ECONOMY

In Brief

Bulgaria, Azerbaijan inch closer to gas deal SOFIA (Reuters) – Bulgaria and Azerbaijan are inching closer to a deal that would allow Azeri gas deliveries of about 2 billion cubic meters (bcm) to the Balkan country by the end of 2013, state gas company Bulgartransgaz said yesterday. Bulgaria has stepped up efforts to reduce its almost complete dependence on Russian gas by diversifying routes and supplies after a dispute between Russia and Ukraine left it without gas for weeks in early 2009. Under the project, Azeri gas would be transported via a pipeline to Georgia to be compressed and shipped by tankers to Bulgaria’s Black Sea port of Varna, said Ivan Drenovichki, executive director of Bulgartansgaz. Azeri state oil company SOCAR, Bulgartransgaz and Georgian Oil and Gas Company are set to launch a feasibility study for the project at a meeting planned for September 23-24, he said. «We have an initial agreement to launch a feasibility study. In September, we are to make this decision,» Drenovichki said. «If all goes well and the project proves expedient, first deliveries can start at the end of 2013,» he said. Bulgaria’s gas consumption averages about 4 bcm a year, he said. The study will define the value of the project, which Drenovichki said could cost hundreds of millions of dollars, with over 85 percent of the funds needed for tankers. Sofia signed a memorandum of understanding for gas deliveries with Baku last November, saying some deliveries could be transported by the EU-backed Nabucco pipeline, aimed to carry natural gas from the Caspian region to Europe. The Nabucco project faces rivalry from the Russia-led South Stream gas pipeline project, which aims to cement Moscow’s position as key gas supplier to Europe. Ireland leads decline in credit-default swaps Ireland led a decline in the cost of insuring against losses on European bonds after a surge in demand at government debt auctions eased investor concerns that the region’s sovereign deficit crisis will worsen. Credit-default swaps on Ireland dropped from a 17-month high, falling 23 basis points to 280, according to data provider CMA. Contracts on corporate derivative indexes fell from the highest levels in four weeks. Investors bid for more than five times the amount of the 2014 securities offered in the Dublin auction that raised a total 1.5 billion euros ($1.9 billion). Concern that slowing economic growth will exacerbate Europe’s deficit crisis prompted speculation that bond buyers would shun offerings from Ireland and Spain yesterday. «The success of the auctions is what’s driving the market,» said Suki Mann, a London-based credit strategist at Societe Generale SA. «There was concern they wouldn’t get their funding but obviously the markets’ concerns have been misplaced.» Bidding for Ireland’s 2014 security compared with offers of more than three times in a May action, the National Treasury Management Agency in Dublin said yesterday. Demand for a 2020 security fell to a bid-to-cover ratio of 2.4, against 3 in July. The yield premium investors demand to hold Irish 10-year bonds rather than benchmark German bunds declined. (Bloomberg) Regency loans Regency Entertainment SA’s lenders are consulting financial advisory firm Lazard Ltd as the Greek casino operator seeks to restructure about 600 million euros ($714 million) of loans. Regency, which is owned by London-based BC Partners Ltd, is starting discussions with lenders to reorganize its debt, according to three people familiar with the matter. The Athens-based company is being advised by Houlihan, Lokey, Howard & Zukin, said the sources, who declined to be identified because the talks are private. (Bloomberg) Lender acquisition EFG-Hermes Holding SAE, the biggest publicly traded Arab investment bank, agreed to acquire a 65 percent stake in Beirut-based Credit Libanais SAL for $542 million to expand in consumer and commercial banking. EFG-Hermes obtained an option to buy an additional 25 percent stake over the next two years on the same terms it will buy the 65 percent stake, the Cairo-based investment bank said in a Regulatory News Service statement. (Bloomberg)