A large-scale operation is currently underway at various addresses in Sofia. CPC agents and police have simultaneously entered the Ministry of Energy, as well as "Bulgargaz" and "Bulgartransgaz", Epicenter.bg learned from its sources.
According to unconfirmed information, the services are currently searching for Rosen Hristov, and his properties are being searched.
The action is related to an investigation by the Sofia City Prosecutor's Office into the extremely unprofitable contract with the Turkish company "Botas".
The contract was concluded in 2023. in the mandate from one of Rumen Radev's official offices by the then head of “Bulgargaz“ Denitsa Zlateva and the acting Minister of Energy Rosen Hristov, who became known by his nickname “Catamaran“, because of his passion for the vessels of the same name.
On Monday, Hristov released a music video in which he drives an expensive convertible car in a seaside resort while riding two dancing models. Later, Rumen Radev's former minister deleted the scandalous video, which gained popularity on social networks in minutes.
It is not clear when and where it was filmed.
Users on social networks recognized only one of the two women in the footage – actress Sanya Borisova, with whom the former energy minister has also published other photos over the years.
Shortly after the video was published, however, Hristov deleted it from his profile.
"The contract is not unprofitable. At the moment, I am suing absolutely everyone who writes such things for defamation. The contract works very well," Rosen Hristov said before the parliament some time ago.
In April, the persons responsible for signing the contract with "Botash" were heard in the parliament. At that time, Hristov, the director of "Bulgargaz" Denitsa Zlateva, as well as the director of the gas transmission operator "Bulgartransgaz", later the acting minister of energy, and now again the director of the state-owned company – Vladimir Malinov, said that they were called for questioning at the State Agency for National Security and National Defense.
"Regarding the contract with "Botaş" I have given testimony at the State Agency for National Security and National Defense, but they were not about the president's connection with the conclusion of the contract. As far as I know, the procedure was somewhat different regarding the manner of signing the contract and the investigation by the European Competition Commission," Hristov said at the time.
WHAT DOES THE CONTRACT WITH "BOTAş" PROVIDE?
The agreement between the Bulgarian state company „Bulgargaz“ and the Turkish „Botaş“ was signed on January 3, 2023.
It provides for Bulgaria to pay Turkey nearly $500,000 per day in fees for access to Turkish liquefied gas terminals and for transmission through Turkish infrastructure.
The fee is due for reserved transmission capacity. Bulgaria must pay separately for the natural gas itself that it wants to deliver.
The fee is due regardless of whether gas is being transported or not.
The agreement also provides for a change in the fee depending on inflation, and therefore from 2025 the fee increases by BGN 50,000 per day.
The agreement is for a period of 13 years and is worth a total of over $2 billion or nearly BGN 4 billion.
In the event of early termination, “Bulgargaz“ will owe the entire amount.
The state gas supplier has already paid hundreds of millions under the same contract. And without actually using the service it is paying for. And for nine months now it has not been able to afford to pay at all.
The document also provides for “Botaş“ to receive reserved capacity in the Bulgarian gas transmission network, which is managed by “Bulgartransgaz“. This practically means that the Turkish company can sell gas to end customers in Bulgaria.
"Botaş" has repeatedly rejected "Bulgargaz"'s request to review the contract. Moreover, it threatens with serious consequences by not accepting the change in market conditions as an argument.
Two billion dollars hang like a sword of Damocles over Bulgaria and specifically over "Bulgargaz".
Bankruptcy is almost inevitable.
The agreement itself is not public with the argument that it represents a "trade secret". This is the practice when concluding such contracts.
The document was published by the group Bg Elves ("the Bulgarian elves"). Information about its content is also available in the report of the temporary parliamentary commission in the 49th National Assembly, which examined the agreement and about which Epicenter. bg wrote.
The agreement was negotiated during the caretaker government of Galab Donev, appointed by President Rumen Radev. The Minister of Energy was Rosen Hristov.
When signing the agreement, they presented it as “historic“.
Radev pointed out at the time that the document was the result of the agreements reached at his meeting with Turkish President Recep Tayyip Erdogan a month earlier.
The document itself was signed by the then director of „Bulgargaz“ Denitsa Zlateva and the director of „Botaş“ Bürhan Özcan.
The leaked document bears the signature of Rumen Hristov. Later it became clear that a separate agreement was also signed by Vladimir Malinov - then director of the gas transmission operator „Bulgartransgaz“, later acting minister of energy, and now again director of the state company.
The contract was signed without the knowledge of the Bulgarian Energy Holding (BEH), which owns „Bulgargaz“ and “Bulgartransgaz“, the parliamentary committee report from 2024 says.
When Donev's cabinet approved the contract, it itself was not submitted to the ministers, the report also states.
RADEV STARTS POLITICAL NEGOTIATIONS FOR "BOTAS"
"It all started with specific international meetings with the participation of President Radev and representatives of the caretaker government, which took place on December 9, 2022. "An agreement was reached at the meeting to strengthen cooperation between the two countries in the energy sector," Energy Minister Zhecho Stankov recalled a week ago.
"After this meeting, there were a number of such meetings at the political level in the presence of Acting Energy Minister Rosen Hristov on December 11 and between December 22 and 24. They had one main goal - to prepare a draft agreement for the purchase and sale and reservation of capacity," he added.
"Bulgargaz" notes that in the agreement, unlike others, the "Service" fee is due from the Bulgarian side to the Turkish side regardless of whether we take advantage of this service, which is the delivery of a daily quantity of 53,200 MWh, the Minister of Energy recalled.
"The Bulgarian side is obliged to pay the value of this capacity, regardless of whether we take advantage of it in full or in zero", he said.
WHERE IS THE PROBLEM WITH THE CONTRACT
On December 24, 2022, an email was received from "Botas", which contained the purchase and sale contract, signed by hand by the then Minister of Energy Rosen Hristov. The letter has been sent to Bulgaria for execution, which, according to Minister Stankov, does not give our country a chance to negotiate on favorable terms.
"The term of the agreement is 13 years. There is no clause by which it can be terminated. The amount that must be paid in order to terminate this agreement is the entire amount under the current contract or 2.2 billion dollars that the Bulgarian side owes", stated Zhecho Stankov.
The quantities that must be transferred under the contract are 53,200 MWh per day or 19.4 million MWh per year.
"The Bulgarian side has 14 slots at the LNG terminals in Turkey, which would allow it to transport a maximum of about 1.3 billion cubic meters through the territory of the Republic of Turkey. The state will pay on an annual basis for capacity for half a billion cubic meters, which we physically cannot use," said Zhecho Stankov.
Calculations show that Bulgaria will have to pay 1.2 billion leva, which will be paid for the term of the contract, without the country physically using the service.
"The purchase and sale agreement describes that the main operator of the specified liquefied gas terminal "Botas" reserves the right to change the delivery point, which happened in 2023. The change of the delivery point has led to $400,000 in additional costs for each cargo delivered," the Minister of Energy said.
THE AGREEMENT - A OBJECT OF CRITICISM
The agreement with “Botas“ has long been a subject of criticism by experts. They point out several main problems.
Paying for a service that is not used
Bulgaria owes more than $500,000 per day regardless of whether it uses the transmission capacity for which it pays or not. There is no information on how this price was formed.
According to the agreement, this fee is for the import of 1.85 billion cubic meters of gas per year. At the same time, Bulgaria can unload 14 tankers per year, and this is only 1.3 billion cubic meters. m per year, the report of the parliamentary committee that examined the contract states.
At the end of March, Zhecho Stankov said in response to a question from a member of parliament that at the beginning of the year a tanker was redirected to a Turkish terminal due to the damage to the terminal in Alexandroupolis, which Bulgaria uses and in which it has shares.
There is no public information about other supplies of liquefied gas through Turkish terminals.
BULGARGAS ON THE BORROW
„Bulgargaz“ has not paid the fees under the contract for nine months because it cannot afford it, and owes 250 million leva to „Botas“, said Energy Minister Zhecho Stankov.
For 2024 - the first year for which the company owes the fees in full - it has registered a loss of 280 million leva, Stankov also said. It does not come only from the contract with “Botas“, but it also has a role.
In addition, the contract allows “Botas“ to use the Bulgarian gas transmission network, and this leads to a loss of market share for “Bulgargaz“.
“This contract practically sinks “Bulgargaz“, said energy expert Iliyan Vassilev.
That is, Bulgaria cannot fully benefit from the capacity it pays for.
By April 2024, when the parliamentary commission published its report, Bulgaria had imported one and a half tankers of gas.
Even when the contract was signed, there were doubts that it could lead to the import of Russian gas into Bulgaria and export to other countries in Europe, but “disguised“ as Turkish. The reason is that according to Turkish law, gas that enters the Turkish gas transmission network becomes Turkish, regardless of its origin.
Turkey is among the largest customers of the Russian “Gazprom“, and the signing of the agreement came against the backdrop of the idea of Turkey becoming a hub for Russian gas.
HOW WE BECOME INDEBT
According to calculations based on the terms of the contract, as described in the parliamentary committee report, “Bulgargaz“ must have paid nearly 270 million dollars (over 480 million leva) to “Botaş“ by now. Part of this money has been paid, the rest “Bulgargaz“ owes.
Every month the bill increases by about 30 million. leva.
The agreement does not contain a renegotiation clause. If “Bulgargaz“ terminates it early, it owes the entire amount - over 2 billion dollars.
Nevertheless, the parliament has ordered the renegotiation of the agreement. Several governments say they are working to change the terms. So far, this has not led to any results. “Botaş“ rejects all requests for negotiations.
After all this, Rosen Hristov stated before the parliament: The agreement was not signed by me, the state does not sign commercial agreements, neither an official government nor a regular one, it does not engage in commercial activity. The agreement was signed by commercial companies in accordance with the due process. The agreement was signed by Denitsa Zlateva in her capacity as executive director, after a number of negotiations were held, most of which I was present at. The agreement was signed publicly. The contract was signed by her in my presence, in the presence of the Minister of Energy of Turkey, the deputies knew very well about the contract, because we had a meeting with the Speaker of the National Assembly at that time, the Turkish Minister, me."