Bosnia and Herzegovina (BiH) is becoming a new energy battleground in Europe’s Southeast. BiH’s western neighbor Croatia endeavors to deliver a diversified and reliable natural gas supply to BiH through the future Ionian Adriatic Pipeline (IAP). In connection with the Trans Adriatic Pipeline Project, the IAP will bring natural gas from the Middle East and Caspian Region to BiH. It is also worth noting that the IAP project is supported by both the European Union and the United States. At the same time, Serbia’s state-owned natural gas provider Srbijagas has purchased a majority stake in two of BiH’s gas transport companies with the intent to extend Russia’s TurkStream pipeline into the country. TurkStream is a new export gas pipeline project stretching from Russia to Turkey across the Black Sea. Already divided along the ethical lines, Bosnia and Herzegovina’s dependence on two competitive energy suppliers could risk deepening division between the three main ethnic communities in the country.
Bosnia and Herzegovina consists of two autonomous political entities that were established by the Dayton Accords of 1995: the Republika Srpska (Bosnian Serb Republic), located in the North and East, and the Federation of Bosnia and Herzegovina, occupying the Eastern and Central regions. Identified as a potential candidate for EU membership during the Thessaloniki European Council summit in June 2003, BiH also borders EU member state Croatia, and EU candidate states Serbia and Montenegro.
Bosnia and Herzegovina is dependent on natural gas imports as it does not domestically extract natural gas. The length of the entire transport system in BiH is 243 km, while the total annual consumption of natural gas in the territory of BiH is 185 ktoe (kiloton of oil equivalent). Gas usage in the country is limited by the distribution network, which is only present in Sarajevo, Zenica, and Visoko in the Federation of Bosnia and Herzegovina, and in Zvornik and Bijeljina in the Republika Srpska. BH Gas, a producing and transporting company from Sarajevo, will use a 101 million euro loan from the European Bank for Reconstruction and Development (EBRD) for the construction of the south interconnection natural gas pipeline that will connect the natural gas transmission systems of Bosnia and Herzegovina with Croatia’s system. The interconnection gas pipeline starts from Zagvozd in Croatia, runs through Posusje and Novi Travnik, and connects to an existing natural gas transmission system via the main branch at Mostar in the Federation of Bosnia and Herzegovina. The Project’s realization would enable diversification of routes as well as sources of supply such as access to the planned LNG terminal Krk in Croatia, natural gas storages in neighboring countries, and gas sources in the Caspian region. The southern interconnection gas pipeline of approximately 162 km length is planned to operate bidirectionally.
Serbia’s New Transmission Gas Pipeline (NTGP) is being built by Serbian transmission system operator Gastrans, which is a joint venture of Gazprom and state-owned Srbijagas. Gastrans is owned by Swiss-based South Stream Serbia, in which Russia’s Gazprom holds a 51% stake and Srbijagas the remainder. In March 2019, the Serbian energy regulator approved the construction of a branch of the TurkStream pipeline that will deliver Russian natural gas into Turkey as well as southern and southeastern Europe. At the same time, Srbijagas became the majority shareholder in the two Republika Srpska-based natural gas transmission companies (Gaspromet and Bijeljinagas). Dusan Bajatovic, Srbijagas’ general director, confirmed plans to construct a gas transmission system towards Banja Luka, the Republika Srpska’s administrative center. Additionally, Bajatovic offers gas coming from TurkStream to gas transmission companies in the Federation of Bosnia and Herzegovina.
The implementation of the Ionian Adriatic Pipeline project enables the opening of a new energy corridor for the Western Balkans region, establishing a new natural gas supply route from the Middle East and Caspian region. The Project, linking BiH to the Croatian network of the Ionian Adriatic Pipeline, is entirely in compliance with the EU energy directives. Contrarily, Serbia’s position as a non-EU country could be a crucial factor in helping Gazprom to extend the second leg of the Turkish Stream pipeline into Bosnia and Herzegovina. Republika Srpska’s future dependence on Russian gas, with the Federation of Bosnia and Herzegovina connecting to the Ionian Adriatic Pipeline, could lead to even greater division within the country.
