MOL GROUP Annual Report

The most important events of 2010The construction of the Romanian and Croatian Interconnectorwas successfully completedThe transmission through the interconnectors between theHungarian and Romanian natural gas transmission networksstarted in July 2010. The Hungarian section of the pipeline is47 km long and has a maximum capacity of 4.8 million m3 /day. The total value of the investment was HUF 9 billion. TheHungarian-Croatian interconnector, Városföld–Slobodnicawas also completed. The Hungarian section of the pipeline is205 km with a maximum capacity of 19.2 million m3/day. Costsof the investment in Hungary amounted to HUF 80 billion. Bothpipelines are suitable for bidirectional transmission thereforethe implementation of the interconnectors considerablyimproves the safety of supply as with the completion of theinterconnectors the domestic gas pipeline network may havefour input points in addition to the previous two.During the pipeline construction works completed in 2010,FGSZ paid special attention to the protection of the naturalresources of the area concerned, environment and natureprotection and the improvement of air purity. The companyalso maintained regular contact with the public and socialorganizations during the construction works.OutlookNorth-South Gas Corridor and NETS cooperationThe North-South Gas Corridor is one of the key projects ofthe European Union. Its main objective is to diversify the gasresources of the region between the Baltic Sea and the AdriaticSea and create an integrated gas market. These goals areattainable through the strategic cooperation of the regionalnatural gas supplier companies and the establishment ofcommon directives in terms of energy policy. FGSZ’s ProjectNETS (New European Transmission System) provides a framefor the creation of the North-South Gas Corridor.In order to achieve the aims described above, FGSZ launchedthe preparation works of the construction of the Hungarian-Slovakian interconnector and also conducts further negotiationsregarding the Slovenian interconnector. The former wouldfacilitate the creation of the North-South Gas Corridor whilethe latter would contribute to the possible construction of theHungarian-Slovenian-Italian transmission system.Gas TransmissionFGSZ operates under Independent Transmission Operatormodel (ITO)The publication of Directive 2009/73/EC brought aboutfundamental changes for FGSZ Zrt. In the spirit of enhancingmarket liberalization, this directive established a newcomprehensive framework for natural gas takeover, storageand distribution, including the regulation of the company’soperation. The EU directive was included in the Hungarianlegislation with the appropriate amendments as a resultof which in the future FGSZ operates under a new modelcalled ITO (independent transmission operator). During2010 the Company implemented all the necessary measuresto continue its operation under the new system operationand gas transmission model following the deadline forsubmitting the licence application.Daily Natural Gas & Capacity Market (NFKP) a new specialelectronic trading platform for natural gasPursuant to Act XL of 2008, FGSZ Zrt. provides a new type ofservice for its clients as of 1 July 2010. With the establishmentof the Daily Natural Gas & Capacity Market (NFKP) a specialelectronic trading platform was created where natural gastraders, private users, natural gas producers and other systemoperators – such as natural gas storage operators or distributionsystem operators – can sell and buy natural gas and highpressuregas transmission network capacities. Due to NFKP,market players can plan their daily tasks more effectively andthe risk posed by day-end balancing is also lower therefore theycan provide end users with smoother and more reliable services.NFKP represents an important step towards FGSZ’s long-termobjective which is the establishment of a more competitiveHungarian natural gas market with higher liquidity.Beregdaróc Compressor Staion in Hungary38 MOL Group annual report 2010 39