Croatia cannot wait much longer for a decision on the northern Adriatic liquefied natural gas (LNG) terminal and is ready to move on its own, its top energy official said on Thursday.
"The Adria LNG project is still there, but we cannot wait until 2013 or 2014. Our alternatives are a floating terminal for our own needs, or an alternative land-based terminal if the countries in central Europe are interested to step in," Darko Horvat from the economy ministry said.
An international consortium of four energy firms last year pushed back until 2013 the final investment decision for building an LNG terminal on the northern Adriatic island of Krk amid a falling demand for gas on the European market. Originally, the decision was to be taken this year.
The Adria LNG consortium brings together Germany's E.ON-Ruhrgas EONG.DE, Austria's OMV (OMVV.VI: Quote), France's Total (TOTF.PA: Quote) and Slovenia's Geoplin. Plinacro and Croatia's state power board HEP were due to join the consortium.
"The Adria LNG partners have not given up a project, but it is for us unacceptable to wait until 2013 to move forward. We cannot allow that nothing happens," Horvat said.
The Adria LNG project has been moving forward slowly in recent years, mostly due to a slow-decision making process in Croatia. It is now at the stage of awaiting a location permit.
Horvat said that Croatia also has an alternative option: a floating terminal of a smaller capacity, up to 2.5 billion cubic metres of gas per year, at a nearby site to focus primarily on domestic Croatian demand.
Croatia hopes to complete European Union entry talks in coming months and join in 2013. It consumes some 3.0 bcm of gas annually. Some 40 percent of it is imported from Russia, while the rest is secured from its own gas fields.
"However, we have already received interest from Hungary and Slovakia for gas from the Krk terminal. We're now waiting for response from other countries to see whether it's a better solution to go immediately for a bigger land-based terminal," Horvat said.
Horvat said the idea was to seek the funds from the European Union as the Krk terminal could become a part of a new gas transport corridor linking the Baltic Sea and the Adriatic.
"There will be a meeting on that subject at the end of May in Zagreb when we're likely to have a clearer picture on how to proceed," he said.
The planned capacity of the Adria LNG terminal would as up to 15 bcm per year and the value of the project was assessed at some 800 million euros ($1.19 billion).
Horvat said that the alternative terminal could have capacity of between 4 bcm and 16 bcm of gas annually, depending on interest from other countries.
He also said he had held talks with four big international investors, including one from Israel, that expressed interest in building the Krk terminal, but did not want to elaborate.