Bulgarian Negru Voda gas capacity not available until 2017

Bulgaria’s natural gas transmission system operator Bulgartransgaz will hold cross-border capacity auctions at the Negru Voda 1-Kardam interconnection point with Romania later this year, for 2017 capacity.

Bulgartransgaz was initially expected to hold unbundled auctions in September, similar to its Romanian counterpart Transgaz, for the gas year starting 1 October (see ESGM 26 August 2016 and 5 September 2016).

However, Bulgarian gas contracts follow the calendar year and therefore capacity will become available from 1 January 2017, Ivalyo Moynov, head of sector development at Bulgartransgaz told ICIS on Thursday.

The auctions follow the expiry of Russian Gazprom’s long-term contract on this section of the Western Line, the transit pipe that carries Russian volume through Ukraine and the Balkans towards Greece and Turkey.

The cross-border capacity will be sold via the RBP auctioning platform.

Bulgartransgaz was considering holding an auction for this key capacity starting from 1 October to coincide with the Transgaz auctions, but then decided against this because most key contracts on the Bulgarian side were still ongoing.

Up to 20 million cubic meters (mcm)/day is likely to be made available to the market. Of this, a maximum of 90% will be auctioned as annual capacity and the rest will be auctioned separately on a more granular level.

However, Moynov could not give an exact deadline for the auction, saying the operator was waiting for the country’s energy regulator EWRC to approve the new gas balancing rules first and it was unclear at this stage when this will happen.

Bulgaria still uses a simple balancing system on a daily basis which does not include imbalance charging. Linepack is settled on a monthly basis.

The associated unbundled capacity on the Romanian side of the Negru Voda 1-Kardam point has already been sold, with some interest in the firm annual product and for delivery in Q4 ‘16 and Q2 ‘17.

Bulgartransgaz has previously said it will use the RBP to auction other key cross-border points, although these were not mentioned by Moynov on Thursday. irina.peltegova@icis.com