The renovation works, which will be financed under EU-funded operational programme Environment, will kick off on November 30, the ministry said in a statement.
The project envisages the construction of 10-kilometre (km) new sewerage and 9 km of water supply network, aimed to reduce water losses in the municipality.
Kozloduy, on the Danube river, is located in the Vratsa region, in northwestern Bulgaria.
(1 euro=1.95583 Bulgarian levs)