Energy minister Rumen Ovcharov has discussed options for joining the pipeline for transit of natural gas from Azerbaijan to Greece and Italy through the territory of Turkey . Ovcharov met his Turkish counterpart Hilim Guler last week to discuss the project in addition to the Turkish proposal for building a dam at the cross point of Tundzha River and the borderline between the two countries. According to Guler, Turkey will start receiving gas from Azerbaijan by the end of this year and Bulgaria could quickly join the new pipeline as an end-user. The project could secure a very good argument for the government against the pressure of Russia 's Gazprom to raise the price of gas supplies before the expiration of the contact at the end of 2010. Ovcharov admitted that the Turkish proposal would be a good and realistic way of diversifying gas imports. However, he has made a series of other statements to the local media that the country should first secure a long-term arrangement with Gazprom for a period of 25-30 years to cover 100% of local demand. He has also hinted that the government will accept a gradual price increase before the expiration of the current deal with Gazprom in expectation of hosting additional transit volumes of Russian gas.

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The country also relies on the Nabucco project for transit of Iranian and Azeri gas to Central Europe . Bulgaria will participate as a transit country in Nabucco and can retain part of the gas supplies that will cover around 40% of the local demand. The pipeline is expected to start transits in 2011. Given the option for joining the gas stream from Azerbaijan to Italy , the government could efficiently break the Gazprom's monopoly on the local gas market. However, it seems that energy minister Ovcharov is not worried about the country's energy dependence on Russia at this stage he is even interested in trading Russia 's monopoly for long-term deals for transit of gas and possibly oil. This is undoubtedly a very risky approach that is fully inconsistent with the free market theory and could have a devastating effect for the local economy in the long run. Risks could be identified in several areas: unreasonable price hikes before the expiration of the current deal with Gazprom in exchange of uncertain transit commitments; concentration of inefficient state investments in one business segment with uncertain supply and demand parameters; lack of supply alternatives in cases of technical failures; high exposure to political, economic and other risks in Russia; and unfavourable bargaining position against efforts of Gazprom to reap price benefits from its monopoly.