Hungary's MOL, refiner Slovnaft accuse Croatia's JANAF of breach of contract

BUDAPEST (Reuters) -Hungarian oil group MOL and its Slovak subsidiary Slovnaft accused Croatian pipeline operator JANAF on Thursday of unilaterally changing its contract and jeopardising non-Russian fuel supplies.

MOL said it and Slovnaft told the European Commission in a letter that JANAF would deliver crude oil already purchased and scheduled for delivery only if the two companies agreed to purchase additional volumes as technical amounts to inject into JANAF's system.

MOL alleged that this requirement was absent from the existing contract.

"JANAF is leveraging its infrastructure position to impose unilateral changes to the contract governing access to non-Russian crude oil transport," MOL said in a statement.

The Adriatic pipeline from Croatia is a key route for alternative supplies for Hungary and Slovakia, which have long relied mostly on Russian crude via the Druzhba pipeline.

JANAF has previously denied allegations by Slovnaft that it was in breach of contract.

"The transportation of oil through the JANAF system is carried out according to the transportation calendar, all in accordance with the concluded agreement, the technical conditions for access to Janaf transport capacities and usual business practice," JANAF said in a statement to Reuters.

It said the current use of the pipeline by the MOL Group was significantly below the contracted and customary business practice in the oil pipeline transport sector.

"We expect from the MOL Group to increase the utilisation of the oil pipeline's capacity in accordance with the existing contract," the statement said.

MOL said the issue jeopardised its ability to secure sufficient non-Russian crude needed to meet regulatory compliance and ensure uninterrupted operations at Slovnaft's Slovak refinery.

The letter sent to the Directorate-General for Competition of the EU executive follows Slovnaft's accusations earlier this month that JANAF had reduced deliveries of non-Russian crude and failed to supply a contracted shipment.

Slovnaft has still not received the shipment in question, a Slovnaft spokesperson told Reuters on Thursday.

"This is of great importance in terms of the feasibility of phasing out Russian oil proposed by the European Union," MOL said.

Hungarian and Slovakian officials have previously expressed concerns over the Adriatic pipeline's capacity and costs.

JANAF transported 2.1 million metric tons of crude oil to MOL's refineries in Hungary and Slovakia this year under an existing deal. The two countries differ with the EU over Brussels' approach to Russia's war in Ukraine.

(Reporting by Anita Komuves in Budapest, additional reporting by Daria Sito-Sucic in Sarajevo and Jan Lopatka in Prague; Editing by Emelia Sithole-Matarise and Jane Merriman)