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Croatia And MOL To Restart INA-Talks As U.S. Mediates Between Sides

Tamás Székely 2015.03.11.

Croatia and Hungary’s oil company MOL are set to restart talks over the jointly-owned Croatian oil firm INA using an international facilitator at the end of March, Croatia’s economy minister told Reuters. Both sides have accepted an offer from the United States to help resolve a long running dispute and steer the talks on INA’s future, Ivan Vrdoljak said. „Each side has agreed to engage the facilitator. If MOL accepts our starting position, which includes a new shareholding agreement and a new strategy for INA’s development, the dispute could be resolved during this government’s mandate,” Vrdoljak added.

Talks started in September 2013, but have made little progress. The three-year clash over the Croatian company has included mutual arbitration suits over management rights and the Croatian government’s alleged breaches of contract, a Croatian Supreme Court bribery verdict against Croatia’s former premier Ivo Sanader for his role in INA’s sale, and charges of bribery in a Croatian court against MOL Chairman Zsolt Hernádi, which he denies.

Croatia wants management rights in INA redefined so that the government has an equal say in decision-making, something MOL has refused. A source close to the Hungarian side told Reuters earlier this month that MOL sees itself as a strategic rather than a financial investor “and it wants to be able to run the company”. MOL also said earlier it was prepared to sell its stake in INA if no agreement was reached soon.  Croatia, which owns 44.84% of Zagreb-based INA, has tried since 2011 to regain some management rights in INA that MOL got as part of a 2009 shareholders agreement which has given it a 49.08% stake in INA.

Meanwhile, Hungary’s oil company MOL has published its financial report about its results achieved in 2014. The company’s downstream clean CCS-based EBITDA was 31% higher than in the previous year, the report shows. Average daily hydrocarbon production reached 98,000 barrels of oil equivalent per day, above the original 2014 target of 91-96,000. The Group’s financial position has also remained rather strong with net gearing at 19.6%.

“2014 proved to be a strong year for MOL Group, notwithstanding that we already felt the effects of the changed oil price environment”, commented Chairman-CEO Zsolt Hernádi the results. “Our full year results clearly demonstrate the strength and resilience of our integrated business model. Our Downstream business delivered outstanding results, especially in the second half of the year”, he said. “We have also succeeded in surpassing the 100% organic reserve replacement ratio in 2014, which is yet another very good sign from a future growth perspective. In terms of acquisitions we can benefit from the lower oil price environment and we are ready to act if the right opportunity arises.”, Hernádi said.

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