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Minister of Foreign Affairs and Trade Peter Szijjarto and the Serbian Republics Minister of Mining and Energy Aleksandar Antic concluded an agreement on the construction of a natural gas pipeline traversing the Hungarian-Serbian border and on cooperation relating to its operation on Friday in Budapest. Following the signing of the agreement, Mr. Szijjarto highlighted: The security of our gas supply is a national security and national strategic issue. He pointed out that no transit agreement for next year has yet been concluded between Russia and Ukraine. In addition, Hungarys allies are late with the bringing of decisions that would facilitate Hungary being able to purchase gas from other sources, he stated.
The Minister said the potential purchasing opportunity from the south, along the Turkey-Bulgaria-Serbia route, was the most realistic alternative. The capacity pre-purchasing procedure for the Serbian-Hungarian border interconnector will be published in September. The level of investment realised by Hungary will depend on the volume of capacity pledged by the various gas trading companies, the Minister said. The procedure will be completed by the end of September, following which the trading contracts will be signed, construction will commence next summer, and the Serbian-Hungarian interconnector will be established by the end of 2021, he added.
The Minister of Foreign Affairs and Trade also spoke about the fact that construction of the LNG terminal in Croatia is yet to begin, while the American-Austrian consortium involved has still not made a decision on the extraction of the Romanian natural gas deposits discovered under the Black Sea. If the southern route via Turkey, Bulgaria and Serbia is realised, then it will represent a long-term gas transport opportunity for Hungary, he highlighted. He also mentioned that Hungarys gas supply for 2020 is already guaranteed in view of the fact that the country is purchasing 4 billion cubic metres of gas from Russia for public utility purposes, in addition to which gas trading companies are purchasing much more. 2 billion of the 4 billion cubic metres usually arrives via Ukraine.
This is uncertain for the moment, and accordingly we have come to an agreement with Gazprom concerning the fact that they will be shipping the 2 billion cubic metres of natural gas in advance before the end of this year, he stated. The full quantity of gas that would have arrived via Ukraine next year will already be stored in Hungarian gas storage reservoirs by the end of September, the Minister emphasised. With relation to the new transport route, Mr. Szijjrt told the press that if trading companies sign contracts for the shipment of 10 billion cubic metres of natural gas and the required infrastructure is constructed, then part of the arriving 10 billion cubic metres of gas will be used in Hungary, while the rest can be exported to other countries via other routes.
The Serbian Minister of Mining and Energy told reporters that on the Serbian side construction is underway on three stretches of the pipeline, with 120 kilometres already complete. According to plan, construction will be finished by December of this year and by 2020 work will be completed on the compressor station that will enable transport of the full quantity of gas via Serbia. Each party will be financing the project on their respective sides of the border.