South Stream Bulgaria raises capital despite freeze of South Stream Gas Pipeline project activities

South Stream Bulgaria, a 50-50 joint-venture of Bulgarian Energy Holding (BEH) and Russian Gazprom, has increased its capital in defiance of orders to the contrary issued by the caretaker Energy Minister Vasil Shtonov, the Bulgarian newswire, Novinite, reported Aug. 19.

  “According to a statement posted on the website of Bulgaria’s Economy and Energy Ministry on Aug. 19, the capital of the South Stream Bulgaria set up to build the Bulgarian section of Russian-led South Stream Gas Pipeline has been increased to BGN 397.6 mln,” the newswire reported. “While the capital increase itself does not mark the start of construction works on the project, it does allow for preparations to go ahead.”

 The statement also said that the capital increase was undertaken despite an explicit order to the contrary issued by the Bulgarian Energy Holding on Aug. 11.

 The capital increase was officially entered into the Bulgarian Commercial Register on Aug. 18 in violation of Shtonov’s recent assurances that all activities connected to implementation of the South Stream Gas Pipeline project in Bulgaria would be halted until the project reaches compliance with the EU regulations.

 “The Economy and Energy Ministry believe the actions of the managers of South Stream Bulgaria do not protect Bulgarian Energy Holding’s interests in the joint venture and intend to refer the case to law enforcement bodies,” the statement said, as cited by the newswire.

 In June 2014, European Commission launched an infringement procedure against Bulgaria over the how the country is handling the construction of the South Stream Gas Pipeline project. At the time the project was allegedly put on hold by the former Bulgarian President Plamen Oresharski.

Photo courtesy of Samuel Bailey.