Hungary's Import Dependency May Fall on New Plant - MOL CEO

By Veronika Gulyas

BUDAPEST--Hungary's largest oil and gas company MOL Nyrt. (MOL.BU) laid the cornerstone of a butadiene plant in a move that may decrease Hungary's dependency on imports of the chemical, the company's chief executive said Tuesday.

MOL is set to invest 120 million euros ($162.7 million) in the plant of its petrochemical arm TVK, part of the company's 300-billion-forint ($1.37 billion) three-year investment scheme.

Production of butadiene, a component used in synthetic rubber production, will be supplied to tire makers across Hungary, MOL CEO Zsolt Hernadi said at an event in Tiszaujvaros, northeast Hungary.

The butadiene plant could help boost TVK's profits, because production of the chemical is more profitable than of other polymer products produced by TVK, MOL said in a statement.

The new plant will have an annual output of 130,000 metric tons from the second quarter of 2015, MOL said.

MOL was trading 0.6% higher at HUF15,290 at 1116 GMT Tuesday.

Mr. Hernadi was speaking in public for the first time since a Croatian court issued an international arrest warrant against him. He is wanted for a hearing related to a bribery case. Croatia earlier sentenced a former prime minister Ivo Sanader, saying he had accepted bribes to allow MOL management to have rights over Croatian peer INA d.d (INA.ZG).

Mr. Hernadi didn't comment on the case. MOL is focusing on business as usual and is committed to solving any problems and issues that come up, he said.

MOL previously said Hungarian authorities had dismissed the allegations against MOL, which now holds a 49.1% share of INA. Hungary's government holds a 24.6% stake in MOL.

Write to Veronika Gulyas at [e-mail]