Hungary Suspends Gas Supply to Ukraine

Hungary Suspends Gas Supply to Ukraine
Hungary Suspends Gas Supply to Ukraine

Hungary’s gas operator FGSZ Ltd. has suspended gas supplies to Ukraine for an indefinite period of time, the company said on Thursday. The decision was made to meet the growing domestic demand for gas, the company said, ITAR-TASS reported.

Gas supplies to Ukraine were suspended at 18:00 local time on September 25. “Gas supplies have been halted for an indefinite period of time,” the company said.

In March 2013, Ukraine and Hungary agreed on gas supplies to Ukraine in the amount of up to 6.1 billion cubic meters a year (16.6 million cubic meters a day).

It was also stated that the system could operate intermittently, depending on current commercial and technical conditions.

  Imports From Russia

A day after Hungary's pipeline operator FGSZ stopped shipping gas to Ukraine, Hungary has secured agreement for increased gas imports from Russia's Gazprom, Hungarian Prime Minister Viktor Orban said Friday, the Moscow Times repoted.

Orban told public radio that he held talks with Gazprom CEO Alexei Miller and that the company had agreed to ship increased volumes of gas to boost levels at Hungary's storage facilities in the coming weeks. Orban's announcement about Hungary's efforts to avoid any supply problems resulting from a potential halt in shipments because of the Ukraine crisis follows FGSZ stopping gas shipments to Ukraine because its pipeline is needed for higher imports. The move triggered a protest from Ukraine's Naftogaz, which urged its "Hungarian partners to respect their contractual obligations and EU legislation."

"Neftogaz calls on the EU to ensure a collective solution to the energy security of Europe and the respect of EU internal rules. Neither EU countries nor Ukraine should be put under political pressure through energy blackmail," Naftogaz said in a statement.

Hungary is heavily reliant on Russian gas. Annual consumption is about 9 billion cubic meters, with most of the gas imported by pipeline from Ukraine. Hungary also has domestic annual production of about 1.5 billion cubic meters.

The central eastern European country has large storage capacity of about 6 billion cubic meters. Its storage tanks are currently a little more than 61 percent full, the lowest percentage in the European Union, according to data from Gas Infrasctrure Europe. Apart from Portugal, where tanks are 75 percent full, the rest of European Union countries have storage tanks more than 80 percent full, with most near capacity. Orban said Hungary's storage would be boosted in the coming weeks and that, regardless of the severity of the Ukraine crisis, Hungary cannot get into a situation in which its people do not get the energy they need.

"I had talks with the Russians, the leader of Gazprom, about this, that we will need a large amount of gas in the coming period to increase the stored volumes," he said.