Since MOL began investment in the company in 2003, INA’s annual investment in its refinery business has increased five times compared to the previous decade. All investment decisions have been approved jointly by MOL and the Croatian Government.
In 2003, when MOL first became a shareholder of INA, none of the refineries were ready for the impending challenges posed by Croatia’s accession to the EU single market. Since then, five times as much investment was channelled into the refining business per year compared to the period before 2003.
During this period, HRK 8 billion (EUR 1.1 billion) was invested in INA’s refinery system – the equivalent of the cost of an entire new refinery – with approximately HRK 5 billion spent in the Rijeka and over HRK 2 billion spent in the Sisak refinery. A further HRK 1 billion was invested in the rest of the refining system.
In 2005, when INA’s Refinery Modernization Program was presented to the relevant bodies, both the Croatian Government and MOL supported it. The Program aimed at enabling both refineries to produce EU-compliant motor fuels.
Since the start of the Modernization Program, every one of INA’s annual business plans (including investments into refineries) were approved by consensus of the two major shareholders – MOL and the Government of Croatia – at the Supervisory Boards of INA.
In order to produce EU-compliant fuels, INA had to make wide-ranging investments in both Rijeka and Sisak including the construction of several new complexes and units from scratch. The first phase of refinery modernization was finished in 2011 in both refineries.
INA’s refining business today produces EURO V quality gasoline and diesel fuels, as well as kerosene, and a large variety lower grade fuel oils and products for the petrochemical industry. These products are mainly sold in the SEE region, including Croatia, Bosnia and Herzegovina, Slovenia, Serbia, Albania, and also in the Mediterranean.
Croatia’ supply market with refined products is highly competitive. The products can arrive in Croatia not only from neighbouring competing refineries, but also from the sea. INA’s current refinery capacities exceed Croatian market demand. Its overall economic utilization and competitiveness continues to face several important challenges including the relatively high black product yield and limited conversion capacity. This is limiting INA’s competitiveness. The key project designed to overcome this constraint is the residue upgrade to the Rijeka refinery – however, all official authorisations have still not been granted five years after the first permit application was filed.