European funding for drilling in Chiren is under question
The expansion of the gas storage facility will continue with vertical drilling

© ECONOMIC.BG / BTA
Due to the delay in implementing the project to expand the Chiren gas storage facility through drilling, European funding for it is now under question. This concerns the Grant Agreement for the implementation of the project with the European Agency for Climate, Infrastructure and the Environment (CINEA), which amounts to nearly 78 million euros. The funding represents 25.3% of the total cost of the project.
The money was meant to be paid out by the end of this year.
For this reason, the acting Minister of Energy Vladimir Malinov will ask CINEA to extend the implementation period and to plan the provided financing for the new drilling. He explained this during a hearing in the National Assembly on the termination of the contract for the project, which has the formal name of "Expansion of the capacity of the UGS Chiren - drilling fund", between Bulgartransgaz (BTG) and DZZD "UGS Drilling Chiren".
After the termination of the contract, Bulgartransgaz is in talks with the financing institution and a meeting with CINEA is scheduled for next week. According to the minister, the Agency is familiar with the current stage of the project and the phased implementation of the new wells.
The funding is divided into two parts – one for the above-ground facilities, which are scheduled to be put into operation at the end of the first quarter of 2025, and another for the drilling operations. Funds for the above-ground facilities are not at risk, as per Malinov.
Why did Vladimir Malinov stop the project?
After the European Public Prosecutor's Office began an investigation into the Chiren drilling fund contract in August, Vladimir Malinov suspended the project a day later while the investigation was ongoing. A few months later, the contract was also terminated. From the parliament hearing today, it became clear that there was no request from the European Public Prosecutor's Office authorities in Sofia, nor from the General Directorate of the National Police to suspend the implementation of the contract.
In view of the subject of the inspection and the signal submitted, if the implementation of the contract continues during the inspection, it can be proven. The implementation of the contract is at a stage where construction and installation works must begin and additional financial resources must be committed within the framework of the contract by BTG - this is one of the reasons behind the decision of the Bulgartransgaz management to stop it," explained Malinov.
According to him, the purpose of the decision taken is to avoid additional damage, including financial, to the company and not to impede the inspection.
The new drillings
Malinov added that the market consultation which BTG conducted for the new wells also refers to vertical-type technology, and not to inclined wells.
A working group of BTG has reviewed, analyzed and discussed the possibilities for the implementation of the drilling fund project. Increasing capacity is a long-term technological process and under the new tender, it will be carried out in stages.
The working group's decision to continue working with vertical drilling was made after analyzing geological modeling and simulation results, which specifically and unambiguously indicate that vertical drilling should be used, Malinov commented.
Next week, BTG will officially launch the public procurement for the new three wells.
Translated by Tzvetozar Vincent Iolov