An oil pipeline project that was suspended due to financial problems a few years ago may once again be on the agenda because of the latest events in Turkey.
Bourgas-Alexandroupolis was conceived of as an alternative to transporting crude from Russia to the world via the Bosphorus strait, a congested waterway controlled by Turkey. The pipeline was to be built by Transneft, Russia’s state giant, and Greece, with financial input from Bulgaria, who would have hosted half of the pipeline.
The Bulgarian side, however, ran into difficulties with the payments: Russia said at one point that Sofia owed some US$10.3 million in project-related costs. Soon after, in 2011, Bulgaria announced it was exiting the project.
Now, TASS reports, Transneft’s head Nikolai Tokarev is saying that there is renewed interest in the pipeline, including from the Bulgarian side. This renewed interest may well be spurred by the latest events in Turkey, which are nothing short of a major purge by President Erdogan.
Now, Erdogan has declared a three-month state of emergency to “remove the threat to democracy” that was the attempted military coup from last weekend. The coup prompted a temporary shutdown of the Bosphorus strait.
These events have combined with tensions between Russia and Turkey to obviously worry the Russian side about the reliability of the Bosphorus as a major export channel for its crude, hence the renewed interest in alternative solutions. The Bourgas-Alexandroupolis pipeline would have the capacity to transport 350 million barrels of crude annually.
By Irina Slav for Oilprice.com
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Irina is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry.