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Hungary’s MVM books capacity

at Croatian LNG terminal

HUNGARY HUNGARIAN state energy group MVM has MOL bid for a 25% stake in the Croatian ter-
booked capacity at the Krk LNG import termi- minal last year, but its offer was rebuffed, amid
The latest bids suggest nal being built in Croatia, the company said on concerns by the government that the purchase
the terminal will June 9, lifting the project’s commercial prospects. would lead to problems similar to those at INA.
operate at profit. The capacity was secured by MVM’s local The Hungarian firm, which owns a 49% stake in
subsidiary, MFGK Croatia, and covers the INA, is locked in a long-standing dispute with
annual import of up to 1bn cubic metres per year Croatian authorities over ownership rights and
of gas for seven years starting in 2021, when the investments.
terminal is due to start up. Croatian Energy Minister Tomislav Coric
The Krk project has a design capacity of 2.6 said on June 10 that Zagreb expected to start
bcm per year. It is expected to deliver gas not talks with MOL on a possible buyback of shares
only to Croatian customers but potentially oth- in INA by the end of June. Croatia has been try-
ers in Hungary, Italy, Montenegro, Serbia and ing to prize the stake back from MOL since 2016.
Slovenia. Its €234mn ($266mn) cost is partially The government owns close to 45% of the firm.
covered by a €101mn grant from the European “We must never sell our share in Krk because
Commission, which has listed it as an EU project it will be even more profitable in the future, as
of common interest (PCI). sales of natural gas will rise,” Croatian analyst
Earlier, Croatian media claimed that local Jasminko Umicevic commented.
energy companies HEP and INA, the latter of Analysts have cast doubts about whether the
which is part-owned by Hungary’s MOL, had Krk terminal is commercially feasible. But the
also booked 500mn cubic metres of annual latest bids suggest it should bring ashore more
capacity. Earlier this month MET Croatia Energy than enough gas to break even.
Trade filed an offer for 200 mcm of gas from the Despite its desire to access alternative gas
terminal in 2021 and 500 mcm over the follow- supplies, Hungary is assisting in Russia’s plan to
ing two years. lay a new pipeline into Central Europe, known
Hungary is anxious to diversify its sources of as Balkan Stream. Due to start operating next
gas supply. Russia is the country’s top supplier, year, Balkan Stream serves as an extension of the
shipping 10.5 bcm of gas last year, according to TurkStream pipeline than runs under the Black
data published by Russia’s Gazprom. Sea to western Turkey. ™

Week 23 11•June•2020 www. NEWSBASE .com P13