Modernization, Energy Security, and Strategic Growth in European Refining
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Introduction
The INA Rijeka Refinery Upgrade Project represents a milestone in Croatia’s industrial and energy history: an unprecedented modernization effort aimed at transforming the country’s premier oil refining asset into a state-of-the-art facility for the 21st century. As the largest single industrial investment in INA’s history — and one of the most significant such projects in the Republic of Croatia — it carries strategic implications for national energy independence, regional fuel supply resilience, and European refining competitiveness.
This essay will explore the origins, purpose, components, economic and geopolitical significance, technological innovation, and long-term impacts of this project. Together, these elements demonstrate why this development is considered both a national and a regional industrial milestone.
INA and the Rijeka Refinery: Context and Background
INA – Industrija nafte, d.d. is Croatia’s leading oil and gas company and a prominent regional energy player. Headquartered in Zagreb, it operates across E&P (exploration and production), refining, and retailing sectors. Its flagship refinery is located in Rijeka, on the Kvarner Bay, and has played a central role in supplying domestic and regional markets with fuels and energy products for decades.
The Rijeka Refinery Upgrade Project stems from strategic decisions taken in the late 2010s and early 2020s to modernize refining capacity, ensure compliance with stricter fuel quality and emissions regulations, and improve the financial sustainability of INA’s refining business. While earlier plans traced back to 2019 and included the original signing of the residue upgrade contract, the full modernization program gathered pace through the 2020s, culminating in the current comprehensive implementation phase.
Purpose and Strategic Objectives
At its core, the Rijeka refinery upgrade was designed with several overlapping strategic objectives:
Increase Refinery Complexity and Capacity
The project’s centerpiece — the construction of a Delayed Coker Unit (DCU) — enhances the refinery’s ability to convert heavy residues into higher-value products such as diesel and other distillates. By increasing crude processing from just over 3 million tonnes per year to an anticipated 4 million tonnes by 2027, the facility significantly expands production capacity.Boost Production of High-Value Products
Diesel output — a critical product for both domestic consumption and regional markets — is projected to increase by up to 30%, or approximately 400,000 tonnes annually once the DCU reaches full operation.Enhance Energy Security and Reduce Import Dependence
By enabling the refinery to produce more fuel domestically — and reducing reliance on imported feedstocks such as vacuum gas oil (VGO), largely sourced from Russia — the project strengthens Croatia’s energy sovereignty and lessens exposure to external market and geopolitical risks.Modernize Infrastructure and Improve Efficiency
Comprehensive modernization — including updated processing units, new ports and storage systems, enclosed coke handling, and a high-capacity substation — upgrades overall refinery capability, safety, and reliability.Support Continuous Operation and Regional Supply Stability
Even as the upgrades have been underway, existing refinery units have remained in uninterrupted operation, achieving record throughput levels — an achievement indicating operational resilience concurrent with construction.
Climate Activist Perspective
Modernizing Fossil Infrastructure in a Warming World
From a climate activist standpoint, the INA Rijeka Refinery Upgrade Project presents a fundamental contradiction. On one hand, it is framed as modernization: greater efficiency, improved product yield, lower sulfur emissions, and enhanced energy security. On the other hand, it represents a long-term investment in fossil fuel infrastructure at precisely the moment when science tells us we must rapidly phase out fossil fuels.
The project, led by INA, centers on the modernization of the Rijeka Refinery, including the installation of a delayed coker unit designed to increase diesel production and optimize heavy residue processing. From an engineering perspective, this improves refinery complexity and economic resilience. From a climate perspective, however, it locks in carbon-intensive production capacity for decades.
The key question climate activists raise is not whether the refinery will operate more efficiently — it almost certainly will — but whether increasing diesel output aligns with global climate targets. Under the Paris Agreement, countries committed to limiting global temperature rise to well below 2°C, ideally 1.5°C. Achieving this requires a sharp reduction in fossil fuel consumption, especially in transport, which remains heavily dependent on oil products such as diesel.
Investing hundreds of millions of euros into refining infrastructure risks creating what climate economists call “carbon lock-in.” Once built, such facilities are designed to operate for 30–40 years. That lifespan extends well beyond 2050 — the target year for climate neutrality in the European Union under the European Climate Law. The tension is clear: How can long-lived fossil infrastructure coexist with a legally binding decarbonization trajectory?
Activists also question the narrative of “energy security.” While domestic production may reduce import dependence, true energy security in a climate-constrained world increasingly means accelerating renewable deployment, electrification, and efficiency — not expanding refining capacity. Croatia, with its solar and wind potential, could arguably channel similar investment into grid upgrades, storage systems, and green hydrogen production. That would align both with security and climate goals.
Environmental concerns are not limited to carbon emissions. Refineries carry local air pollution risks — nitrogen oxides, particulate matter, and industrial byproducts. Even if modernization reduces certain emissions per unit of output, total emissions may still rise if production increases. For communities near Rijeka, long-term health impacts remain a critical consideration.
There is also a financial dimension. As global demand for oil products eventually peaks — a scenario increasingly discussed by the International Energy Agency — refineries may face declining utilization rates. Large capital expenditures in late-stage fossil infrastructure can become stranded assets, placing economic burdens on companies, governments, or taxpayers.
That said, climate activism does not ignore transitional realities. Europe still consumes significant quantities of oil products. Some argue that if fossil fuels are used during the transition, they should be produced as efficiently and cleanly as possible. Yet this argument must be balanced against the urgency of transformation. Every euro invested in fossil optimization is a euro not invested in accelerating the clean energy shift.
Ultimately, the INA Rijeka Refinery Upgrade Project symbolizes a broader European dilemma: managing present-day energy needs while racing against the climate clock. For activists, the project is not merely an industrial upgrade — it is a test of whether long-term infrastructure decisions are aligned with the planetary boundaries we can no longer afford to ignore.
Project Components and Technical Overview
Delayed Coker Unit (DCU)
The DCU is the technological centerpiece of the upgrade. Delayed coking is a process that breaks down heavy residues into lighter, more valuable products such as naphtha, diesel range fuels, and petroleum coke. The DCU’s installation enhances yield efficiency and allows the refinery to maximize crude utilization, reducing low-value output while increasing volumes of high-value derivatives.
New Port and Storage Infrastructure
To support increased production and logistics, a new port facility and storage silos are being built. These additions streamline inbound feedstock deliveries and outbound product distribution, while enclosed systems reduce environmental emissions from handling petroleum coke and other byproducts.
Electrical and Power Upgrades
A new high-capacity substation, the largest in Croatia, ensures stable and reliable energy supply for the expanded refinery operation. Power supply upgrades are crucial for expansive automation, safety systems, and uninterrupted commercial production.
Modernization of Existing Units
Beyond new facilities, the upgrade touches existing hydrogen, hydrocracking, and sulfur recovery units — ensuring compliance with modern environmental standards and improving overall process efficiency. These enhancements support cleaner, higher-quality fuel outputs aligned with modern European emissions requirements.
Construction, Workforce, and Execution
The scale and complexity of this project are reflected in its workforce and execution strategy:
Over 10,500 workers participated in construction phases, with approximately 80 subcontracting companies contributing expertise and labor. More than half of the construction work was delivered by Croatian companies, emphasizing local economic involvement.
The new facility will directly employ around 60 specialized staff including engineers and operators once fully commissioned.
The installation involved hundreds of large process equipment items — from columns and heat exchangers to pumps and compressors — sourced from suppliers in Italy, Germany, Poland, South Korea, and beyond.
Safety and training were also priorities, with millions of hours dedicated to HSE (Health, Safety, Environment) training and risk assessments.
Commissioning and Testing Phases
As of early 2026, INA announced that construction of the DCU and major infrastructure components was complete, and the project entered hot commissioning — the testing of equipment with process fluids to verify operational stability under real conditions.
This phase follows cold commissioning (systems testing with inert media) and precedes trial operation — anticipated to begin in March 2026 — as the facility ramps up toward full commercial output within the same year.
Economic, Environmental, and Regional Impacts
Economic Returns and Refining Margin
By enhancing diesel and high-value product yield, the refinery improves its profitability profile, creating more resilience against global refining margins and price volatility. The reduction of imported vacuum gas oil feedstock also reduces input costs and exposure to global supply chain shocks.
Energy Security
For Croatia and nearby markets — including Bosnia and Herzegovina, Montenegro, and Slovenia — enhanced refinery output translates into stronger energy supply security, especially critical during peak demand seasons such as summer tourism.
Environmental Performance
Modernization and process upgrades help align the refinery with tighter European emissions standards, reducing sulfur content in fuels and improving overall environmental performance. While traditional fossil fuel production has intrinsic environmental impacts, increased efficiency and modern handling systems mitigate some risks.
Challenges and Future Prospects
Like any megaproject, the INA Rijeka refinery upgrade faced challenges — from coordinating complex engineering phases and dealing with supply chain risk under global uncertainty to aligning timelines and cost overruns. However, according to annual reports, engineering phases were largely completed ahead of the final phases of construction by late 2024.
Looking forward, the refinery’s enhanced capacity and product mix position it well in the broader European refining landscape, particularly as neighboring facilities either contract or modernize their own assets. Continued investment in green transition projects — such as green hydrogen and biofuel production — also reflects INA’s strategic adaptation to evolving energy markets.
📘 References
INA completes construction of key systems for new refinery unit — INA official press release.
INA initiates key phase of testing for new facility — INA/MOL Group announcement.
Hydrocarbon Engineering coverage of Rijeka project.
INA’s broader refining & marketing strategy overview.
Archive data on scope and participation details.
Annual report progress and future projects.
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