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Hungary’s “perfect” game on the gas market

The construction of single line national transmission systems is no longer an option to develop national transmission systems of a highly dynamic XXI century, with continuous positioning and repositioning of political, strategic or economic nature. The construction of stellar systems with multiple entry and exit points in different directions is the solution of these times, as it creates the possibility of a rapid response to volatility markets.
Analyzing the philosophy behind transmission systems over the last 20 years, we see that stellar systems with multiple interconnections, as well as flexibility to the rapid and massive changes of any gas transmission flows, were the preferred ones. Along with Germany, Austria or Slovakia, Hungary has also resorted to this technique.
Hungary has chosen to play its national interest very well, even risking some sanctions for its withdrawal from some international agreements. It chose to get out of Nabucco project first, when it realized that this move was winning; it also chose to allow Nabucco to alienate all the know-how of the project, and chose to get out of BRUA project when it realized it had the chance to gain more from leaving this project than staying in it.
We will follow two maps containing projects for the development of the gas transmission system in Hungary, according to MEKH-ANRE HU, before and after the announcement of Hungary’s withdrawal from BRUA (1 August 2017).

Before 01.08.2017

After 01.08.2017
Hungary played smart but intelligent (for itself), waiting until the auctions for BRUA ST1 were completed (or almost completed) in Romania and then changed the switch, proposing the development in Hungary of a STAR transmission system, to the detriment of a single line system, as BRUA was, because:
– it limited the actions of an important potential competitor in the region on the gas market;
– it wants to play a more important role in Eastern Europe, not as a simple transit country, but actively involving in the gas trading activity (the Hungarian state-owned company MOL has trading subsidiaries in almost all the European countries, including Turkey; MOL Romania ranking … on the Romanian gas market);
– it “freed” the old corridor NABUCCO to Austria, which is thus free for other projects (SOUTH STREAM).
We have seen the reasons why it made this move, but still why has Hungary risked a scandat at EU level?
Answer: Because it can afford it.
Hungary is a country that:
– has many representatives in the leadership of various levels within the European Council and European Parliament,
– was the Eastern European country with the greatest involement of people at the level of all the European institutions and today has very active people, very well reagarded at European level,
– has a very performing diplomacy,
– has developed multiple lobby instruments at Brussels level.
So, in total opposition to Romania, which has almost none of these, it probably thought the risk was way too low and undertook it.

 

Translation from Romanian by Romaniascout.


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