* Environmental concerns, benefits key obstacles-PM
* Energy minister says no govt decision is yet taken
* Bulgaria to await environmental assessment-govt
* Prime Minister demonstrates political will, analysts say
* Greece says committed to Burgas-Alexandroupolis link
(Adds Greek reaction)
By Tsvetelia Tsolova and Irina Ivanova
SOFIA, June 11 Bulgaria is likely pull out of a
trans-Balkan oil pipeline to carry Russian crude through its
territory to Greece, but will first await an environmental
assessment on the project, officials said on Friday.
Speaking after a meeting with European Union ambassadors,
Prime Minister Boiko Borisov said Sofia would not participate in
the project due to strong opposition from residents of the Black
Sea coast where the 300-kilometre pipeline was due to start.
Hours later, the government press office played down
Borisov's words, quoting him as saying that the Balkan country
would await an environmental assessment on the project before it
decides whether or not to abandon it.
Borisov said that the pipeline, estimated to cost a total 1
billion euros ($1.2 billion), posed serious environmental risks
and did not offer enough economic benefits for Bulgaria.
"This is a project that the population of Burgas do not
want," he said. "We all saw what happened in the Gulf of
Economy and Energy Minister Traicho Traikov told Reuters the
cabinet had not officially decided to scrap plans for the
pipeline, but said the outlook did not look good.
"There is no decision to pull out of the project. What we
have are very serious arguments that are negative," he said.
Traikov expressed concern whether Russia will provide the
necessary oil for the link, saying that if the pipeline project
fails, it would not only be because of Bulgaria.
Greece had also questioned Russian oil supply.
But on Friday Athens said it remains committed to the
pipeline that would pump up to 50 million tonnes of Urals crude
a year from the Black Sea port of Burgas to Alexandroupolis on
"The Greek side remains committed to the completion of this
project and continues its efforts towards this direction,"
government spokesman George Pelalotis said.
DEPENDING ON RUSSIA
Once Moscow's most obedient satellite during communist
times, Sofia -- under tough-talking Prime Minister Boiko
Borisov -- has started to review Russian-backed energy projects
to ensure they match national interests and the EU agenda.
Sofia has declined a Russian loan for a new, 2000 megawatt
nuclear power plant Belene and Borisov reiterated on Friday the
plant will be built only if a western investor for it is found.
Analysts say the move shows Bulgaria's readiness for closer
ties with the EU after the previous Socialist-led cabinet irked
Brussels and the United States by appearing to side with Russia.
"Russia will not be pleasantly surprised... But it is time
to understand that Bulgaria will carry out only projects that
make economic sense for it," said Ognian Minchev, Sofia-based
analyst with Institute for Regional and International Studies.
"This is a clear demonstration of firm political will and
the government's desire for a bigger energy independence," said
Kiril Avramov with independent think-tank Political Capital.
Bulgaria's only nuclear plant is Russian-built and it is
fully dependent on Russia's natural gas supplies. The country's
only oil refinery is controlled by Russia's Lukoil (LKOH.MM).
In 2007, after decades of political bickering, Bulgaria
agreed with Russia and Greece to build the pipeline, allowing
Russian crude to bypass the traffic-clogged Bosphorus Straits.
Russia holds 51 percent in the link, while Sofia and Greece
kept 24.5 percent each.
The residents of Burgas and nearby Black Sea resort towns
held a series of protests opposing the project, which they fear
may cause serious environmental damage to the coast and scare
away holiday makers, their main livelihood.
(Additional reporting by Renee Maltezou and Dina Kyriakidou;
Editing by Alison Birrane)