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Croatia has great potential to become a bedrock of the region’s energy security – interview with Robert Bošnjak, Head of Strategic Development Business Unit at Plinacro

Under current circumstances, ensuring the security of supply through different sources and routes is key. The Ionian-Adriatic Pipeline (IAP) project could play a crucial role, not only for Croatia but for the entire Central and Eastern European region.

On the sidelines of the 37th International Scientific and Expert Meeting of Gas Professionals which took place in Opatija on 11–13 May, CEENERGYNEWS spoke with Robert Bošnjak, Head of Strategic Development Business Unit at Croatia’s natural gas transmission system operator Plinacro about the current status of the IAP, the readiness of company in ensuring the country’s short- and long-term needs and Croatia’s potentials concerning the production and utilisation of decarbonised gases.

“The Ionian-Adriatic Pipeline project is one of the projects that will ensure security and diversification of supply for the entire region,” he begins. “It is a project that would connect the existing Croatian gas transmission system with the Trans-Adriatic Pipeline (TAP) project and provide a new supply route and a new gas source from the Caspian region, that is, from Azerbaijan and possibly from other gas sources, such as Eastern Mediterranean gas or a new LNG in Albania.”

Technically, the starting point of the IAP is in Fieri, Albania and the pipeline route runs along the Albanian and Montenegrin coasts. In Split, it connects to the existing Croatian gas transmission system. The connection for Bosnia and Herzegovina (BiH) is planned by the Southern Interconnection.

The IAP would provide a source of gas for Central and Southeast Europe, but it would also enable the gasification of Albania, Montenegro and Bosnia and Herzegovina and significantly contribute to the implementation of the low-carbon policy of the European Union, promoting gas as a transition energy source in areas where coal is the primary source of energy .

In particular, its 5 billion cubic metres (bcm) per year capacity would supply natural gas to Albania (1 bcm/year), Montenegro (0.5 bcm/year), southern BiH (1 bcm/year) and Croatia (2.5 bcm/year). The implementation of the entire Ionian Adriatic Pipeline project enables the opening of the new energy corridor for the SEE region.

“Concerning the preparation of the project for the Croatian sections of the IAP, a high level of preparation has been achieved, for some sections even building permits have been obtained, while for the Albanian and Montenegrin sections the preliminary designs have been completed,” Mr Bošnjak explains adding that the next logical step is the establishment of the Ionian-Adriatic Pipeline Company.

The importance of the project has been also recognised by the Energy Community and it is on the List of Mutual Interest of the Energy Community. Mr Bošnjak hopes that due to current circumstances, the EU will also follow suite.

Speaking about the current tight situation on the European energy markets, Mr Bošnjak underlines that Plinacro has a well-developed gas network that covers around 95 per cent of the territory of Croatia with a network that consists of 2.550 kilometres of high-pressure gas pipelines.

“Gas entry into the system is diversified – domestic production (offshore and onshore), two interconnections – one with Slovenia and one with Hungary and the LNG terminal on the island of Krk, put into operation in January 2021,” he says.

“We should also bear in mind the PSP (Underground Gas Storage), a gas storage system operator company that is 100 per cent owned by Plinacro and that in 2020, the first compressor station on the transmission system was put into operation, which ensures the flexibility of the system,” he recalls.

Considering all, Mr Bošnjak says that the entire gas chain in Croatia is well-formed and meets the local demand. Supply is well-diversified and he believes that Plinacro will be able to meet demand not only in the short term but also in the medium term.

However, he goes on by saying that if it is required to meet the needs of neighbouring countries through LNG, it will be necessary to make changes in the system, that is, to start the implementation of new projects. The Croatian Prime Minister announced this week that they plan to expand the floating LNG terminal on Krk Island to 6.1 bcm/year, which would enable Croatia to play a more regional gas supply role. Plinacro is also a co-founder and a shareholder of the LNG terminal.

“There has been a lot of discussions lately about REPowerEU projects that will ensure security of supply of EU and diversify it from Russian gas,” he says.

Croatian projects are mentioned as projects that include increasing capacity of LNG and transmission systems towards Slovenia and Hungary, which can certainly contribute to security of gas supply of Central and Central Eastern Europe. All projects of Plinacro are in a high phase of preparation, the necessary permits have been obtained, and in case of agreement concerning them, we can quickly start the implementation of these projects.

In terms of the energy transition, Plinacro is also contributing to the acceleration of the energy transition in the Western Balkans, a region which Mr Bošnjak defines as a very poorly gasified area, as Albania, Montenegro and Kosovo do not have a gas network at the moment and in BiH and Northern Macedonia gasification has been completed only partially.

“Coal, heavy oil and firewood are still widely used as primary energy sources,” he says adding that coal-to-gas transition would mean integration into the green transition and harmonisation with the EU Green Deal.

Plinacro has been constantly developing projects to connect with its neighbours in the Western Balkans, thus contributing to the gasification and energy transition. In these projects, Plinacro cooperates closely with the gas transmission system operators of the neighbouring countries, for instance, the project of Interconnection with Serbia is also planned.

“Plinacro can certainly help with its experience and the transfer of knowledge and technologies in the gasification of countries to its partners in neighbouring countries and thus contribute to the energy transition of the Western Balkans,” says Mr Bošnjak. “Furthermore, Croatia, as an EU member, had to speed up the acceptance of EU guidelines and laws related to the green transition and as such it will definitely contribute to increasing the energy transition in the region.”

Another focus of attention is, of course, hydrogen. This year, Plinacro became a member of the European Hydrogen Backbone initiative and as Mr Bošnjak explains, the company has already included hydrogen projects in its development plans, moreover, these projects have been applied to the ENTSOG’s Ten-Year Network Development Plan (TYNDP).

In accordance with the EU guidelines, in all our plans, we are being more and more dedicated to the development of the hydrogen transmission infrastructure. This is our future and our reality.

Mr Bošnjak thinks that in the first phase, since the infrastructure requirements for hydrogen transmission will remain limited, the demand will initially be met by the production in the vicinity or at the point of consumption.

“Mixing with natural gas is expected in certain areas and the planning of transport infrastructure for the transmission of clean hydrogen, and infrastructure for the capture and use of CO2 will begin immediately to facilitate the use of certain forms of hydrogen with low CO2 emissions,” he points out.

Planning the development of the network for the transmission of hydrogen and CO2 will be based on the principle of the lowest cost, for example on optimising the use of the existing gas infrastructure and the repurposing of the existing gas pipelines into the pipelines for the transmission of hydrogen and CO2.

“In the second phase, infrastructure intended for hydrogen (newly built or infrastructure from the repurposed gas pipelines for natural gas) will transport hydrogen not only for industry and transport but also for the purpose of electricity balancing and supplying heat to the residential and commercial buildings,” he continues. He underlines that in this phase, transmission infrastructure will be required at the level of the whole of Croatia and the EU.

“Croatia will be actively involved in the development of the European Hydrogen Backbone. Wherever it’s technically and economically justified, the existing gas network will be repurposed for the transmission of renewable hydrogen over longer distances, while larger hydrogen storage facilities, assumed to become needed in this phase, will be considered and developed,” says Mr Bošnjak.

As the EU expects the development of international hydrogen trade, Croatia will use its favourable geographical position and the potential of the existing gas transmission system and, if necessary, build new pipelines for, hydrogen transmission to take over the role of an indispensable link in hydrogen transport from Eastern Europe, the Balkans and the countries of southern and eastern Mediterranean to hydrogen users in Croatia and towards the growing regional and European hydrogen market.

“Depending on the market developments and achieved national potentials for hydrogen production, the existing location for the LNG terminal will be repurposed into a location for the supply of renewable hydrogen,” notes Mr Bošnjak.

He believes that Croatia has the potential also for creating policies concerning the production and utilisation of decarbonised gases. “We also believe that in the foreseeable future we will activate these potentials and actively participate in the decarbonisation of the gas sector,” he continues pointing out that Croatia is at the forefront of the professional, technical and natural potential required for the transmission of decarbonised gases and especially for the collection and storage of CO2.

The country has a significant number of depleted gas and oil fields in which it can store CO2 and pipeline infrastructure through which it can transport CO2. “In this part, I think that Croatia as the owner of the underground storage, INA as the existing and potential concessionaire and Plinacro as the transmission system operator can participate in this in synergy and be the technological leaders in the region,” he concludes.

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