Prime Minister Sergei Stanishev will represent Bulgarian in Athens on March 14 and 15 at the signing of the intergovernmental agreement on the Bourgas-Alexandroupolis oil pipeline, the Government media office said on March 7.

Bulgaria, Greece and  Russia were supposed to sign the agreement on March 6 but this was postponed. The postponement sparked much speculation in Bulgarian, Greek and Russian media. Some of the reports suggested that some parties to the agreement caused the postponement in a bid for a better deal. Bulgaria’s Regional Development and Public Works Ministry, which is in charge of the Bulgarian contribution to the project, declined to comment on the reasons for the postponement, Bulgarian news agency BTA said.

An earlier Associated Press (AP) report said that Greece had denied that there would be any delay in carrying out the pipeline project.

AP quoted what it said were Greek development ministry sources saying that the deal would be signed sometime in March. The online version of Greek-language newspaper Naftemporiki said on March 6 that deep uncertainty surrounded the signing of the agreement.  Naftemporiki said that Moscow resented the position expressed by the Greek foreign ministry on the deployment of missile defence systems on Czech and Polish territory, which the Russians reportedly saw as support for the US in the Russian-US controversy over the missile defence deployment.

Bulgarian-language daily Dnevnik blamed Russia for the delay. The newspaper said that the Russians had asked for the postponement on the grounds of difficulties with the translation of the document. Dnevnik quoted sources as saying that the signing ceremony would take place sometime from March 14 to 16 depending on confirmation by the Greek hosts.

At the beginning of this month, it seemed that the three sides had made some progress on the pipeline project. On March 1, Bulgaria, Greece and Russia reached an agreement on an audit of the pipeline project.  Greece and Russia had already reached an agreement for the audit. The news came after a visit to Greece by Sergei Stepashin, head of Russia’s national audit office.

Stepashin was in Athens to co-ordinate the audit with his Greek counterpart. The audit will be done by the national audit offices of the three countries. Their Bulgarian colleagues are expected to join the agreement in the next few weeks. “Auditing will enable efficient use of funds for the project,” Stepashin said, quoted by Bulgarian National Radio (BNR). “The inspection will deal with the state funds allocated to the project,” Stepashin said. According to Bulgarian-language news website Mediapool, the issue around the audit of the pipeline was about Greece trying to prove that it had invested state funds in the pipeline and thus should receive more shares in the project. It was all about distributing shares in the future International Project Company that will own and service the pipeline, Mediapool quoted sources as saying.

On February 7 2007, Bulgaria, Greece and Russia agreed on the final text of the agreement. According to the approved text, Russia will have 51 per cent in the pipeline company through the Trouboprovodnii Consortium Bourgas-Alexandroupolis, owned by Transneft, Rosneft and Gazprom-Neft. Bulgaria and Greece will have 24.5 per cent each. Greece’s shares will be distributed as follows: The consortium comprised by Hellenic Petroleum and Thraki will have 23.5 per cent and the Greek state will have one per cent. State-owned companies Bulgargaz and Technoexportstroy will be Bulgaria’s representatives in the international company, with equal shares. In Bulgaria’s case, however, the country’s shares in the pipeline company are to be offered to private petrol companies. On February 14, Bulgarian Regional Development and Public Works Minister Assen Gagauzov told Dnevnik that foreign, non-Russian companies were interested in Bulgaria’s shares.

The oil pipeline will transport Russian oil through Bulgaria’s Black Sea port of Bourgas to the Greek port of Alexandroupolis on the Aegean Sea. Russian oil will be shipped across the Black Sea from Russia’s Novorossiysk to a terminal at Bourgas. From there it will be piped more than 280km (including 155km on Bulgarian territory) to a terminal at Alexandroupolis. Bulgaria, Greece and Russia will build the pipeline, worth about $700 million. The pipeline will carry 700 000 barrels of oil a day. The amount of barrels could reach one million per day. The project completion is set for 2010. Bulgaria is projected to gain nearly $35 million a year from transfer taxes. Neither Bulgaria nor Greece will have the right to use any of the transported Russian oil for their needs. 

The Bourgas-Alexandroupolis project was initiated in 1994 by Greek and Russian companies as an alternative to moving Russian and Caspian oil to Western Europe, bypassing the traffic-congested Bosphorus in Turkey. Implementation of the project has been repeatedly put on hold over the past 13 years, mainly because of Moscow’s doubts about the feasibility of the idea and uncertainty about Russian oil companies’ readiness to guarantee the required amounts of oil.