Bulgaria has not made a final decision to quit the Burgas-Alexandroupolis oil pipeline, Prime Minister Boyko Borisov has declared several hours after he suggested the opposite.

“The Bulgarian government hasn’t made a final decision regarding the construction of the Burgas-Alexandroupolis oil pipeline,” Borisov said, as cited by the press services of the Council of Ministers.

He has practically reversed his statement made around noon on Friday after a meeting with the Ambassadors of the EU member states in Sofia that Bulgaria was quitting the Russian-sponsored oil-pipeline, and was freezing the construction of the Belene nuclear power plant.

Borisov has clarified that he made his statement containing criticism about the economic feasibility and the environmental impact of the future Burgas-Alexandroupolis oil pipeline in response to a question by the Ambassador of Greece in Sofia. Bulgaria, Greece, and Russia are partners in the problematic pipeline project.

“We are going to make a final decision on the project as soon as the assessment of the impact of the Burgas-Alexandroupolis project on the environment is ready. For the time being, we see that the project is not economically feasible and profitable. What is more we have promised our voters to protect the environment,” Borisov has declared.

His statement raised a lot of questions across Europe Friday afternoon, throwing a lot of people into confusion for several hours, including Minister of Economy, Energy, and Tourism, Traicho Traikov who openly admitted that he was taken aback by exclaiming, “I can’t believe he said that!”

Before it was denied, the news about Bulgaria’s quitting, which would effectively ruin the entire project, drew reactions from other political forces with the Co-Chair of the rightist Blue Coalition Martin Dimitrov welcoming this development, while senior Socialist Party representative Rumen Ovcharov blamed the withdrawal on US pressure on the Borisov government.

The end of the work day on Friday practically prevented both Trans-Balkan Pipeline, the Bulgarian-Greek-Russian company in charge of the project, and the other interested factors from issuing statements.  

According to the press service of the Bulgarian Cabinet, during his meeting with the EU Ambassadors, the Prime Minister actually said that “Bulgaria is going to wait for the completion of the environmental assessment of the oil pipeline, and only then will it make a final decision.”

The formal statement clarifies that during the meeting with the Ambassadors of the EU member states, the Ambassador of Greece Danai-Magdalini Koumanakou has asked Borisov a question about the construction of the pipeline.

Borisov has replied by summarizing much of the criticism of the project – that it economic feasibility was not guaranteed and that it could pose a serious threat for the environment of the Gulf of Burgas on the Bulgarian Black Sea coast. The PM even pointed to the current BP oil spill in the Gulf of Mexico as an example of a potential environmental disaster.

Borisov has also told the Russian news agency ITAR-TASS in a brief telephone interview that the Bulgarian government has not made any final decision on the realization of the Burgas-Alexandroupolis project yet.

Thus, the Bulgarian Prime Minister has practically restated the already known position of his government that the fate of the oil pipeline will be decided once the Environment Ministry manages to complete its environmental impact assessment of the project. In the winter and spring of 2010, cabinet members' statements suggested that such an assessment might take six months or longer.

Bulgaria and Greece each have a 24.5% stake in the Trans-Balkan Pipeline company, while Russia has 51%. The Russian shares are owned by three energy companies Transneft (33.34%), Rosneft (33.33%) and Gazprom Neft (33.33%); the Greek shares belong to a consortium name HELPE SA-THRAKI SA, a joint venture between Hellenic Petroleum and Thraki, owned by Prometheus Gas and the Latsis Group, which has 23.5%, while 1% belongs to the Greek government. The Bulgarian Burgas-Alexandroupolis Project Company is 100% owned by the Bulgarian government and is under the responsibility of the Minister of Finance, Simeon Djankov.

The construction of the 279 km pipeline for transporting Caspian and Russian oil by circumventing the Bosphorus Straits was expected to be completed by 2011 and to cost about USD 1-1.5 B.