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Greece, Bulgaria talk about oil pipeline bypassing Bosphorus Strait | Oil and Fuel

A European Union embargo on Russian oil that takes effect on Monday has led Greece and Bulgaria to speak about reviving a long-defunct oil pipeline mission that bypasses the Bosphorus Strait.

The pipeline would run 280km (about 174 miles) from the port of Alexandroupolis on the Aegean Sea to the port of Burgas on the Black Sea, and may proceed as far north because the port of Constanza in Romania, Bulgaria’s Power Minister Roman Hristov advised Al Jazeera.

“We’ve got a two-year derogation [from EU sanctions] to purchase Russian oil, however after that, we’ll face issues due to the hike in transit charges by the Bosphorus,” Hristov mentioned in reply to a query from Al Jazeera at an power convention in Athens.

So, we have now begun discussing the revival of the Burgas-Alexandroupolis pipeline, and its extension north to the ports of Varna and Constanza,” he added.

“We help the mission,” mentioned Greek Power Minister Kostas Skrekas in an announcement. Neither minister agreed to reply additional questions.

The EU transfer disrupts tanker commerce from Russia’s oil export terminal at Novorossiysk on the Black Sea’s east coast to EU ports on its west coast.

Different suppliers

Refineries at Burgas and Constanza can nonetheless purchase oil from Kazakhstan and Azerbaijan.

A Kazakh oil pipeline ends on the Caspian Pipeline Consortium (CPC) Terminal close to Novorossiysk, and an Azeri oil pipeline terminates at Georgia’s Supsa additional south.

However it’s not sufficient to fulfill their wants, particularly when Ukraine’s wants are taken under consideration.

The deficit is stuffed by further volumes from different sources which might be shipped into the Black Sea by the Bosphorus Strait.

The unique Burgas-Alexandroupoli pipeline concept, first aired in 1993, was to move south, exporting crude oil from the Black Sea to the Mediterranean and past.

“The true drawback was delays and bottlenecking on the strait. That is very straightforward to beat with a pipeline,” mentioned Mike Myrianthis, a Greek oil trade veteran who was concerned within the mission on the time.

“We needed to be tied to a significant producer for long-term provide … There was an excellent relationship with Russia then,” he advised Al Jazeera. “I keep in mind we had been speaking a couple of second, parallel pipeline.”

In 2007, Greece, Bulgaria and Russia signed a political settlement to construct the pipeline, with Russia promising to offer 35,000-50,000 tonnes of oil a yr to fill it.

A 650,000-tonne tanker farm in Alexandroupolis would guarantee a relentless provide to ships.

However Bulgaria pulled out of the mission in 2010, citing environmental considerations. Trade insiders inform Al Jazeera it was US opposition to dependence on Russian oil that scuppered the mission.

However Russia wouldn’t profit from the north-flowing pipeline, and the concept has acquired new urgency with Western sanctions on Russian oil, which the Worldwide Power Company assumes to be everlasting.

Final October, Turkey added impetus to the pipeline when it hiked transit charges for tankers utilizing the Bosphorus Strait fivefold to $4 per tonne of oil, including about half a proportion level to present oil costs.

Turkey would elevate its earnings from transit charges from $40m to $200m a yr, in line with the Each day Sabah newspaper.

Turkey has its personal plan to bypass the congested Bosphorus with a waterway working west of it. President Recep Tayyip Erdogan proposed Canal Istanbul amid nice fanfare in 2011, however development has not but begun.

Geopolitical contest

Till the conflict in Ukraine, oil and fuel pipelines flowed south from Russia by Ukraine and the Balkans.

The Ukraine conflict has thrown Greece and Turkey into geopolitical competitors, as Alexandroupolis has begun to reverse these power flows, whereas Turkey is turning into Russia’s new southern conduit.

“The concept is to create a north-south pipeline axis for fuel and oil, which may even be strengthened by rail transport. All this community is in the end meant to finish up in Ukraine so even that nation could be equipped from the south,” mentioned Myrianthis.

On this contest, Greece’s area of Western Thrace has already develop into an essential various to the Bosphorus.

A 2019 defence settlement has allowed america to make use of the port of Alexandroupolis as a logistics base to ship provides and reinforcements to ahead NATO members Bulgaria and Romania, and weapons into Ukraine itself.

The border of Romania with Moldova and Ukraine is simply a day away from Alexandroupolis by rail, a sooner transit than by the Bosphorus, and a extra reliable one since Turkey introduced it was closing the strait to all army site visitors in response to the conflict in Ukraine.

Final Could, Russia lower fuel flows to Bulgaria, ostensibly as a result of it refused to pay in roubles.

Greece has since develop into Bulgaria’s sole supply of fuel, which travels from Azerbaijan throughout Turkey and northern Greece by the Trans-Adriatic Pipeline (TAP).

A member of the employees stands over part of the Interconnector Greece-Bulgaria (IGB) fuel pipeline [File: Alexandros Avramidis/Reuters]

An Interconnector Greece Bulgaria (IGB), operational since October, siphons off a billion cubic metres a yr from TAP to the Bulgarian fuel community.

By the tip of 2023, Alexandroupolis will purchase a floating storage and regasification unit (FSRU) to import liquefied pure fuel (LNG), and the IGB pipeline will probably be prolonged 28km (about 17 miles) south to succeed in it, additional eroding the Russian fuel monopoly in Southeast Europe.

There’s discuss of a second IGB pipeline being constructed parallel to the primary, and of no less than two extra FSRUs.

Greece-North Macedonia pipeline

Greece is in discussions with North Macedonia to construct a separate fuel pipeline to that nation.

Greece, which plans to export 8.5 billion cubic metres of fuel to the Balkans by 2025, is quick turning into the principle provider of non-Russian fuel to the area.

The Burgas-Alexandroupolis oil pipeline would add one other dimension to its function as a supplier of power safety.

Turkey, too, has acquired geopolitical weight as Russian power is steadily dislodged from Japanese Europe. Three Russian fuel pipelines already enter Turkey.

At a gathering with Erdogan in Astana, Kazakhstan on October 13, Russian President Vladimir Putin introduced he was ready to construct a fourth, turning Turkey into an export hub for Russian fuel.

“If there’s an curiosity in Turkey and our potential patrons in different nations, [we] might take into account constructing one other fuel pipeline system and making a fuel hub in Turkey for gross sales to different nations, to 3rd nations, primarily, in fact, to European ones, if they’re, in fact, On this,” Putin was reported as saying.

Turkey has welcomed the mission.

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