Bulgaria and Greece to seek EU financing for hydrogen pipeline project

In a joint effort, Bulgarian and Greek gas operators have submitted an application to the European Union (EU) for the inclusion of their ambitious hydrogen pipeline project as part of the European projects of common interest. The aim is to secure free financing, initially to conduct a comprehensive feasibility study. This announcement was made by Vladimir Malinov, the executive director of “Bulgartransgaz,” during the ongoing “Green Transition” forum organized by dir.bg and 3e-news.net.

The plan to establish a hydrogen pipeline was initially revealed a year ago after Bulgartransgaz and the Greek operator, DESFA, reached an agreement in late December 2021. The companies have since gathered preliminary information regarding the potential to power the hydrogen pipeline and the projected demand for this eco-friendly energy source. However, the next crucial step involves conducting extensive market research to analyze factors such as capacity, optimal route, cost projections, and return-on-investment assessments. The companies are actively seeking financing for the actual construction of the pipeline.

Vladimir Malinov pointed out that natural gas currently holds a cost advantage over hydrogen, with a price of approximately 30 euros/MWh. Additionally, long-term contracts for the supply of liquefied natural gas from newly built terminals for regasification can reduce its price by half. However, despite this price discrepancy, the companies remain committed to pursuing the hydrogen pipeline project as part of their long-term sustainable energy strategy.

To further explore the potential of hydrogen, Bulgartransgaz recently engaged the services of “Simatex” EOOD, a consultant tasked with analyzing the viability of various sections of its network for hydrogen transmission. The analysis includes blending hydrogen with natural gas at concentrations ranging from 5 to 20 percent. Furthermore, the study will identify necessary investments for retrofitting specific facilities to facilitate this blended transmission. The consultancy contract, valued at 350 thousand euros, was awarded to “Simatex” EOOD, which subsequently subcontracted the assessment to the Dutch company Rosen Europe, with a contract worth 280,000 euros.

Meanwhile, the second gas operator in Bulgaria, “ICGB,” responsible for the gas connection between Bulgaria and Greece via the Komotini-Stara Zagora gas pipeline, is also exploring the possibility of transporting hydrogen. The company believes that with the necessary modifications, the existing infrastructure can facilitate the transportation of this future fuel.

According to Vladimir Malinov, while the role of natural gas will remain significant, particularly as a transitional fuel during the green economy transformation, the current technology allows for carbon emissions to be captured, transforming natural gas from a “blue” to a “green” fuel. Malinov emphasized that solar energy and natural gas will be the foundational fuels for this green transition, illustrating his point metaphorically by stating that the color green is obtained through the combination of yellow (sun) and blue (gas).

Furthermore, Malinov addressed certain misconceptions regarding natural gas in Bulgaria, stating that the prevailing associations of Russian origin, high cost, and environmental pollution do not accurately reflect the current situation. He presented data revealing that Russian gas consumption in the European Union currently stands at 9 percent, and in Europe as a whole, it accounts for 15 percent. Norwegian gas from the Caspian region has largely replaced Russian gas, and the significance of liquefied natural gas from the United States, North Africa, and the Middle East is steadily increasing.

Malinov concluded by emphasizing that effective energy storage, not only for natural gas but for all forms of energy, will be the key to successful energy transition.

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