Contract signed for the construction of four gas pipelines worth €533.1 million

The project ‘Strengthening Gas Infrastructure’ will see the construction of four gas pipelines in Croatia by mid-2026, significantly increasing the capacity for transporting natural gas from the LNG terminal on Krk, it was highlighted on Friday during the signing of the contract for financing this project.

The contract was signed by the Ministry of Economy and Sustainable Development, the Fund for Environmental Protection and Energy Efficiency, and the company Plinacro, which is allocated €533.08 million based on the amendment to the National Recovery and Resilience Plan 2021-2026.

The construction of four gas pipelines is planned: Zlobin – Bosiljevo, Bosiljevo – Sisak, Kozarac – Sisak, and Zabok – Lučko, through which gas from the LNG terminal on Krk will be transported to Slovenia, Hungary, and other countries in Southeast Europe.

– All gas pipelines will have the capability of gas flow in both directions and will be included in the monitoring and management system of the gas transport network of Plinacro – it was emphasized during the signing of the contract at the Ministry of Economy and Sustainable Development.

The head of the ministry, Damir Habijan, stated that the signing of this contract is of great importance for the continuation of the energy transition, as well as the transformation of the entire energy system.

With the Russian aggression against Ukraine, there has been a greater need for secure natural gas supply at the level of the European Union, thus also for additional investments in gas infrastructure itself, said Habijan, recalling that in August 2022, a decision was made to expand the capacity of the LNG terminal on the island of Krk from the current 2.9 billion to 6.1 billion cubic meters of natural gas annually, as well as to construct the Zlobin – Bosiljevo pipeline.

Greater security of supply for Croatia and neighboring countries

The project is financed from the NPOO within the REpowerEU plan, and the CEO of Plinacro, Ivica Arar, thanked the Government and the relevant ministry for their engagement in ‘securing non-repayable funds for the gas infrastructure strengthening project’.

– This significant investment, thanks to the non-repayable funds provided by the Government, will not affect the increase in gas transport tariffs – emphasized Arar, who listed the benefits of the project, in addition to increased capacity, as reducing dependence on Russian gas and greater security of supply for Croatia and neighboring countries.

Arar noted that at this moment, Plinacro can transport 260 million cubic meters of gas annually to Slovenia, and with the construction of the pipeline, this will increase to 1.5 billion. Regarding Hungary, the current capacity of 1.7 billion cubic meters of gas will increase to 3.4 billion cubic meters, Arar noted, adding that the total length of the four pipelines reaches 220 kilometers. Arar believes that Plinacro will manage to meet the ‘extremely short and demanding deadlines’ for completion of construction by mid-2026.

The director of the Fund for Environmental Protection and Energy Efficiency, Luka Balen, stated that the project, besides contributing to Croatia’s energy independence and diversification of supply sources for the entire EU, is also important due to the infrastructure that will be able to be used ‘today or tomorrow’ for hydrogen transport,’which is extremely important in the green transition’.

Balen announced that the Fund is also launching a tender for the procurement of electric vehicles for citizens today, for which nearly €15 million is planned.

The deputy director of the Fund, Mirko Budiša, emphasized that this is one of the largest investment projects from the NPOO related to the energy system. The Fund is an intermediary body in the project, which is also working on more than 3,000 other projects, with a total value exceeding €4.5 billion, Budiša reported.