Romania To Export Gas Through Arad-Szeged Pipe In 2-3 Years At The Earliest

05.25.2011 ZF English

Natural gas exports from Romania to Hungary will be technically feasible in two or three years at the earliest, though the government has pledged to do everything in its power for domestic producers to be able to sell their gas on other markets as well by the end of next year.

The government "should take all the necessary actions to make sure the bi-directional flow of gas at the border with Hungary is set by the end of 2012", Romanian authorities wrote in the memorandum of understanding agreed between the government and the European Commission.

In reality, though, the two sides involved in the project, Transgaz (TGN.RO) and FGSZ Natural Gas Transmission Close Company, Hungary's gas shipping company, part of MOL oil group, have not reached as much as a joint development agreement for this phase of the project so far.

"It takes an investment in a gas compression station on the Hungarian side of the pipe and certain investments on the Romanian side of the pipe are also necessary. We must reach a joint development accord and after this phase another two or three years would be needed to carry out the project," said FGSZ representatives.

On the other hand, Transgaz says the flow of gas from Romania to Hungary depends on the decision of transmission operators, though Transgaz is the natural gas transmission operator of Romania.