site.btaParliament Hears Energy Minister about Chiren Gas Storage Expansion

Caretaker Energy Minister Vladimir Malinov told MPs Thursday that the contract for the expansion of the Chiren gas storage facility has been terminated.

"There has been no request from the European Prosecutor's Office in Sofia or the General Directorate of National Police to suspend the contract. However, in view of the subject matter of the inspection and the report submitted, the management of Bulgartransgaz has decided to terminate the contract. The reason is that the continuation of its implementation, including the start of construction works and the commitment of additional financial resources, could lead to financial damage for the company and hinder the inspection,” Malinov said in the National Assembly. He was answering questions about the reasons for termination of the contract for the expansion of the capacity of the Chiren facility.

The building of Bulgartransgaz was searched by officials of the General Directorate of National Police and the European Prosecutor's Office in connection with the expansion of the underground gas storage in Chiren. This was announced by Bulgartransgaz CEO Kiril Ravnachki on August 15.

At that time, Malinov noted that he welcomed the inspection initiated by the European Public Prosecutor's Office because the public procurement for the expansion of the underground gas storage had already been subject to an inspection by the Public Financial Inspection Agency (PFIA). The findings of PFIA have been made public and it has been found that there were no breaches in the initiation and conduct of the procurement, and the conclusion of the contract, and that all legal requirements were complied with. Malinov announced that he would order the management bodies of the Bulgarian Energy Holding and Bulgartransgaz to suspend the contract until the completion of the audit.

In connection with the inspection, the Minister sent a letter on August 15 to the management of Bulgartransgaz and the Bulgarian Energy Holding, in which he insisted on full protection of the project and taking timely action to prevent damage to financial interests or misuse of funds allocated by the European Union.

He said that an extension to the grant agreement for the expansion of the Chiren gas storage facility will be requested to allow planned drilling.