Bulgaria's government said it allocated 150,000 levs ($94,400/77,000 euro) from the state budget to raise the capital of the Burgas-Alexandroupolis Oil Pipeline Project Company in order to cover costs before withdrawing from the pipeline project.
The Burgas-Alexadroupolis Oil Pipeline Project Company's capital will be raised through a new issue of 1,500 shares which its sole owner, the finance ministry, will buy, the government said in a statement following a regular weekly meeting on Wednesday.
The state-owned company will spend the money from the capital increase to honour its obligations as a shareholder in the Trans Balkan Pipeline (TBP) Project Company. Part of the funds will go to cover minimum operating costs until the company exits the pipeline project.
The 258 kilometre pipeline was projected to link the Bulgarian Black Sea port of Burgas with the Greek Aegean port of Alexandroupolis overland. Tankers were planned to discharge the oil at an offshore terminal in Burgas where it could be fed into the pipeline for transportation to Alexandroupolis.
In December Bulgaria decided to pull out of the project, saying that it would not be possible to carry it out under the terms stipulated in the trilateral agreement signed in 2007.