Croatian minister: State-owned pipeline Janaf can fully meet Hungary’s oil needs

NEWS 31.05.2022 21:48
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Source: Matija Habljak/PIXSELL

Economy and Sustainable Development Minister Davor Filipovic said on Tuesday that he and Hungarian foreign minister Péter Szijjártó had discussed the security of energy supply against a backdrop of Russian aggression against Ukraine.

Minister Filipovic also said that the capacity of the JANAF oil pipeline infrastructure of 11.4 million tonnes could fully meet Hungary’s needs.

“Croatia is here to secure oil supplies to Hungary and other EU countries,” Filipovic told the press after the meeting, stressing that Croatia would be a good neighbour to Hungary with regard to energy supply, especially oil, in the coming period.

He reiterated that the REPowerEU plan envisages numerous investments in energy infrastructure, which Croatia was planning to use primarily to expand LNG capacities, strengthen the existing  Plinacro gas pipeline networks and JANAF capacities in order to position itself as an important factor on the energy map of Europe. He added that Croatia was ready to be a partner to Hungary in energy supply, as well as to other European countries.

He said that the existing capacities of the JANAF oil pipeline infrastructure were not even close to being fully used, saying that this year “slightly more than 500,000 tonnes of oil” went to Hungary.

During the latest summit in Brussels, the European Union agreed on a new set of sanctions whereby seaborne oil imports from Russia would be immediately banned. Two thirds of the Russian oil imported by the EU comes via tanker and one third by the Druzhba pipeline. In case of problems with the Druzhba pipeline, Hungary will be able to get oil through Croatia.

At the summit, Croatian Prime Minister Andrej Plenkovic said that JANAF could expand its capacity by 30% within 20 to 30 days, and with investments of only eight million euro. He also said that JANAF transfers 11.4 million tonnes of crude oil per year, and by expanding the capacity by 30% the amount could increase to more than 15 million tonnes, so Hungary and Slovakia could be supplied in an orderly manner.

Arbitration reward pending regarding buyback of INA shares

Asked whether Croatia would take advantage of the situation of Hungary’s dependence on JANAF in negotiations on buying back Hungarian energy group MOL’s stake in Croatian peer INA, Filipovic today recalled that an arbitration process had been launched at the Swiss Federal Supreme Court and that the Croatian side was waiting for a review of the arbitration award in order to decide what to do.

In late 2021, the government tasked the Ministry of Economy and Sustainable Development with requesting the Swiss Federal Supreme Court to review a decision of the UN Commission on International Trade Law (UNCITRAL) of 23 December 2016 in order to declare null and void an amended agreement on relations between INA shareholders and an agreement on INA’s gas business, both signed in 2009. The decision was made due to new legal circumstances stemming from the Supreme Court’s final ruling against former PM Ivo Sanader, who was found guilty of receiving bribes from MOL executive Zsolt Hernadi. Due to those circumstance, the government had then decided to suspend the buyback of INA from MOL.

Asked whether the government would extend its decision on excise duties on fuel prices, which expires tomorrow, Filipović said that the government would continue to take care of Croatian citizens and that it continually monitored the situation.

“If we estimate there is a need for that, we will stand by our citizens like we have done so far,” said Filipovic, adding that the public would be informed about everything.

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