Croatia Could Play Pivotal Role in Europe’s Energy Diversification and Security 

 

4dc522946453b7f18899ca50de32abeb5 December 2016, VG Intelligence Weekly Issue 33

This past week the Organization of the Petroleum Exporting Countries (OPEC) announced plans to cut their oil production by 1.2 million barrels per day, propelling crude prices by more than 8 percent. As oil prices surge and December temperatures drop, the burning question, once again, is how to diversify and secure Europe’s gas supply market, reducing the dominant dependence on Russian natural gas. One of the projects that can contribute to the resolution of this issue is the Liquefied Natural Gas (LNG) terminal on the northern Adriatic Island of Krk (i.e. LNG Croatia). The idea is that LNG Croatia, together with the realization of a two-way gas flow pipeline connecting Hungary, Slovenia and Central/South Europe,  would serve as a connector with South East Europe via the Ionian-Adriatic Pipeline (IAP), an integral part of the Adriatic Ionian Corridor, which then connects with the Trans-Adriatic Pipeline (TAP) in Albania. Despite receiving wide backing from the international community, the project has stagnated due to unresolved permitting and land issues, and government instability in 2016.  However, last week saw a rise in efforts to draw attention to the need for the Croatian Government to refocus its efforts and fast-track the project. Amos Hochstein, Special Envoy and Coordinator for International Energy Affairs at the US State Department, met last week with Croatia’s Prime Minister (PM) Andrej Plenkovic to once again express the US’ support for the construction of the LNG Croatia project. Both Messrs Plenkovic and Hochstein stressed the importance of the project, with PM Plenkovic emphasising Croatia’s determination to continue with the construction of the terminal and the floating terminal, as an interim solution. Hochstein, an advocate of a strong European gas network, is no stranger to the region.  He has been a frequent visitor to Croatia, in an effort to show backing for regional and local energy projects…

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