Books on Bulgaria
Update No: 159 -
A doubtful affair
Bulgaria, along with Romania, entered the
EU in 2007. There are those like us who
think that this was a premature step on
behalf of the EU.
Neither country is really tackling the
grave problems of crime and corruption
with which they are afflicted. They are
rampant in both of them.
Their admission is also permitting the
entry of migrants into the EU, notably
Gypsies, or Romany people. It is generally
forgotten that Hitler's Holocaust killed
as high a proportion of Europe's Romanies
as it did Jews, two million Gypsies.
Hence President Sarkhozy of France has got
away with targeting Bulgarian and Romanian
Gypsies for eviction. They have been
settling in Southern France. They are
deeply unpopular and are now to go.
This matter involves a can of worms, that
nobody wants to open. Let us turn to more
September offers a new oil frontier
Bulgaria is being transformed from being
an energy consumer to being an energy
The opening of new fields in Bulgaria will
boost production by 7,500 barrels of oil
equivalent per day, Melrose Resources
said, as interim pre-tax profits at the
Edinburgh-based oil and gas group jumped
by more than a third. Melrose, which has
operations in Egypt, Bulgaria, Romania and
Turkey, said it produced an average of
40,000 boe/d in the first half of this
year, driven by its offshore Egyptian
The group expects to receive a boost when
the first of two Bulgarian fields begins
production in September, and the income
will help pay down the company’s $459m
(£294m) of net debt.
For the six months to June 30, pre-tax
profit rose 32 per cent to $26.2m – up
from $19.8m in the same period last year –
on sales that rose from $97.6m to $110m.
Bulgarian developments the key
Dave Thomas, chief executive, said the
Bulgarian fields were crucial to
increasing the company’s cash flow. “Cash
from operations will grow steeply. As soon
as these Bulgarian developments come on,
we’re on a strong growth curve – assuming
a $70 barrel of oil, [we’re expecting]
$240m in cash flow from our operations in
2013,” said Mr Thomas.
Melrose plans to maintain current
production levels in Egypt, bring two
Romanian fields onstream in two years and
divest assets in North America.
Debt concerns have shadowed the company,
which is more highly geared than many of
its competitors. According to the company,
debt has been cut by $15m in the past six
months and Mr Thomas said money raised
from the US asset sale would go towards
paying down debt.
Nick Copeman, an oil analyst at Oriel
Securities, said the results were in line
with expectations and he does not expect
Melrose’s high level of debt to become a
“Production was slightly better than
expected and the second half will be
driven by Bulgaria. As for the net debt,
Melrose sells fixed-price gas and if the
oil price stays buoyant I don’t see it as
an issue,” Mr Copeman said.
Azeri gas as the Bulgarian alternative
Bulgaria has stepped up efforts to reduce
its almost complete dependence on Russian
gas by diversifying routes and supplies
after a dispute between Russia and Ukraine
left it without gas for weeks in early
Under the project, Azeri gas would be
transported via a pipeline to Georgia to
be compressed and shipped by tankers to
Bulgaria's Black Sea port of Varna, said
Ivan Drenovichki, executive director of
Azeri state oil company Socar,
Bulgartransgaz and the Georgian Oil and
Gas Company are set to launch a
feasibility study for the project at a
meeting planned for 23 September to 24
September, he said to Reuters.
"We have an initial agreement to launch a
feasibility study. In September we are to
take this decision," Drenovichki said."If
all goes well and the project proves
expedient, first deliveries can start at
the end of 2013," he said.
Bulgaria's gas consumption averages about
four Bcm a year, he said.
The study will define the value of the
project, which Drenovichki said could cost
hundreds of millions of dollars, with over
85% of the funds needed for tankers.
Sofia signed a memorandum of understanding
for gas deliveries with Baku last
November, saying some deliveries could be
transported by the EU-backed Nabucco
pipeline, aimed to carry natural gas from
the Caspian region to Europe.
The Nabucco project faces rivalry from the
Russia-led South Stream gas pipeline
project, which aims to cement Moscow's
position as key gas supplier to Europe.