July 2012, Vol. 239 No. 7

Projects

Hungary Questioning Nabucco Viability

Hungarian Prime Minister Viktor Orban described Nabucco as a deeply troubled project and predicted that Hungarian MOL would withdraw from the project consortium. While acknowledging that Budapest needed Nabucco to reduce dependence on Russia, Orban expressed hope for Hungary to be included in Gazprom’s South Stream project, if implemented.

A briefing by MOL’s top officials cited Nabucco’s cost overruns, persistent uncertainties over funding and lack of guaranteed supplies of gas. Ten years after its inception, “hardly anyone can say today what exactly this project is, and how much it would cost to build it.”

Consequently, MOL is prepared to sell its stake in the Nabucco consortium; it has not approve the project company’s operating budget for 2012, and is withholding disbursement of MOL’s contribution to that budget. Management said MOL remains committed to the goal of diversifying Hungary’s and the entire region’s gas supplies and, if the Nabucco project is eventually implemented, “nothing would stand in the pipeline’s way through Hungary”.