gas system, but a special route duct, aimed to serve a special client – Gazprom, and its competitors will not have equal or fair access.Finally, the Balkan vs. Turk Stream drama is a case of ‘lay low’ and ‘play dumb’ – classics from the late Bulgarian dictator Zhivkov’s rulebook.What does the Bulgarian government miss?Although there is no detailed list of the segments of the Turk Stream, the text in the NDAA explicitly states that sanctions will be applied to the maritime sections but also to all “successor’ projects, regardless of name.The only valid interpretation of whether the Bulgarian segment is part of the Turk Stream, based on the above wording, will be given by the US State Department and the Department of Treasure, not the Bulgarian government. Worth a quote from US Ambassador to Bulgaria Herro Mustafa, that leaves no room for second guesses: “The continuation of the Turk Stream through Bulgaria is intended to use Bulgaria solely as a transit country. “By refusing to acknowledge the fact that the Turk Stream passes through Bulgaria – PM Borisov and Energy Minister Petkova have jeopardized the ability of Bulgartransgaz, and the main contractor Arkad to seek exemption or more lenient terms. The text in the sanctions sets a precondition for any company to seek settlement – to halt work immediately. By refusing to do so, until the situation is clarified, as the companies, involved in Nord Stream – 2, did, the Bulgarian government has exposed itself to potential future claims for damages and losses in the hundreds of millions of euros.Finally, PM Borisov wrongly believes that he could outwit the US Congress or the Washington establishment by implying the unsaid and the unheard, that during his meeting with President Trump, he has received a tacit nod of approval.Let me remind him of a hard fact – there is a strong bipartisan support for the sanctions and for the need to deny the Kremlin the right to monopolize the CEE regional gas market via the Nord and Turk Stream ‘pincer’ strategy. It is not just about geopolitics, but touches upon basic business interests – the equal right of US and any other LNG to compete with Russian gas on Bulgarian and regional markets.The residents in some high offices in Sofia seem to have missed the main message – playing in the court of Gazprom alone, denying competitors the right to challenge Russian gas market shares on  Bulgarian and regional turf, will be perceived as a threat to US and NATO’s essential interests.The play is not America vs Europe as Kremlin tends to portray the situation. The will of the EU people has been exemplified by the two resolutions of the European Parliament passed with overwhelming majority condemning the Nord and by default the Turk Stream.The US sanctions provide additional leverage to every country and national gas company that seeks to negotiate better terms with Gazprom and fight Russian influence.Those who seek to persist with their total dependence on Russian and Gazprom gas will perceive the US sanctions as a threat to their personal and group interests.Let me finish with another quote from US Ambassador Mustafa’s latest speech at the Atlantic Club: “Our common goal is to make Bulgaria a true gas distribution center and a key source of regional energy security, with no monopolies, whether foreign or national, operating on the basis of market principles. “It is time to move on, beyond Gazprom as the only or preferred option for Bulgarian consumers and let the markets and competition decide.


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One thought on “The Bulgaria Government: The Turk Stream doesn’t cross Bulgaria

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