site.btaPhased Increase in Capacity of Chiren Gas Storage Facility to Start from Next Injection Season

The Chiren underground gas storage expansion project is being implemented within the planned timeframe and the next step is to commission part of the new infrastructure by the end of 2024, which will allow the phased increase in storage capacity to start from the next injection season, said caretaker Energy Minister Vladimir Malinov during a hearing in Parliament. According to him, the plan is to increase the storage capacity from 550 million cubic meters to 1 billion, as well as to increase the production and injection capacity to 8-10 million cubic meters on a daily basis. The project is in synergy with existing and planned new and expanding LNG terminals in South East Europe.

The Minister explained that the increased capacity of the Chiren gas storage facility will not only provide additional reserve in case of gas supply problems, but will also help to successfully enter the market for gas from alternative sources. He added that this is particularly true for LNG supplies in the region.

In relation to Block 1-21 Khan Asparuh, located in the exclusive economic zone of Bulgaria in the Black Sea, Malinov said that he had allowed Total Energy to transfer its 57 percent share of the rights and obligations arising from the exploration permit to OMV Offshore Bulgaria, making it the full holder of the exploration concession.

In addition, the term of the oil and gas exploration permit in this block is extended by 23 months as a result of a delay caused by force majeure. "The extension of the permit term by almost 2 years will allow OMV to proceed with exploration activities," Vladimir Malinov said. He added that on June 27 this year he had signed the relevant additional agreements with the representatives of both Total Energy and OMV, and the permit term was extended by 23 months, with OMV now the concession holder.

The permit holder is obliged to submit to the Minister for the Environment and Water, within one month of the entry into force of the agreement, a comprehensive work plan for this period as well as an annual programme. In this regard, following the signing of the additional agreement, Malinov set a deadline of July 9 for the working group, which was to carry out a legal, technical, tax and financial and economic analysis in view of the possible acquisition by Bulgarian Energy Holding (BEH) of up to 20% of the rights and obligations under the prospecting and exploration permit. The working group has submitted a report stating that BEH has until July 31 to propose an update of the oil and gas prospectivity expert report for Block 1-21 Khan Asparuh.

BEH will also commission a financial and economic analysis by July 31 with the assistance of an external financial consultant based on the detailed work programme provided by OMV. Thirdly, after updating the expertise on the oil and gas prospectivity of Block 1-21 Khan Asparuh and preparing a financial and economic analysis, BEH will commission a legal and tax analysis from an external consultant. The proposals of the working group have been approved by the caretaker Minister of Energy.

Malinov also commented on the Vertical Gas Corridor, which should be commissioned in the first quarter of 2026. He pointed out that all the procedures and public procurement on its Bulgarian territory have been concluded.

The Energy Minister assured that there is enough gas secured for the new winter season. The natural gas is provided under the supply contract from Azerbaijan, the gas storage in Chiren, as well as quantities stored in Turkiye under the agreement with the Turkish company BOTAS. He pointed out that more than 2 million megawatt hours of natural gas owned by Bulgargaz are currently stored in Turkiye.