BULGARIAN State Railways (BDZ) is currently in talks with Germany's Siemens, the Canadian-Swiss Bombardier and the Chinese CITIC on delivery of new high-speed trains.

Transport and Communications Minister Nikolai Vassilev confirmed the news but declined to comment on when the talks are expected to be completed and whose offer is most likely to be accepted.

In a special report from Bulgaria, Reuters news agency said that Bulgaria has launched the first of two tenders for a 340 million euro high-speed rail project.

The Transport Ministry invited contractors to submit binding bids by September 28 to upgrade the first 38 km of a total 151 km stretch of rail linking Bulgaria with neighbours Greece and Turkey.

The bids will be publicly opened on September 29 and the investor with the best financial offer will be contracted in March or April of next year, Deputy Transport Minister Sofia Kasidova told Reuters. The stretch should be operational by mid-2007.

Contractors are required to mainly build new tracks and only overhaul 30 per cent of the remainder, to create a high-speed corridor allowing trains to travel at 160 kilometres an hour.

The whole project, which should be complete by 2011, will be financed with a 153 million-euro grant from EU pre-accession funds, an 150 million euro loan from the European Investment Bank, and 37 million euro from the state budget.

Kasidova said the second tender for the design and electrification of the remaining 113 kilometres will be launched after the contract for the first stretch is signed and the construction works are started.

Currently, Bulgaria has only a few very congested road border crossings with Greece and Turkey and low-speed train crossings.

Meanwhile, in the beginning of July, BDZ stopped the operation of 55 of its trains and 97 more will be put out of use by the end of 2004. The move is a cost-saving measure, company representatives said. State-owned railways also introduced a new timetable, which is projected to cut the company's expenditure by 25 000 leva a day.

Bulgarian-language media speculated that the Transport Ministry is in secret negotiations with Siemens for delivery of second hand trains. Other critics say that the Transport Ministry's idea is to buy diesel engines and use them on electrified lines. Experts however commented that it is inefficient to use such engines on long destinations and added that this has not been done in any European country.

In early May, Vassilev and the parliamentary transport committee agreed that BDZ would be modernised through delivery of families of trains, rather than separate engines, including both high-speed and diesel engines. Therefore the tender, which BDZ organised for supply of 25 new diesel engines, had to be terminated.

Vassilev insisted on the preparation of clearly specified criteria for candidate suppliers. The requirements had to be announced in early June. Joint ventures were envisaged to be set up between BDZ and the supplier companies to repair and run the new trains, which would have reduced the operational costs. Eight companies showed interest in delivering bullet trains and diesel engines, including Siemens, Bombardier, Spain's Talgo, companies from Slovakia, Hungary, the Czech Republic, South Korea and Japan.



- Business Staff