Croatia is preparing to fill the regional energy gap after the war in Ukraine exposed the European Union’s dependence on Russian fossil fuels. In this context, as reported by the Financial Times this morning, Croatia could emerge as a winner from the European energy crisis.
Currently, plans are underway to double the capacity of the Adriatic Pipeline to 2 million tons per month, which should assist EU member states with terminals and refineries connected to the pipeline and seeking to reduce their dependence on Russian gas. Additionally, the capacity for importing liquefied natural gas is also increasing, while analysts believe that the investment cycle in wind and solar energy should enable Croatia to become a net energy exporter.
– Croatia has a good chance of becoming the ‘energy gateway’ for a number of neighboring Central European countries in the current energy geopolitical situation – said Igor Dekanić, a professor at the Faculty of Mining, Geology and Petroleum Engineering at the University of Zagreb, to the Financial Times.
Croatia began diversifying its energy sources before the attack on Ukraine, importing an increasing amount of oil from Azerbaijan and Kazakhstan, while reducing oil imports from Russia by just over a quarter of total imports in 2020. Furthermore, LNG imports, mainly from the USA, have replaced Russian supplies.
However, they could now profit if they become a larger supplier to neighbors forced to diversify their energy imports, collecting increased fees for the transshipment of oil and LNG. For example, MOL, headquartered in Budapest, relied on a pipeline that pumps Russian oil through Ukraine to supply its refineries near Budapest and Bratislava. However, this model is now threatened by EU sanctions, potential war damage, or Russia’s decision to halt supplies, as recently occurred with gas through the Nord Stream pipeline. MOL’s backup option is the Adriatic Pipeline, which would allow it to reduce dependence on Russian oil.
