Billionaires Bet Billions on Russia’s Last Gas Pipeline – Will They Control Europe’s Energy Future?
In a world where energy is power, the race to control critical infrastructure is heating up. The TurkStream pipeline, Russia’s final operational conduit for natural gas to Europe, has emerged as a focal point in this high-stakes game. Recent reports indicate that Elliott Investment Management, a Florida-based hedge fund led by billionaire Paul Singer, is exploring a bold acquisition of a stake in Bulgaria’s segment of TurkStream, alongside other assets managed by Bulgartransgaz. This move, coupled with financier Stephen Lynch’s audacious bid for the damaged Nord Stream 2 pipeline, signals a new chapter in U.S. investment strategies targeting Russian energy infrastructure. These developments raise profound questions about energy security, sanctions, and the geopolitical balance in Europe.
The TurkStream Pipeline: Russia’s Last Gas Artery
The TurkStream pipeline, operational since January 2020, is a critical piece of Russia’s energy export strategy. Spanning 930 kilometers under the Black Sea from Anapa, Russia, to Kiyikoy, Turkey, it delivers gas to Turkey and extends through Bulgaria’s Balkan Stream to supply Southern and Central Europe. With an annual capacity of 31.5 billion cubic meters (bcm), TurkStream has become Russia’s sole remaining pipeline for gas exports to the European Union (EU) following the sabotage of Nord Stream 1 and 2, the closure of Yamal-Europe, and the halt of Ukrainian transit routes in late 2024. In the first quarter of 2025, TurkStream’s European section saw a 16% year-on-year increase in gas volumes, reaching approximately 4.5 bcm, driven by demand in Hungary and Slovakia. Since its inception, the pipeline has delivered over 63 bcm of gas to the EU, generating more than €20 billion ($22.72 billion) for Russia’s state-owned Gazprom.
Bulgaria, a key transit country, earns approximately $350 million annually in transit fees, a significant economic boon for the NATO and EU member state. However, the pipeline’s role in sustaining Russian gas flows to Europe has drawn scrutiny as the EU pushes to eliminate Russian energy imports by 2027. Countries like Slovakia and Hungary, heavily reliant on TurkStream gas, have resisted sanctions, complicating Brussels’ plans. Against this backdrop, Elliott’s interest in acquiring a stake in Bulgartransgaz’s assets, including Balkan Stream, is a calculated move with far-reaching implications.
Elliott’s Strategic Play: A Hedge Against Sanctions?
Elliott Investment Management, under the leadership of Paul Singer, is no stranger to bold financial maneuvers. Known for its aggressive tactics in distressed debt and infrastructure investments, the hedge fund has reportedly signed a nondisclosure agreement (NDA) with Bulgartransgaz and held discussions with Bulgarian officials in Sofia in April 2025. The proposed deal includes not only a stake in Balkan Stream but also a broader portfolio of infrastructure assets, such as data centers and fiber-optic cables. Additionally, Elliott is exploring options to refinance Bulgartransgaz’s debt, signaling a comprehensive investment strategy.
Bulgarian officials reportedly view U.S. investment as a shield against potential EU sanctions. With the EU’s roadmap to phase out Russian gas by 2027, assets like TurkStream face risks of being targeted. American ownership could deter sanctions, given the U.S.’s influence in NATO and its complex relationship with Russian energy under the current administration. Moreover, the deal could strengthen Bulgaria’s ties with Washington, offering diplomatic leverage in a region where energy geopolitics are increasingly contentious. For Elliott, the investment promises steady revenue from transit fees and a foothold in Europe’s energy infrastructure, a sector poised for growth as digital and energy demands converge.
Stephen Lynch and Nord Stream 2: A Parallel Ambition
Lynch’s bid, described as a “once-in-a-generation opportunity,” reflects a similar logic to Elliott’s TurkStream play: acquiring distressed or politically sensitive assets at a discount, with the potential for outsized returns. However, the challenges are immense. Nord Stream 2’s physical damage requires billions in repairs, and its operation would hinge on lifting sanctions and resolving breach-of-contract claims. Despite these hurdles, Lynch’s interest underscores a growing trend among U.S. investors to capitalize on Russia’s energy woes, betting on a future where geopolitical tensions ease.
To understand the significance of these deals, consider the broader energy context. In 2022, Russia supplied 45% of the EU’s gas imports, a figure that dropped to 19% by 2025, primarily through TurkStream and liquefied natural gas (LNG) shipments. The EU’s sanctions on Russian coal and most oil imports have intensified pressure on gas, but unanimous approval from all 27 member states is required for gas sanctions, a hurdle given opposition from Hungary and Slovakia. In 2024, Europe imported 20 bcm of Russian gas via TurkStream, with Bulgaria’s Balkan Stream handling a significant portion. Gazprom’s export revenues from TurkStream alone reached €20 billion since 2020, underscoring the pipeline’s economic weight.
Bulgaria’s $350 million in annual transit fees represents a critical revenue stream, equivalent to roughly 0.4% of its GDP. For comparison, Hungary expects to receive 7.5-8 bcm of Russian gas via TurkStream in 2025, meeting nearly 80% of its gas demand. Meanwhile, EU gas prices, as measured by the TTF benchmark, stabilized at $580 per thousand cubic meters (kcm) in January 2025, but analysts predict a potential drop to $232-$349 per kcm if Russian gas flows increase. These figures highlight the delicate balance between energy security, economic stability, and geopolitical strategy.
Geopolitical Implications: A New Energy Order?
The involvement of U.S. investors in Russian-linked energy infrastructure raises profound geopolitical questions. For Bulgaria, selling a stake in TurkStream to Elliott could align it more closely with U.S. interests, potentially at the expense of EU cohesion. The deal could also entrench Russian gas in Europe, countering the EU’s decarbonization and diversification goals. Critics argue that American ownership might complicate sanctions enforcement, especially if the U.S. pursues a softer stance on Russian energy under a future administration. Recent reports suggest the U.S. is exploring ways to ease energy sanctions if Russia agrees to end the Ukraine conflict, a scenario that could revive pipelines like Nord Stream 2.
For Russia, these deals present both opportunities and risks. Gazprom, battered by sanctions and a 7% EU market share (down from 35% pre-sanctions), could benefit from U.S. investment stabilizing TurkStream’s operations. However, ceding control to American investors could undermine Moscow’s leverage over European energy markets. Ukraine, meanwhile, has actively targeted TurkStream’s infrastructure, launching drone attacks on the Russkaya compressor station in 2025, signaling its opposition to Russian gas flows.
Economically, TurkStream and similar pipelines offer stability in a volatile energy market. Bulgaria’s transit fees and Hungary’s gas imports underscore the financial incentives for maintaining Russian gas flows. For Elliott, the deal promises diversified revenue streams, especially if it includes data centers and fiber-optic cables, which are projected to grow at a 12% compound annual growth rate (CAGR) through 2030. However, environmentalists warn that prolonging reliance on fossil fuels undermines the EU’s net-zero targets, which aim for a 55% emissions reduction by 2030.
Elliott Investment Management’s pursuit of TurkStream and Stephen Lynch’s bid for Nord Stream 2 represent audacious bets on the future of energy geopolitics. By targeting Russia’s distressed energy assets, these U.S. investors are positioning themselves at the nexus of finance, diplomacy, and power. For Bulgaria, the deal offers economic and diplomatic benefits, but it risks entangling the country in a broader geopolitical struggle. As the EU grapples with its energy transition and sanctions strategy, the outcome of these deals could redefine Europe’s energy landscape for decades. Whether these investments herald a new era of U.S. dominance in European energy or a misstep in a volatile market remains to be seen.
