The oil pipeline project from the Greek port of Alexandroupolis to the Bulgarian port of Burgas is on the agenda of Bulgaria, Greece, and Romania in the context of greater energy, transport and digital connectivity in Southeast Europe.
Greek Prime Minister Kyriakos Mitsotakis announced the news after a trilateral meeting between Bulgaria, Greece and Romania near the Bulgarian city of Varna.
Bulgarian Prime Minister Nikolay Denkov hosted the meeting with Mitsotakis, his Romanian counterpart Marcel Ciolacu, and Moldova’s Energy Minister Victor Parlicov. The Vice President of the European Commission (EC), Margaritis Schinas, and the European Commissioner for Transport Adina Valean also participated.
After the talks, Mitsotakis noted the great importance of the pipeline and the significant role of Greece, which “guarantees the energy security of the whole of Southeast Europe.”
The oil pipeline, which has been discussed since 1994, was unfrozen by the caretaker governments of Bulgarian President Rumen Radev. Bulgaria and Greece even created working groups and signed a memorandum for the project, which have been working since the beginning of this year.
“The export of natural gas to our northern neighbours has increased four times; we are moving to Moldova,” Mitsotakis said to show the importance of the Balkans’ energy connection in the context of Russian aggression towards Ukraine.
The Greek prime minister even suggested that the next trilateral meeting be held in “the beautiful and hospitable Alexandroupolis, symbolising the importance we attach to this new connectivity between the three countries.”
The oil route from Greece to Bulgaria
For now, the construction of the oil pipeline seems to be of strategic interest to Bulgaria because of the expected refusal to use Russian oil, which is currently delivered by tankers across the Black Sea directly to the refinery in Burgas. Using another type of oil will further strain the already heavy traffic through the Bosphorus, which could lead to supply uncertainty and higher crude oil transfer fees.
The start of the project must be voted on by the parliament. The construction of the oil pipeline in the Greek city means that crude oil will be transported via a pipe between the Aegean and the Black Sea, which is of interest to all countries in the region dependent on the supply of Russian oil.
But at the same time, the oil pipeline is also of interest to the Russian company Lukoil, which manages the refinery in Burgas. The Russian company fears a shortage of raw materials after the end of the derogation to operate the refinery, which processes 7-10 million tons of oil per year. The Russian company announced that it is preparing to switch to processing non-Russian oil from the end of 2024.
The oil pipeline construction will allow Lukoil to export its production more easily and reduce Russia’s dependence on Turkey.
In Greece, the pipeline project was initiated by the right-wing conservative New Democracy government led by Kostas Karamanlis (2004-2009). Now, New Democracy is in power again with Prime Minister Kyriakos Mitsotakis.
For the first time, the idea of an oil pipeline connecting the Black and Aegean seas was discussed at the end of 1997, when, at the suggestion of Greece, a committee was created to study the possibilities. However, Russia did not show interest then.
Later, the pipe (285 km) became part of the so-called Grand Slam – three key energy projects agreed upon between the presidents of Russia and Bulgaria, Vladimir Putin and Georgi Parvanov, in January 2008 with an estimated capacity of 35 million tons of crude oil per year, which can be increased to 50 million tons.
The construction of the oil pipeline at that time was estimated at $1.3-$1.9 billion. It was also planned to increase the capacity of the terminals in the two ports, which included oil tanks of over 600 thousand tons in Burgas and 1.2 million tons in Alexandroupolis.
Environmental organisations, the tourist business, the municipalities of Burgas and Pomorie, as well as GERB and the urban right, argued against the project, arguing that the benefits of the pipe are for Russia and Greece, and the risks for Bulgaria. Now, however, the direction of the pipe must be reversed – from Greece to Bulgaria.
Bulgaria’s refusal of the pipeline was announced in 2010 by then-Prime Minister Boyko Borisov (GERB), but the tripartite agreement for its construction and operation between Russia, Greece and Bulgaria was denounced by the parliament in March 2013.
Bulgaria and Greece each own 24.5%, and Russia – 51% of the international project company Trans-Balkan Pipeline BV, registered in the Netherlands. The Bulgarian share is held by Project Company Burgas-Alexandroupolis EAD. The company has not yet been liquidated, and even for 2019, it declared a turnover of BGN 46 thousand.
Energy and road connectivity
The prime minister of Romania pointed out the importance of the Southern Transport Corridor, which will support the recovery of Ukraine, and announced the intention for a new bridge between Giurgiu and Rousse, a new border point between Bulgaria and Romania, as well as to increase the capacity for navigation on the Danube, i.e. called “Fast Danube” project.
Among the future projects in the context of the development of the vertical transport road corridors, the new railway corridor that would connect the Baltic with the Aegean and Black Seas was also discussed.
“Europe can no longer afford to be disconnected, to have no roads connecting neighbouring countries, to have no energy connectivity and thus to be dependent on external factors,” Nikolay Denkov emphasised. “We must all be together in every sense of the word ‘together.’
(Emiliya Milcheva, Krassen Nikolov | Euractiv.bg)
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