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EU grants

The contract with INEA for co-financing the works necessary for implementation of floating solution was concluded on 18 December 2017. According to the concluded contract, the grant amounted to 27.92% of the eligible total capital costs, with a maximum amount of EUR 101.4 million, while the obligation of LNG Croatia LLC was to complete all works by the end of 2019, and for the terminal to be operational from 1 January 2020. 

Considering that it was not realistic to construct the terminal within the agreed deadlines in accordance with the concluded contract with INEA and taking into account the fact that all tenders were in progress while the permits required for the construction of the terminal were in early preparatory stage and it was impossible to obtain them within those deadlines and in accordance with the legal deadlines and procedures, in April 2018, negotiations started with INEA to extend the contractual deadline by one year and to keep the maximum contracted amount, or increase the percentage of eligible capital costs. Given that the contract with INEA is taking into account the percentage of eligible capital costs and co-financing cannot exceed a certain percentage, it was necessary to increase the percentage taking into account the fact that the initially planned capital costs will be significantly reduced. Following the conclusion of the FSRU and EPC works tenders, a prolongation of the deadline for one year and increase in the percentage of eligible capital costs from 27.92% to 46.09% have been officially requested, in order to allow the maximum allowed amount of co-financing of EUR 101.4 million to be utilized. 

Prolongation of deadlines and increase of percentage of eligible capital costs was approved, and on 7 February 2019 an Annex to the Agreement was concluded extending the deadlines for terminal construction from 31 December 2019 to 31 December 2020, when all works are expected to be completed. At the same time, the percentage of eligible capital costs was increased from 27.92% to 46.09%, which allowed the maximum amount of EUR 101.4 million of the grant to be utilised.