Tuesday, July 8, 2008

Hungary, Romania gas pipeline to enhance supply security

BRUSSELS (Thomson Financial) - Hungary and Romania have agreed to connect their gas supplies for reasons relating to security of supply, the European Commission said.

The pipeline will strengthen regional security of supply, creating a link that is not dependent on a third country. The line will follow the Arad - Szeged route.

Hungary and Romania's transmission systems operators, FGSZ Ltd. and Transgaz, concluded a Joint Development Agreement for interconnecting their systems on July 1.

FGSZ will develop the Hungarian pipeline part, whilst Transgaz will develop the Romanian part. Both parties will finance their sections of the pipeline from their own resources.

After finalizing the agreement, natural gas will be transported from Hungary to Romania through the pipeline. Later, they may consider creating technical conditions to transport natural gas from Romania to Hungary through the pipeline.

'This is a first, concrete step in the direction of an integrated European gas network also in Central-Eastern EU. It will create close a missing interconnection, allowing the development of the internal market and enhance security of supply in the region,' the commissioner said.

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