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MVM unit to get Krk LNG only from W European market players

MFGK Croatia, the Croatian unit of the state-owned Hungarian Electricity Works (MVM), will get liquefied natural gas (LNG) from the Krk terminal in Croatia only from Western European market players, MVM said, according to a report by state news wire MTI.

An aerial shot of Krk LNG terminal. (Photo by xbrchx/Shutterstock.com)

MVM noted that MFGK Croatia had signed a contract on Friday booking regasification capacity of some 1 billion cubic meters annually over a period of almost seven years at the Krk terminal.

The capacity booking is of "historical significance", MVM said, as it will mark the first time gas from a dedicated LNG source will be delivered to Hungary.

"The agreements are in line with the MVM Groupʼs strategic goals to diversify gas sources and delivery routes, as the sources of LNG procured will come exclusively from Western European market players," MVM said.

"In light of global market trends, LNG has become a competitive optional source in the region, further strengthening the gas market position of Hungary and the MVM Group," it added.

MVM acknowledged, however, that deliveries of Russian gas would remain "the backbone of energy security" for Hungary and the region.

MFGK Croatia has booked capacity of 666 million cubic meters at the terminal for the 2020/2021 gas year and an annual 1.014 bln cubic meters of capacity in each of the following six gas years, data on the terminal operatorʼs website shows.

The latest European gas market report compiled by the European Commission, for Q4 2019, shows the United States accounted for 25% of total LNG imports to the EU. Qatar was the second-biggest source of imports (23%), followed by Russia (19%), Nigeria (11%) and Algeria (7%).