BUDAPEST Nov 29 Hungary's state-owned energy
firm MVM may sign a deal with E.ON to buy the German
utility's local gas trading and storage units before the end of
this year, a source familiar with the situation told Reuters.
"There are intensive talks under way," the source said on
Thursday on condition of anonymity, adding there "might be some
kind of an agreement signed before the holiday season."
MVM and E.ON declined to comment. The Hungarian government
was not immediately available for comment.
Hungarian newspaper Vilaggazdasag said, without naming its
sources, MVM was likely to pay closer to 800 million euros for
the units than 1.2 billion euros, a figure earlier quoted in
local media as the price sought by E.ON.
Hungarian Prime Minister Viktor Orban said in late August
his right-of-centre government would "buy back E.ON from the
Germans momentarily", but there have been no further
announcements since then.
Nationalising E.ON's local units could give the
government control of gas imports and long-term energy prices,
E.ON's gas wholesale unit, E.ON Foldgaz Trade Zrt, is
Hungary's biggest gas trader, supplying gas distributors and,
thus, the household sector in the country of 10 million.
Its storage unit, E.ON Foldgaz Storage Zrt, operates four
gas storages with a total capacity of 4.2 billion cubic metres.
Hungary, whose position at the heart of central Europe gives
it an important role as a gas-shipping route, gets over 80
percent of its annual gas consumption of 11-12 billion cubic
metres through imports, mostly from Russia.
The price of natural gas has always been an important
political issue in Hungary which has a long-term gas deal with
Russian group Gazprom expiring in 2015.
If MVM bought E.ON's gas operations, the government could be
in a position to negotiate a new contract.
Hungarian oil and gas firm MOL sold its gas
business to E.ON in 2005.
(Reporting by Krisztina Than; Editing by Andrew Callus and Mark