Bloomberg News

Croatia, Hungary Discuss Cooperation in Energy, LNG Krk Terminal

May 25, 2012

Croatia and Hungary may cooperate in several energy projects, including an LNG terminal on the Croatian island of Krk and investing in wind power plants in next European Union member, Economy Minister Radimir Cacic said.

“Hungary has shown a great interest in participating in the building of a liquefied natural gas terminal on the island of Krk, which for us is also very important,” Cacic said in a phone interview, after meeting with Pal Kovacs, Hungary’s state secretary for national development, earlier this week in Zagreb.

“It would be a win-win project, as through interconnectors in Hungary we could supply Slovakia and Poland on one side and Romania on the other,” Cacic said. He also said Croatia would aim “at a starting position of holding a 25 percent plus one share package” in the project.

Cacic said on April 18 Croatia will build a liquefied natural-gas terminal on Krk by 2016 to supply countries in the region, taking over a previous plan backed by international partners.

The project would connect to the proposed Trans Adriatic Pipeline, a regional natural-gas project. Adria LNG, with partners E.ON AG (EOAN), OMV AG (OMV), Geoplin d.d. and Total SA (FP), originally considered building a terminal on Krk, near Italy, before its licenses for the project expired.

“Other investors are welcome as well,” Cacic said. Qatar’s state oil company, Qatar Petroleum, is “also interested,” he said.

Macquarie Interest

Macquarie Group Ltd. (MQG), Australia’s largest investment bank, is also interested in the Croatian government’s plan to build an LNG terminal, Mark Dooley, the executive director for Macquarie Capital Europe in London, said by phone on May 18.

Natural-gas consumption in the former Yugoslav region and Albania will double by 2020 to 11 billion cubic meters (385 billion cubic feet) of gas a year, according to a study released in October by Plinacro d.o.o., a state-owned gas pipeline operator. Croatia intends to meet the increased demand, spurred by economic growth and rising environmental concerns, by building the terminal.

Hungary has also shown interest in investing into wind power plants in Croatia and leasing them from Croatia, Cacic said.

To contact the reporter on this story: Jasmina Kuzmanovic in Zagreb at jkuzmanovic@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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