In this list
LNG | Natural Gas

Southeast Europe makes new progress on path to gas transformation

Crude Oil | Natural Gas | Natural Gas (North America) | Upstream

Platts Upstream Indicator

Commodities | Electric Power | Electric Power Electricity | Energy Natural Gas | Energy Transition | Renewables | LNG | Natural Gas | Refined Products | Diesel/Gasoil | Gasoline | Shipping | Wet Freight

Market Movers Europe, March 18-22: Russian elections, Red Sea attacks dominate oil; climate ministers set COP29 priorities

Chemicals | Energy Transition | Oil & Gas

Seoul Commodity Market Insights Forum

Natural Gas | Metals | Energy Transition | LNG | Upstream | Crude Oil | Coal | Non-Ferrous | Hydrogen | Emissions | Renewables

CERAWEEK FACTBOX: No energy transition without oil, gas, LNG

Chemicals | Polymers

Platts Asia Recycled PET Assessments

Metals | Natural Gas | Upstream | Crude Oil | Non-Ferrous | Ferrous | Steel

Metals: Saudi Arabia's new oil?

For full access to real-time updates, breaking news, analysis, pricing and data visualization subscribe today.

Subscribe Now

Southeast Europe makes new progress on path to gas transformation

Highlights

Bulgaria takes first US LNG cargo via Greece

More progress on new regional gas supply corridors

Improving interconnection key to regional market

  • Author
  • Stuart Elliott
  • Commodity
  • LNG Natural Gas
  • Topic
  • LNG Commoditization

London — Southeast Europe -- for decades an isolated gas region almost entirely dependent on imports from Russia -- is set for a significant transformation in coming years, with changes already taking place now bringing new flexibility.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

Bulgaria -- often highlighted as the country most vulnerable to Russian supply disruption -- last month bought its first US LNG cargo via the Greek LNG import terminal at Revithoussa.

LNG imported into Revithoussa can be sent northward into Bulgaria via the existing Sidirokastro interconnection point thanks to a 2016 agreement to allow for reverse flow.

The Marvel Falcon brought an LNG cargo from the Cheniere-operated Corpus Christi plant to Revithoussa on May 29, carrying the gas equivalent of some 100 million cu m of LNG, according to S&P Global Platts Analytics.

A second smaller US LNG cargo was expected in the third quarter, Bulgarian energy minister Temenuzhka Petkova said.

"One of the main priorities of the [Bulgarian] government in the field of energy is the diversification of gas supply sources and routes," she said.

"We can boast concrete actions -- gas from the US is now entering the Bulgarian gas transmission system."

Importing LNG at "competitive prices" is a serious step towards the liberalization of the gas market in southeast Europe, Petkova said, adding that term volumes could help form the Balkan Gas Hub that Bulgaria is looking to develop.

Bulgaria has more ambitions in the LNG sphere too. Late last year, state-owned Bulgartransgaz agreed to take a 20% stake in the planned Alexandroupolis LNG floating import terminal in northern Greece.

Greece itself has already imported two cargoes of US LNG into Revithoussa for its own use, including the first cargo shipped from Corpus Christi last December.

PIPELINE PROJECTS

With a number of gas pipeline projects set to move forward -- shifting the balance of trade flows in the region -- southeast Europe will almost certainly resolve the security of supply issues that have plagued the region for years.

Three key pipeline projects are under development:

  • the Southern Gas Corridor, and specifically the Greece-Bulgaria interconnector, to bring gas from Azerbaijan to the region.
  • TurkStream and its onshore extension via Turkey and Bulgaria to Serbia and onto Hungary, which while still bringing Russian gas will at least diversify the route.
  • and the BRUA system, which can bring gas from Bulgaria and new gas resources offshore Romania into Hungary and onto either Austria or Slovakia thanks to a combination of existing and new pipelines.

Azeri gas has already reached the Turkish border with Greece via TANAP, but will have to wait for the completion of TAP -- expected in mid-2020 -- before it can move any further.

Construction of the Greece-Bulgaria interconnector started on May 22, with the pipeline expected to begin operations by the end of 2020.

The interconnector is a spur off the TAP pipeline and designed to transport up to 3 Bcm/year in forward flow to Bulgaria -- with an option to be increased to 5 Bcm/year -- and up to 2 Bcm/year in reverse flow.

TURKSTREAM EXTENSION

The TurkStream onshore expansion, meanwhile, is making rapid progress -- impressive given that as recently as last year Gazprom was still said to be weighing its options for which would make the best onward route into Europe for the second string of TurkStream.

Construction of the Serbian section started in April, with energy minister Alexander Antic telling Gazprom CEO Alexei Miller earlier this month the linear part of the pipeline was "on schedule" for completion by the end of 2019.

Expansion of the Bulgarian network, however, stumbled in May when the Saudi Arabia-led consortium that won the tender to carry out the $1.2 billion work was stripped of the contract.

A consortium of Italy's Bonatti, Germany's Max Streicher and a Luxembourg-based unit of Russia's TMK will reportedly take on the work, which is expected to be completed by the end of 2020.

At the other end of the line, meanwhile, Hungary has started the non-binding open season procedure to gauge interest for capacity to bring gas via the TurkStream extension, with a binding process expected in September.

Hungary has said it wants to receive gas via TurkStream "as soon as possible", according to a recent Gazprom statement.

In Serbia, a binding capacity booking process was launched in April, but no results have been announced.

While it seems almost certain that all the capacity coming into southeast Europe via TurkStream will be booked, it is likely the gas will only start to flow in full in 2021, at least a year after TurkStream gas begins operations.

Click here for full-size map

Turkstream set to transform Southeast European gas market

-- Stuart Elliott, stuart.elliott@spglobal.com

-- Edited by Dan Lalor, daniel.lalor@spglobal.com