Bulgarian Prime Minister Boyko Borissov announced that Bulgaria will receive Russian gas from the “Turkish Stream” gas pipeline after a conciliatory two-hour meeting with Russian President Vladimir Putin in Moscow. Speaking to Putin Borissov personally took all the blame for the failure of the South Stream project. Kreassen Nikolov has the story.
Krassen Nikolov is a journalist specialised in judiciary affairs. He works for Mediapool and will be a regular contributor for BulgarianPresidency.eu for the six months of the Bulgarian Presidency of the Council of the EU.
Energy featured high in the talks between Borissov and Putin. Apart from gas, another issie discussed has reportedly been the Russian participation in another major energy project in Bulgaria – the construction of the Belene nuclear power plant. Putin announced that Russia has an interest in participating in this project, and Borisov said Bulgaria needs a second nuclear power plant.
Borissov’s visit took place following the settlement of the Commission’s investigation on Gazprom. On 24 May the Commission announced it will not fine the Russian gas export monopolist if it agrees to operate on a market principle in the countries of Central and Eastern Europe. Gazprom agreed to not to claim from Bulgaria a compensation for stopping South Stream and not to block the resale of Russian gas from its trading partners. [More]
The ground for the gas talks between Putin and Borissov was prepared by the visit of Bulgarian President Rumen Radev to Russia on 21 May. Radev was the first to speak publicly about the need for a decisive improvement of the Bulgarian-Russian relations and the construction of a direct gas pipeline to Bulgaria – “Bulgarian Stream”, as a second pipe of Turkish Stream has not yet been completed. Borissov too embraced the new Bulgarian-Russian relations, but “Bulgarian Stream” was put aside at the expense of “Turkish Stream”.
What was agreed in Moscow
Through the Turkish Stream gas pipeline, which should turn to Bulgaria, Borissov sid the country would receive 15.75 billion cubic meters of gas per year (bcm/y) to realize his idea for a gas hub “Balkan” near the Black Sea city of Varna. Bulgaria needs approximately 3 bcm/y for its own consumption.
Until now, it has not been clear how gas from Turkish Stream pipeline, which reaches the European territory of Turkey, would reach EU territory. The two options are Greece and Bulgaria. Turkish Stream is a direct competitor of the Southern Gas Corridor and Russia has plans to use the provisions of the EU legislation so that Russian gas could flow via the TAP pipeline via Greece to Italy.
Borissov presented the news as his personal success from his meeting with Putin, although it became clear that the Russian position had been prepared in advance. A day before his talk with Borissov, Putin received the agreement from Turkish President Recep Tayyip Erdogan on the turn of Turkish Stream to Bulgaria.
The business model of the gas trade near Varna is still not clear. After the meeting, it was understood that at least half of the gas would be left to the hub for the free sale. The idea is that the neighbors of Bulgaria – Greece, Serbia and Macedonia would buy this gas. The Commission has to be convinced that the project is market-based. So far Bulgaria has made sure that it will receive 1 bcm/y of gas from Azerbaijan through the TANAP gas pipeline, part of the Southern Gas Corridor, which also runs through Turkey. Borissov, however, needs one more source of gas to get approval from Brussels for the Varna hub.
“Russia and us and the European Commission will find a formula for the gas hub”, Borissov said.
“The main question was whether there would be a second point of entry from Turkish Stream to Bulgaria, Putin and the Turkish President did not object to it, before there was another route (South Stream). Yes, the gas could come directly to Bulgaria via South Stream, but these are past events”, said Borissov, who insisted that the gas hub near Varna should be realised as a European project.
The Prime Minister added that the project “Bulgarian Stream” is impossible at present, but things may change.
“If Bulgaria is a stable and predictable distribution center for Europe, we will talk about another pipeline, which will cost about €9 billion”, added Borisov.
How it was agreed
In Moscow, Borissov chose not to play as equal to Putin, but took full blame for the tense relations with the Kremlin. He said that “the bigger [brother] forgives” the mistakes. Putin replied that he dislikes the talk of the “big” and “small” because “the bigger one usually pays”.
Borissov then explained that Gazprom and Putin have forgiven Bulgaria €800 million or the failed project “South Stream”. This is not true because not claiming compensations was part of the bigger deal between the Commission and Gazprom.
‘My colleague’ Putin
“I know we had some bad moments in the past, but it’s good that my colleague is not a rancorous and looks at the future of the economies of both countries”, the Bulgarian Prime Minister said before Putin.
“We are sorry for South Stream, I see Bulgaria is sorry because it would be very profitable, we are ready for the new route”, Putin said.
As expected, Borissov motivated the failure of South Stream with Bulgaria’s membership in EU and NATO.
“We are the most disciplined state in the EU and NATO, and all the ‘Streams’ circumvented us. The gas pipelines passed through NATO states Greece and Turkey, and we were left with nothing, we gave them up, so I thank Mr Putin, he is not rancorous”, the Bulgarian Prime Minister said.
Surprisingly, Borissov abruptly left from Moscow, skipping the program for the second day.