By Arshad Mohammed and Tsvetelia Tsolova
SOFIA (Reuters) - U.S. Secretary of State John Kerry pledged to support Bulgaria's efforts to wean itself off dependence on Russian energy at the launch of an annual strategic dialogue between the two NATO allies on Thursday.
Russia's cancellation in December of a multi-billion-dollar gas pipeline that would have benefited Bulgaria has highlighted Sofia's vulnerability to fallout from the West's standoff with Russia over Moscow's role in the Ukraine crisis.
Under pressure from both Washington and Brussels, Bulgaria's previous, Socialist-led government reluctantly halted work on South Stream. The project aimed to feed gas to Europe while bypassing Ukraine, which is at loggerheads with Russia over gas supplies and annexation of part of its territory.
"The United States is prepared to help Bulgaria which has made difficult decisions in order to try to protect its energy future," Kerry told reporters in the Bulgarian capital.
The United States will send an energy envoy to Sofia to work on projects, including further talks with U.S. firm Westinghouse over a deal to build a new nuclear reactor on the Danube River.
Bulgaria depends on Russia for 90 percent of its gas, which comes via Ukraine. A 2009 Russia-Ukraine standoff left hundreds of thousands of Bulgarian households shivering and hit its industry as Russia turned off the taps.
Kerry said it was unclear if Russia would punish Bulgaria for moving away from Russian energy, but said Washington would stand by Sofia, which also relies on Russia for nuclear fuel. Its sole oil refinery is owned by Russia's Lukoil.
U.S. officials said graft left the Balkan nation open to undue influence from Moscow and Kerry encouraged Bulgaria's efforts to reform its judiciary and enforce the rule of law.
Bulgaria is the EU's poorest member state and also one of its most corrupt and fighting graft would make the country's political and business class less susceptible to bribes.
"Here in Bulgaria, it (the fight on corruption) is not just about strengthening the democracy of the country. It is about providing a climate for investment and shielding the country from those who exploit the situation to gain undue influence over your choices as a nation," Kerry said.
The South Stream cancellation last month has increased Sofia's desire to develop as a regional gas hub. Washington supports the construction of a pipeline between Greece and Bulgaria, which could allow Azeri gas to provide an alternative to Russian energy.