November 23 (SeeNews) - Public gas grid operator Bulgartransgaz said it called a tender for the provision of some 49 million euro ($50.6 million) in bank financing to cover investment costs of the construction of the Bulgarian section of a natural gas link to Serbia.
The prospective loan should have a term of six years, including a one-year grace period, with interest and principal payments to be made on a monthly basis, Bulgartransgaz said in a press release on Tuesday.
The deadline for submissions is December 9. The interest rate is envisaged to be the sum of one-month EURIBOR plus a proposed margin covering all fees and commissions.
The funds will be channelled for investment design, technical design, materials and equipment procurement, construction and commissioning of the reverse gas interconnection Bulgaria-Serbia (IBS).
The company invites as bidders commercial banks, international financial organisations operating in Bulgaria on the basis of ratified intergovernmental agreements and treaties as well as government funds.
According to the budget revision adopted in July, the loan will be guaranteed by the state, which will be able to issue guarantees under new loan agreements signed by Bulgartransgaz for a total amount of up to 382 million euro, under applicable EU state aid regulations.
Bulgartransgaz will select the most economically advantageous offer in terms of the loan interest rate and margin, it said.
Bulgaria launched a 3 billion cubic metres (bcm) natural gas link with Greece on October 1, increasing its imports of gas from Azerbaijan.
Last month, Bulgatransgaz also signed a natural gas interconnection deal with North Macedonia.
Serbia, which receives its natural gas from Russia, kicked off the construction of a link to Bulgaria's gas transmission system in February. The 1.8 bcm pipeline is due for completion in September 2023. It will enable Serbia, which began talks with Azerbaijan over the summer, to potentially diversify its energy sources by making use of the Greece-Bulgaria link.
($ = 0.968208 euro)