Hungary is considering a long-term contract for gas supplies from Romania, which could replace Russian imports in the coming years, Index reports.
This is the Neptun Deep project in the Black Sea, which could start production in 2027 and partially meet the needs of the Hungarian market.
According to the source, the price of Romanian gas is already close to the price of Russian imports, including the more expensive contract volumes. A decision is expected in the coming weeks whether the new Hungarian cabinet will sign the agreement or resume negotiations.
The project is being developed by OMV Petrom and Romgaz. Initial estimates foresee supplies of approximately 1 billion cubic meters per year to the Hungarian market, with the possibility of increasing these volumes in the future.
Additional pressure is being put on the EU's REPowerEU plan, which envisages the EU ending purchases of Russian energy goods from 2027.
REPowerEU is a European Commission plan adopted in May 2022 following the outbreak of the energy crisis caused by the conflict in Ukraine. The aim is to accelerate the reduction of the EU's dependence on Russian oil, gas and coal through diversification of supplies, energy savings, increased energy efficiency and rapid development of renewable energy, as well as the modernization of Europe's energy infrastructure.
It is noted that the Hungarian state energy holding MVM (Magyar Villamos Müvek) is seen as a potential buyer of future Romanian gas. The structure of the deal has already been agreed on the price, while the main disputes concern the volumes and the delivery schedule.
According to sources, the key constraint remains the limited window for signing the contract, due to administrative and political procedures in Romania and the change of government in Hungary.
In mid-May, the Minister of Economy and Energy, former Shell CEO Istvan Kapitány, said that the Hungarian government did not intend to terminate oil and gas contracts with Russia. According to him, Budapest plans to “rely on several sources“. The country's Foreign Ministry also added that Hungary will seek to diversify its energy sources to avoid energy dependence on Russia.
Peter Magyar, who won the parliamentary elections, said that Budapest cannot yet give up Russian oil. “The new government prioritizes the diversification of energy supplies. The Druzhba oil pipeline will also remain - Hungary cannot abandon it even if it wants to. Russia will remain, as will Hungary," he stressed.
Hungary has increased its energy cooperation with Russia under Viktor Orban. Energy resources from Russia are supplied to Hungary via the Druzhba oil pipeline.