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From Bulgaria

20.09.2013 11:38

Bulgaria Sealed a Deal with Shah Deniz for 1 Bn. Cub. Meters of Gas per Year as of 2019

Bulgaria and Greece

AUTHOR: publics.bg

© Aquafornia@flickr.com

Bulgarian state-owned gas company Bulgargaz EAD announced that on Sept. 19 it signed a contract with BP-led Shah Deniz consortium for the delivery of 1 bn. cub. m of gas per year over a period of 25 years from the second phase of the Shah Deniz Caspian field.

The delivery start date is in 2009, while the contract should come into force, as soon as a final investment decision at the end of 2013.

Bulgargaz did not precise the cost of the deal, nevertheless highlighting positive effects for Bulgaria from obtaining Caspian natural gas such as actual diversification of sources and routes and increase in energy security.

The deal is expected to further strengthen the portfolio of Bulgargaz, which recently came under the scrutiny of European antitrust authorities over allegations of withholding gas pipeline and storage capacities in detriment of its competitors.

Greece, through its gas company DEPA, recently privatised by Shah Deniz Azeri stakeholder SOCAR, has also secured a similar contract. As much as 10 bn cub. m of natural gas a year are expected to flow from the Caspian Sea to customers across Europe.

BP, operator of the Shah Deniz field, said that strong demand for its gas increases their confidence in long-term development in Azerbaijan’s gas resources.

Al Cook, deputy director of BP for Shah Deniz said that during the selection process, the Shah Deniz consortium received offers for between three to four times the volume of available gas from different buyers across central and Southeastern Europe.