Bulgargaz will award the LNG contract to TotalEnergies in January-February 2024, as Bulgargaz announced on October 24.
Nine competing companies
“We are delighted to confirm that TotalEnergies Gas and Power Ltd has indeed won this procedure,” said a Bulgargaz representative. Nine companies submitted bids in response to the tender opened on October 9 for deliveries to LNG terminals in Turkey. The competition was fierce, demonstrating the strategic importance of LNG supply for the region.
Evaluation of Proposals
The proposals were carefully evaluated by a committee specially appointed by Bulgargaz’s CEO. Each bid was carefully evaluated using a pre-announced methodology, guaranteeing a fair and transparent process.
The tender was for four cargoes of LNG. Each has a capacity of 3.4 TBtu with an operational tolerance of +/-5%. These cargoes are scheduled for delivery in January, February, July and August 2024. They total 1 million MWh per month, with one cargo per delivery window. The tender specified that the unloading destination would be Turkey, with the possibility of delivery to Greece, thus offering a degree of flexibility.
Reference to the Dutch TTF
Although the final price awarded has not yet been confirmed, Bulgargaz has specified in the tender details that prices for these deliveries should be based on the Dutch TTF natural gas price for the month of delivery. This reference to the Dutch TTF is standard practice in the LNG industry to ensure competitive and transparent pricing.
Announcement of Upcoming Winners
The winning companies for the July-August 2024 deliveries will be announced on November 30. This stage is crucial to the completion of the contract award process. It will be eagerly awaited by the parties involved and observers of the energy industry.
In January 2023, Bulgargaz signed a 13-year agreement with Botas. This is the Turkish state company in charge of crude oil and natural gas pipelines. This agreement enables Bulgaria to import up to 1.5 billion cubic meters of regasified LNG per year via Turkey. This strategic initiative was an essential response to the cut-off of gas supplies from Russia in April 2022. Thanks to this agreement, Bulgaria’s energy security during the winter of 2024 has been strengthened.
LNG Price Evaluation
The cost of LNG is a critical factor for the Bulgarian economy and consumers. While the final price has yet to be revealed, it is essential to note that fluctuations in liquefied natural gas prices have a direct impact on the country’s economic stability. The details of the final prices will be closely scrutinized by economists and energy industry players.
Regional context
The award of this LNG contract has major regional implications. Demand for LNG in Eastern Europe and the Mediterranean region has increased in recent years. This is due to the diversification of supply sources and concerns about energy security. As a member of the European Union, Bulgaria plays a key role in this dynamic.
The award of the LNG contract by Bulgargaz to TotalEnergies for January-February 2024 deliveries is a significant development in the Eastern European energy sector. This strengthens Bulgaria’s security of supply and contributes to the region’s economic stability. Details of the final awards and the names of the forthcoming winning companies are attracting a great deal of interest. This story continues to evolve, and its impact on the regional energy industry will be closely monitored.
