After the government decided that all domestic gas must be sold to the national electricity provider HEP, INA energy company has started sending letters to enterprises with contracts for gas supplies, urging them to change their contracts at a price several times higher, the Croatian Jutarnji List daily reported on Monday.

Several companies have contacted Jutarnji List to report they are shocked because INA will not be able to provide them with that gas due to the government’s recent decision, although they had previously concluded contracts with INA on gas supplies

They say that in the meantime INA has advised them to change their contracts at a price that is ten times higher than the contracted price because it too has to purchase gas at the market price.

The director of one such company in Zagreb County that uses gas for its production, said that he signed a contract with INA back in May 2021 for a certain amount of gas at a price of €23 per megawatt hour, and distribution of that gas was to have started at the beginning of October this year.

However, just ten days ago the company received a notice from INA informing them of “changed circumstances” and calling on them to amend its contract.

The director was quoted as saying that INA’s notice states that on 15 September, a new regulation on the removal of disturbances on the domestic energy market entered into force, according to which INA  as a producer of domestic gas, was ordered to supply all the gas produced in the period from 15 September 2022 to 31 March 2024 to HEP at a fixed price.

In addition, the government’s decision also applies to gas that was produced until 15 September, regardless of whether the supplier had previously signed a contract for those quantities of gas.

Furthermore, according to INA, meeting contractual obligations under these circumstances has become “excessively difficult” for them, which would cause them a substantial loss because it too would be compelled to procure natural gas under market conditions.

This means that the enterprises that had signed contracts with INA for gas supplies at a price of €23 per megawatt hour could now have to buy that gas from INA at a price of more than €200, the Jutarnji List reported.