Minister Malinov suspects Russian interests behind the signal and the inspection of the modernization at the "Chiren" UGSF

"I admire and welcome this inspection by the European Prosecutor's Office in Bulgartransgaz, because this topic should be closed." This was stated to BNT by the Acting Minister of Energy, Vladimir Malinov. The minister is also completely calm on the subject for several reasons. "An inspection found that there were no violations in relation to the public procurement and that it was conducted in accordance with the requirements and principles of the Law on Public Procurement and there were no indicators of fraud."

At the same time, Malinov stated that he does not accuse the European Prosecutor's Office of acting under the long arm of Russia. "But I see that for many of the projects we are working on there are people of the status quo who are used to living and building this status quo, experts who have built and lived in an energy system that is completely dependent," he added.

The Acting Minister of Energy recalled that the State Financial Inspection Agency had already checked the public order. He clarified that the focus of the inspection is on the public order and its implementation based on the concluded contract. "According to the contract itself, only an advance payment was transferred. This payment was guaranteed 100% by the contractor and no other payments were made to him in connection with the construction of the wells themselves".

At this point, the activities related to the design, the issuance of the building permit and the environmental assessment have been paid. "But European funds have not been spent on the construction of these wells," Vladimir Malinov was categorical.

According to him, Bulgarian energy has become a topic that everyone understands "like football" for example.

Malinov was categorical that our country will try to renegotiate the contract with the Turkish company Botash, the implementation of which is now a serious financial burden for Bulgargaz. Malinov also noted that "Bulgargaz" is in a difficult financial situation with losses of around BGN 200 million.

According to the minister, the electronic system of "Bulgartransgaz" does not give an advantage to one or another company. At the moment, 6-7 companies are booking capacity in it.

"It is no secret to anyone that the Bulgarian energy sector has been indisputably dependent on one source, and that is Russia".

He stated that the Bulgarian energy industry should be independent and diversified.

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The Chiren underground gas storage expansion project is a project of "common interest" (PCI) under Regulation (EU) 347/2013, priority corridor: North-South connections between the gas transmission networks in Central Eastern and South Eastern Europe (NSI East Gas). On June 22, 2022, Bulgartransgaz EAD and the European Executive Agency for Climate, Infrastructure and Environment (CINEA) signed a Grant Agreement for the co-financing of the expansion of the Chiren gas station with the following identification number and name: Project 101069718 — 6.20.2-BG-W-M-21-Extension of the "Chiren" WWTP. According to the Grant Agreement for the implementation of the project, it amounts to 77,910,018 euros. The financing represents 25.3% of the total cost of the project. The remaining part of the project is implemented with Bulgartransgaz EAD's own funds and loan financing. According to the grant agreement, activities are financed in the first two directions - the above-ground part and the drilling fund.

The following public procurements were announced for the implementation of the Project in August 2022:

- "Delivery of the necessary materials and equipment, construction and commissioning of a site: Expansion of the capacity of the "Chiren - above-ground part" UGSF, with reference number: 220-080;

- "Organizational planning, investment design, supply of necessary materials and equipment, construction and commissioning of construction: Expansion of the capacity of UGSF Chiren-drilling fund", reference number 220-081;

- "Investment design, supply of the necessary materials and equipment, construction and commissioning of an object: "Gas pipeline connecting the "Chiren" gas pipeline with the existing gas transmission network of "Bulgartransgaz" EAD in the area of ​​Butan village", reference number 220-082.

The opening and conducting of public procurement were in strict compliance with European and Bulgarian legislation. The orders were appealed and confirmed by the Commission for the Protection of Competition and the Supreme Administrative Court and in 2023 contracts were concluded with the selected contractors.

More information about each of the cited public procurements is available in the profile of the buyer of "Bulgartransgaz" EAD in CAIS EOP https://app.eop.bg/buyer/11715.

By Order of 12.03.2024 the director of the Agency for State Financial Inspection carried out a financial inspection of "Bulgartransgaz" EAD to check for legality regarding compliance with the regulations in the field of public procurement of the public procurement with the subject "Organizational planning, investment design, supply of necessary materials and equipment, construction and commissioning of construction: Expansion of the capacity of UGSF Chiren-drilling fund", incl. the grounds of the concluded contract in accordance with the provisions of the ZOP.

According to the report on the financial inspection of "Bulgartransgaz" EAD dated 07.06.2024, no violations were found during the opening and execution of the public procurement and the conclusion of the contract with the contractor. The amendment of the contract is lawful according to the normative provisions of the ZOP. The report is publicly available on the website of the State Financial Inspection Agency.