Monday, 20 June 2022

Croatia to Boost its LNG Capacity from 2.9 to 6.1 Billion Cubic Metres

ZAGREB, 20 June 2022 - Croatia will expand the capacity of its LNG terminal off Krk Island from 2.9 billion to 6.1 billion cubic metres, Prime Minister Andrej Plenković said in Riga on Monday while attending the Three Seas Initiative summit meeting.

The Three Seas Initiative, launched by Croatia and Poland, is an informal political platform of 12 countries located between the three seas -- Baltic, Adriatic and Black -- with the aim of boosting their energy, transport and infrastructure connectivity.

Addressing the meeting in the Latvian capital city, PM Plenković said that the increased capacity of the LNG terminal to 6.1 billion cubic metres was far above Croatia's needs.

This increase will enable Croatia to become a regional energy hub, which is also beneficial to our neighbouring countries: Slovenia, Bosnia and Herzegovina and Hungary said Plenković.

The premier also commented on transport connectivity and highlighted the pan-European 5C corridor from Hungary via Croatia and Bosnia and Herzegovina reaching the southern Croatian seaport of Ploče.

The Three Seas Initiative was born out of a shared interest in developing transport, energy and digital infrastructure connections on the EU’s north-south axis.

The initiative was launched in 2015 at the proposal of the then Croatian president Kolinda Grabar-Kitarović and her Polish counterpart Andrzej Duda.

The very first summit meeting was held in Dubrovnik in 2016, while the initiative's investment fund now stands at €928 million.

According to U.S. Secretary of State Antony Blinken who addressed the summit meeting via video, new American contributions will raise this amount above a billion euros.

Plenković said that the Three Seas Initiative Investment Fund (3SIIF) is the most logical way for making investments in energy, transport and digital projects in Croatia.

The contribution of Croatia's development bank (HBOR) in this fund stands at €20 million. Croatia is currently proposing 11 projects to be funded under the 3SIIF-financed schemes.

Apart from Plenković, several heads of state or government arrived in Riga for the two-day event.

The executives of several Croatian companies, including Končar, the Luka Rijeka port, and Plinacro, are also taking part in the business conferences in Riga today and tomorrow.

Tourists from the countries covered by the Three Seas Initiative account for 40% of guests visiting Croatia.

This group of countries is interesting for Croatia, and furthermore, they are also part of our Central European identity, said Plenković.

During his visit, he will hold several bilateral meetings, including a meeting with Latvian President Egils Levits and Google Vice-President Karan Bhatia.

Ukrainian President Volodymyr  Zelenskyy addressed the Riga event via a video link.

The next summit meeting will take place in Romania.

These countries: Austria, Bulgaria, Croatia, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, and Slovenia make up the initiative.

For more, check out our politics section.

Monday, 30 May 2022

Plenković: Investment Decision on Expansion of LNG Terminal Very Close

ZAGREB, 30 May 2022 - Croatia will most likely decide to expand the existing floating LNG terminal on Krk Island and an investment decision is very close, Prime Minister Andrej Plenković said in Brussels on Monday.

"Various options exist and the best and most effective one is an investment in the existing terminal to increase its capacity," Plenković said ahead of an EU summit where the main topic will be Ukraine and the consequences of the Russian aggression, which is why the EU is endeavoring to reduce its dependence on Russian energy and diversify its supply routes as soon as possible.

"In the current circumstances, despite it being a surprise to many, Croatia has the opportunity to become a real energy hub for Central Europe," Plenković underscored.

He added that an investment decision is very close regarding the expansion of the existing terminal so that it can be used by many countries in the neighborhood, Slovenia, Hungary, Bosnia and Herzegovina, and others.

Plenković did not wish to comment on Hungarian Prime Minister Viktor Orban's statement that excluding the Druzhba oil pipeline from a ban on Russian oil imports was a good approach but that Hungary needs a guarantee that it can import oil also in case of any incident occurring on the section of the pipeline that runs through Ukraine.

"I didn't hear what he said so I cannot comment but I can say that (Croatian oil pipeline operator) Janaf, which transports oil from Omišalj towards the mainland, including Hungary, is completely capable of supplying huge quantities of oil that are required by Hungarian refineries," said Plenković.

With regard to procuring vacuum gas oil that INA obtains from Russia for its refinery in Rijeka, Plenković said that "INA is not the only one in the world that needs vacuum gas oil, other refineries need it too and supply it from other countries."

According to a European Commission recommendation, Croatia could continue to obtain vacuum gas oil from Russia for the Rijeka refinery on the condition it does not have an alternative from other sources.

Plenković said that EU leaders will just "touch on" the subject of a sixth package of sanctions at the summit. EU leaders have not been able to come to an agreement on the matter for a month now because of Hungary's opposition and Plenković said the matter would be decided at the level of ambassadors and ministers.

The basis for discussion on the energy issue will be the European Commission's RePowerEU program, which says that the EU should invest in a joint effort to secure sufficient energy products and create an alternative network for its citizens and economies so as to be able to stop being dependent on Russian energy.

"Some countries' dependence on Russia has developed for years and that cannot be changed overnight," said Plenković.

For more, check out our politics section.

Wednesday, 3 November 2021

Could Blockchain Tech Reveal How Green Croatian LNG Terminal Really Is?

November the 3rd, 2021 - Blockchain technology is one of those things on everyone's lips of late, and while some tilt their heads in confusion, others are taking advantage. Could Blockchain tech reveal just how green the Croatian LNG Terminal actually is? Perhaps.

As Poslovni Dnevnik/Darko Bicak writes, gas is a generally accepted transitional energy source between the fossil and green eras, and in addition to the gas transported by standard pipelines, there's more and more gas from LNG. It is LNG that is increasingly the subject of analyses that question whether its use is really "transitional green" or whether it is ultimately closer to fossil fuels than anything else.

This is especially relevant here in Croatia because finally, at the beginning of this year, after decades of planning and design, the floating Croatian LNG Terminal in Omisalj on Krk was put into operation, which in the medium term should grow into a fixed project with a larger volume on the land.

As Gas outlook writes, the oil and gas industry is considering the use of Blockchain technology for digital monitoring of LNG freight transactions, and analysts estimate that this technology could be a solution to transparency concerns about carbon-neutral trading in this energy source.

The concept of a “carbon neutral” LNG isn't without its problems and Environmental, Social and Corporate Governance (ESG) and it is under the increasing control of investors, governments, lenders, employees and consumers. There are currently no standardised methods for accurately measuring and monitoring direct and indirect emissions associated with the entire LNG supply chain, but there are certain efforts that are emerging.

“There is concern among all stakeholders about the integrity of carbon dioxide reporting, the consistency and methodologies applied. Previous attempts by the industry have been fraught with problems of double counting, the origin of compensation, the transparency of verification methodologies and data quality issues,'' warned Scott Waller, consultant at EY.

This is particularly the case as the LNG industry seeks to extend and expand the use of natural gas - for example by using ships on LNG - in line with the argument that it compensates for higher emissions from the use of coal, oil and diesel.

At this point, there is a lack of evidence to substantiate this claim, but the UN estimates that Blockchain technology will be able to provide greater transparency around greenhouse gas emissions and facilitate the monitoring and reporting of reduced emissions.

This would solve the possible problems of double counting, as reporting and verification of climate measures are crucial to achieving the goals of the Paris Climate Agreement, and its even stricter modifications, some of which are likely to be agreed at the ongoing Glasgow Climate Change Conference in Scotland.

For more on the Croatian LNG Terminal, check out our business section.

Friday, 9 July 2021

Plenković: LNG Terminal Put Croatia on Energy Map of the World

ZAGREB, 9 July 2021 - The LNG terminal on the northern Adriatic island of Krk has put Croatia on the energy map of Europe and the world, Prime Minister Andrej Plenković told reporters in Sofia on Friday where he was attending a summit of the Three Seas Initiative.

The aim of this initiative is to connect the countries of Central Europe, from the Baltic to the shores of the Black Sea and the Adriatic. The initiative is backed by the United States, and Croatia, as a participant, has a number of projects, Plenković said, citing the LNG terminal on Krk island.

"This year Croatia has opened its LNG terminal at Krk, putting itself on the energy map not just of Europe but of the world as well. We believe that in this way Croatia has made a great contribution to cooperation in the energy sector as part of this initiative," the prime minister said.

The Three Seas Initiative was launched by Croatia and Poland at a meeting in Dubrovnik in the summer of 2016 to promote trade and infrastructure, energy and political cooperation in the region between the Adriatic, Baltic and Black Seas.

The LNG terminal at Krk is important to Croatia because it is connected to an existing terminal in Poland.

Plenković said that Croatia would use funds for projects that would benefit all countries participating in this initiative. 

The participating countries are: Austria, Bulgaria, Croatia, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia.

For more on politics, CLICK HERE.

Wednesday, 14 October 2020

Croatia FM: Cirkovce-Pince Transmission Line will Help Develop Electricity Market

ZAGREB, Oct 14, 2020 - Croatian Foreign Minister Gordan Grlic Radman said in Kidricevo, Slovenia on Wednesday that the construction of the Cirkovce-Pince transmission line would encourage the further development of the electricity market, thereby helping the EU's economic recovery.

Grlic Radman, Slovenian Prime Minister Janez Jansa and Hungarian PM Viktor Orban attended the laying of the cornerstone for the transmission line which will connect the three countries' power systems.

"Strengthening infrastructure links in central Europe is beyond question, notably between Croatia, Hungary and Slovenia, three neighboring, friendly states," said Grlic Radman.

The Cirkovce-Pince project includes the construction of an 80-kilometer-long 400 kV transmission line and it should be completed in 2022.

The construction of this transmission line "will facilitate better integration of the electricity market, ensuring supply and access to those markets in this part of Europe and encouraging the further development of that market," said Grlic Radman.

Besides cooperation at the political level, he welcomed "the excellent cooperation at an economic level" between the relevant companies, including Croatia's Dalekovod. 

He said the energy sector would be highly important for the EU's economic development, adding that Croatia "will focus even more on energy efficiency, renewable energy sources, energy storage and the completion of key infrastructure projects."

One of those projects is an LNG terminal off Krk island which should be put in operation next year. Grlic Radman also underlined the Three Seas Initiative.

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Monday, 4 May 2020

MET Books Portion of Krk LNG Terminal Capacity for Three-Year Period

ZAGREB, May 4, 2020 - The MET Croatia Energy Trade company has submitted a binding offer to the LNG Hrvatska company to book capacities in the LNG terminal on the northern Adriatic island of Krk for a three-year period, amounting to 1.3 billion cubic meters overall, MET Croatia announced on Monday.

"Significant changes on the international energy markets are spearheaded by the rapid growth of global LNG trade, a development that MET Group welcomes. The Croatian LNG project will help Central and Eastern Europe to become an integral part of this global market. Furthermore, Croatian LNG imports will help MET Group link most of its downstream markets both from pipeline gas and from an LNG perspective as well," the company said in a press release.

Mario Matković, CEO of MET Croatia Energy Trade, said that that company was actively monitoring the global growth of demand for liquefied natural gas and increasing the volume of LNG delivered day by day.

"To succeed on the LNG market, apart from the specific knowledge with a global LNG desk, it is necessary to have a local presence, i.e. a market access for gas placement. We are the only player in the region that has both. Therefore, we have no doubt that booking the capacity in the LNG terminal in Krk will highly contribute to our long-term business strategy," Matković said.

MET Croatia, a member of MET Group, a European energy company headquartered in Zug, Switzerland, has been present in Croatia since 2013. The group employs 1,700 people in 15 countries, operates in 26 gas markets and is active in 22 international trading hubs. MET Group has been operating for 13 years and is the leading independent integrated energy company in the CEE region and other European markets including Spain and Italy, the statement said.

According to information available on the website of the LNG Hrvatska company, construction work on the floating LNG terminal is proceeding according to plan, and the terminal is due to start operating in early 2021. The terminal's technical capacity is 2.6 billion cubic metres annually.

The value of the investment project is estimated at €233.6 million. The European Commission has granted €101.4 million given that the project is listed among the Commission's projects of common interest.

More news about the LNG terminal can be found in the Business section.

Wednesday, 19 June 2019

Croatia and Hungary to Analyse Potential Cooperation in Gas Markets

ZAGREB, June 19, 2019 - Croatian Energy and Environment Protection Minister Tomislav Ćorić and Hungarian Foreign Minister Peter Szijjarto on Wednesday agreed on setting up a working group tasked with analysing the potential cooperation on the gas markets of the two neighbouring countries.

After their talks in Zagreb on Wednesday morning, Ćorić said that they had discussed the possibilities of developing cooperation between the Croatian and Hungarian gas markets.

We have agreed on establishing a working group consisting of Croatian and Hungarian experts and in the coming months it will analyse potential pros and cons of such form of cooperation, Ćorić said.

The Hungarian minister confirmed that operators of the gas transport systems and national regulators would be included in this task.

This will be the closest cooperation between the Croatian and Hungarian gas markets so far, he added.

I would like underscore that we treat the diversification as a crucial issue. An LNG terminal is a realistic scenario and we believe that partnership can help us to be partners in this project and make it innovative from the view of the energy security of the region of Central Europe. Therefore we have agreed to continue our talks, Szijjarto said.

As for the gas supply diversification, he recalled that Hungary had already expressed readiness to negotiate a possibility for Budapest to have a 25-percent interest in the future company that would run and own the LNG terminal off the Croatian terminal of Krk.

Such cooperation could create a market situation whereby the purchase of the LNG gas at that terminal could be economically visible and competitive for us, the Hungarian minister said.

Ćorić said that he found this form of cooperation a positive step forward.

Such cooperation is expected to result in combination of stakes held by owners and the lease of capacities in the terminal. However, he admitted that there are differences in which steps to be taken in that regard.

More energy news can be found in the Business section.

Wednesday, 5 June 2019

US Secretary of Energy: LNG Terminal in Croatia Will Be Profitable

ZAGREB, June 5, 2019 - New gas sources in Southeast Europe, such as potential exploitation in the Romanian Black Sea, do not endanger the profitability of building an LNG terminal at Krk island, Croatia as the demand for this energy source will only grow, while its price will fall, US Secretary of Energy Rick Perry said in Ljubljana on Wednesday.

Croatia's Večernji List daily said recently the potential exploitation of gas in the Romanian part of the Black Sea, in which the US company ExxonMobil has the lead role, would make the already modest capacities of the LNG terminal in Croatia irrelevant for the broader region.

The paper also said that Hungarian Prime Minister Viktor Orban, whose country has submitted a bid for a 25% stake in the Croatian LNG project, said upon returning from Washington that the US project in Romania had been the "first and most important topic" of his talks with President Donald Trump.

Critics of the construction of the LNG terminal in Croatia also note that the 20 or so such terminals already existing in Europe work at 25% capacity.

I think those arguments are not legitimate, said Perry, who arrived in Slovenia to attend a Three Seas Initiative summit. You will need much more gas than we will be able to deliver, he said, adding that the appetite for cleaner energy sources was increasing in Europe.

If Europe wants an economic transition, it will need more energy, Perry said, adding that Germany planned to abandon nuclear energy.

Either the lights will go out or they will use LNG. There is no third option, he said about Germany, adding that the US supported the construction of the Krk terminal. Not necessarily for the purchase of US gas, he said, but because more routes and suppliers are a good formula for Europe which cannot be free and sovereign if it depends only on Russian gas.

Russia currently sells gas at a lower price, but Perry said the price of US gas was constantly falling, that this would continue and that US natural gas reserves were massive.

He also said climate change could not be fought without nuclear energy free of harmful emissions. He announced a forum for next month between the European Commission and his department on Small modular reactors.

A panel discussion on energy on Wednesday afternoon marked the start of a business forum in Ljubljana, which is being held parallel to a summit of leaders of countries participating in the Three Seas Initiative, the largest international event held in Slovenia over the past decade with more than 600 participants from some 40 countries, including Croatia's President Kolinda Grabar-Kitarović.

Opening the business forum, Slovenia's Prime Minister Marjan Šarec said that only better connectivity in Europe, not just north-south but east-west as well, can secure a better and more successful future for new generations. Investment and cohesion funds that would be used for better digital and energy connectivity of Central and East Europe would also benefit the Western part of the continent.

Croatia's delegation in the energy panel included Environment and Energy Minister Tomislav Ćorić and an executive at the national electricity provider HEP, Robert Krklec.

Ćorić said that within the framework of the Three Seas Initiative, Croatia is focused on diversifying sources and routes of energy procurement. He also spoke about plans for the construction of an LNG terminal on the island of Krk, which should be operational in 2021.

US Secretary of Energy Rick Perry, who had met with Slovenia's President Borut Pahor and Prime Minister Šarec earlier in the day, attended the energy panel too.

There seemed to be some divergence of opinion between Perry, who said he was speaking on behalf of US President Donald Trump, and Miguel Berger from the German Economy Ministry concerning the Russian-German South Stream II gas pipeline and the EU's independence from Russia for energy supply.

Berger said that Germany supports the construction of an LNG terminal on Krk island, Croatia and that gas be imported from the USA as a means of diversifying supply routes, but that that has to be based on market principles. He also dismissed US claims that South Stream II jeopardises Europe's energy independence.

More LNG terminal news can be found in the Business section.


Saturday, 27 April 2019

Green MEPs Ask EC to Stop Supporting Croatia’s LNG Terminal Project

ZAGREB, April 27, 2019 - Zorislav Antun Petrović, leader of the nonparliamentary ORaH party, said on Saturday that nine members of the European Parliament from the Green group had asked of European Commission Vice-President Maros Šefčovič, in charge of Energy Union, that the EC immediately stop supporting the project to build an LNG terminal off the northern Croatian Adriatic island of Krk.

Petrović said that energy independence was in Croatia's interest and that it was achieved by investing in renewables rather than spending money to enable the import of foreign energy products in Croatia.

He said that energy transition was one of the key topics for the Green Left coalition (consisting of ORaH, the We Can! platform and the New Left party), which is running in the coming elections for the European Parliament.

Petrović said that in their letter to Šefčović, the nine Green members of the European Parliament said that not only was the LNG project in direct contravention of the EU's obligations assumed under the Paris Agreement but that they had noticed numerous irregularities in its implementation that so far had not affected the EC's support for the project.

Petrović said the Green MEPs cited in their letter a number of reasons why the project was unacceptable in its present form.

They asked the EC not to approve the assistance requested by the Croatian government for the project and not to renew the Projects of Common Interest (PCI) status for the LNG terminal on the fourth PCI list that is currently being worked on.

Petrović said the letter was signed by MEPs Thomas Waitz, Monika Vana (Austria), Max Andersson (Sweden), Reinhard Buetikofer, Sven Giegold (Germany), Philippe Lamberts (Belgium), Florent Marcellesi, Michele Rivasi (France) and Tilly Metz (Luxembourg).

More news about the LNG project can be found in the Business section.

Saturday, 13 April 2019

Hungary Offers to Buy 25% of LNG Terminal on Krk

ZAGREB, April 13, 2019 - The Hungarian government has made an offer to buy 25 percent of a LNG terminal that is to be built in Croatia, Hungarian Foreign Minister Peter Szijjarto told journalists in Dubrovnik on Friday, according to MTI news agency.

Szijjarto had talks with Croatia's Environment and Energy Minister Tomislav Ćorić on the sidelines of a China-Central and Eastern Europe summit and said it was crucial for Central Europe to diversify its gas supplies.

Szijjarto said it was in Hungary's strategic interest that the terminal should be built and that it should offer gas to Hungary at a competitive price. He added that the decision and the plans for the terminal have been in place, but "there has been no progress" in the physical implementation.

The Hungarian foreign minister said that Croatia had "not yet provided a clear answer" on the matter, as the country wants to take a decision on Hungary's offer at the same time as it contracts gas volume. Investing in the terminal is "a strategic issue" but "we will certainly not buy gas at a higher price than at present," he said, adding that the negotiations would continue.

Ćorić confirmed on Monday that he had received a letter of intent from Hungary to purchase a 25 percent stake in the future LNG terminal, adding that the interest in entering the ownership structure should be accompanied by an interest in the lease of gas from the LNG facility on the northern Adriatic island of Krk.

"A few weeks ago, Hungarian Foreign Minister Peter Szijjarto sent a letter of intent on behalf of the Hungarian government. Hungary is interested in buying 25% plus one share in the LNG terminal," Ćorić said then in response to questions from the press.

He said that talks with Hungary would continue at the summit of 16 Central and Eastern European countries and China in Dubrovnik. He noted that Hungary's demand for gas was considerably higher than Croatia's, given that Hungary's annual natural gas consumption ranges between nine and ten billion cubic metres, compared with Croatia's consumption of 2.7 billion cubic metres.

The value of the floating LNG terminal on Krk island is estimated at 234 million euro. The European Commission has approved a 101.4 million euro grant for the project, which is included on the Commission's list of projects of common interest.

The Croatian government has decided to set aside 100 million euro for the project, 50 million in 2019 and as much in 2020. The remaining 32.6 million euro will be provided by the founders of the LNG Croatia company - the HEP national electricity provider and the Plinacro gas network operator.

Ćorić reiterated that the construction of the LNG terminal was a strategic project for Croatia.

More news about the LNG terminal on Krk can be found in the Business section.

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