IGB gas pipeline secures €110m loan from European Investment Bank

The European Investment Bank (EIB), through a loan of €110 million, has agreed to support the construction of the IGB Project- Gas Interconnector Greece-Bulgaria (IGB gas pipeline), a 182km long bidirectional pipeline that will link the natural gas systems of Bulgaria and Greece.

ICGB AD is the promoter and beneficiary of the IGB gas interconnector. The company has been created specifically to develop, construct, finance, own and operate the cross-border gas pipeline.

The EIB loan will be given to the state-owned Bulgarian Energy Holding company. Alongside IGI Poseidon, Bulgarian Energy Holding is the shareholder of ICGB AD.

The new interconnector will also help set up a link with the Trans Adriatic Gas Pipeline (TAP gas pipeline) in Greece. It will be executed across the South Central and South Eastern regions in Bulgaria and Eastern Macedonia and Thrace regions in Greece.

European Investment Bank grants €110 million for the IGB gas pipeline. Photo courtesy of Dusan Ondrejicka/EIB

According to the EIB, the IGB gas pipeline will contribute to diversifying the energy supply in Bulgaria and south-eastern Europe. The pipeline interconnector project is part of a larger plan to better connect energy markets in neighboring countries such as Romania and Hungary.

The objective of the IGB gas pipeline project is to boost the security of gas supplies in the region and also the efficiency of the networks.

The IGB gas interconnector is made up of 151km pipe in Bulgaria – that is connected to the backbone of the Bulgarian gas transmission in Stara Zagora, and 31km pipe in Greece – that is connected to the Greek gas system and to the TAP gas pipeline in Komotini.

IGB gas pipeline capacity

The initial capacity of the IGB gas pipeline will be three billion cubic metres per year (bcm/y). The gas interconnector will be designed to facilitate a further capacity expansion to reach five bcm/y through the addition of a compressor station.

In July 2019, the IGB gas pipeline secured the final license it needed to begin its construction on Greek territory. Earlier this year, the European Union (EU) allocated €33 million for the construction of IGB gas interconnector.