Nabucco says MOL still with project despite Hungary PM remarks

24 April 2012 17:18  [Source: ICIS news]

LONDON (ICIS)--The Nabucco consortium and the European Commission have had no indication that Hungarian oil, gas and petrochemicals group MOL is set to withdraw from their pipeline project, despite comments to the contrary from the Hungarian prime minister, they said on Tuesday.

"Nabucco is in trouble. I'm not an expert in the details, but what I have seen is that even the Hungarian company MOL is leaving the whole project," Viktor Orban said late on Monday at an event in Brussels organised by the European Policy Centre.

Orban’s comments followed a 17 April meeting with Alexei Miller , the CEO of Russia’s Gazprom, which is building the South Stream pipeline, a direct competitor to the EU-favoured Nabucco project to transport gas to Europe via a pipeline route stretching from Azerbaijan to Austria.

Hungary would like to ensure that the South Stream project picks a route that runs across Hungarian territory rather than around it, Orban added in his Brussels comments.

The Nabucco consortium put out a statement in the wake of Orban’s comments, saying: “The Nabucco shareholder in Hungary is FGSZ, a MOL subsidiary, and we have not had any indication that this will change."

European Commission energy spokesperson Marlene Holzner, meanwhile, said the Commision had received no word from MOL about the group intending to withdraw from Nabucco.

MOL itself was not immediately available for comment. However, the firm has recently questioned whether enough gas supplies would be available to make Nabucco viable and expressed concern about possible escalating costs of the infrastructure project.

Robert Rethy, an analyst at Prague-based investment bank Wood & Company, was not surprised at Orban’s remarks.

“It is not surprising particularly in light of the unexpectedly quick work being done on the Gazprom-led South Stream pipeline – Nabucco's major competitor – which has advanced significantly in recent weeks in Bulgaria, Serbia and Hungary, and whose construction may start as early as December 2012,” he said.

The other Nabucco consortium members are Germany’s RWE, Austria’s OMV, Bulgaria’s Bulgargaz, Romania’s Transgaz and Turkey’s Boru Hatlari ile Petrol Tasima.

By: Will Conroy
+44 20 8652 3214

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