Are you sure?

Croatian Janaf works on Adriatic spot oil market

Croatia's oil pipeline operator Janaf is working to improve infrastructure and pave the way for creating an international Adriatic spot oil market, the company said on Friday.

Janaf said its intention was not to participate itself in oil trade, but to open space for interested traders to use the capacities of a deep-sea terminal in the northern Adriatic port of Omisalj.

“Improvement of storage and transport facilities we're now working on will create conditions for setting up an Adriatic spot oil market. Omisalj would thus become a part of an overall Mediterranean oil market,” Janaf said in a statement sent to Reuters.

Croatian weekly Nacional reported this week that Janaf is in talks with Russia's Gazpromneft, the oil arm of Gazprom, on involvement in the future spot market, but Janaf declined confirmation, saying only:

“Our work on infrastructure is paving the way for future participation of any interested traders.”

Janaf is in an investment cycle worth 1.9 billion kuna ($360.9 million), which envisages enlargement of storage facilities at three locations. Janaf can currently store some 900,000 tons of oil and the goal is to increase it to some 2.2 million tons.

Janaf operates a pipeline connecting the northern Adriatic with central Croatia and on to Serbia and Hungary.

The company is also upgrading transport facilities between Omisalj and the central town of Sisak to make the pipeline operable in both directions. Currently, the crude runs only from the coast northwards.

Janaf is some 75% owned by the state, while the rest is owned by Croatia's oil group INA - where Hungary's MOL is the biggest shareholder - and several investment funds.

It posted first quarter revenues at 124.1 million kuna, or 51% more than in the same period last year, while net profit rose to 19 million kuna from 8.2 million kuna.

Last year's revenues amounted to 375 million kuna.

Janaf shares closed at 1879.94 kuna on Thursday and had not been traded early on Friday. They peaked at 2,500 kuna in early February. (Reuters)