Caretaker cabinet ready to negotiate with Gazprom for Russian gas supply

No gas quantities have been secured for October. Therefore, the government is considering starting negotiations with Gazprom. Businesses and trade unions have also demanded immediate negotiations for the supply of Russian natural gas. The caretaker government has developed options for starting talks with the Russian company, but expects the negotiations to be difficult.

According to the caretaker government, negotiations with Gazprom are now inevitable. The reason - the business cannot produce at competitive prices because of the high price of blue fuel. The trade unions also support them as they fear job cuts.

The caretaker government is therefore ready to start negotiations with Gazprom to resume gas supplies from Russia. So far, Bulgaria is relying on supplies from Azerbaijan and a tanker of US liquefied natural gas that will be unloaded in Turkey.

Bulgara’s southern neighbour has expressed interest from companies for pipeline gas supplies. Our country has started negotiations for additional quantities of Azeri gas.

The quantities of natural gas for October are insufficient, the energy crisis headquarters announced. Therefore, the caretaker government does not rule out purchasing natural gas from Gazprom Export.

"Obviously, after last week we were only able to deliver one tanker and after the business was absolutely adamant today that the price levels as of today are unacceptable, i.e. Gazprom Export instantly becomes now an absolute valid option that we start to negotiate with. But I have never thrown them off the list and we have, on all options, prepared a strategy so that when we need to, we can immediately start negotiations. We are prepared. The point is that there has to be some response," explained Rosen Hristov, caretaker energy minister.

"We Continue the Change" (majority partner in the former ruling coalition government) reacted to the position of the caretaker cabinet.

"We were presented with a single solution, namely Gazprom Export. Discussions with Gazprom Export were held repeatedly by the previous cabinet, but this did not yield results. Most likely it will not yield results now either, and the winter season is coming," said Radoslav Rybarski of We Continue the Change.

The party reminds that Gazprom unilaterally violated the current contract with Bulgaria.

Businesses and trade unions warn that rising blue fuel prices are putting companies on the brink of bankruptcy and laying off workers.

"Natural gas - when attempted to be passed onto the price of manufactured products, the market refused to accept it. That is, we cannot operate at these levels," said Vasil Velev, chairman of the Industrial Capital Association of Bulgaria.

"We insist on guaranteeing the cheapest possible gas supply. As it became obvious from the meeting - all Gazprom's alternatives are several times more expensive," said Vanya Grigorova, "Podkrepa" trade union.

According to the interim energy minister, a price between 250 and 300 BGN/MWh is acceptable for Bulgaria. However, the business sector insists on compensation above BGN 250/MWh.

"BGN 200 per MWh at current levels and the TTF for the coming months are achievable prices, and BGN 250 per MWh is a price above which compensation should be sought," Vasil Velev said.

The caretaker cabinet agrees there should be compensation and will prepare draft laws for the new parliament to consider. To cover the needs for blue fuel, additional quantities of Azeri gas will be sought, as well as supplies from Turkey.

"We are starting talks with Azerbaijan to negotiate additional gas supplies from that country. There are indications from Turkish companies that they are interested in deliveries of pipeline gas to Bulgaria. I expect confirmation this week and we will start negotiations immediately," Rosen Hristov said.

Hristov hopes to reach an agreement in two weeks. The caretaker government is also working to complete the gas link with Greece.

"Almost no control has been exercised and accordingly we found there complete chaos and a leadership that did not cooperate to solve the problem," Hristov added.

"Unfortunately, a lot of time has been wasted in which nothing has really been done," said Hristo Alexiev, caretaker deputy prime minister for economic policies.

The builder of the gas link has sent a timetable with commitments to complete construction and secure the necessary documents. The caretaker cabinet will also form a working group to rescue Sofia district heating company, Bulgargaz' biggest customer, which has accumulated debts worth hundreds of millions.