Cause and Effect in European Politics and Law

A new page in Russian-Bulgarian relations

Adelina Marini, September 21, 2009

Bulgaria and Russia have started negotiations on all mutual energy projects, agreed so far, from the very beginning and on a new basis. This is what we understood from the visit of the Russian energy minister and the accompanying delegation in Bulgaria on Friday. Sergey Shmatko came to Bulgaria on the invitation of his Bulgarian counterpart Traycho Traykov to continue what the prime ministers of Russia and Bulgaria had started more than a week ago in the Polish town of Gdansk. The new foundation of the future relations between the two countries will be openness, transparency and the information of the Bulgarian society, the Bulgarian prime minister Boyko Borisov assured after his meeting with Sergey Shmatko that lasted more than an hour.

Before that, in the Ministry of the economy, energy and tourism the Russian delegation and the Bulgarian representatives held prolonged negotiations on all mutual projects: the construction of the South Stream pipeline, "Nabucco", the construction of the second Bulgarian nuclear power station "Belene", the oil pipeline "Burgas_Alexandroupolis" and, last but not least, a new contract for gas deliveries for Bulgaria.

One of the reasons euinside to think that the negotiations on all these projects have started from the very beginning is the statement of the Russian energy minister himself that he was surprised how well his Bulgarian counterpart had been prepared, as well as from the statement of the Bulgarian prime minister Boyko Borisov who excused his team for refusing to answer the numerous questions of the journalists with the explanations that the discussions on the details of each projects was still going on. But he said: "The important thing is that we do not have any inhibitions with regard to our work with Russia, we have put our relations on a very open, honest, pragmatic and mutually beneficial basis, so that the Bulgarian society to know what will be the benefits in the next decades from the participation of Bulgaria in these projects".

In essence, the common ground of all projects is that their financial structure will be mostly discussed. With regard to the construction of the South Stream pipeline minister Traycho Traykov explained that two working groups had been formed. The first will discuss the clauses of the new agreement for a project company and the second will work on the preparation of the auction for a preliminary study. Bulgaria and Russia have agreed that this project is in no conflict with the "Nabucco". According to the statement of Mr. Boyko Borisov, the two projects are no competitive on the territory of Bulgaria.

But the problem with South Stream is that its route to a large extent goes in parallel with the project layout of "Nabucco" with the only difference that the European project which is supported by the US, will not be supplied with Russian gas. The problem is that there is still no clarity how and which countries will participate in the "Nabucco" to fill the capacity of the pipe. Unlike "Nabucco", with South Stream there is no problem with the filling of the pipe with gas. One of the benefits which the Russian side underlines is that is surrounds Ukraine by saving any future suffering for Europe in case of a new conflict between Russia and Ukraine.

So far, the position of the EU which still lacks a common energy policy, was that is Bulgaria would announce South Stream as a priority project, the country must consult with the Commission. But Mr. Borisov promised that in the next few months there will be reports on the progress of the negotiations on every 2 weeks. He pointed out that many EU member states have also taken part in the project and one of the founders of the project is Italy and recently Germany also supported it.

The Russian energy minister specified in the beginning of his statement that he had come to Bulgaria to find out what the position of Bulgaria was for the construction of "Belene". He expressed his content of the positive response he had received. What still remains to be negotiated is how the project will be financed. For the purpose Russia promised to provide Bulgaria with a detailed financial and legal audit of everything that had been done so far in Belene which will give Bulgaria the opportunity to find out how much this project will cost and what share of the station can be sold to interested investors. According to Mr. Traykov, the Russian companies will not be discriminated in this process. An interesting fact was that everyone in the meeting focused on the fact that "Belene" will be an entirely European project which will help Russia prove its capabilities to realise such projects on EU's territory. It is worth noting also that both countries have agreed that "so far the project was led in a way, inconsistent with the best practices for project management", according to Mr. Traykov.

Regarding the "Burgas-Alexandroupolis" project, negotiated for more than 8 years now, there is also a change and it is that the Russian side will provide Bulgaria with all the information possible to assure the Bulgarian society of the safety of the project from an ecological point of view.

However, it remained unclear in what context the negotiations of a new gas deliveries contract had started because the current agreement, negotiated still unclear why earlier, expires in 2013. What is clear is that Russia fully accepts the pragmatic approach of its Bulgarian partners in search of the Bulgarian interest and benefit, whatever that might mean.

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