October 30, 2019 / 2:02 AM / a month ago

Russia's Putin, Hungary's Orban to discuss TurkStream pipeline, nuclear energy

* TurkStream would bring gas bypassing Ukraine

* Hungary relies on Russia in gas shipments

* Nuclear plant project also will be on agenda

* MOL, Lukoil to sign deal over contaminated oil

By Krisztina Than and Vladimir Soldatkin

BUDAPEST, Oct 30 (Reuters) - The TurkStream pipeline that would bring gas to Central Europe bypassing Ukraine and nuclear energy issues are expected to feature high on the agenda at a meeting between Hungarian Prime Minister Viktor Orban and Russian President Vladimir Putin on Wednesday.

Right-wing conservative leader Orban, in power since 2010, has pursued what he has hailed as good pragmatic relations with Russia. Some analysts, however, say the relationship is lop-sided, with Russian interests dominating.

A source familiar with the agenda of Putin’s visit said one of the goals was to agree on the TurkStream pipeline.

“Putin has to agree with all the countries involved, so that there wouldn’t be any troubles with the pipeline,” the source said, declining to be named.

Hungarian Foreign Minister Peter Szijjarto told Reuters that TurkStream should be constructed as soon as possible in Bulgaria because that would open up an additional delivery route to Hungary, which is reliant on Russian gas shipments.

The current gas transit agreement between Moscow and Kiev expires after Dec. 31 and Russia and Ukraine are under increasing pressure to sign a new deal, although this faces several obstacles.

Russia plans to launch the first part of the TurkStream pipeline, with annual capacity of 15.75 billion cubic metres, by the end of the year to supply Turkish domestic customers. The second part, with the same capacity, is expected to run from Bulgaria to Serbia and Hungary.

The talks on Wednesday will also cover future gas deliveries to Hungary, which already has its gas storage full for the coming winter.

Hungary has annual gas consumption of around 10 billion cubic metres and has almost 6.5 billion cubic metres of gas stored now, Szijjarto told a news conference on Tuesday.

“Here and now I reject all western European criticism regarding our cooperation with Russia in the field of energy,” he said, adding that Hungary had to rely on Russia for its gas as there were no alternative options.

He also said Russian oil producer Lukoil and Hungarian MOL will sign a settlement deal over contaminated oil, which disrupted oil exports from Russia to the West this year.

Orban’s government has promoted Moscow’s interests within the European Union, calling for the ending of economic sanctions imposed after Russia’s annexation of Crimea in 2014.

But Hungary has never vetoed the sanctions, and Szijjarto has said Hungary would not veto an extension of sanctions if the EU decided at the end of 2019 to prolong them.

In 2014, Budapest also signed a deal for two new reactors at its Paks nuclear plant with Russia, to be built by state atomic energy firm Rosatom and funded with a 10 billion euro loan from Russia. It will be owned and operated by the Hungarian state.

But the project has been stalled for years and will likely be discussed on Wednesday. (Writing by Krisztina Than, editing by Ed Osmond)

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