Bulgaria Insists that Greek Contractor Incur Daily Sanctions for Delayed Construction of Gas Interconnector
NW 16:09:31 10-12-2021
LG1607NW.116
116 ECONOMY - INTERCONNECTOR - BULGARIA, GREECE
Bulgaria Insists that Greek Contractor
Incur Daily Sanctions for Delayed
Construction of Gas Interconnector
Sofia, December 10 (BTA) - Due to delays in the construction of natural gas interconnector Greece-Bulgaria (ICGB), the Bulgarian side insists that as from January 1, 2022, the Greek company Avax which is building the facility should incur daily penalties as provided for in the contract, Bulgarian caretaker Energy Minister Andrey Zhivkov said here on Friday, addressing Parliament during Question Time.
In case of delay, the contractor owes a penalty of 90,000 euro per day but not more than 10 per cent of the total fixed price of 144.8 million euro.
Zhivkov nevertheless hopes that the imposition of sanctions will guarantee that the project implementation will not be delayed further and will ensure completion according to the agreed schedule, which provides for the commissioning of the pipeline on July 1, 2022.
The Minister described the pace at which work on the pipelines has progressed in recent months as "critically unsatisfactory".
The initial deadline for completion of the project was April 2021, and it was extended until December 31, 2021 due to the pandemic and technical issues. Next, the project company gave the building contractor six months to deliver the facility ready for commisisoning.
Because of the delayed commissioning of the interconnector, in January-September 2021 Bulgargaz was compelled to import just 250 million cu m of the annual quantity of 1 billion cu m of natural gas contracted with Azerbaijan. The Azeri gas is currently much cheaper than the Russian gas, whose price is 70 per cent pegged to the prices on the European gas exchanges.
The ICGB pipeline is 182 km long, of which 151 km in Bulgaria and 31 km in Greece. It runs from Komotini (Northeastern Greece) via Kurdjali, Haskovo and Dimitrovgrad to Stara Zagora (Southeastern Bulgaria). The interconnector is part of the vertical gas corridor connecting Greece, Bulgaria, Romania and Hungary which provides access to natural gas and LNG from the South Gas Corridor to Southeastern and Central Europe and Ukraine.
The Greece-Bulgaria Gas Iinterconnector project is of key importance for this country and the region due to its strategic significance for achieving diversification of gas sources and routes. The facility will improve energy connectivity in Southeastern Europe as it is built in synergy with other major existing and future projects, such as TAP and the LNG terminal in Alexandroupolis, where Bulgaria is a full-fledged shareholder.
The project is among the key priorities in the energy sector of the governments of Greece and Bulgaria and is strongly supported by the European Commission, the European Investment Bank and foreign partners including the United States and Azerbaijan. LG/LN/LG//
LG1607NW.116
116 ECONOMY - INTERCONNECTOR - BULGARIA, GREECE
Bulgaria Insists that Greek Contractor
Incur Daily Sanctions for Delayed
Construction of Gas Interconnector
Sofia, December 10 (BTA) - Due to delays in the construction of natural gas interconnector Greece-Bulgaria (ICGB), the Bulgarian side insists that as from January 1, 2022, the Greek company Avax which is building the facility should incur daily penalties as provided for in the contract, Bulgarian caretaker Energy Minister Andrey Zhivkov said here on Friday, addressing Parliament during Question Time.
In case of delay, the contractor owes a penalty of 90,000 euro per day but not more than 10 per cent of the total fixed price of 144.8 million euro.
Zhivkov nevertheless hopes that the imposition of sanctions will guarantee that the project implementation will not be delayed further and will ensure completion according to the agreed schedule, which provides for the commissioning of the pipeline on July 1, 2022.
The Minister described the pace at which work on the pipelines has progressed in recent months as "critically unsatisfactory".
The initial deadline for completion of the project was April 2021, and it was extended until December 31, 2021 due to the pandemic and technical issues. Next, the project company gave the building contractor six months to deliver the facility ready for commisisoning.
Because of the delayed commissioning of the interconnector, in January-September 2021 Bulgargaz was compelled to import just 250 million cu m of the annual quantity of 1 billion cu m of natural gas contracted with Azerbaijan. The Azeri gas is currently much cheaper than the Russian gas, whose price is 70 per cent pegged to the prices on the European gas exchanges.
The ICGB pipeline is 182 km long, of which 151 km in Bulgaria and 31 km in Greece. It runs from Komotini (Northeastern Greece) via Kurdjali, Haskovo and Dimitrovgrad to Stara Zagora (Southeastern Bulgaria). The interconnector is part of the vertical gas corridor connecting Greece, Bulgaria, Romania and Hungary which provides access to natural gas and LNG from the South Gas Corridor to Southeastern and Central Europe and Ukraine.
The Greece-Bulgaria Gas Iinterconnector project is of key importance for this country and the region due to its strategic significance for achieving diversification of gas sources and routes. The facility will improve energy connectivity in Southeastern Europe as it is built in synergy with other major existing and future projects, such as TAP and the LNG terminal in Alexandroupolis, where Bulgaria is a full-fledged shareholder.
The project is among the key priorities in the energy sector of the governments of Greece and Bulgaria and is strongly supported by the European Commission, the European Investment Bank and foreign partners including the United States and Azerbaijan. LG/LN/LG//
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