Since its beginning, the capital costs of the project have been kept to a minimum, and since the initially planned investment of EUR 383 million, the investment has been significantly reduced to EUR 233.6 million.
In order for the project to continue with its realization and be sustainable so that it is integrated into the gas market of the Republic of Croatia, it is necessary to co-finance part of the project by the Republic of Croatia in such a way that ultimately the investment will be positive for the owners (HEP d.d. and Plinacro d.o.o.). Namely, of the total estimated value of the investment, which is around EUR 233.6 million, EUR 101.4 million comes from EU grants, EUR 100 million will be provided by the state, and HEP and Plinacro will finance a smaller part of CAPEX amounting to EUR 32.2 million.
In addition to the already approved grant from the European Commission, the grant of Republic of Croatia amounting EUR 100 million, ensured from the State budget, is sufficient to allow the owners (HEP d.d. and Plinacro d.o.o.) to make a positive Final Investment Decision on booking of 0.52 billion m³ capacity. The remaining part of EUR 32.2 million with which they will participate in the realization of the investment through the recapitalization of the company will have a return on investment in accordance with the allowed revenue, which is regulated by the Methodology adopted by the Regulatory Agency.
The annual operating costs of the terminal will amount around EUR 13 million, which will be covered from the booking of the capacity of 0.52 billion m³ and partly from the security of supply fee (SoS fee) charged under the transport tariffs, which will cover operating costs, depreciation and allowable regulated revenue in accordance with the Methodology.
It is important to note that it is expected to increase the capacity booking once the construction risk is eliminated and the terminal is constructed, especially considering the use of LNG in transport after 2020 and if there is a need for SoS fee, it will be short-term. Unregulated terminal revenue, i.e. revenue from SoS fee, is calculated at 0.3 EUR/MWh and ultimately to the final gas price, if we do not take into account the decrease of tariff for transport that has occurred since 1 January 2019, to influence only up to 1% on the price of gas to end users (for the average household it is HRK 35 yearly), while considering the decrease of the tariff for transport from 1 January 2019, it will have no impact.