Croatia’s Prirodni plin to buy gas European traded hubs

21 November 2013 17:15 Source:ICIS

Croatia’s natural gas incumbent Prirodni plin will turn to Europe’s spot natural gas markets from next year to import gas rather than extend its long-term supply contract.

Prirodni plin, which is part of Croatian oil company INA, has an three-year deal for 750 million cubic metre (mcm) per year with Italy’s Eni that is due to lapse at the end of 2013 ( see ESGM 16 December 2010 ).

The Croatian company told ICIS on Thursday it is preparing to update its procurement strategy and will cover domestic demand via its production at Croatian gas fields and purchases at traded hubs.

Croatian demand is around 3 billion cubic metres (bcm)/year.

Prirodni plin did not comment at which hubs it would trade short-term contracts, but according to the Central European Gas Hub it is already a member of the Austrian market.

If Prirodni plin becomes active at Austria’s hub, it will need to ship the gas through Slovenia.

Last week the Slovenian grid operator Plinovodi said it had recently received additional long-term capacity booking requests for its entry point from Austria and its exit point to Croatia. The Cersak and Rogatec points subsequently became congested.

Plinovodi data shows that 1.6bcm has been shipped from Slovenia into Croatia this year. Last year’s data shows only 913mcm sent over the Rogatec point.

The ownership of Prirodni plin, which is a loss-making business, is the centre of a dispute between INA and its two main shareholders, Hungarian supplier MOL and the Croatian state ( see ESGM 4 October 2013 ).

Croatia is also interconnected with Hungary and has imported 160mcm from the country so far this year, according to Hungarian operator FGSZ. Last year Croatia imported almost 300mcm through this point.

The Croatian gas market is in the process of liberalising and will switch to an entry-exit model at the start of 2014, meaning shippers will no longer nominate capacity along pipeline paths. Tom Marzec-Manser

By Tom Marzec-Manser