In what was first seen as a contradictory move, the Bulgarian Government decided on May 3 to pull out of Transbalkan Oil Pipeline Bulgaria, the company established to build the Bourgas-Alexandroupolis oil pipeline.
The Cabinet reasoned its action saying that none of the companys shareholders had any experience in the performance of big international projects and it could not take on the role of Bulgarias representative in the investment phase of the Bourgas-Alexandroupolis as well as in the international project company expected to be set up.
By a Government decree of 2003, Transbalkan Oil Pipeline Bulgaria was established in connection with the Bourgas-Alexandroupolis project implementation. In addition to the state, seven private companies are shareholders in the company: Transstroy Oil Pipeline, MG Energetika i Prirodni Resursi (MG Power Engineering and Natural Resources), Magnum 07, KZU, Monolith 3, Industrial Holding Bulgaria, and LUKoil Bulgaria.
In 2004, Bulgaria, Greece and Russia agreed that Bourgas-Alexandroupolis project be implemented under the project funding principle and that one international project company be registered for that. It had to consist of companies nominated by each of the three countries. A trilateral agreement was signed to that effect in April 2005.
The view that the oil pipeline design has to be an independent stage, which has nothing to do with the international project company activity, was approved. Thus the project was conditionally divided into two phases: an investment phase and a construction phase.
Initially each of the states suggested several companies to take part in the registration of the international company. Bulgaria nominated four companies: Transbalkan Oil Pipeline Bulgaria, Universal Terminal Bourgas, Industrial Holding Bulgaria and Minstroy.
Currently the Bulgarian participants, and the shareholders of Transbalkan Oil Pipeline Bulgaria in particular, have different interests and disagree on the fashion of project implementation and about the place of every one of them in it. Most see their participation mainly in the construction phase.
This leads to Bulgarias lack of clear vision in regards to the Bourgas-Alexandroupolis project and the role of the Bulgarian participants in it, the Cabinet said.
Regardless of its reasons, however, the move was seen by the Greek media as a desire by the Bulgarian state to completely pull out of the project. In an article entitled The Energy War in the Balkans, published on May 4, the Greek newspaper Vima wrote that an alternative pipeline project has caused the developments.
From the point of view of the Bulgarians, it was not that there were problems with Bourgas-Alexandroupolis, but that another problem appeared, related to Turkeys recently announced Baku-Ceyhan oil pipeline project, Vima wrote.
The newspaper read the Bulgarian Cabinets decision to pull out of Transbalkan Oil Pipeline Bulgaria as a clear signal of the Cabinets desire to withdraw from the entire Bourgas-Alexandroupolis project.
In response to the Greek media reports, Economy and Energy Minister Roumen Ovcharov said Bulgaria was not withdrawing from the project.
He pointed out that the Governments decision was to actually withdraw from a company that had nothing to do with the Bourgas-Alexandroupolis project. Ovcharov said that this way the profile of the Bulgarian participants in the project company would be brought in line with the trilateral agreement signed by Bulgaria, Greece and Russia in 2005.
Ovcharov said that the Bulgarian companies will include Bulgargaz, one of the largest infrastructure companies with resources to take part in the construction of the oil pipeline.
Deputy Prime Minister and Foreign Minister Ivailo Kalfin also said that the Bulgarian state had not backed out of the Bourgas-Alexandroupolis project, which, according to him, still remained a priority. He was reacting to news reports on Greek television channels.
Antenna TV reported that the Greek government was seriously concerned following the reports that the Bulgarian state had withdrawn from participation in the consortium for the Bourgas-Alexandroupolis project.
The Antenna TV correspondent said from Thessaloniki, where the South-East European Cooperation Process member states were meeting, that Greek foreign minister Dora Bakoyannis had asked Kalfin for clarification. In turn, he assured her that the Bulgarian Government remained as interested in the project as ever.
