Hungary and Russia plan to establish a joint venture for the preparation works of the South Stream natural gas pipeline, at the end of January, Hungarian business daily Vilaggazdasag said Thursday, without naming its sources.
The two parties are to sign the joint venture's foundation documents at Russian Deputy Prime Minister Victor Zubkov's visit to Hungary Jan. 28-29, the daily said.
The project company, to be called Deli Aramlat Magyarorszag Zrt., will be founded by Russian gas company OAO Gazprom (GAZP.RS) and Hungarian state-owned development bank MFB Zrt. The final decision on the investment, to be made at the end of 2010, will be based on the project company's work, the daily said.
The company will be led by Russian and a Hungarian chief executives, with the Hungarian post expected to be filled by MFB Invest Chief Executive Officer Csaba Bato, the daily said.
Through the South Stream pipeline, Hungary would receive natural gas from Russia through Romania and Bulgaria. Transport would be guaranteed by Gazprom's audited reserves.
Hungary is heavily dependent on imported gas, which has made it particularly vulnerable when Russian-Ukrainian disputes interrupted the flow of gas. Gas is the source of 40% of Hungary's total energy supply, and 80% of that gas is imported from Russia through Ukraine.