Bulgaria Should Focus on Gas: Report
Energy consultancy Baringa Partners said May 2 it has produced a report, co-funded by Shell, that shows Bulgaria should develop an energy strategy for 2030 that incorporates a more prominent role for gas in its energy system, or risks being unable to meet its 2030 climate change targets.
It urges the Bulgarian government – which holds the EU Council presidency until end-June - to develop a detailed plan for the transition of the existing energy mix towards gas, implement effective market reforms, and undertake select infrastructure investments. Market liberalisation has not been as rapid or as effective as it could have been, the report argues, with gas playing a relatively minor role in the power generation mix. Baringa’s analysis points to “the critical role that gas can play in Bulgaria’s energy future and pathway to decarbonisation as an affordable, plentiful fuel….in partnership with renewables.”
“Shell agrees with the findings in the study which show that the Bulgarian gas market has the potential to provide a lower cost route to a decarbonised future than focusing on renewable sources alone,” said Kamelia Slaveykova, Shell Bulgaria country chair.
Baringa energy/renewables partner Jayesh Parmar said that the Ukrainian crisis of 2009 highlighted Bulgaria’s vulnerability over gas imports but added: “Policymakers are starting to recognise the real opportunity that exists for Bulgaria to develop its own gas supplies in the coming years and replace the coal on which it has relied for so long to provide low cost energy.”
Among its recommendations, Baringa welcomes Bulgaria’s moves to invest in new interconnectors, specifically IGB for access to southern corridor gas and LNG imports via Greece but adds that it should use congestion management procedures to unlock market access to key import routes blocked by 90% ship-or-pay contracts, and should campaign for increased compression in Romania so that capacity in the existing gas pipeline from Romania can be increased. It also urges Sofia to progress energy market reforms, following the EU-acquis for detailed guidance.
Romania's deepwater Neptun field, owned by a joint venture of ExxonMobil and OMV Petrom, has the potential to be a key upstream gas source for the region in the 2020s, while a delayed northern Greece LNG import project hopes to take Final Investment Decision late 2018. Offshore Bulgaria itself, Total made an oil discovery in 2016 on its large Khan Aspurah licence but has yet to develop it.
Bulgaria consumed 3bn m3 of natural gas in 2016, according to the latest BP Statistical Review of World Energy; according to Bulgaria's own statistics, imports made up 97% while own production was 3%.