Brussels, 19/02/2015 (Agence Europe) - Hungary is against European Commission plans to have oversight of inter-governmental agreements (IGAs) on energy issues between member states and third countries, warned Hungarian Prime Minister Viktor Orban on Wednesday 18 February, the day after discussion on amending the long-term gas contract between Hungary and Russia.
“We will have a major problem. I am expecting a big fight”, Orban told the press the day after the visit to Budapest of Russian President Vladimir Putin, on Tuesday 17 February. The Commission's current approach “reflects that the EU is heading into an energy union that hinders national sovereignty”, he is quoted by the Dow Jones agency as adding.
Hungary is looking to amend and extend its 20-year old gas contract with Russia, which is due to expire at the end of the year, to afford greater flexibility with regard to payments. The aim is, over the next four or five years, to use the remaining gas in its supply contract and so avoid having to pay for it under its long-term contract. Restructuring of the gas supply under the current contract would mean that Hungary would not have to inform the EU, Orban said.
On Tuesday, Energy Union Commissioner Maros Sefcovic said he expected Hungary to involve the European Commission in negotiations on its new gas contract with Russia. “Ideally, the Commission should be part of the negotiating team. One of the key elements for energy security should be much higher transparency”, he said, in comments reported by the Wall Street Journal.
As part of its package of proposals for the energy union which it will unveil on 25 February, the Commission wants to review the 2012 regulation on the transparency of IGAs between member states and third country suppliers of energy in order to ensure that these agreements are transparent and that they comply with the energy internal market rules and the EU's energy security criteria. The Commission is proposing a mechanism whereby the member states will be required to consult the Commission prior to signing an IGA with a third country. “I think we should level the playing field a little bit to be able to share the information much more”, said Sefcovic on Tuesday, stating that the goal of the Commission was to ensure that no energy supplier enjoyed a monopoly in any EU market and to prevent third parties from gaining an unfair or competitive advantage in talks with individual member states. The Commission is thinking here about the secret gas agreements concluded between Russian gas giant Gazoprom and EU member states that were stakeholders in the South Stream gas pipeline project that has since been cancelled by Moscow. (Emmanuel Hagry)