South Interconnection gas pipeline project faces delays

The construction of the South Interconnection gas pipeline between Bosnia and Herzegovina and Croatia has stalled following the expiration of a contract deadline in June. The agreement is intended to be signed between the Government of the Federation of Bosnia and Herzegovina and the American company AAFS Infrastructure & Energy.

Energy expert Almir Bečarević suggests that the delay may stem from financing disputes. There are indications that the American firm seeks to involve the Federation Government as a guarantor for future gas consumption to secure necessary credit. This could result in a tripartite agreement between the company, the Federation Government, and a future creditor.

In addition to the unsigned contract, Bosnia and Herzegovina and Croatia have yet to ratify the international agreement related to the project. The matter is expected to be addressed by the Presidency of Bosnia and Herzegovina, though political opposition has raised concerns regarding the terms of the deal.