FGSZ, Ukrtransgaz sign interconnection agreement

Energy Trade

Hungarian gas delivery company FGSZ, a unit of MOL said it signed a new interconnection agreement on Friday with Ukrainian peer Ukrtransgaz on both forward and reverse flow across the border of the two countries.

The agreement, signed on May 29, is in compliance with the European Unionʼs Third Energy Package and is the first of its kind concluded between a gas TSO in an EU member state and Ukrtransgaz, FGSZ said. It should serve as a model for other TSOs in member states bordering Ukraine, it added.

"Complying with the EU’s newly adopted network codes, the Hungarian-Ukrainian Interconnection Agreement defines industry standard procedures for business-as-usual operation, and its provisions provide sufficient tools to govern the management of cross-border gas flows in times of supply crises as well," FGSZ said in a statement.

FGSZ noted that it had reactivated an idle interconnector pipeline between Hungary and Ukraine in March 2013 in response to the looming Ukrainian-Russian conflict, and used it within the legal framework of consecutive, temporary interconnection agreements. The capacity of the interconnector in the direction of Ukraine to Hungary is 26 bln cubic meters per year. Reverse flow capacity is 6.1 bln cubic meters per year.

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