Bulgartransgaz picks new winner of multimillion-euro gas pipeline tender

State-owned natural gas transmission network operator Bulgartransgaz said it has disqualified the winner of a multimillion-euro tender for construction of a pipeline for gas transit from the border with Turkey to the border with Serbia, and picked a new contractor.

Under the new decision, a contract will be signed with the second-ranked consortium comprising Italy's Consorzio Varna 1 and the Bulgarian branch of Luxembourg-registered Completions Development, which proposed to build the 484 km-long pipeline for 2.41 billion euro ($2.69 billion) within 250 days, or for 1.10 billion euro should the deadline be extended to 615 days, Bulgartransgaz said in a statement.

The consortium, which was ranked second in the tender, initially offered a price of 1.60 billion euro for building the pipeline within the 615-day deadline but subsequently lowered it by 31.15%, according to the statement.

Bulgartransgaz disqualified the original winner, a consortium comprising Saudi Arabia's Arkad Engineering and Construction Company and Italy-registered Arkad ABB, because the group failed to meet the deadlines for signing the contract and for submitting the necessary documents.

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The original winner had to submit the relevant documents by May 2 and sign the contract by May 16 but failed to do so. Bulgartransgaz subsequently extended the two deadlines to May 22 but the Arkad consortium missed the new deadlines, too. The group had offered to build the pipeline for 1.29 billion euro within 250 days, or for 1.10 billion euro within 615 days.

At the end of January, Bulgartransgaz successfully completed the binding Phase 3 of the economic test for the pipeline project - part of a larger project of Russia's Gazprom to build a string of its TurkStream pipeline for transit of gas to Europe from Turkey via Bulgaria, Serbia and Hungary.

The offshore section of the TurkStream pipeline stretching 930 km across the Black Sea from Russia to Turkey consists of two parallel strings with annual throughput capacity of 15.75 billion cubic metres of gas each. One string is intended for consumers in Turkey, while the second will carry gas to customers in Europe through Bulgaria.