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Croatia LNG on track after South Stream project cancelation

LNG Croatia to build Balkans LNG import terminal hub

2B1st_Project_Smart_Explorer_Sales_Pursuit_ToolThe Zagreb-registered company LNG Croatia LLC (LNG Croatia) is planning to build the first liquefied natural gas (LNG) import terminal in Croatia to become a strategic hub on the north of Adriatic Sea to supply the Balkans region and Eastern Europe countries up to Poland.

When President Vladimir Putin made the decision to cancel the $45 billion South Stream project to supply Russian gas to the southern Europe, he opened a giant opportunity for Croatia to trigger studies for a regional hub to import LNG and distribute it to neighboring countries.

Croatia_LNG_Krk_Island_Import_Terminal_Project_MapMost of Eastern Europe countries and Balkans still depend on Russia for their gas supply, therefore the construction of a LNG Import Terminal on the Adriatic Sea takes a strategic dimension.

In November 2014, the European Commission selected LNG Croatia Import Terminal project to be included in the list of Connecting Europe Facility (CEF) Energy 2014 program.

By this decision the EU will finance 50% of the total costs for the LNG Croatia Import Terminal project feasibility study.

In December 2014, LNG Croatia called for bid (CFB) potential LNG suppliers for an open season to last until May 2015.

The purpose is to pre-qualify companies interested in supplying Croatia LNG terminal with LNG up to filling up its total capacity.

LNG Croatia selected the Omisalj county in the Krk Island in the North Adriatic Sea to build its LNG import terminal.

This Krk Island location will facilitate LNG Croatia construction of the deep water harbor to receive the LNG carriers as well as the deployment of a pipeline distribution system into the Balkans along the Adriatic coast and inland.

Krk Island LNG Terminal to feed North-South Corridor 

Estimated to cost $1.3 billion capital expenditure the Croatia LNG Import Terminal project should include:

 – Berths for LNG carriers up to 265,000 cubic meters

 – Two LNG storage tanks of 180,000 cubic meters capacity each

 – Regasification facility with a capacity of 1 million cubic meters per hour (cm/h) of gas 

Overall, LNG Croatia Import Terminal project should have a capacity to download and pipe in up to 6 billion cubic meter per year (bcm/y) of natural gas.

Croatia_LNG_Krk_Island_Import_Terminal_ProjectFrom the Krk Island, the Croatia LNG Import Terminal project will be able to distribute natural gas into the neighboring Bosnia-Herzegovina, through three gas connections, and to Bulgaria and Ukraine.

In parallel, discussions are on going between Croatia and Poland to connect the future Krk Island LNG Terminal to the Swinoujscie LNG Terminal under construction in Poland through a $1.3 billion North-South gas pipeline corridor.

Poland is depending on the Russian gas for 60% representing 10 bcm/y.

On its side Croatia is consuming only 3 bcm/y out of which 2 bcm are already produced locally.

It means that the LNG Croatia Terminal could provide Poland easily with some 3 bcm/y of gas representing 30% of its Russian gas import.

In starting the front end engineering and design (FEED) in 2016, LNG Croatia may expect to start commercial operations at the Krk Island LNG Import Terminal by 2019 and supply Poland through the North-South Corridor by 2020.

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