Bulgaria to Lose Role as Gas Transit Country - Gazprom CEO

Business » ENERGY | December 6, 2014, Saturday // 14:52
Bulgaria: Bulgaria to Lose Role as Gas Transit Country - Gazprom CEO President Vladimir Putin (L) and Gazprom President and CEO Alexey Miller (R). Photo by EPA/BGNES

Bulgaria, and not the European Union, should be blamed for the demise of the South Stream project, Russian energy concern Gazprom's CEO Alexey Miller has reiterated.

Miller told a Russian TV channel on Sunday Bulgaria would lose the role of a transit country it is currently enjoying, carrying 18 billion cubic meters of Russian natural gas to Turkey, Macedonia and Greece.

"After the realization of the offshore pipeline project leading to Turkey all these volumes will be carried via Turkey, and not via Bulgaria," he asserted. Miller's estimates suggest the country's total loss would be EUR 3 B a year if his scenario unfolds.

Gazprom had previously hinted at having to reduce the flow of gas pumped through the existing infrastructure if South Stream was built, as the explicit idea of the project was to circumvent Ukraine.

Miller also explained in a TV interview cited by TASS agency that the decision to abandon South Stream (the project is "absolutely closed" in his words) marks the beginning of a move by Gazprom to change its strategy on the EU's gas market.

Russian President Vladimir Putin declared South Stream abandoned on Monday evening while on a visit to Turkey. So far none of the countries that take part in the project has officially received any notice.

"The European Union, the European Commission just gave the gas tap to Turkey as a present. And I think Turkey could make use of this in its dialogue with Europe," Miller also claimed.

"We gained a new strategic partner in the gas business," he went on, adding a boost of gas transit through the country's territory, which could result in a total amount of 50 bcm being transported, will raise its geopolitical profile within the region.

He stressed Turkey "is de facto becoming such a hub as the one Germany is for Northern Europe."

Gazprom's chief executive also described the Commission's decision to "block" South Stream as "a targeted policy of the EU".

Though he stopped short of raising a hypothesis of bringing the project back to life, he asked: "Who would give us guarantees this [situation] will not be repeated in a month, two [months], half a year?"

In Miller's view Gazprom would not register any kind of loss after scrapping South Stream, since the EUR 4 B already spent were invested into infrastructure on Russian soil, and that could have a use in the alternative pipeline the concern is to build to Turkey.

Miller dismissed claims that the decision to dropped South Stream had been taken in advance, underlining it had been adopted during the visit to Turkey.

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Tags: Vladimir Putin, Gazprom, South stream, Bulgaria, turkey, macedonia, greece

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