A string of conflicting news concerning the partnership between Moscow and Sofia to build new transport infrastructure for the Russian gas to Eastern Europe emerged recently. First, Alexei Miller, Gazprom’s CEO revealed that the company is not interested to take part in setting up the Bulgarian Balkan Gas Hub, citing long term contracts that lock in the company’s natural gas deliveries. Balkan Hub is an EU supported initiative aimed at diversifying natural gas supplies in Central and Eastern Europe, by bringing together the regional gas markets in the region.
Bulgaria has continued to express the willingness to partner with Russia for the construction of the second line of the Turkish Stream pipeline. Bulgartransgaz recently received three offers for construction works related to building a new route for the Russian gas in Bulgaria, a project estimated at 1.4 billion euros. At the same time, the Greek prime-minister, Alexis Tipras also confirmed his interest to support an alternative route for the same pipeline, bypassing Sofia’s proposed route. However Russian officials are wary of promises that are not backed by Brussels.
Amid the fierce competition between Sofia and Athens (which Moscow can only benefit from), Russia is solidifying its stance in Serbia, where the national energy regulator (AERS) recently granted an exemption to Gastrans (majority owned by Gazprom) from the application of EU’s so called Third Energy Package to a future gas pipeline that would extend the second line of Turkish Stream. The Energy Community Secretariat expressed disappointment but the Vienna organization has little margin of maneuver here.
Russia will continue its efforts to bring new gas to Eastern Europe and particularly to the Balkans, in an attempt to undercut the traditional Ukrainian route and maintain a significant presence in the region. However, we do not expect Moscow to rush into any project before it is sure that the South Stream debacle will not repeat itself.