Energy issues top agenda in Putin-Orban talks

Energy matters were hot topic during talks between Hungarian Prime Minister Viktor Orban and Russian President Vladimir Putin here Thursday.

In a joint press conference, Putin pointed out that 75 percent of Hungary's gas and 65 percent of its oil came from Russia, and that Hungary was also a key transit country.

Orban said that an agreement between the two countries had already regulated Hungary's gas and oil supply to 2021, and negotiations were about to begin on the post-2021 period.

Orban said that supplies through Ukraine were uncertain, but it had connections to the North Stream pipeline and if need be, could receive supplies through it. He lamented the failure to go ahead with construction of the South Stream pipeline, and voiced an interest in a possible pipeline through Turkey.

Putin underlined that Russia guaranteed Hungary's energy supply under any and all circumstances.

Orban said that while Hungary was interested in diversifying its sources, failures by both Croatia and Romania to turn their own pipelines into bi-directional ones made this impossible. "If our EU partners don't do their part, we have to look elsewhere," he said.

Both leaders also spoke at length about Hungary's sole nuclear power plant originally built with Russian technology, located at Paks, about 100 km south of Budapest, on the Danube. When the two new reactors Russia has contracted to build are completed, it would double the facility's capacity, Putin added.

Putin noted that the Paks project would cost 12 billion euros (about 12.9 billion U.S. dollars), and that Russia was prepared to finance 80 percent of the costs, He also noted that the project would create 10,000 jobs.

Orban said he thought the project could get underway in 2017 since only one European Union decision was still pending. He expected actual construction to begin in 2018.

On other economic issues, both Orban and Putin mentioned agricultural and food industry projects in Russia. They also spoke about water management, an area in which Hungary is traditionally strong and could use its skills in Russia but failed to give details.

Putin mentioned several other areas including the manufacture of composite vehicles and railroad cars that the two countries could produce in cooperation and sell to third markets.

Citing European Union trade sanctions against Russia following its dispute with Ukraine that upset economic ties between Russia and the EU, Putin noted that trade between Russia and Hungary had dropped by half in the past three years, and investments had also declined.

Orban reiterated his opposition to the sanctions, noting that they had cost Hungary 6.5 billion dollars in unrealized trade. Orban emphasized his view that non-economic issues should not and could not be resolved through economic means, and that any attempt to do so resulted in a lose-lose situation.

At the same time, Orban emphasized that in the international policy field, Hungary and Russia were in "different dimensions," and Hungary "needed to know its place."

Putin was last time in Hungary in February 2015, and Orban traveled to Russia in February 2016. Enditem