Wednesday, November 25, 2020
Home Oil & Gas Hungary strikes deal with Russia on 4.2 bcm gas deliveries

Hungary strikes deal with Russia on 4.2 bcm gas deliveries

Hungary signed a trade agreement with Russia’s state-owned energy group Gazprom to purchase 4.2 billion cubic metres (bcm) of natural gas for one year starting from this October, the Minister of Foreign Affairs and Trade Péter Szijjártó announced during his official visit to Moscow.

“Hungary will be purchasing 2 billion cubic metres of natural gas over the summer for storage, the transport of which has already begun,” informed Mr Szijjártó noting that in addition to negotiations on the quantities to be shipped, the expansion of transport routes is also progressing. He highlighted the construction of the Turkish Stream gas pipeline which will enable to purchase natural gas from the South from next October.

“All the necessary Hungarian decisions have been made to ensure that we can connect the Serbian-Hungarian border and Hungary’s national gas pipeline system with a 15-kilometre pipeline, the planning of which has already begun. This will enable the transport of 6 billion cubic metres of natural gas to Hungary from the South from next October,” Minister Szijjártó explained.

The 930 kilometres long Turkish Stream pipeline will carry Russian gas on two parallel strings with an annual capacity of 15.75 bcm of gas each. The first one will ship gas to Turkey while the second line will continue to Europe, via Bulgaria, Serbia and Hungary. The pipeline project is a strategic element of Moscow’s efforts to circumvent its traditional gas transit routes to Europe from the South and cut off Ukraine from the shipments.

In a recent interview with CEENERGYNEWS Pál Ságvári, Hungary’s Ambassador-at-Large for Energy Security reiterated that Hungary is confident about the realisation of the TurkStream project, which fulfils two strategic aims at the same time; mitigating the inherent supply security risk of the Ukraine transit route and, opening a new route from the South.

Upon his visit to Moscow, the Hungarian Foreign Minister also spoke about commencing negotiations on the period beginning next autumn.

“Our target is to be able to conclude a long-term agreement covering three five-year periods, which may be exited at the end of each five-year phase,” he explained. “This would assure our long-term supply, and also enable us to renegotiate or exit the agreement if better opportunities arise, or there is a change in the international energy market.”

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