Denkov has seven days to decide whether to propose a government, although he has only a slim chance of getting the required support, analysts said.
The centre-right GERB party, which won an Oct. 2 snap election, failed to win support for a technocrat cabinet last month.
PP, whose ruling coalition collapsed in June to trigger the country's fourth general polls in 18 months, has failed to secure enough support for a minority government with its ally Democratic Bulgaria, raising the prospect of another early vote in the spring.
Denkov, a former education minister, said he planned to invite political parties for a new round of talks over key priorities and put it to a vote in parliament this week to see if he stands a chance of leading a cabinet.
"I am taking this second mandate with the clear notion that it would be a very hard task, many even say it is impossible," Denkov told President Rumen Radev when getting his mandate.
"Despite that, we are convinced that we should anything that is necessary to form a government," he said.
Political analysts said the chances of a PP-led minority government were marginal. Key rival, the GERB party, as well as the ethnic Turkish MRF party and pro-Russian Revival, have declined support.
Failure to form a regular government would weigh on Bulgaria's plans to join the Euro Zone in 2024. It would delay much needed reforms to combat high-level graft and could hamper the efficient tapping on billions of euros in EU recovery funds.
It would also leave the Balkan country without a comprehensive 2023 budget amid high inflation and a looming economic slowdown.
If PP fails, Radev would have to choose another political party and ask it to form a government. If that final attempt also fails, Radev would call a snap poll within two months.
(Reporting by Tsvetelia Tsolova,; Editing by Jason Hovet and Ed Osmond)
