The governments of Bulgaria, Greece and Russia will next month sign a memorandum on a Balkan pipeline, enabling oil firms to side-step bottlenecks and boost Russian oil exports, a Greek official said on Friday. Greek Deputy Development Minister George Salagoudis told reporters the memorandum would be signed on April 15. "As soon as the memorandum is signed, the companies which form the initiative group will agree on the creation of an international firm, which will implement the project," he said.
The $700 million Burgas-Alexandroupolis pipeline from Bulgaria's Black Sea coast to the Aegean is expected to have an initial capacity of 15 million tonnes (300,000 bpd) rising to 700,000 bpd over three years, but progress on the project has been slow since its proposal in 2000.
In January, Russia said British oil major BP's Russian joint venture TNK-BP would co-ordinate the project with Russian gas monopoly Gazprom, oil major LUKOIL and pipeline monopoly Transneft as partners.
Salagoudis said other private participants may include Russian state oil firm Rosneft, Greek refiner Hellenic Petroleum, Latsis group, Gazprom's Greek unit Prometheus gas as well as the Bulgarian port of Burgas.
He also said the governments would not become shareholders in the project: "This is a purely private initiative."
He said Greece could invest up to $130 million in the project, adding that construction could begin in 2006.
Though its crude production has boomed to over 9 million bpd, Russia has focused on new export projects on its north western Baltic and Arctic coasts, particularly the flagship port of Primorsk on the Gulf of Finland.
TNK-BP has already successfully co-ordinated another foreign pipeline project for Russia - the reversal of Ukraine's Odessa-Brody link to pump Russian crude to the Black Sea.
That proposal met strong resistance from some Ukrainian officials keen instead to ship Caspian crude from the Black Sea to Europe, but TNK-BP lobbied hard and is now a major shipper on that route.
The 300-km (200-mile) Burgas-Alexandroupolis pipeline will help Russia boost exports through the Black Sea to Mediterranean markets.
It will bypass Turkey's Bosphorus straits, a notorious shipping bottleneck running through Istanbul - a city of over 10 million and the only gateway to the Black Sea and many of Russia's biggest oil-exporting ports.
With 2.9 million barrels of Russian and Caspian oil passing through the straits each day, the route is running at capacity and prone to expensive delays and bad weather.
Ankara has repeatedly urged oil exporters such as Russia to find other routes in order to reduce chronic congestion.
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