Hungary has signed a 10-year gas supply agreement with Shell, taking one of its first steps towards diversifying and reducing dependence on Russian energy as the EU deadline to phase out Russian imports approaches.

Source: Bloomberg, as reported by European Pravda

Details: On Tuesday 9 September, the country signed a contract for 2 billion cubic metres of gas to be delivered over ten years starting in 2026, Hungarian Foreign Minister Péter Szijjártó said in an interview on the sidelines of the Gastech conference in Milan.

He said that the supplies will reach Hungary through Czech and German pipelines.

While the EU plans to end imports of Russian fossil fuels by the end of 2027, Hungary has long opposed these plans. Budapest has urged the EU to compensate member states for diversification efforts and now appears to be taking steps to find alternatives.

“We have been negotiating some other contracts by other Western suppliers, but we are not there yet to announce,” Szijjártó said.

Meanwhile, he noted that the EU’s current plan for phasing out Russian imports still poses a serious risk to Hungary’s energy security, since the country does not have sufficient pipeline infrastructure from other markets to cover the necessary volumes.

Hungary has a contract with Russian energy giant Gazprom to supply 4.5 billion cubic metres of gas annually until 2036, which has been supplemented with additional purchases after 2022.

Szijjártó added that Hungary’s nuclear plans, aiming to double its atomic capacity with two new reactors, would enable it to cut gas imports by half and ease pressure on fuel supplies, covering 70% of the country’s electricity needs domestically.

Background: The European Union plans to fully end imports of Russian gas by the end of 2027.

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