Hrvatska Elektroprivreda (HEP) has no influence on the sale, price or choice of buyers of gas surpluses taken over from the INA oil and gas company, which are automatically disposed of in the transport system when the storage facility is full, the state-owned power company said in reply to a query from the Croatian state news agency Hina.

In the response, HEP noted that the government had passed a decree to address disruptions to the domestic energy market in September 2022, under which all natural gas produced in Croatia must be delivered to HEP at €41 per megawatt-hour, which was five times below the market price at the time.

Since the energy crisis had not subsided by March this year, a new decree was passed for the period from April 1, 2023 to March 31, 2024, HEP said, adding that based on this decree the company continued to take over natural gas produced in Croatia from INA and that the price of gas was regulated by the Croatian energy regulator HERA.

HEP noted that it can use this gas only for purposes stated under the decree and not for its own purposes or for sale on the market.

“Since the gas storage facility is full, the gas surpluses from INA are automatically disposed of in the transport system. This gas is managed by the transport system operator and (Croatian energy market operator) HROTE. HEP has no influence on the sale of gas, on its price or on the choice of buyers,” the company said, adding that it expects further guidance from the relevant ministry.

Croatian gas transport system operator Plinacro said in a press release on Tuesday that it does not trade in gas, does not sell it and is not in charge of trade transactions.

The question of sales of gas surpluses which HEP purchases from INA at a regulated price arose after member of Parliament Zvonimir Troskot (Most party) claimed that HEP was selling this gas considerably below the price, thus incurring losses.

Troskot said that HEP buys gas from INA at €47.60/MWh and then sells it to suppliers via HROTE at considerably lower prices, as a result of which in some cases the company loses about €500,000 a day.

Following media reports that HEP had lost €10 million on gas surpluses in June alone, opposition MPs on Tuesday demanded accountability, and not from the HEP management and the Ministry of Economy, but from Prime Minister Andrej Plenkovic.

Economy Minister Davor Filipovic told N1 in an interview that gas trade was the responsibility of the HEP Management Board, while Plenkovic said that the matter would be discussed with the relevant ministers.