Shareholders of Croatia’s oil pipeline operator JANAF are set to vote on a proposal that would see the company enter an upstream oil and gas project in Kazakhstan, marking a potential expansion beyond its traditional focus on oil transit and storage. The decision will be taken at an extraordinary shareholders’ meeting on 27 January.
Under the management proposal, JANAF would partner with the Croatian Hydrocarbon Agency (AZU) and Kazakhstan’s national energy company KazMunayGas to explore hydrocarbons in the Shygys exploration block. If approved, JANAF would commit up to €43.6 million to finance exploration and potential production activities in the area.
As an initial step, shareholders will be asked to approve JANAF’s entry into the ownership structure of Geoenergija Razvoj, a Zagreb-based company designated as the Croatian project vehicle for operations in Kazakhstan. JANAF would participate through a capital increase, injecting a symbolic amount equal to the existing paid-in capital contributed by AZU. Following this move, the two Croatian entities would hold equal ownership stakes in Geoenergija Razvoj.
The substantially larger financial exposure relates to JANAF’s role as a funding partner in the Kazakh project. Under the proposal, the company would assume an obligation to provide additional cash contributions of up to €43.6 million to support exploration and potential hydrocarbon exploitation at the Shygys site. This commitment would become effective only if Geoenergija Razvoj’s Kazakh subsidiary secures the status of strategic partner to KazMunayGas, which holds the exploration concession for the block.
JANAF’s management notes that the initiative originated from AZU, which invited the company to participate after carrying out technical assessments of hydrocarbon potential and geological conditions across several exploration areas in Kazakhstan. Based on this analysis, the Shygys block was identified as particularly promising, prompting AZU to open talks with KazMunayGas and work toward establishing the necessary concession framework.
Within the proposed partnership, AZU would contribute technical expertise and project know-how, while JANAF’s role would be primarily financial. The ceiling on JANAF’s funding commitment is based on AZU’s estimates of the costs associated with the initial exploration phase, extending through to a potential commercial discovery. The timing and structure of individual capital injections would be determined either in the shareholders’ agreement of Geoenergija Razvoj or through subsequent decisions by its owners.
JANAF’s shareholder structure is dominated by the Croatian state, which controls 78.51% of the company. INA holds an 11.8% stake, HEP owns 5.36%, while the remaining shares are held by pension funds.
