The Hungarian and Russian governments are set to sign an agreement on constructing the Hungarian section of the Southern Stream natural gas pipeline which will bring Russian natural gas to Europe, in Moscow on Thursday, Hungarian Prime Minister Ferenc Gyurcsany said on Monday.
"There is one more agreement we want to sign in the next few days. This is an agreement on an arm of the so-called South Streamproject going through Hungary," Gyurcsany told a press conference after talks with Russian Deputy Prime Minister Dmitri Medvedev in Budapest on Monday.
Gyurcsany said the ownership of the Hungarian project would be split down the middle. "We agreed today on a joint venture with 50-50 percent ownership. Hungary will be represented by a 100-percentstate-owned firm," Gyurcsany added.
The gas depot to be located in Hungary as part of the project would take in a minimum of 1 billion cubic meters of gas, the South Stream project has a payback period of 15 years and will cost about 2 billion U.S. dollars to put into practice, the prime minister said.
Gyurcsany said the deal didn't pose any threat to Nabucco, as the two pipelines could exist side-by-side.
Nabucco is backed by European Union, which aims to reduce Europe's reliance on Russian gas by bringing in Middle Eastern gas through Turkey.
The South Stream pipeline will bring Russian gas in under the Black Sea and is expected to end in Italy, with a branch to Austria.
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