Southern Gas Corridor to transform Bulgaria into a major part of infrastructure for gas supply from alternative sources - minister

By Trend

One of the Bulgarian main objectives with regard to the diversification of energy sources is increasing diversification of the sources of natural gas supply from the Caspian Region, Alexander Nikolov, Minister of Energy of the Republic of Bulgaria, said in an exclusive interview with Trend.

"This objective is stated in our Integrated Energy and Climate Plan 2021 – 2030. We appreciate the opportunity for natural gas supply via the Southern Gas Corridor as this results in real diversification of the sources of natural gas supply to Bulgaria. The direct effect of the Southern Gas Corridor project implementation will transform Bulgaria and its gas transmission system into a major part of the infrastructure for gas supply from alternative sources for the entire region of Central and Southeast Europe. The project is also linked to the gas interconnector between Greece and Bulgaria (IGB) project. The IGB project will provide Bulgaria and other countries in Southeast and Central Europe with access to the Southern gas corridor. It will also ensure that Bulgaria is able to import the contracted quantity of 1 billion m3 of natural gas per year from Shah Deniz 2 gas field in Azerbaijan. The interconnector will also provide a possibility for gas supply via the LNG terminal in Alexandroupoli from producers like the United States, Qatar, Algeria, Nigeria, etc., including Israel and Egypt in the future," he said.

Nikolov pointed out that in this respect, Bulgaria expects the role of natural gas to be adequately taken into account within the process of development of new initiatives at EU level.

"Especially for carbon-intensive regions, natural gas has no alternative in the energy transition phase. It stands out as a transition fuel because of its economic viability compared to emerging renewable technologies and less polluting effects compared to other fossil fuels. It is also frequently cited as a driver of the energy transition because of its central role in the scaling up of hydrogen – which the European Union, among others, has predicted will play a key role in a future climate-neutral economy. The Bulgarian side relies very much on its partnership with Azerbaijan. The backbone of this partnership is the contract signed in 2013 between the Bulgarian natural gas distribution company Bulgargaz and Azerbaijan’s state oil company AGSC for supply of 1 billion cubic meters of natural gas per year from Shah Deniz 2," he added.

Progress in construction of IGB

"We value our good long-term relations with our Azerbaijani partners. Diversification is our economic and political goal. I think we have a common understanding in this direction. Despite the delay in the construction of the Greece-Bulgaria interconnector, we are making serious efforts and believe that the interconnector will enter into commercial operation from the beginning of the second half of this year ? as provided in the latest updated schedules. This will provide a real opportunity for diversification of supplies, as IGB is the connection of Bulgaria and the whole region of Southeast Europe with the Southern Gas Corridor," said the energy minister.

He pointed out that with the opportunity to receive in full the agreed quantities of gas from Azerbaijan, the partnership between the two countries in the energy sphere is entering a qualitatively new stage.

"Deepening cooperation between us is a key factor in meeting the priorities of the Bulgarian government related to diversification and gas supplies - namely our country to develop and strengthen its role as a gas hub for the region of Southeast Europe. As I have already mentioned, the IGB project is of great importance to us and to the European Union as a whole. It will connect the transmission grids of the Greek natural gas transmission system operator DESFA and the Trans Adriatic Pipeline (TAP) in Komotini, Greece, and the transmission system of the Bulgarian gas operator Bulgartransgas EAD in Stara Zagora.

The project for the construction of an interconnector between Greece and Bulgaria has been included in the PCI list of the European Union with accordance with Regulation (EU) ? 347/2013 on guidelines for trans-European energy infrastructure. It is one of seven priority gas projects implemented within the framework of the Central and South East Europe Energy Connectivity (CESEC) initiative.

The direct effects of the IGB project implementation include real diversification of the sources of natural gas supply to Bulgaria, creating an opportunity for the supply of natural gas via the Southern Gas Corridor and from LNG sources, and connecting and transforming Bulgaria and its gas transmission system into a major part of the infrastructure for gas supply from alternative sources for the entire region of Central and Southeast Europe.

?he Ministry of Energy holds regular meetings with both the contractor and the suppliers to speed up the activities for building the interconnector. Meetings are also held on the highest political level – between the Bulgarian Prime Minister Mr. Kiril Petkov and the Greek Prime Minister Mr. Kyriakos Mitsotakis," he said.

SOCAR's possible role in Bulgarian market

Nikolov noted that the Bulgarian side welcomes SOCAR's interest in investing in Bulgaria's gas infrastructure.

"For us, this is an assessment of the potential of the gas market in the country on the one hand, and on the other - a step towards deepening our cooperation with a strategic partner such as Azerbaijan. We have provided SOCAR with all the necessary information and we are looking forward to hearing from them.

In terms of gasification, progress at the level of 5% has been achieved in the development and expansion of household gasification in Bulgaria — one of the priorities set out in our Energy Strategy. We consider replacing electricity with natural gas for heating and other household purposes as a possibility for increasing energy efficiency.

In addition, we would be glad to gain some of the experience of Azerbaijan in gas storage. We are currently working on increasing the electricity and natural gas storage capacity by developing the existing storage facilities and by building new storage facilities," added the energy minister.

Cooperation alternative energy sphere

He said that in the context of the European Green Deal, Bulgaria is interested in cooperating with Azerbaijan in the area of developing energy from renewable sources and enhancing energy efficiency by developing and implementing new technologies for a modern and sustainable energy sector.

"Bulgaria is leader in the implementation of renewables. We aim at increasing the use of renewables, with biomass, solar power and wind power projected to increase up to, respectively, 17.1 %, 3.8 % and up to 1.5 % by 2030. The Bulgarian side is open for exchanging experience for projects to exploit the potential of solar energy and water basins; bio-based resource efficiency projects, including bio raw materials and biogas, as well as waste management and recovery and the implementation of the circular economy. In connection with the principle of putting energy efficiency first, we also attach great importance to the development, construction and implementation of new resource materials," the minister explained.

He went on to add that Bulgaria as a member state of the EU can reinforce its cooperation with Azerbaijan in the framework of the Eastern Partnership.

"One of the four main areas of cooperation under the Partnership Priorities between the EU and Azerbaijan is connectivity, energy efficiency, environment and climate action. Building on the successful cooperation on energy connectivity and the significant progress made on the Southern Gas Corridor, this includes support for Azerbaijan's ability to operate as a trade, logistics and transport hub, regulatory assistance, sustainable management of resources. Negotiations on a new and upgraded framework agreement designed to reflect the enhanced and mutually beneficial EU-Azerbaijan cooperation in a wide range of areas, strengthen policy dialogue in key sectors and boost trade are at an advanced stage," said the energy minister.

He pointed out that projects in the field of hydrogen as an alternative energy source, as well as the development of energy storage opportunities are key in terms of energy transformation and the implementation of our decarbonisation targets.

"The Bulgarian side is actively working in this direction and such projects are included in the Bulgarian Recovery and Resilience Plan, which is to be approved by the European Commission. I am confident that in the future implementation of such projects our cooperation with the Azerbaijani side will be useful and significant. Bulgaria is leader in PV Projects especially in the construction area. Local companies have successfully expanded in the EU and globally. I believe that we will be able to cooperate with the Azerbaijani side in this direction as well," Nikolov concluded.