Bulgaria wants link to gas pipeline between Azerbaijan and Europe

'We will start discussing how Bulgaria can be linked to this gas pipeline,' Rumen Ovcharov said.

His Turkish and Greek counterparts today during a visit to the Bulgarian capital Sofia that they supported in principle Bulgaria's participation in the gas pipeline.

British energy giant BP announced in September that it would start production at the end of the month on the massive Caspian Sea gas field Shah Deniz, which will provide Europe with an extra source of fuel.

The Shah Deniz field in Azerbaijan, whose major shareholders are BP, Norway's Statoil and the Azerbaijani state oil company SOCAR, will feed a new South Caucasus Pipeline crossing Azerbaijan and Georgia before terminating in the Turkish city of Erzerum, where it will link up with European networks to Greece and Italy.

The pipeline, which is being built to supply energy-hungry Europe, will have the added effect of loosening Russia's grip on energy markets in Azerbaijan and Georgia.

Bulgaria, which is also wholly dependent on Russian gas imports, is not located on the pipeline's immediate path but wants to branch into it to diversify its gas supplies.

Bulgaria has also expressed readiness to participate in the Nabucco pipeline project channeling gas from Iran to Europe.

It is currently discussing with Russian energy giant Gazprom a hike in natural gas prices. These used to be preferential but Gazprom has said they can no longer remain so.

In 2005, Bulgaria's domestic gas consumption was about 3.065 bln cubic metres.

But it paid 42 pct of that at the cheaper price of 83 usd per 1,000 cubic meters on a gas-for-transit contract under which Russia paid no transit fees for transferring its gas through Bulgarian territory on its way to Turkey, Greece and Macedonia.

The rest of the gas was paid on a different contract at 297 leva (151 eur) per 1,000 cubic meters.

These prices were fixed in 1988 in a long-term deal due to expire in 2010 but Gazprom demanded in January to raise gas prices and sign a single contract at 258 usd per 1,000 cubic metres.

Bulgaria has since tried to renegotiate the requested price hike.

Last week, it chose Russia's Atomstroyexport to build a 4 bln eur nuclear power plant in the northern Bulgarian town of Belene. It hopes the deal will help it negotiate better prices for its gas supplies.

On Bulgarian national television, energy minister Ovcharov said indeed that 'there could be some connection' between the two deals. AFX

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