South Stream Bulgaria’s Capital Increase is Breach of Protocol, Says Sofia

Gazprom confirmed that South Stream Bulgaria suspended orders and contracts for the South Stream gas pipeline construction in the country. At the same time, a Russian newspaper voiced the possibility of a plan B for the project, which could pass through Greece and Turkey, dropping Bulgaria, Serbia, Hungary and Slovenia. 

‘South Stream Bulgaria AD adheres to the principles of transparency and responsibility while constructing the South Stream gas pipeline, so the project complies with the EU requirements,’ the company led by Alexey Miller wrote in a statement published on Wednesday.

The company confirmed that the first gas will be supplied in late 2015. 

On the other hand, according to Vzglyad, Gazprom could prefer to avoid re-negotiations with Bulgaria and prefer an alternative route, which would resemble the TAP-TANAP project from Azerbaijan to Italy. 

The end point of the project would be, also in this case, Austria and Italy, the business newspaper wrote on Monday. 

WHAT’S GOING ON IN BULGARIA?

Earlier this month, Bulgaria’s government sent a letter to the Bulgarian Energy Holding asking to stop all the activities of South Stream Bulgaria, in which the Bulgarian company has a 50% interest (the rest is owned by Gazprom). 

On Tuesday, Sofia also stressed that South Stream Bulgaria’s capital increase constitutes a breach of protocol. The company applied for capital increase on August 12. 

‘According to the Ministry of Economy, the capital increase itself constitutes the beginning of construction activities…,’ the Ministry wrote in a statement published on Tuesday, adding that Sofia supports the project only if realised in full compliance with European rules.