Capacity expansion of Chiren UGS (PCI 6.20.2)

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PROJECT DESCRIPTION AND OBJECTIVES 

The project on expanding the Chiren UGS capacity (PCI 6.20.2) envisages a staged capacity increase of the only gas storage facility on the territory of Bulgaria in order to achieve greater stored gas volumes, increased gas reservoir pressures and higher daily average withdrawal and injection rates. The project provides for increase of the working gas volume up to 1 bcm and withdrawal and injection rates increase up to 8-10 mcm/d.

Chiren UGS has been the only gas storage on the territory of Bulgaria for 40 years. It is a key instrument for the functioning of the gas market in Bulgaria, covering the seasonal fluctuations in natural gas consumption in the country by securing the necessary flexibility caused by the differences between the supplies and consumption, and ensures emergency reserve. Chiren UGS is a crucial instrument ensuring the security of gas supplies.

The project for its expansion aims on one hand to create conditions to ensure security of supplies to Bulgarian users and users in the countries from the region, and on the other – the development of Chiren UGS as a commercial gas storage in an interconnected regional and common European market, as Chiren UGS is an integral part of the regional gas system consisting of interconnections, LNG terminals, storage facilities.

The planned development of the gas projects in the region is a prerequisite for the market development, the diversification and market integration increase and is directly related to the expansion of the only gas storage facility in Bulgaria. In the mid-term Chiren UGS promises to become a commercial facility with a significant role in competition development in the regional gas market and in provision of additional flexibility of the gas transmission systems at regional level, with a significant contribution to congestion management and seasonal optimization of the gas transmission systems utilization.

 

STATUS OF THE PROJECT

  • In 2009 the development of a Technological Project for Chiren UGS Operation was assigned. The Project was completed in 2011 and pursuant to it there are possibilities to expand the capacity. The Technological Project recommends additional geological and geophysical studies to be carried out aimed at specifying the parameters of the expansion.
  • On March 19, 2015 following the launched and completed procedure on the selection of a contractor a contract was signed and „Chiren Reservoir Geomechanical Simulation” was successfully completed. The study is one of the principal geological and geophysical studies, required to be conducted before engaging in the actual storage expansion works. The study ended in November, 2015. The main conclusion of the report is that currently according to the information available on the geological structure, Chiren UGS is a reliably tight and fit for an increase in the formation pressure up to 150 bar.
  • On September 2, 2015 following the launched and conducted procedure on the selection of a Contractor a contract has been entered into for a study with the following subject-matter „Surface gas analysis on the Chiren structure area”. The surface gas analysis is one of the main methods of verifying the tightness of the underground gas storages, whose purpose is to check for the presence of gas accumulations close to the surface within the borders of spread of the gas reservoir and to determine the surface zones with hydrocarbon anomalies if any. The study was completed in line with the contract. The results from the analysis show that at this stage of exploring the geological and chemical environment only hydrocarbons with biogenic and surface origin are found.
  • In 2015 Bulgartransgaz EAD prepared a project proposal "3D seismic studies as part of the project for the expansion of Chiren UGS 6.20.2”, proposed to be financed under the Connecting Europe Facility – CEF - Energy-2015-1, at a total estimated value of EUR 7 800 000 and an amount of the grant of 50% of the project value - EUR 3 900 000.
  • On October 23, 2015 Bulgartransgaz EAD officially signed a Grant Agreement No. INEA/CEF/ENER/M2015/1029442 for the “Conduct of 3D seismic surveys on the area of the Chiren structure as a part of the Chiren UGS expansion project 6.20.2” which includes the activities:
  • Activity 1: 3D field seismic studies on the Chiren structure area” and Activity 2: “3D seismic studies quality control and processing the acquired data”.
  • In line with the time schedule of the signed Grant Agreement regarding the leading operating Activity 1, on September 11, 2015, a procedure for the selection of a Contractor for “Implementation of 3D field seismic studies on the Chiren structure area” has been launched. The objective is to get a detailed structural and lithological information on the gas reservoir and information on the spread of the open crack system to locate areas for drilling new highly productive operational drillings necessary for the increase of the Chiren UGS maximum deliverability and injection rates as well as observer wells which control gas migration to the periphery of the geological structure.

The public procurement award procedure has been terminated due to inconsistence of the submitted offers with the requirements of the Contracting authority. Appeal before the Competition Protection Commission (CPC) of the Contracting authority’s decision to terminate the procedure and following the announcement of the decision of CPC and a subsequent appeal on the side of the same participant before the Supreme Administrative Court (SAC) resulted in the delay in the project’s realization compared to the initial time schedule.

In October 2016, an application for withdrawal of the cassation appeal has been filed by the applicant and by decision No 12121/10.11.2016 the SAC terminates the administrative case No 11802/2016. Bulgartransgaz EAD has sent a letter requesting SAC to determinate in a conclusive manner whether the above-mentioned decision has entered into force. Consequently to receiving SAC reply in January 2017 informing that the decision to terminate the public procurement has not been appealed and has entered into force, activities involving the launch of the new public procurement with the same subject-matter started.

  • By virtue of a Decision of the Executive Director of Bulgartransgaz EAD on 13.09.2017 a procedure on the selection of a contractor with subject-matter„ Conduct of 3D seismic surveys on the Chiren structure area” has been launched again.
  • The procedure has been successfully completed, and on 25.05.2018 a Contract with the selected Contractor has been signed – Geofisika Torun (Poland). All activities under the Contract are currently ongoing.
  • In line with the time schedule of the signed Grant Agreement for the implementation of Activity 2 on November 16, 2015 a procedure on the selection of a contractor for “3D field seismic studies quality control on the Chiren structure area and subsequent processing of the acquired data”. The selection procedure was successfully The contract with the selected contractor was signed on July 14, 2016 - Мingeounivers Engineering-NIS-MGU ЕООD (Bulgaria). All activities under the Contract are currently ongoing.

 

NEXT STEPS

  • The results from the completed set of studies/preparatory activities will serve as a base in the determination of the best option for Chiren UGS expansion and for the next steps related to the implementation of the PCI, namely, design and construction of ground and underground facilities.

 

INFORMATION CONCERNING THE PUBLIC AND PLANNING OF PUBLIC DISCUSSIONS

  • At the beginning of 2014 a Preliminary market test was carried out aimed to inform all interested parties of Bulgartransgaz EAD intention to expand the storage capacity and everyone was invited to state their intentions to book long-term capacity after the expansion. The activities related to the preparation of different types of documents on organizing the next stage are currently ongoing.
  • On 26.06.2014 a notification about the project for carrying out 3D field seismic surveys on the Chiren structure area was submitted to RIEW Vratsa. Subsequently, the case has been transferred to the MEW, as two protected areas fall within the boundaries of the area to conduct studies of UGS Chiren: "Bozhiya most-Ponora" code BG0000594 and PA "Bozhite Mostove" BG0000487. After the investigations by the MEW, the competent authority issued an opinion No НСЗП-273 of August 21, 2014, stating that there is no need to perform EIA and the project can be implemented in compliance with the measures set out in the Opinion.
  • On 07.01.2015 a notification about the project for carrying out ground gas analysis on the Chiren structure area was submitted to MEW having a reference No НСЗП-4/07.01.2015. After the investigations by the MEW, the competent authority issued an opinion No НСЗП-4/23.01.2015, stating that there is no need to perform EIA and the project can be implemented in compliance with the measures set out in the Opinion.

 

PROJECT PROMOTER

Bulgartransgaz EAD

1336 Sofia, post box 3, residential area Luilin 2

66 Pancho Vladigerov Blvd.

Head office: +359 2 939 63 00

Fax: +359 2 925 00 63

e-mail: info@bulgartransgaz.bg