PM Borisov’s pet project – the Balkan Gas Hub has risen in prominence after his talks with President Trump. Not sure the US President got into the story behind Bulgaria’s pretense to become a regional gas hub, but good intentions and promises were in abundance. The adopted Strategic Partnership Framework document states that “our shared goal is for Bulgaria to become a true gas hub and a key source of regional energy security, free of monopolists, foreign or domestic, and operating on market principles.” Nothing specific or imminent insofar as LNG contracts boosting gas liquidity for the Balkan Gas Hub is concerned. The bottom line – Russian gas will continue its monopoly unabated. The Bulgarian State trader Bulgargas has no intention of replicating Polish, Greek, Ukrainian, Baltic,
There has been much talk recently of a return to the balance of great power interests and spheres of influence. President Trump’s transactional foreign policy is an epitome of this return to two centuries old doctrines and the paradigm of interests before principles. President Macron has joined and suggested a restart of the geostrategic partnership with Russia, to balance off China and the US, calling for dropping sanctions and a return to business as usual. The French President seems not only to be seeking to lead post-Brexit EU but also to step in the shoes of his great predecessors De Gaulle and Napolean. He has managed to veto opening up accession talks with Albania and North Macedonia, disregarding prevailing EU common ground. Paris is engaging in the
Last week the Bulgarian PM inspected work progress at the Interconnector Greece-Bulgaria, noting that it is a landmark project for energy security in the region. Two days later, he flew to Thessaloniki to meet the Greek PM and the US ambassador to Greece, repeating praise for Greek-Bulgarian cooperation in the energy field and commitment to buy more LNG. DEPA, Kolmar, and the Bulgarian company Energiko have managed to import partial or fully LNG sourced gas into Bulgaria via the Greek terminal at Revithoussa. Due to outdated regulatory practice and lack of liberalization of the gas market, the margins between the “buy” and “sell” prices have been collected by the traders, including Bulgargas. Lower international prices of gas have failed to reflect into a proportionate decrease in gas prices
The spy affair involving the top Russophile in Bulgaria – Nikolay Malinov, has received an ominous turn in the last three days. Mr. Malinov was miraculously granted a three-day exemption from the ban to leave the country, allowing him to fly to Moscow and receive a Soviet time Оrder of Friendship from President Putin. The motives are clear – for outstanding contributions to the Russian nation. Mr. Malinov is what ideally fits into the term ‘Russian agent of influence.’ The invitation and the ceremony were all carefully staged showcase of Vladimir Putin’s imperial hiatus. In the case of Mr. Malinov, it was a clear case of marked red lines the Bulgarian PM Borissov should not cross. The most intriguing part of the story is the five-minute
Shortly after the October 20th visit of the head of Russia’s Civil Intelligence Sergey Naryshkin, an S-400 division and Panzer rocket-artillery system arrived in Serbia. They are supposed to take part in the second part of the joint military drills ‘Slavic shield – 2019’ that will span October 23-29th. The news generated fresh concerns about a possible permanent deployment of the S-400, leading to widespread geopolitical repercussions. More than 200 Serbian military experts were flown to Russia two months ago to take part in the first leg of the ‘Slavic Shield-2019’ military drills in the region of Astrakhan, which included training and live-fire tests with S-400. This summer, NATO-member Romania banned the river transport of Russian armored vehicles to Serbia. Russia then flew them over NATO member
The effect of LNG and newly sourced gas in the Southern Gas Corridor will spread across the CEE and the SEE and put the heat on Russia’s gas monopoly. In other words, if hidden and overt preferential treatment for Gazexport is revoked, this will result in lower prices or market shares for the incumbent monopoly. Reverse supplies via the Trans-Balkan Pipeline could start as early as January 1st, 2020, bringing gas from Turkey, Greece, and the Southern Gas Corridor to clients in Romania, Moldova, Ukraine, and Slovakia even before Turk Stream gas crosses the Bulgarian border. Demand for Nord Stream-2 south and eastbound gas exports via Opal and Eugal gas pipelines should wane with lower price differentials amid rising competition from the Southern Gas Corridor and LNG.
Sanctions on their own won’t stop Nord Stream-2, the market, and the EU directives can obliterate the effect sought by the Kremlin and turn what President Putin perceives as an asset into a liability. Gas pipelines are not a threat – politicians like Putin certainly are. The national security line in addressing the issues starts from the basics – Is Russia a threat? Perceptions matter. For many politicians in old Europe, located in offices at a safe distance from Russia, the threat notion is vague, remote, and academic. They do not discern Putin’s Russia as a threat. Perception matter. For many politics in old Europe. For the Austrian business, born and bred in brokering deals between Russia and Eastern Europe, this is routine and legitimate “business”.
President Putin’s address to the Valdai forum This year the Valdai forum gained in high-level profile – foreign heads of states attended the year’s plenary session, starring President Putin’s keynote address and his answers in the Q&A follow-up. The new old message – the pivot of the world is shifting to the East, and Russia is shifting its foreign policy alongside. One could mistakenly take Putin’s words at face value and deduct Russia is less interested in Europe and the West. Suffice it to dissect this into the strategic backdrop of the new cordial entente with Macron’s France and Trump’s America. Do not take Valdai’s communications wrong – although the speakers were invited to discuss the longer-term horizon, not an inch of what they covered contradicts or
The Turk Stream is not only about bypassing Ukraine. It is a direct response by Gazprom to challenge the Southern Gas Corridor and natural gas from the Caspian Sea. The race to secure parallel routes, block transmission and storage capacities have been part and parcel of the strategy to protect market shares and pre-empt competitors from the gas market in South East, East and Central Europe, where Russia used to sell more than 70 billion cubic meters. The CEE market has long been considered ‘isolated’ thus doomed to be captured. Yet it remains critical for Gazprom’s revenue base as regional gas prices also include a monopoly premium. Natural gas prices for Moldova, Ukraine and Bulgaria are over $220 per thousand cubic meters, while at gas hubs in “old Europe”
This is where we come to the “Russia spy scandal” which is a classic special operation, coordinated with Moscow. Its credibility rests on the fact that there is a genuine threat assessment of Russia’s hybrid war potential against Bulgaria. The State Agency for National Security (SANS) files is overflowing with information, which has been persistently and deliberately ignored. The dossiers have been piling up, ready to be used at the right moment and played in line with needs. Yet the choice made was for the relatively innocent public personage, carefully avoiding the real Russian secret agents, operating in the country. The applied innovation is blending fact and fiction in a massive PR feat, serving both ends and killing two birds with one stone – first, striking a geopolitical