The European Investment Bank (EIB) is providing a loan of Eur150 million to MOL (Hungarian Oil and Gas Company) to co-finance the construction of 205 km long natural gas transmission pipeline between Varosfold and the Croatian-Hungarian border.
The project will create a bi-directional gas transmission between Hungary and Croatia. It covers also the construction of two compressor stations, a metering station at the border and a short small diameter branch line to Pecs. This will further integrate the EU gas market and provide gas transit capacity, along a priority Trans-European Energy axis, from Hungary to Croatia, Bosnia-Herzegovina and Italy, and in reverse mode from Croatia to Hungary.
In addition, the new facility will shorten the gas transit from Ukraine to Croatia, and thereby reduce the need for gas compression, which in turn yields less associated CO2 emissions. It will help to meet gas demand in Hungary and Croatia, part of which will enable to displace the use of more costly and polluting fuels in the residential and power sectors.
The loan supports the successful cooperation of the EIB with the MOL. In the past, the Bank had provided two loans to MOL amounting to Eur275 million to finance refining and distribution and development of oil and gas system.