© Reuters. Gas pipelines are seen in a gas distribution center near the Serbian border in Kiskundorozsma, Hungary, September 28, 2021. REUTERS/Bernadett Szabo
By Krisztina Than
BUDAPEST (Reuters) -The EU has no role in a contract for Russian gas that Hungary operates with Gazprom (MCX:), and Budapest is working on a solution to pay for the fuel, its foreign minister said on Wednesday.
Russia has demanded that overseas clients from what it terms “unfriendly” countries pay in roubles for , a plan that has met with strong criticism from European capitals.
Hungary has been one of a few EU member states that have rejected energy sanctions against Moscow in response to Russia’s invasion of Ukraine.
The Kremlin said last week that foreign buyers of Russian gas would have to open rouble accounts in state-run Gazprombank from last Friday or else risk being cut off.
With only a few weeks left before bills are due, governments in Europe, which relies on Russia for more than a third of its gas, are talking to energy companies about Russia’s demand.
But the European Commission has said that those with contracts requiring payment in euros or dollars should stick to that.
Hungarian Foreign Minister Peter Szijjarto said its gas supply was based on a bilateral contract between units of Hungarian state-owned MVM and of Gazprom, and a solution for a payment due in May was currently being worked out.
The EU “had no role” in that contract, he added.
Replying to a question on whether Hungary could pay in roubles for the Russian gas imports, Szijjarto told reporters:
“Our first payment obligation is due at the end of May. The technical solution is there to allow us to be able to pay for the gas we have used, and the technical details of this solution are currently being worked out.”
He did not provide further detail.
Hungary, which is heavily reliant on Russian gas and oil imports, signed a new long-term gas supply agreement with Russia last year.
Prime Minister Viktor Orban, whose government has pursued close business relations with Moscow for over a decade, swept to power for a fourth consecutive term in elections on Sunday, partly on a pledge to preserve security of gas supply for Hungarian households.
The European Union so far has not imposed sanctions on oil and gas from Russia but is preparing to propose a ban on coal imports and other products.
“As for the intention of the European Commission that there should be some kind of common response from countries importing Russian gas, we do not think that is necessary,” Szijjarto said, adding that countries had individually signed bilateral contracts.
“And how everyone modifies their contracts, its none of our business….just as no one has a say in how we modify our own contract.”
Under Hungary’s deal, Gazprom is expected to ship 4.5 billion cubic metres of gas annually, via two routes: 3.5 billion cubic meters via Serbia and 1 billion via Austria.
Russian gas deliveries to Europe via three key pipeline routes were broadly steady overall on Wednesday morning, with eastbound flows into Poland from Germany falling back to zero after briefly resuming overnight.