Page 9 - FSUOGM Week 35 2021
P. 9
FSUOGM PIPELINES & TRANSPORT FSUOGM
Hungary's Minister of
Foreign Affairs and
Trade Peter Szijjaro
(left) with Gazprom
CEO Alexey Miller
(right) have agreed on a
long-term gas deal.
Hungary and Russia reach long-
term gas supply agreement
RUSSIA HUNGARY has worked out all details and issues much better than the one in the delivery agree-
of a long-term gas delivery agreement with Rus- ment expiring this year. This will allow keeping
Hungary signed its last sia that will replace one expiring in the autumn, gas prices low, he added.
long-term agreement Minister of Foreign Affairs and Trade Peter The government fixed utility prices, leading
on gas deliveries from Szijjaro announced on August 30 after meeting to a 25% cut in electricity, gas and central heating
Russia in 1995. with Gazprom's CEO Alexey Miller. prices for retail users just before the 2014 elec-
Hungary signed its last long-term agreement tions, which helped Viktor Orban's government
on gas deliveries from Russia in 1995, which secure a second landslide victory after sweeping
expired in 2016. This was extended on an annual into power with a two-thirds majority in 2010.
basis. Energy prices are now some 30% below 2014
The agreement, to be signed at the end of Sep- levels.
tember and coming into force from October 1, Keeping utility prices low remains a top
will be in force for 10+5 years, with an option priority for the government ahead of the 2022
to modify delivery volume after the tenth year. elections.
Under the agreement, Hungary will buy The new contract will replace the 9bcm
4.5bcm of gas a year from Gazprom, including annual contract between Gazprom and the Rus-
3.5bcm delivered from the south, through Hun- sian-Hungarian joint venture Panrusgaz, signed
gary’s interconnector with Serbia, and 1bcm via in 1996. Under this contract, the main supplies
the pipeline running from Austria. are transited through Ukraine, via Beregovo on
Construction on a gas pipeline linking the the Ukrainian-Hungarian border, with the rest
Hungary-Serbia border to Hungary’s gas pipe- via Baumgarten in Austria.
line network is set to be completed in October. Gazprom delivered 8.6bcm of gas to Hungary
The pipeline will connect Hungary to the Turk- in 2020, down from 10.5bcm in 2019. In the first
Stream pipeline. half of 2021, Gazprom's deliveries amounted to
Russia for long has advocated the com- 3.9bcm. Hungary's domestic gas consumption in
pletion of the interconnector between Hun- 2020 was 10.2bcm.
gary and Serbia, allowing Russia to bypass Gazprom declined to comment on the rea-
Ukraine. Gas deliveries from Ukraine to son for the volume reduction under the contract
Hungary were occasionally halted in recent with Panrusgaz, as well as the pricing principle.
years due to the Russian-Ukrainian conflict According to market participants, the pricing
on gas prices. will be based on the quotations of the CEGH
Szijjarto said the price the sides agreed on is Baumgarten hub.
Week 35 01•September•2021 www. NEWSBASE .com P9