Bulgaria temporarily freezes Chiren gas storage expansion amid EPPO investigation

Bulgaria is freezing the project to expand the Chiren underground gas storage until the European Public Prosecutor’s Office (EPPO) completes an investigation it has launched into the implementation of the project, caretaker Energy Minister Vladimir Malinov said at a press conference on August 14.

A day earlier, EPPO started raids of offices of Bulgaria’s state-owned gas transmission operator Bulgartransgaz in an investigation related to the expansion of the Chiren gas storage.

Apart from Bulgartransgaz, EPPO is probing three more companies located in various cities in Bulgaria over alleged fraud related to the Chiren expansion project that is funded by the EU.

Malinov said that the project will be halted until the EPPO completes its investigation, but also noted that the diversification of gas supplies is impossible without the completion of that project and of the LNG terminal in Alexandroupolis. He also said that no construction works have been carried out on Chiren’s expansion so far.

"I hope that the inspection of the European Prosecutor's Office at Bulgartransgaz EAD on the project for the expansion of the underground gas storage in Chiren will be completed as soon as possible, so that we do not allow the project, which is key to diversification and energy security in the region, to be delayed,” Malinov told journalists. 

"The diversification of gas supplies without the realisation of the project for a liquefied natural gas terminal in Alexandroupolis and without the expansion of the gas storage in Chiren is impossible,” he added. 

The EPPO was contacted by the Bulgarian Energy and Mining Forum (BEMF) in February. The organisation claims that Bulgartransgaz changed subcontractors after receiving an EU grant of €78mn for the implementation of the project. At the time, Malinov was heading the company.

The BEMF said that the replacement of subcontractors violated the contract and could compromise the implementation of the project as the participants in the project’s implementation have no experience in oil and gas drilling.

The EU granted €78mn to Bulgaria for the Chiren storage’s capacity expansion, as the project was seen as important for the country’s faster transition from coal to green energy.

The project envisages the doubling of Chiren’s storage capacity, from 550mn to 1bn cubic metres (bcm), enhancing gas withdrawal and injection capabilities.