Russian President Vladimir Putin and Hungarian Prime Minister Victor Orban reached an agreement in Budapest on Tuesday on the terms of a new contract to provide gas to the central European country; it replaces the current agreement, which was signed in 1996 and expires this year.
"Today we have agreed, taking into account our good relations and on the basis of mutual agreement of both sides, that gas which goes unused by Hungary can be used in the following years, and that we will pay for that gas when we get it. For us it's a great relief," said Victor Orban in Budapest, announcing the agreement.
"I thank President Putin for making it possible for the people and industry of Hungary to be supplied with cheaper Russian gas. Without reliable supplies of Russian gas we would not be able to continue the work we are planning to carry out."
Under the terms of the 1996 contract, Hungary is bound to pay for gas it contracted to buy but did not use; the Hungarian party came to the table with a request to cancel the so-called 'take or pay' clause from the contract, which is usual practice for Gazprom and the norm in the energy industry.
President Putin remarked that Russia's flexibility had come in response to requests from its Hungarian partners. "All the questions which were raised with us during the course of today's negotiations have been resolved in the same vein that they were put to us by our Hungarian friends."
"Firstly Gazprom as a state company is ready to carry over volumes of gas unused by our Hungarian partners to the following period," said the president, confirming that 'take-or-pay' had been canceled. "Another question is the expansion in the use of underground storage. It is clear that such storage spaces allow Hungary to go through the autumn-winter period without any problems, and Gazprom in principle is not against the storage of greater volumes of gas there."
The political deal, the technical details of which are still to be finalized, was one of several made during President Putin's working visit to Hungary. Agreements were also reached in other areas including healthcare and education, as well as the signing of a memorandum on cooperation in training personnel in nuclear energy and related fields.
Earlier on Tuesday, President Putin laid a wreath at the Tomb of the Unknown Soldier at Heroes’ Square, and at the Memorial to Soviet Soldiers in the Kerepesi National Pantheon in Budapest. "I am very grateful to the Hungarian government and Prime Minister for the invitation to visit Budapest at the time of the 70th anniversary of its liberation from the Nazis," declared the president.
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