Bulgaria Won't Drop South Stream Project

Bulgarian Economy and Energy Minister Delyan Dobrev has ruled out the possibility of Bulgaria exiting the South Stream gas pipeline project.

"Currently, there is no danger of Bulgaria not participating in South Stream," Dobrev told reporters on Thursday.

"We support the South Stream project. We believe it is profitable for Bulgaria, but we have to specify all the details," he added.

The Economy and Energy Minister explained that the Bulgarian part of the project will be financed by loans, which would decrease the investment risk for the Bulgarian Energy Holding.

Dobrev further revealed that the successfully negotiated 11% discount on prices of Russian natural gas will be worth a total of USD 115 M.

On June 8, Dobrev said Bulgaria was still having disputes with Russia over the ways to finance the construction of the South Stream gas transit pipeline, and the allocation of the profit.

Back in November 2010, the state-owned Bulgarian Energy Holding and its subsidiary Bulgargaz signed a contract with Gazprom to create a joint venture, South Stream Bulgaria, in which both own 50%, and which is supposed to be in charge of the construction and operation of the pipeline in Bulgaria. According to estimates from that period, Bulgaria's participation in South Stream is to cost about EUR 400-500 M.