Hungarian energy company MVM is ready to phase out Russian Gas if necessary

Hungary's MVM state-owned group can still supply gas to the country even if Russian imports are stopped, but prices will probably rise, according to its chief executive. As part of a move to reduce the EU's energy dependence on Moscow over decades, the European Union decided on Wednesday to stop importing Russian gas by 2027. Short-term pipeline gas contracts will be affected as early as June 2026. Hungary, a landlocked country, opposes this move and has said that it will challenge the legislation before the EU Court of Justice.

Karoly Matrai is the CEO of MVM. MVM trades over 10 billion cubic meters of gas throughout Central Europe, and it has a 40 to 45% share on the Hungarian wholesale markets. He said that MVM had been in discussions with other suppliers but he would not identify them.

Matrai added that MVM could likely access different LNG port capacities throughout Europe, and there would "probably be enough gas" even if Hungary’s long-term contract to purchase gas from Russia fell under the planned EU ban.

DIVERSIFICATION PUSH

MVM secured 1 billion cubic meters of LNG capacity per year at Croatia's Krk Terminal and signed agreements with Shell to provide 200 million cubic metres annually from 2026 onwards and France's Engie to supply 400 mcm.

Matrai, however, said that the costs of shipping LNG from LNG ports into Hungary and Slovakia will increase prices in the future. MVM imports Russian gas through the Turkstream pipeline and purchases gas from other countries on the spot markets to meet the local demand, which is around 8 billion cubic meters per year. It also ships gas to Slovakia. Matrai stated that MVM only supplies non-Russian natural gas to its clients in the Czech Republic. Matrai expects that the Romanian regulator will make a decision by April on MVM's acquisition of E.ON’s 68% stake in E.ON Energie Romania.

Matrai stated, "We're preparing for a bad decision. We will be happy if it is a positive one."

He added that the group plans to invest 400 to 600 billion forints in order to extend Paks 1, Hungary's nuclear power plant, by 20 years past its shutdown dates of 2032-2037. (Reporting and editing by Krisztina than and Gergely szakacs)

(source: Reuters)