RLF - Bulgargaz Energy Security



Project number:


Business sector:

Natural resources

Notice type:


Environmental category:


Approval date:

02 Nov 2022


Passed Final Review, Pending Approval

PSD disclosed:

21 Sep 2022

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Project Description

Provision of a three-year revolving loan of up to EUR 150 million to Bulgargaz EAD (the "Borrower") under the Resilience and Livelihoods Framework for 1) partial refinancing of the bridge loan received from the Government of Bulgaria for the acquisition of natural gas;  2) acquisition of natural gas. The loan will be guaranteed by the Republic of Bulgaria.

This project was approved in the context of the Bank's response to the Russian-led invasion of Ukraine in February 2022. To avoid delays to the delivery of this project, the Bank's President granted a deviation from the ordinary timelines for PSD disclosure, as contemplated by Section V of the Directive on Access to Information. Details of this deviation, and the Bank's response to this situation, can be found on our website.

Project Objectives

The strategic importance of the transaction is driven by the energy security objective to ensure continued and uninterrupted gas supply in Bulgaria during the 2022 winter season and the following years. This is essential to safeguard basic needs and economic livelihoods of the local population. The financing will enable procurement of gas from diversified sources, including from the Balkan Gas Hub and LNG imports in accordance with the EBRD procurement rules to compensate for the discontinuation of deliveries under the pipeline gas contract with Gazprom.

Transition Impact

ETI score: 65

The Project will support the Resilient and Inclusive TI qualities:

Resilient: by providing financing to procure gas from diversified sources to compensate for the cancelation of the pipeline gas contract with Russian state-owned Gazprom. Bulgaria relies heavily on Gazprom for up to 75% (and more in previous years) of the gas it imports. With domestic production having been reduced to practically zero over the past few years, natural gas supplies diversification is critical for Bulgaria's energy security.

Inclusive: by (i) providing an emergency facility to prevent gas supply disruptions and maintain a reliable supply of vital energy services in advance of the main heating season; and (ii) promoting human capital development and capacity building for its local workers by introducing a new training programme on market-relevant procurement skills and procedures in line with EBRD's Procurement Policies and Rules. With the Bank's technical assistance, Bulgargaz will build up its capacity to purchase gas on competitive gas markets, including the LNG market, which is a new market for Bulgargaz. Ultimately, this will allow Bulgargaz to secure a portfolio of contracts with different suppliers, and to develop a sustainable long-term supply strategy, which does not depend on a single source. 

Client Information


Bulgargaz EAD is the sole public supplier and the last resort supplier of natural gas in Bulgaria, 100% owned by Bulgarian Energy Holding EAD, a state owned energy holding company 100% owned by the Ministry of Energy of Bulgaria.

EBRD Finance Summary

EUR 150,000,000.00

Total Project Cost

EUR 150,000,000.00


Sources of additionality under the Project are (i) Financing Structure, which effectively bridges a financing gap due to adverse market conditions with a longer than available tenor on the market; (ii) Standard-setting aimed to support the client to develop and adopt a Climate Corporate Governance Plan and climate reporting standards as well as introduction of best practices in terms of procurement of LNG and pipeline gas; and (iii) Risk mitigation helping Bulgaria to mitigate energy security risks and provide predictability of funding and stable pricing.

Environmental and Social Summary

Categorised B (ESP 2019). The independent environmental and social due diligence,  consisting of the review of the EIA documents for key storage and transmission facilities and a site visit to selected facilities, that are crucial for the transportation and storage of the purchased gas, is ongoing. Key issues, identified to date, are associated with the excessive CO2 equivalent emissions (above permitted levels in some instances) most probably from the Chiren gas storage and outdated compressor stations. Chiren underground storage is the only available gas storage facility and is subject to the ongoing modernisation funded by EU. Key issues associated with the Chiren UGS include landtake and compensation of affected people, and compliance with SEVESO, IED and ATEX Directives. Some of the gas transmission facilities seem to traverse or be adjacent to protected areas and the Bank will review the Company's approach to managing biodiversity issues. The ESAP for identified risks and impacts will be agreed as a Condition Precedent to Disbursement.

Technical Cooperation and Grant Financing


Company Contact Information

Tatyana Petrova-Boyadzhieva
47, Petar Parchevich Str. 1000 Sofia, Bulgaria

Implementation summary

PSD last updated

21 Sep 2022

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.


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