Page 87 - SE Outlook Regions 2022

Meanwhile, Croatia intends to challenge a 2016 ruling by the United
Nations trade tribunal upholding a deal that has given control of INA to
Hungary’s MOL. The government decided to take legal action after the
Croatian supreme court upheld the guilty verdicts against former
Croatian prime minister Ivo Sanader for taking a bribe from MOL head
Zsolt Hernadi in October. The review motion must be filed by February
8, and a response is expected by the end of 2022.

Croatia will not proceed with the plan to buy back MOL’s stake until the
new legal action is completed. Economy Minister Tomislav Coric said
the two parties had different views on the price of the stake and were
unable to reach an agreement until now.

At the end of December, Croatian state oil pipeline operator Janaf
extended its agreement for crude oil storage with BP Oil International
and inked a new contract with Lukoil Croatia. The annex to the contract
for crude oil storage extends its term from April 1, 2022 to March 31,
2023. Janaf also inked a deal with Lukoil Croatia on the storage of
petroleum products from January 1, 2022 to end-December 2023.

Janaf operates 622 kilometres of pipelines and has crude oil and oil
products terminals on the island of Krk, as well as in Sisak, Virje,
Slavonski Brod and Zitnjak.

3.4.5 Construction

Croatia’s construction sector should pick up in 2022 as the works
recovery from two earthquakes in 2020 is expected to intensify.

The sector started showing signs of recovery in 2021 with the volume of
construction works increasing by 10.6% through September, according
to the latest available statistics office data. Construction works on
buildings moving up by 10.9% y/y, while civil engineering increased by
10% y/y.

Among the projects expected in 2022 is also the construction of a
sustainable nature resort by the hotel operator Valamara River, in which
HRK223 will be invested in 2022. The sum will be invested by Helios
Faros, in which Valamara River is a minority shareholder.

The nature resort is a new concept from Valamar for a sustainable
eco-friendly village for family holidays that should implement the use of
ecologically acceptable building materials with minimum impact to the
environment, usage of energy from renewable sources and high level of
energy efficiency.

In the longer term, Helios Faros intends to invest HRK800mn in
sustainable tourism by reconstruction and construction of three hotels
and resorts of four and five stars.

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