site.btaWill Greece-Bulgaria Interconnector Sever Gas Cord between Eastern Europe and Russia?

The war in Ukraine and the resulting insecurity of natural gas supplies has added a sense of urgency to the search for alternative gas sources for all of Europe. With the prices of energy sources rising even before the war, the new Bulgarian government has been trying to secure natural gas deliveries from other sources as a matter of priority from day one of its tenure.

In the case of Bulgaria, the only viable option to diversify gas supply sources is the Greece-Bulgaria gas interconnector (IGB), which is expected to carry gas from Azerbaijan via the Trans Adriatic Pipeline and from other sources via a planned liquefied natural gas terminal at Alexandroupolis, Northern Greece. After IGB goes into operation, it will have an initial capacity to carry 3 billion cubic metres of gas annually, which can be increased to up to 5.5 billion cu m at a later stage. It was no coincidence that the first foreign guest whom Prime Minister Kiril Petkov received in Sofia in December 2021, just days after the formation of the new government, was Greek Prime Minister Kyriakos Mitsotakis, with whom he discussed the timeframe for the completion of the IGB project.

But why was this vital gas link unavailable when it was needed most? In recent months, the delay of the project has been blamed on the pipeline building contractor, Greece's J&P AVAX, which was supposed to complete the construction of the facility by the end of 2021. In January 2022, Teodora Georgieva, Executive Director of the project company ICGB, said that the contractor has been made to pay 90,000 euro in compensation for every day of the delay, beginning on January 1, 2022.

In a documentary for Greece's ANA-MPA news agency earlier this month concerning the building of two measuring stations in the Greek town of Komotini, George Tasakos, head of the Pipelines and Networks Department at AVAX, explained that the delay was due to problems stemming from the COVID-19 pandemic, which held back the supply of necessary equipment and materials and caused anxiety among the workers, many of whom were infected with the disease. According to Tasakos, the construction work had been completed 90-95% and the gas could be expected to begin to flow into Bulgaria by the beginning of July 2022.

Regardless of the real reason for the delay, it is yet to be explained why the project has dragged on for so long. It started as far back as 2009 after a crisis resulting from the interruption of Russian gas supplies via Ukraine. Following a series of ups and downs, a roadmap was adopted in 2015, envisioning that the pipeline should be completed in 2019, which was still a pre-pandemic year. Therefore, many analysts believe that the real reason for the delay has to do with politics rather than organizational or technical difficulties.

Last year, former Bulgarian economy minister Traicho Traikov hinted in an interview with Radio Free Europe that Russian gas supplier Gazprom and its urge to keep its market monopoly were behind the multi-year delay. Energy expert Ivan Hinovski also attributed the delay to conflicting geopolitical interests when he was interviewed by the Greek economic web portal businessenergy.gr. A similar view was expressed indirectly a few days ago by Prime Minister Kiril Petkov at the 7th Delphi Economic Forum. The Bulgarian leader said that national corruption is used by foreign countries like Russia as an instrument to influence domestic stability and politics and to create dependencies. As an example, Petkov cited the rapid construction of the Russian-backed TurkStream gas pipeline compared with more than 10 years of procrastination in building IGB.

Whether political or technical, the causes of the delay seem to have been overcome by now, at least at first glance. Almost all COVID restrictions have been dropped and the suspected political hurdles have apparently been eliminated. The war in Ukraine has made any secret favouritism towards Russian gas projects unpopular. The initiatives to diversify the supply of energy sources have turned from a priority for the EU into an urgent need. A message to this effect was issued in mid-March by Romanian President Klaus Iohannis, who said at a meeting with his Bulgarian counterpart Rumen Radev that it is important that IGB becomes operational soon. Iohannis proposed linking IGB to the existing BRHA (Bulgaria-Romania-Hungary-Austria) gas pipeline, which will make the so-called vertical gas corridor a reality.

Under the circumstances, the Greece-Bulgaria gas interconnector is almost certain to be launched in July. Regardless of the appeal of alternative political positions in Eastern Europe over the last 10 years or so, it is becoming ever more evident that the war in Ukraine has wiped out the grey zone between pro-European and pro-Russian policies, and the IGB pipeline is one of the main instruments to do away with the remaining economic dependencies. IGB's importance is not limited to Bulgaria but extends northwards to Romania, Hungary and Austria, and with the expected completion of the Bulgaria-Serbia gas interconnector, it extends to Serbia as well.