site.btaBulgaria to Seek Compensation for Servitude Right for Construction of South Stream Pipeline Section

Bulgaria to Seek Compensation for Servitude Right for Construction of South Stream Pipeline Section

Sofia, August 26 (BTA) - Bulgaria will seek compensation for
instituting a right to use part of the Pasha Dere beach near
Varna (on the Black Sea) and its economic waters for
construction of a section of the South Stream gas pipeline, the
Council of Ministers decided on Wednesday. It adopted a
methodology for appraisal of the amount of compensation for the
direct costs incurred and gains foregone by Bulgaria as a result
 of restrictions on the sea bed constituting public State
property, required for the implementation of the project, the
Government Information Service said in a press release.

Next, competitive bids will be invited for an appraiser to
determine the amount in question, and the Council of Ministers
will institute real rights to the coastal strip.

Even though Russian President Vladimir Putin said in early
December 2014 that Moscow was cancelling the South Stream
project, which was supposed to pipe Russian natural gas across
the Black Sea via Bulgaria, Serbia and Hungary to Austria,
Bulgaria has not yet been formally notified by Gazprom that
project activities are discontinued.

"The Bulgarian State is bound to fulfil its obligations under
Bulgarian legislation," the press release says. It specifies
that a failure by the Minister of Regional Development and
Public Works to consider and approve detailed plans and
development-project designs, to issue building permits and to
commission an appraisal of the building right could be
considered non-performance, for which Bulgaria may be subject to
 litigation and imposition of financial sanctions.

The Government Information Service recalls that a detailed plan
was approved on July 1, 2014 for a land tract of the Pasha Dere
beach, where the gas pipeline was supposed to make a landfall.
The Regional Development and Public Works Ministers' order
approving that plan entered into effect in October 2014. Before
the development-project designs are approved and the relevant
building permits are issued, the relations at real law between
the State and the company that will be building the work have to
 be settled.

The chosen methodology for calculating the compensation uses
various methods and approaches with a view to ensuring a
comprehensive and predictable coverage of the possible direct
costs and gains foregone during the construction and operation
of the work. "Optimum protection of the State interest will be
achieved in this way, including within the context of the
long-term policies pursued by the Bulgarian State," the press
release points out.