site.btaThree Parties Unveil Plan to Terminate Lukoil Concession for Oil Port near Burgas

The parties behind the government, Continue the Change – Democratic Bulgaria (CC-DB) and GERB-UDF Wednesday unveiled plans to terminate a concession that was granted decades ago to Lukoil to operate the Rosenets oil port near Burgas on the Bulgarian Black Sea coast. The proposal drew comments left and right, including much criticism from President Rumen Radev who called the plan “wrong and rushed” and suggested there may be corporate interests involved. The Socialists saw dual standards in the government's approach to concessions.

The idea to cancel the concession was announced very early in the morning to the press in the corridors of Parliament by CC-DB co-leader Kiril Petkov. He said that, if adopted, this proposal would terminate the concession of the port, which was extended by the former caretaker cabinet by 24 years, in his words, with no motives.

Control of this port is of key importance for the Bulgarian state, Petkov noted, adding that all key infrastructure should be under the control of the Bulgarian state, especially those along the country’s borders.

"Our strategic goal is to enter Schengen and this is a big step towards it. This step is also in line with the European Union regulation on the sanctions for the war. Thus, we clearly state that Schengen is our national goal, that no Bulgarian key sites will be handed over without motives," Petkov emphasized. 

Petkov added that Lukoil will continue to operate at the port by paying fees.

DB co-leader Atanas Atanasov said that the need for Bulgaria to regain control of the port has been a topic of discussion for years. "Now that Russia has declared Bulgaria an enemy, we are taking action to restrict Russia's ability to use Bulgarian infrastructure. This is the main goal," he stressed.

Petkov said his expectation is that the proposal will be backed by GERB-UDF.

GERB-UDF did express support but it also claimed credit for the proposal for terminating the concession. 

Speaking to the media in the corridors of Parliament, GERB leader Boyko Borissov said that they are supportive of taking steps towards terminating Lukoil's concession but insist that this should also apply to the oil pipes and also that a special administrator should step in as provided for by the law. 

The figure of a special administrator was introduced in January 2023 when Parliament voted revisions to the law on administrative regulation of economic activities, related to crude oil and petroleum products. The revised law says that facilities for production, processing, treatment, storage and transportation of oil, including through pipelines, and energy products, which are crucial to national energy security, are subject to supervision by the Economy Minister. It also says that in the event of a threat to national security, abuse of monopoly position or international restrictions, the State will be able to take over the operational control of the company by appointing a special representative to manage it.

Borissov further said that there was a meeting Tuesday of himself, Kiril Petkov, Finance Minister Assen Vassilev, Democratic Bulgaria co-leader Hristo Ivanov, Foreign Minister Mariya Gabriel and MPs Delyan Peevski and Yordan Tsonev of the Movement for Rights and Freedoms (MRF), where the Rosenets concession was discussed along other "important decisions".

"The proposal was made by GERB-UDF, Democratic Bulgaria and the MRF and was not only about the Rosenets port but also about the pipes and about appointing a special administrator, so that the State can take full control," said Borissov. He added that Continue the Change were "vehemently opposed" to the idea about the pipes and the special administrator. 

"Now I hear Kiril Petkov urging me to support him for something that we argued yesterday on how far it should go. But let's say that they are young and still learning," said Borissov.

MP Delyan Peevski (MRF) even told the press that the legislative initiative for terminating the concession was prepared by MRF and GERB, and they got Democratic Bulgaria on board immediately while Continue the Change hesitated.

The MP said that under the proposal within one week after the amendments are adopted, the concession will be terminated. He said that Lukoil helps finance Russia’s war in Ukraine. According to Peevski this should end because the state has to have full control over the company. “A private company cannot own a door in state border," said Peevski.

President Radev: “Wrong and rushed idea”

“The proposal to terminate the concession for the Rosenets oil port is yet another rushed and wrong idea of political leaders,” President Rumen Radev told journalists during a public appearance.

Radev said that it was the government of Boyko Borissov that awarded a concession for the Rosenets port.

It is yet to see whether this proposal is a result of corporate interests or a crisis PR, added Radev.

“The caretaker government did not terminate the concession, which is in place for another 24 years, because it fought with the staggering prices of fuels, brought on us by the four-party coalition,” said Radev referring to the short-lived government in 2021 of Continue the Change, Democratic Bulgaria, the Socialist Party and There Is Such a People.

According to him, the caretaker government did what the regular government had to do and collected BGN 180 million in taxes from Lukoil in five months, twice as much as all Parliament-appointed governments did in 15 years.

"I hope that they did a risk assessment of what is behind the port because there is a large logistics base, which belongs to Lukoil. How will the port operate with this logistics base, without which the transportation of oil to the refinery is impossible and most importantly how this will affect the prices of fuels“, said Radev.

BSP: Double Standards for Concessions

There is a double standard in making a proposal to terminate the concession of Rosenets oil port, BSP floor leader Korneliya Ninova told journalists in the National Assembly on Wednesday.

Ninova said, however, that the BSP's principled position is that sites which are strategic for national security should be managed and operated by the state.

She said that the Constitution stipulates that such sites – bodies of water, forests, beaches - are exclusively state property. “Starting from the specific case, we say in principle that we are in favour of such sites being state property, but what we notice here is that a double standard is being applied,” Ninova said. In her words, a proposal is being made to terminate the concession of Rosenets, but at the same time a concession of Plovdiv Airport and the extension of other concessions on the sea are being prepared. In Ninova’s view, this is unprincipled. “We want the decision to be principled and to have a majority that says that the state wealth will be state property, to be exploited by the state,” Ninova said.

Toshko Yordanov of There Is Such a People was asked to comment the idea for terminating the Lukoil concession but he used that as an opportunity to slam Democratic Bulgaria co-leader Hristo Ivanov and Democratic Bulgaria in general, and did not reveal much of his party‘s position on the proposal in question.