A European Union embargo on Russian oil, which comes into effect on Monday, has prompted Greece and Bulgaria to talk about reviving a long-gone oil pipeline project that bypasses the Bosphorus.
The pipeline would run 280 km (about 174 miles) from the port of Alexandroupolis on the Aegean Sea to the port of Burgas on the Black Sea and could continue all the way to the port of Constanza in Romania, Bulgarian Energy Minister Roman Hristov told CNN Breaking News.
“We have a two-year exemption [from EU sanctions] for buying Russian oil, but after that, we’ll run into problems due to the increase in transit fees across the Bosphorus,” Hristov responded to a question from CNN Breaking News at an energy conference in Athens.
That is why we have started to discuss the revival of the Burgas-Alexandroupolis pipeline and its extension northwards to the ports of Varna and Constanza,” he added.
“We support the project,” Greek Energy Minister Kostas Skrekas said in a statement. None of the ministers agreed to answer any further questions.
The EU’s move is disrupting tanker trade from the Russian oil export terminal in Novorossiysk on the east coast of the Black Sea to EU ports on the west coast.
Refineries in Burgas and Constanza can still buy oil from Kazakhstan and Azerbaijan.
A Kazakh oil pipeline terminates at the Caspian Pipeline Consortium (CPC) terminal near Novorossiysk, and an Azerbaijani oil pipeline ends at Supsa, further south, in Georgia.
However, it is not enough to satisfy their needs, especially when Ukraine’s needs are taken into account.
The deficit is being offset by additional quantities from other sources, which are shipped across the Bosporus to the Black Sea.
The original idea of the Burgas—Alexandroupoli pipeline, which was first aired in 1993, was to flow south and export crude oil from the Black Sea to the Mediterranean and beyond.
“The real problem was delays and bottlenecks in the strait. This is very easy to overcome with a pipeline,” said Mike Myrianthis, a veteran of the Greek oil industry who was involved in the project at the time.
“We wanted to be tied to a major producer for long-term delivery… There was a very good relationship with Russia back then,” he told CNN Breaking News. “I remember we were talking about a second, parallel pipeline.”
In 2007, Greece, Bulgaria and Russia signed a political agreement to build the pipeline. Russia promised to deliver 35,000-50,000 tons of oil a year to fill them.
A 650,000 ton tanker farm in Alexandroupolis would ensure a constant supply of ships.
However, Bulgaria withdrew from the project in 2010 citing environmental concerns. Industry experts tell CNN Breaking News that US resistance to dependence on Russian oil has derailed the project.
However, Russia would not benefit from the Northern Pipeline, and the idea has gained new urgency as a result of Western sanctions against Russian oil, which the International Energy Agency believes are permanent.
Last October, Turkey gave the pipeline a boost when it raised transit fees for tankers using the Bosphorus five times to $4 per ton of oil, raising the current price of oil by about half a percentage point.
Daily Sabah newspaper would increase Turkey’s income from transit fees from $40 million to $200 million a year.
Turkey has its own plan to bypass the congested Bosphorus with a waterway running west of it. President Recep Tayyip Erdogan proposed the Istanbul Canal to great attention in 2011, but construction has not yet begun.
Until the war in Ukraine, oil and gas pipes flowed south from Russia through Ukraine and the Balkans.
The Ukraine war has plunged Greece and Turkey into geopolitical competition as Alexandroupoli has begun to reverse these energy flows while Turkey becomes Russia’s new southern leader.
“The idea is to create a north-south pipeline axis for gas and oil, which will also be reinforced by rail transport. This entire network should ultimately end up in Ukraine so that even this country can be supplied from the south,” said Myrianthis.
In this competition, the Greek region of Western Thrace has already become an important alternative to the Bosphorus.
A defense agreement signed in 2019 has allowed the United States to use the port of Alexandroupoli as a logistics base to ship supplies and reinforcements for NATO members Bulgaria and Romania, as well as weapons to Ukraine itself.
Romania’s border with Moldova and Ukraine is just a day away from Alexandroupoli by train. This is a faster transit than through the Bosphorus and more reliable since Turkey announced that it would close the strait to all military traffic in response to the war in Ukraine.
Last May, Russia cut off gas supplies to Bulgaria, ostensibly because it refused to pay in rubles.
Greece has since become Bulgaria’s only gas source, flowing from Azerbaijan via the Trans-Adriatic Pipeline (TAP) via Turkey and northern Greece.
A Greece-Bulgaria interconnector (IGB), which has been operating since October, discharges one billion cubic meters of TAP into the Bulgarian gas network annually.
By the end of 2023, Alexandroupolis will purchase a floating storage and regasification unit (FSRU) for importing liquefied natural gas (LNG), and the IGB pipeline will be extended 28 km (approximately 17 miles) south to reach it, further undermining the Russian gas monopoly in southeastern Europe.
There is talk of a second IGB pipeline being built parallel to the first, and of at least two more FSRUs.
Greece-North Macedonia pipeline
Greece is currently holding talks with North Macedonia to build a separate gas pipeline to that country.
Greece, which plans to export 8.5 billion cubic meters of gas to the Balkans by 2025, is quickly becoming the main supplier of non-Russian gas to the region.
The Burgas-Alexandroupoli oil pipeline would add another dimension to its role as a provider of energy security.
Turkey has also gained geopolitical weight as Russian energy is gradually being displaced from Eastern Europe. Three Russian gas pipes are already running into Turkey.
At a meeting with Erdogan on October 13 in Astana, Kazakhstan, Russian President Vladimir Putin announced that he was ready to build a fourth and make Turkey an export center for Russian gas.
“If there is interest in Turkey and our potential buyers in other countries, [we] could consider building another gas pipeline system and creating a gas hub in Turkey for sale to other countries, third countries, primarily to European countries, of course, if they are interested, of course,” Putin was reported.
Turkey has welcomed the project.