Business

Decision on LNG terminal on Krk Delayed for Next Year

A floating LNG terminal seems to be the best solution.

The investment decision on the floating LNG terminal at Omišalj on the island of Krk will be made in the first quarter of 2018, and the first gas from the terminal should be available to customers by early 2020, said Goran Frančić, CEO of LNG Croatia, speaking at the international gas conference on Wednesday, reports tportal.hr on May 3, 2017.

He said that the next step in the process was the drafting of technical documentation, the conceptual and the main project, and the drafting of the environmental impact study, in order to obtain location and building permits. The company has also issued a request for a concession. He said it was important to continue with the “open season” for the lease of the LNG terminal capacity, since the leasing companies want to know the final gas price. He said that the market would decide whether LNG would be competitive.

Frančić added that this summer, LNG Croatia would announce a tender for the ship and for the construction of an infrastructure connection to the transport system, which will mean that the price of the entire investment will then be known.

''If everything goes according to the plan, we will make the investment decision in the first quarter of next year, and that will depend on how the market will respond and on the income needed for the investment.'' said Frančić.

He stressed that the European Commission had decided to co-finance the LNG terminal with 102 million euros and added that the rules for the use of funds had been strictly defined and that the money would be used for the purchase of the ship.

''If there are no surprises, in late 2019 or early 2020 we would have the first gas in the transport system available to customers.'' Frančić stated.

Tvrtko Perković from INA said that his company had positive business results last year in almost all business sectors and that this was the result of the company’s efforts in the last few years. He announced that the company would focus on exploration and the renewal of reserves in the next period.

Ivica Arar, CEO of Plinacro, said that he hoped the reduction in gas tariffs would not affect development, which, on the other hand, could be positively influenced by the EU funds, as well as Croatia's involvement in European transport projects. In the new investment cycle, major projects will be the ones connecting Croatia with neighbouring countries, said Arar.

CEO of Prvo Plinarsko Društvo (First Gas Society) Pavao Vujnovac said that this year had offered the opportunity of an open market to all participants, but the state decided to extend its regulations.

''We need to work on technology development and create the prerequisites for full liberalization of the market in the next period all together.'' he said.

The international gas conference will last until Friday, and it has brought together around 600 participants from 20 countries. The main topics are energy strategies and gas in the future energy sector, smart technology in the gas and energy systems, gas infrastructure development, gas distribution systems and technical regulations.

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