Bulgaria and Greece agree interconnector

An agreement has been signed between the governments of Bulgaria and Greece to build a 182-km interconnector gas pipeline between Greece’s Komotini and Bulgaria’s Stara Zagora, which will help funnel Azeri gas sent via Turkey to eastern and central Europe, reports Keith Nuthall. The pipeline will also ease Bulgaria’s energy exposure to Russia, as it currently relies heavily on Russian gas exported via Ukraine.

The agreement was signed by Bulgarian government-owned Bulgarian Energy Holding and IGI Poseidon – a joint venture between Greece government-owned gas supplier DEPA and Italy’s Edison. The pipeline is expected to have an initial annual capacity of 3bn cm and construction is projected to begin in October 2016, with operations starting in 2018. The current cost estimate is €22mn and as the project would be a key element of the European Union’s (EU) planned Energy Union of interlinked energy markets. The EU is expected to contribute €45mn.

Following signing of the agreement, Bulgaria’s Energy Minister Temenuzhka Petkova declared that the project was ‘strategic for Bulgaria, Greece and all of south-eastern Europe’. At a press conference in Sofia, he said: ‘It will ensure real diversification of supplies and be the basis of a gas distribution hub, which will boost the development of the energy market in the region.’

As the EU lifted Iranian sanctions on trade, shipping and insurance in mid-January, the US ‘suspended’ but did not ‘terminate’ its nuclear-related sanctions. Crucially, Iran can now reconnect to the global banking system with $100bn (about £70bn) of assets due to be unlocked. The day after sanctions were lifted, Iran’s Deputy Oil Minister Rokneddin Javadi issued an order to increase oil production by 500,000 b/d. However, in a cautious move the US Treasury imposed new sanctions preventing 11 entities and individuals linked to Iran’s ballistic missile programme from using the US banking system. US Acting Under-Secretary for Terrorism Adam Szubin said: ‘Iran’s ballistic missile programme poses a significant threat to regional and global security, and it will continue to be subject to international sanctions.’ Some time later, these new sanctions were stalled by Iranian protests.