US investors target strategic Bulgarian gas storage
Five people with knowledge of the matter report that two American financiers with the support of a former campaign manager for U.S. president Donald Trump approached Bulgarian authorities about a potential investment in a government-owned underground gas storage facility stocked primarily with Russian natural gases.
The group, led by Stephen P. Lynch (a Florida financier trying to purchase a gas pipe linking Russia to Germany) and Fei Wang (another U.S.-based investor), is looking at ways to take part in a government plan worth millions of euros to double the capacity Bulgaria's only underground gas storage facility, called Chiren.
People said that Brad Parscale who worked for Trump's 2016-2020 campaigns would be allied with the group to increase storage capacity in Chiren, transforming Bulgaria into a hub of gas serving Eastern Europe.
Lynch, through a spokesperson declined to comment on this article.
Gas storage sites are strategic assets for the industry. They allow operators to manage seasonal fluctuations in demand, and take advantage of price fluctuations by buying gas at low prices and releasing it at higher ones.
Chiren, with or without U.S. Investors, could play a crucial role in the years to come as Greece, Serbia and Hungary, along with other countries of Eastern Europe, debate whether they should continue buying gas from Russia, or import more from other sources, such as the United States.
People familiar with the matter say that Lynch and Wang will meet top government officials this week in Sofia to discuss how to obtain recent data about Chiren and to conduct an evaluation.
A Bulgarian Prime Minister's aide, Rosen Zhelyazkov, did not answer questions about the meeting and the talks planned with the Americans.
Sources in the industry described the discussions as exploratory and said that no deal was guaranteed. Parscale was said to have played a secondary role in the initial phase of the talks, but that it would provide connections with U.S. companies if the project became a reality. Lynch caused controversy in Europe when, during negotiations between Washington, Moscow and to broker a deal for peace in Ukraine, he tried to restore the flow from Russian gas to Germany through the Nord Stream pipe running under the Baltic Sea.
German and EU authorities both made it clear that they would oppose a similar initiative. Lynch's new project in Chiren is taking place amid tensions between the European Commission and other countries in East Europe who have announced their intention to stop importing Russian gas by 2027.
RUSSIA PIPELINE
Bulgaria, as a member state of both the EU and NATO, will play a key role in the debate, because TurkStream, the last active gas pipeline from Russia to East European nations, runs through its territory.
The spring of this year, Bulgarian officials approached several U.S. investors to purchase a stake of the TurkStream section in their country. This fueled speculation from opposition parties that Bulgaria wanted to give the Russian gas a more American flavour to try and protect it.
Although the talks failed, Bulgarian officials, according to those with first-hand knowledge, have remained silent on the goals they had hoped to achieve by enlisting the support of U.S. investors.
Martin Vladimirov, an energy expert with the Center for the Study of Democracy in Sofia, told us that any additional storage capacity will be sought after by both those who want to continue importing Russian gas as well as those who wish to switch to new suppliers. "Bulgaria could play a major role in speeding up Europe's decoupling from Russian Gas, but only if EU and Bulgarian policymakers implement specific stopgaps to ensure that the facility isn't used to launder indirect Russian supply from third countries like Turkey," said Vladimirov.
Wang, Lynch's partner in the project said he was not involved with Lynch's Nord Stream 2 venture, had no involvement with TurkStream and had no connection to Russia.
The spokesperson for the European Commission declined to comment about how Chiren's expansion could fit into their plans to prohibit Russian gas. Zheco Stankov did not answer any questions about this matter. Lynch has been involved in many Russia-related deals. He led a group of investors in the early 2000s to purchase Yukos Oil assets. He acquired the Swiss subsidiary Sberbank, Russia’s largest lender three years ago after receiving approval from the U.S. Treasury for the purchase of a sanctioned assets. Lynch's recent attempt to purchase Nord Stream 2, which owns the one pipeline that connects Russia with Germany and is still operational, elicited anger in Europe. Germany's Chancellor Friedrich Merz said in May that he will make sure Nord Stream 2 cannot go into operation. The other three Nord Stream pipes were damaged by an underwater attack in 2022.
Chiren was built in 1970 inside an evaporating gas field. In 2021, a 285-million-euro plan was launched to double Chiren’s capacity. However, the project was stopped in 2024 due to an investigation by European Prosecutors into alleged misuses of EU funds.
The European Public Prosecutor's Office has not responded to messages asking for comment on the current state of the investigation.
The Bulgarian authorities said that depending on the results of the investigation, they could launch a tender for extension works at Chiren.
(source: Reuters)
