April 27, 2017 / 7:54 AM / 5 months ago

Bulgaria wants to renegotiate Gazprom gas prices every year

SOFIA, April 27 (Reuters) - Bulgaria wants to renegotiate gas prices with Gazprom more often than proposed by the Russian gas company as a concession in an EU antitrust case, its energy minister said on Thursday.

Interim Energy Minister Nikolai Pavlov said Bulgaria would also seek to be granted access to the gas markets of other eastern European countries - an option that Gazprom’s concessions envision for Slovakia, Hungary and Poland.

A provisional agreement announced last month would see Gazprom avoid a fine of up to 10 percent of its global turnover over EU charges it abused its dominant market position and overcharged clients in eight eastern European nations.

The deal is subject to feedback from EU states and market players that should be sent by May 4.

Pavlov has said there are a lot of ambiguities in the proposed concessions and that Bulgaria, almost fully reliant on Russian gas supplies, may need more time to prepare its response.

Gazprom has offered to link its prices to benchmarks such as European gas market hub prices, rather than oil, and allow clients to renegotiate prices every two years among other concessions.

“We want to be able to renegotiate gas prices every year and in the first two years every six months,” Pavlov told national radio BNR.

“What is also raising concerns is that Gazprom had offered access to the Bulgarian market to companies from Hungary, Slovakia and Poland, while there is no reciprocity.”

Pavlov said Sofia would object to this commitment linked to gas delivery access points and would demand that Bulgarian companies also be granted access to the markets of other eastern European countries.

Sofia said such access may put pressure on its gas utility Bulgargaz to carry out its obligations under the Gazprom contract and would also seek to scrap or at least decrease the “take-or-pay” option in the contract to avoid eventual losses.

“Our goal is that contracts with Gazprom be renegotiated under better conditions,” Pavlov said. (Reporting by Tsvetelia Tsolova; editing by Jason Neely)

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