Bulgaria's BOTAŠ Agreement on Hold Amid Energy Security Concerns
Bulgaria is renegotiating its contract with Turkish Petroleum Pipeline Corporation (BOTAŞ) due to concerns over its financial burden. The agreement, signed in 2023, allowed for the transfer of up to 1.5 billion cubic meters of natural gas annually over 13 years.
The deal was initially seen as a way for Bulgaria to reduce its dependence on Russia and gain access to global liquefied natural gas (LNG) markets through Türkiye. However, the capacity guarantee in the agreement proved expensive for Bulgaria, with the country required to pay not only for the gas it used but also for reserved capacity.
The situation has raised questions under energy law regarding long-term contracts and their future. The Bulgarian Energy Minister Zhecho Stankov estimated that terminating the agreement could cost more than 2 billion euros, while other statements put the total contractual obligation at approximately 4 billion Bulgarian lev, or around $2.3 billion.
Bulgaria has chosen to suspend the contract for 15 months rather than terminate it, giving Sofia a temporary way out of paying for unused capacity under improved commercial terms. The decision is seen as an attempt to renegotiate the contract's risk and cost structure, taking advantage of its growing supply options in recent years.