Govt Buying Only Gas Imported from Russia from MOL

The government started talks with Hungary’s MOL to buy off a part of gas business from Ina and so tried to regulate the gas price.

Croatian Vice-Premier Damir Polancec on Monday commented on a report by the International Monetary Fund that Croatia is one of the countries least affected by the inflation of fuel prices.

Polancec said he had expected Croatia to be one of the least affected because the prices of gas and electricity were significantly lower in Croatia than in other countries.

He said the government would continue to negotiate with traders to decrease prices of products.

Export and supply to be purchased from Ina 

He also said the Croatian government began negotiations with Hungary’s MOL to buy off a part of the Croatian oil company Ina’s gas business. However, it will not purchase all production, but a part relating to the import and supply of the Croatian market with natural gas.

Polancec explained the separation with the government’s attempt to reach the best price in agreeing the purchasing price of gas with the Russian Gasprom, but also with the fact that the buyoff of the company dealing with exports and supply would provide motive for MOL and Ina to reduce prices during negotiations about a new agreement.

The agreement with the Russian company expires in 2010, before which a new agreement must be signed. Croatia satisfies 40 percent of its needs for gas by importing from Russia. Ina pays for the imported gas 2.32 kuna per cubic metre, while the average price at which it sells it on the Croatian market is 1.22 kuna, and it sells to distributors at 1.07 kuna per cubic metre, Polancec said.

The EU defines that there should be no difference between domestic and import prices on the gas market, so the prices will have to be adjusted, he said.