Bulgarian gas transmission operator Bulgartransgaz has cancelled a €56 million procurement for new production wells at the Chiren underground gas storage facility after the only financially evaluated offer exceeded the available budget. The decision affects Bulgaria’s programme to increase gas storage capacity and maintain operational reliability at the site used for winter supply security.
Two bids were submitted to the procurement process, with only one advancing to financial evaluation. The bid for the first three production wells was priced at 21.37% above the operator’s estimate. The optional second package covering three additional wells was priced 17.75% above the projected budget.
Procurement outcome and next steps for Chiren expansion
Bulgartransgaz decided not to award the contract following the results of the financial evaluation. Instead, the operator plans to engage external experts to review alternative approaches for implementing the broader Chiren expansion. The cancelled procedure was launched in April 2026.
The April 2026 tender followed an earlier procurement for the same works that had also been terminated. Repeated tender failures have been cited as highlighting the role of construction-cost assumptions and technical risk allocation in underground gas storage projects. The procurement outcome does not specify which factors drove the difference between budgeted and offered costs, but it leaves a gap that requires reassessing contracting and financing assumptions.
Role of Chiren storage in seasonal supply management
For Bulgaria, expanding Chiren remains strategically significant within its gas supply arrangements. The facility supports management of seasonal gas demand and provides an additional supply option when imported pipeline gas or LNG deliveries are disrupted. Additional withdrawal capability is also expected to improve Bulgaria’s ability to respond to short-term regional supply pressures.
The immediate priority for Bulgartransgaz is to identify an implementation structure capable of attracting commercially acceptable bids while preserving the expansion’s technical objectives. Without a viable procurement solution, Bulgaria faces further delays to infrastructure intended to provide greater flexibility during periods of winter gas demand.
