Bulgaria eyes new gas project after South Stream failure

Bulgaria's premier outlined Wednesday plans for a proposed new project to bring gas from Russia and elsewhere to Europe, while bypassing Ukraine, following the failure of the South Stream project.

"South Stream is history. What is on the agenda now is the gas distribution centre 'Balkan'," Prime Minister Boyko Borisov told parliament in Sofia.

The multi-billion-dollar South Stream pipeline project had aimed to deliver 63 billion cubic metre (bcm) of Russian gas annually to Europe under the Black Sea and through the Balkans.

But in December 2014, under pressure from Brussels which said it broke competition rules because the project would only transport Russian state giant Gazprom's gas, Russia scrapped the plans.

It turned instead to another project through Turkey called TurkStream, but this too was shelved after the downing of a Russian warplane on the Turkish-Syrian border in December.

Borisov said that Russia might agree to build at least the undersea part of South Stream with two pipes with an annual capacity of 10 bcm each, which would then be channeled to Europe through a new pipeline.

According to initial plans, apart from Russian gas, the "Balkan" hub will also receive Azerbaijani gas from the under-construction Trans-Anatolian Gas Pipeline (TANAP) -- thus avoiding EU objections.

In addition it could receive liquid natural gas (LNG) from terminals in neighbouring Greece as well as smaller amounts from local fields in Bulgaria and Romania, Borisov explained.

Bulgarian experts familiar with the project said the hub, located near the Black Sea city of Varna, was planned to start working in 2021-2023.

Bulgaria is now the only country in the European Union that depends almost entirely on Russian gas deliveries via Ukraine for domestic consumption.

The country was a staunch backer of both South Stream and the EU flagship Nabucco pipeline project that was also abandoned.

Sofia plans to discuss "Balkan" during a meeting of a Bulgarian-Russian economic cooperation committee on February 27-28, the government said.

Borisov added that EU member Bulgaria would be holding talks to make this project "a priority of the European Commission" and that he was "optimistic" about its implementation.