Hungary Could Unilaterally Suspend Gas Deliveries to Ukraine Again
Hungary's transmission system service provider FGSZ resumed gas deliveries to Ukraine on Saturday. While the current levels are around 2.7 mcm, Hungary could theoretically ship up to 16.8 million cubic meters a day. Natural Gas Europe had the pleasure to speak with János Fehér, FGSZ' CEO.
Fehér explained that Hungary is not carrying out any form of reverse flow, as it is shipping the gas through a second pipeline. He also illustrated that "the capacity of transmission to Ukraine is available for network users on interruptible basis only." This means that Hungary could unilaterally suspend gas deliveries to Ukraine without breaching any contract, as happened on September 25, 2014.
Recently, Hungary resumed gas deliveries to Ukraine. In 2014, Kiev imported a total of 600 million cubic meters of gas. Do you expect similar levels in 2015?
FGSZ is a transmission system service provider and not a gas trader company. We provide this service on an interruptible basis. Therefore we are not competent to answer this question. The quantity of gas transmitted depends on the network users demand.
Commenting FGSZ’ decision to resume gas deliveries, some newspapers spoke of reverse flow, but the company explained the term is not correct, as the transmission is carried out through a separate pipeline. What is the difference? Does it have to do with any contractual term? Does it have to do with Russia’s Gazprom?
FGSZ has two separate pipelines interconnecting its system to the Ukrainian one (UKR-HU 1400 dia, while HU-UKR 800 dia). Both pipelines are uni-directional and not bidirectional. The two separate pipelines are operated under separate interconnection agreements. The interconnection agreement for transmission to Ukraine is a fined term contract for test run period and capacity is available on interruptible basis only.
Would an unilateral suspension of gas deliveries be possible as happened on September 25, 2014?
Due to test run mode agreement and related issues the capacity of transmission to Ukraine is available for network users on interruptible basis only – it means that the service is not guaranteed to network users.
What could be the reasons for such a decision?
Since the interconnector for transmission to Ukraine is operated in test mode we cannot pre-define any specific or all reasons that would force eventual interruptions.
European Commissioner Maroš Šefčovič met Gazprom’s Alexey Miller in Moscow on Wednesday. The two delegations spoke about reliable gas supply to European consumers. What’s your understanding of the meeting?
As a part of Company policy we never comment on others’ statements, accordingly FGSZ is not competent to answer this question.
Sergio Matalucci
Sergio Matalucci is an Associate Partner at Natural Gas Europe. Follow him on Twitter: @SergioMatalucci