January 17, 2013 - 19:18 AMT
Russia’s Gazprom to build pipeline, power plant in Croatia

Gazprom, Russia’s natural-gas export monopoly, intends to build a pipeline to Croatia and a power plant in the country to maintain its market for the fuel, Bloomberg reported.

The gas link, to be developed with local partner Plinacro d.o.o., will branch off from Russia’s planned South Stream pipeline, Gazprom Deputy Chief Executive Officer Alexander Medvedev said today in Zagreb, capital of the Balkan country.

“We intend not only to supply gas, but also to develop the gas market, and one of the ways is to build gas-powered electric plants,” Medvedev said.

Gazprom plans to add pipes and power stations in Europe to keep market share in the continent as slowing economic growth curbs demand and competition for customers increases. The Moscow-based producer has largely relied on piped fuel even as global output of liquefied natural gas expands.

Gazprom and Plinacro will build a connector with capacity to carry 2.7 billion cubic meters a year, Mladen Antunovic, head of Plinacro, said in an interview. The pipeline, costing an estimated 60 million euros ($80 million) to build, may start operating in December 2016, he said.

Gazprom, the world’s biggest gas producer, and partners Eni SpA (ENI), Wintershall AG and Electricite de France SA, started work last month on the South Stream pipe, which will run from Russia under the Black Sea to eastern and southern Europe. The project is scheduled to start delivering gas at the end of 2015 and reach capacity of 63 billion cubic meters a year in 2019.

Gazprom’s plans to build a power station in Croatia may focus on Osijek, in the east of the country, Medvedev said. The company would construct a 500-megawatt plant in cooperation with local utility Hrvatska Elektropriveda DD, he said.