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. Last Updated: 07/27/2016

Bulgarian Prime Minister Backs South Stream Plan

SOFIA, Bulgaria — Bulgaria’s new center-right government agreed Friday to stay onboard with Russia’s planned South Stream gas pipeline but cast doubts over the future of two other joint energy projects.

Bulgarian Prime Minister Boyko Borissov said after meeting with Energy Minister Sergei Shmatko that Sofia would benefit from the South Stream pipeline, designed to bring Russian gas to Europe under the Black Sea and bypass Ukraine.

The new Bulgarian government, which won July elections, has been reviewing South Stream as well as plans to build a nuclear plant and participate in a trans-Balkan oil pipeline, to check if they match national interests and the European Union agenda.

Observers and diplomats say the review shows Bulgaria’s readiness for closer ties with the EU after the previous Socialist-led cabinet irked Brussels and the United States by appearing to side with Russia. The new government of the GERB party has said it will give priority to the EU-sponsored Nabucco pipeline project, due to bring Caspian gas via the Balkans to central Europe and thereby reduce the bloc’s dependence on Russian gas.

“It was important for us to hear that Nabucco and South Stream are not rivals,” Borissov told a joint news conference with Shmatko. “We participate equally in both. The benefit for us is that the Russian gas will come to our border.”

He said work on the project would accelerate in the next two months.

Despite fears in Brussels that South Stream may hurt Nabucco’s prospects, European companies are eager to join it. Earlier in the week, French power group EDF said it was in talks to take part in South Stream, and Italian oil group ENI is involved in the project.

The EU receives a quarter of its gas from Russia and has so far managed to do little to secure supplies for Nabucco after a January price dispute between Moscow and Kiev disrupted supplies to Europe; Bulgaria was among the worst hit. “When there is a lack of a coherent EU energy policy, in this game every country will do its best to serve its own interests,” said Kiril Avramov of the Political Capital think tank. But he said Sofia’s leverage in talks with Moscow was limited by the country’s near full dependence on Russian energy.

Shmatko said Moscow was ready to provide funding for some joint energy projects as Bulgaria struggled to raise money for the Belene nuclear power plant. He did not give details.

“We discussed the situation with Belene and we share the opinion of the Bulgarian side to make a quick audit of the project so that we can work out a joint approach … on funding the project,” he told the same news conference that the previous Bulgarian government had contracted Atomstroiexport to build the 2,000 megawatt plant and picked Germany’s RWE for a 49 percent stake.

Soaring costs, which Sofia says could reach 10 billion euros ($14.7 billion), dwindling budget revenues and a lack of funding have prompted a rethink on Belene.