Russia-Hungary agree on a gas supply deal bypassing Ukraine effective from October 1.

Hungary will annually receive from Russia 4.5 billion cubic meters of gas: 3.5 billion via Serbia through the Turkish Stream gas pipeline and its overland extension, and 1 billion cubic meters via Austria. The new contract is for 15 years with the possibility of terms renewal in 10 years. Most of the volume will through a new interconnector on the country’s border with Serbia. Until now, most of Hungary’s gas import have been from Russia, supplied through Ukraine.

Ukraine’s pipeline company expect to receive $1.3 billion this year to move gas from Ukraine’s Russian border to the EU

. $1 billion of this amount is spent on running the pipeline company — paying 11,000 employees and performing maintenance. Without a long term transit contract after 2024, the pipeline network will only serve 10 bcm of imports and 20 bcm of domestic production. To survive, he said, the company would have to decommission “more than 50%” of current capacity.

Ukraine must show “goodwill” if Russia is to continue shipping its gas across Ukraine after the expiration of the Gazprom contract at the end of 2024,

 President Putin told the annual St Petersburg Forum investment conference on Friday. According to TASS, he said: “There is a possibility to use Ukraine’s gas transport system in the future, even after our current contract expires. Everything is possible and we are ready for it and want it but goodwill from our Ukrainian partners is needed.”