Croatian Opposition MPs Quit Parliament Over Handling of ‘Gas Affair’

Opposition MPs demand debate in parliament over state purchases of gas at high prices – which then had to re-sold for a much lower price when the power utility ran out of space to store it.

The headquarter of Hrvatska Elektroprivreda, HEP. Photo: EPA/ANTONIO BAT

As the so-called “Gas Affair” continues to shake Croatia’s political scene, on Friday opposition MPs quit parliament in protest after their demand for an additional session on the matter was not granted.

“We want a session of parliament, we are not going on vacation until this gas affair is fully resolved. If you decide to ignore our request, we will leave parliament and will not take part in votes,” said MP Marija Selak Raspudic from Most (The Bridge) party, after almost all opposition clubs insisted on an additional session.

Parliament speaker Gordan Jandrokovic answered the opposition demands by setting out the conditions needed to meet them. “If you collect 76 signatures, and if an additional session is called by the government or the President, there are rules, and I’ll follow them,” he said.

The affair concerns massive state purchases of gas, which then had to be re-sold at a lower price, causing a big loss to the budget.

The war in Ukraine has caused a crisis in the global energy market, and many countries, including Croatia, adopted measures to protect the most vulnerable social categories such as households, hospitals and schools.

In September 2022, the government passed a decree on avoiding disturbances in the domestic energy market, empowering the state-owned power utility Hrvatska Elektroprivreda, HEP, to purchase gas from the semi-state-owned oil company INA at a fixed price.

HEP bought gas from INA at a rate of 47.60 euros per MWh. But HEP continued to buy more gas, even when it filled up its storages. The surplus then had to be re-sold at a lower price than the purchase price, in some cases for as little as one cent per MWh.

There is still no official data on how big a loss was caused by such trading but the weekly magazine Nacional put the figure at up to 200 million euros.

Minister of Interior Davor Bozinovic on Tuesday said the police had launched an investigation into HEP. “Given that investigations are ongoing, you know that I can’t say anything more,” he told reporters.

On Thursday, parliament’s Economic Committee was was convened at the behest of the opposition. Minister of Economy Davor Filipovic, the heads of HEP, the Croatian Energy Regulatory Agency, HERA, and the Croatian Market Energy Operator, HROTE, answered MPs’ questions for five hours.

There were harsh words and even door slamming, but not much more was learned about HEP’s losses at that session.

What did emerge is that most of the gas was re-sold by HEP to a private company, Prvo Plinarsko Drustvu, PPD. The head of HROTE, Boris Abramovic, asked about who bought the gas, revealed that PPD bought 63 per cent of the surplus gas.

In the meantime, PPD issued a statement claiming it was not favoured in any way when buying the gas.

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