Hrvoje Krhen has been recently appointed as the new Managing Director of LNG Croatia. In his first interview to CEENERGYNEWS, he speaks about his priorities as director and the future of the energy diversification in the region.
My main goal as a newly appointed Managing Director of LNG Croatia is to finish the LNG terminal within the planned time schedule and budget by the end of this year and to start with the commercial operation of the terminal from the 1st of January 2021.
According to Dobroslav Šestanović, main construction engineer, at the beginning of the year, the company had completed 55 per cent of the work at the liquefied natural gas (LNG) terminal in Krk, indicating that operations could begin within the planned deadlines.
Early in March, also the Minister of Environment and Energy Tomislav Ćorić expressed his satisfaction with the progress and dynamics of the works during his latest visit at the construction site.
“The current status of EPC works, which include building the jetty, connecting the pipeline and all other onshore auxiliary infrastructure and facilities, is running within the schedule,” confirms Mr Krhen. “So far we have drilled more than 120 piles for the jetty construction. More than 90 per cent of the 4,2 kilometres long 40” pipeline is constructed and we are performing all other necessary construction activities according to schedule. The LNG carrier has arrived in the shipyard at the end of January as planned, together with the necessary equipment for the conversion, and all conversion activities are ongoing in line with the schedule.”
Mr Krhen expects to finish the conversion of the LNG carrier into a Floating Storage Regasification Unit (FSRU) vessel during September when the FSRU vessel will be shipped from Shanghai to Omišalj on the Island of Krk. It is expected that the FSRU vessel will arrive at the end of October this year when all necessary trial works and commissioning will start in order to be fully operational from January 1, 2021.
In regards of future projects we expect to develop a bunkering station in Rijeka bay and to open the possibilities for the usage of LNG in marine, road and rail transportation in Croatia and in the region, he reveals.
The LNG terminal on the Island of Krk will provide security of natural gas supply and competitiveness on both the domestic and the regional gas market. Croatia’s neighbour Hungary has always shown its interest for a comprehensive agreement that would connect the natural gas networks of the two countries, therefore it always pushed for negotiating the procurement of gas via the future Croatian LNG terminal.
“Hungary is maintaining its purchase offer with relation to the minority ownership of the future terminal”, said the Hungarian minister of Foreign Affairs and Trade Péter Szijjártó in February, referring to an offer made last year to make a purchase for 25 plus one per cent of the shares of the company that owns and operates the LNG terminal.
As for potential partners, Mr Krhen is cautious and only says that they are in communication with all interested potential terminal users from the region.
“Due to market development, Hungarian companies are interested in terms of cooperation in order to become terminal users and we look forward that this kind of cooperation will be realised in the months to come,” he adds.
The European Union invested 101.4 million euros in the construction of the LNG terminal in Krk, showing its support for the diversification of energy sources. Also, Lithuania is working towards the same direction and Poland’s oil and gas company PGNiG just commenced commercial operations at the Klaipėda LNG reloading station, giving a boost to the energy diversification in the Baltics. Now it is the Balkans’ turn and the LNG terminal at Krk comes as a strategic project.
“The LNG terminal on the Island of Krk is a strategic project in terms of security of supply and diversification, not only for the Republic of Croatia but for EU as well,” Mr Krhen concluded. “It will ensure energy needs and increase the security of supply through the new natural gas supply route for the countries of Central and Southeastern Europe. In parallel, we are developing bunkering station in the Port of Rijeka in order to enable usage of LNG as an alternative fuel in the trafficking.”