Hungary on Thursday denied media reports that the European Union blocked a 12-billion euro ($12.7 billion) nuclear deal between Hungary and Russia. The Financial Times (FT) had reported that the planned construction of two 1,200-megawatt nuclear reactors in the Hungarian town of Paks was blocked by the European regulator Euratom.
The decision, which was made privately, was reportedly taken at a meeting in Brussels last week.
“If the Russians now refuse to modify the original contracts, this will be the end of the road for the project,” Jávor Benedek, a Hungarian member of the European Parliament, told FT. “The report is very clear that the fuel supply agreement does not comply with European law.”
However, Hungary's Cabinet State Secretary András Giró-Szász “firmly denied” the report in a statement to Hungarian state news service MTI, Agence France-Presse and the Press Trust of India reported. "It is not true that the EU has blocked the Paks II construction," Giró-Szász said, and added that he has asked FT to issue a correction.
The European Commission and Euratom had no immediate comment, Reuters reported.
The plan would expand Hungary’s sole Soviet-era nuclear plant at Paks, which currently provides around 40 percent of the country’s electricity needs. The expansion was largely financed by Russian money, and contracts for building, designing, and maintaining the plants, worth at least 6 billion euros ($6.4 billion), were awarded to a subsidiary of Russian state nuclear company Rosatom in December. Construction was set to begin in 2018, FT reported.
Hungary currently relies on Russia for 60 percent of its gas imports, and 80 percent of its oil imports.
The decision to award the contracts to Rosatom without a public competition had prompted an inquiry by the European Commission into whether the deal violated EU policy. Hungary had last week announced that it would keep the details of the project secret for 30 years for national security reasons, and that it complied with similar guidelines in other countries, the Associated Press reported.
Russia has been expanding its reach through energy deals abroad, having recently inked nuclear agreements with South Africa, India and Iran, as well as gas deals with China and Pakistan.