Bulgaria to put electricity utility chief in charge of South Stream

Written by on November 29, 2013 in Bulgaria - No comments

Bulgaria’s Economy Minister Dragomir Stoynev said on November 29 that Vladimir Inkov will be “put in charge” of South Stream, the gas pipeline being developed at Kremlin’s urging, in order to bypass the Soviet-era transit route through Ukraine.

Stoynev’s comment came in Parliament, in response to reporters’ questions concerning an announcement earlier in the day that Inkov had been released from his duties as chief executive of Bulgaria’s state-owned electricity utility NEK.

Stoynev said that based on Inkov’s work so far, he was “worthy to work on such an important project”, as quoted by news agency Focus, but did not give further details on Inkov’s future position.

Some Bulgarian media, among those critical of the current Cabinet, suggested that the reshuffle had more to do with Inkov’s inability to turn around NEK’s fortunes.

Inkov has been chief executive of NEK since July, when the Government of Prime Minister Plamen Oresharski replaced a number of key officials in state-owned companies in the energy sector. Before that, he was on the board of directors at Bulgaria’s power grid operator ESO and was in charge of public procurement tenders at the Bulgarian Energy Holding, NEK’s parent company.

Inkov’s place as chief executive of NEK is expected to be taken by Yordan Zhelev, who is currently the chairperson of the company’s board of directors, public broadcaster Bulgarian National Television said.

Russia wants to complete South Stream by end-2015, hoping to cut off Ukraine from gas transit to Europe altogether. Although Russian officials have repeatedly said that the project has sound economic grounding, some observers say it is motivated mainly by political disagreements between Moscow and Kyiv.

The pipeline will cross the Black Sea, Bulgaria, Serbia and Hungary before reaching northern Italy. A number of European energy companies, including Italy’s Eni and French EdF hold stakes in the offshore section of the pipeline (Russia’s state-owned Gazprom is the majority shareholder), while the land stretches are set to be built by joint ventures between Gazprom and local gas companies (in Bulgaria’s case, state-owned Bulgargaz, which owns 51 per cent in the joint venture).

Russian president Vladimir Putin, the main driving force behind the project, marked the start of work in Russia in December 2012 – although most of the work so far has been focused on expanding the gas grid in southern Russia to accommodate increased gas flows for South Stream’s planned 63 billion cubic metres a year capacity. Similar ceremonial “first welding” events were held in Bulgaria on October 31 and in Serbia on November 24.

The pipeline will also branch out to several other countries, including Slovenia, Macedonia and Republika Srpska in Bosnia-Herzegovina.

(South Stream’s official start was marked with a welding ceremony in Anapa, on Russia’s Black Sea coast, on December 7 2012. Photo: gazprom.ru)

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