Krk Island LNG Terminal Capacity Booked, Gas Prices Could Go Down, Says Minister

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Photo by Johannes Havn from Pexels

Photo by Johannes Havn from Pexels

ZAGREB, June 16, 2020 – Environment and Energy Minister Tomislav Coric has said that, now that 98% of the capacity of the liquefied natural gas (LNG) terminal on Krk island has been booked, the LNG Croatia company’s revenue in the next five years will exceed €100 million, and gas prices could go down.

“The completion of this project and its inauguration on 1 January 2021 puts Croatia on Europe’s energy map. The project primarily provides for the security of energy supply in Croatia and contributes to the EU’s energy supply security, and it helps avoid any additional costs for our citizens… we expect the price of natural gas in Croatia in the coming period to drop,” Coric said on Tuesday.

LNG Croatia’s income in the next five years is estimated to exceed €100 million, Coric said, adding that this should provide the terminal’s owners, the HEP power provider and the Plinacro gas company, with very decent revenues.

“With this project, launched two and a half years ago, we have shown that big infrastructure projects, if managed well, indeed make sense and that based on our energy development strategy for the period until 2030 Croatia is moving along the path of increasing energy self-sufficiency and energy system efficiency,” said Coric.

Asked about the participation of Hungarian companies in the project, given that Hungary was at one time interested only in ownership of LNG Croatia and not in renting its capacity, Coric said that in addition to an EU grant, Croatia had decided to finance a part of construction work on the terminal from the state budget while the rest was financed by corporate investments and loans.

He said that he was glad the terminal’s capacity had been leased to more than one client and noted that he did not see any reason for Hungary to enter the ownership structure of LNG Croatia.

Coric said that the terminal was built in line with the highest environmental, security and other standards and that he believed resistance to it by the local population and environmental organisations would wane.

LNG Croatia director Hrvoje Krhen said the terminal would be put into operation on January 1, 2021.

The entire capacity of the LNG terminal on Krk Island has been booked for the next three gas years, LNG Croatia said on Monday, adding that part of the capacity has been reserved by Powerglobe Qatar LLC.

Pursuant to the rules of use of the terminal for liquefied natural gas, all available capacities have been entirely booked with the latest reservation made by Powerglobe Qatar LLC, which has booked gas capacities up until the 2034/2035 gas season, the company said.

The terminal has a technical capacity of 2.6 billion cubic metres a year.

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