Bulgaria outgoing govt secures U.S. LNG gas deliveries

The Balkan country, which has been almost completely dependent on Russian gas, is struggling to ensure gas supplies after Russia's Gazprom cut off deliveries over its refusal to pay in roubles. Petkov said the LNG shipments, agreed with the support of the European Union's executive Commission, could commence if the caretaker government that will be appointed by President Rumen Radev in the coming days confirms the deal and ensures that the tankers can be offloaded at LNG terminals in Greece or Turkey.

Bulgaria has secured seven cargo shipments of U.S. liquefied gas (LNG) from October to ensure gas inflows in the winter, outgoing Prime Minister Kiril Petkov said on Thursday, adding the deal still had to be confirmed by the next government by Aug. 19. The Balkan country, which has been almost completely dependent on Russian gas, is struggling to ensure gas supplies after Russia's Gazprom cut off deliveries over its refusal to pay in roubles.

Petkov said the LNG shipments, agreed with the support of the European Union's executive Commission, could commence if the caretaker government that will be appointed by President Rumen Radev in the coming days confirms the deal and ensures that the tankers can be offloaded at LNG terminals in Greece or Turkey. "The contract will be signed today but with the option to be confirmed by August 19," Petkov told reporters, adding that the caretaker government could drop the plan if it found a better offer or was unable to secure capacity at LNG terminals.

"This contract is an important step towards securing natural gas supplies for the winter," he said. Petkov said Bulgaria has already booked capacity for the first shipment in October at the Greek LNG terminal near Athens.

Energy Minister Alexander Nikolov said the deal had been agreed with an U.S. gas producer but declined to name it. He said the price for the first three shipments was linked to Henry Hub prices and would be about $30 cheaper than the LNG gas price in Europe. Bulgaria consumes about 3 billion cubic metres of gas per year, of which over 90% was coming from Russia until May. It currently receives 1 bcm per year from Azerbaijan and also imports gas from gas traders in neighbouring Greece and Romania.

Petkov's coalition government collapsed in a no-confidence vote last month. Attempts by Petkov's party and his allies to form a new government failed, prompting the president to appoint a caretaker government and call a snap election. Political analysts expect the new interim administration to take a softer stance towards Russia which may include efforts to renew Russian gas imports. The agreed deal may complicate such a development.

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