The Naftogaz Group has signed a memorandum with the Hungarian energy company MOL on the construction of storage facilities for petroleum products to meet Ukraine’s needs. The facilities are planned to be built in Hungary, near the Ukrainian-Hungarian border, to safeguard part of the reserves from Russian attacks and to diversify supplies. The agreement was announced by Serhiy Fedorenko, acting chairman of the Naftogaz board.
Briefly about the main points
- The memorandum sets out future storage capacity for petroleum products.
- The facilities are to be built near the Ukrainian-Hungarian border.
- Stocks held abroad should be less vulnerable to shelling.
- «Naftogaz» is expecting a more reliable supply for Ukrainian consumers.
- The capacity, budget and project timeline have not yet been announced.
The project is currently at the memorandum stage
The agreement concerns the construction of new storage facilities for petroleum products intended for the Ukrainian market. The location near the border is intended to combine the use of Hungarian infrastructure with convenient logistics for onward supply to Ukraine.
The parties announced the signing of a memorandum, rather than the start of construction. The details of the future project, including its capacity, cost and timeframe, are to be determined in subsequent stages of the agreement.
Overseas reserves should reduce the vulnerability of the fuel market
The need for additional storage facilities is linked to Russia’s ongoing attacks on Ukraine’s fuel infrastructure. Storing some petroleum products outside high-risk areas could reduce the market’s dependence on individual facilities that could be damaged as a result of shelling.
According to Fedorenko, the diversification of supply routes and the establishment of stockpiles outside areas at risk of attack are among the factors contributing to the stability of the fuel market. In «Naftogaz»It is expected that the new capacity will improve the reliability of fuel supplies to Ukrainian consumers.".
The agreement was signed at the Carpathian Economic Forum
The signing of the memorandum on 20 September was announced following the Carpathian Economic Forum, which took place as part of the Carpathian Eight Summit. Naftogaz described the cooperation with MOL as one of the agreements reached during the event.
According to the government, investment, financial and trade agreements worth over €1 billion were concluded at the forum, almost half of which relate to the energy sector. This figure does not represent the value of the Naftogaz and MOL project: the financial details of the future facilities have not been disclosed separately.
