May 22 (SeeNews) - The Croatian government said it has approved the planned borrowing of up to 250 million kuna ($36 million/33 million euro) by state-owned gas transmission system operator Plinacro from the local unit of Erste Bank - Erste&Steiermaerkische Bank, to finance the construction of the Omisalj-Zlobin LNG pipeline.
The ten-year loan will have a one-year grace period, as well as a regular fixed interest rate of 1.45% and an effective interest rate of 1.48%, the government said in a statement on Thursday.
The Omisalj-Zlobin pipeline will link mainland Croatia to the planned LNG terminal on the Adriatic island of Krk.
Plinacro said earlier this month that the construction of the 430 million kuna pipeline is running according to schedule despite the coronavirus crisis, and is expected to be completed by the end of the year.
Works on the project began in December and have been progressing simultaneously along the route of the planned 17.5-km pipeline, Plinacro has said.
The Krk LNG terminal will have a capacity of 2.6 billion cubic metres (bcm) of natural gas per year as of 2021. It will deliver gas to the Croatian national transmission network connected to fellow EU member states Slovenia, Italy and Hungary, as well as non-EU countries Serbia and Montenegro.
(1 euro = 7.58008 kuna)
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