Despite Hungarian Majority Ownership, INA Must Sell All Gas to Croatia

On Wednesday, the Croatian government decided that the Croatian oil company INA must sell all gas produced in the country to the state-owned Croatian Electric Works (HEP) and increase its production by 10 percent, according to Croatian public television (HRT).

The economic and energy crisis is also a daily topic in Croatia, with which the government is constantly dealing. Recently, the Croatian Minister of Economy and Energy, Davor Filipovic, announced that a meeting of the Crisis Council for Security of Gas Supply had unanimously decided to propose to the government to increase production by 10 percent, and to sell all gas produced exclusively to the Croatian Electric Works (HEP). The state-owned power company will distribute and sell this gas to households, hospitals, kindergartens, and other institutions, he added.

The measure comes into force on October 1 and will be effective until the end of March. According to the government decree, a natural gas producer will have to sell natural gas at 0.3425 kunas per kilowatt-hour. The gas will be held exclusively by HEP and will be made available to gas supply companies to cover losses.

The Croatian government has also announced that the Croatian multinational oil company INA will be obliged to increase its natural gas production by 10 percent compared to its planned production from October 1, 2022 to March 31, 2023.

The company is also required to sell all gas produced to Croatian Electricity.

INA’s situation is special because its majority owner is Hungarian oil company Mol, with 49.08 percent, and Mol also has the controlling rights. Only 44.84 percent of the company is owned by the Croatian state.

The Croatian government said that it had already indicated to Mol last week that they would make such a decision in order to protect Croatian households.

INA reacted to the government’s decision in a statement, saying that the company will respect all decisions of the cabinet on energy price setting, as it has done so far. As far as the increase in production is concerned, INA will do everything within its technical and technological capabilities to achieve the target, they added, stressing that this means, above all, bringing existing gas fields and wells into production, for which the necessary permits are pending.

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