Lithuania to consider gas import alternatives after 2024
With Baltic States unable to reach an agreement in regards to the location of the regional liquefied natural gas terminal, Lithuanian government has lost the opportunity to ask for European Union’s support in purchasing Independence ship of Klaipeda terminal. The decision has been made to search for alternative solutions, BNS was told by Lithuanian Energy Minister Žygimantas Vaičiūnas.
Klaipedos nafta has recently announced an international contest to searcg for natural gas import alternatives.
«This does not mean we have given up on buying the ship back. Our goal is securing competitive prices now and in the future. This is why, having assessed the situation in the region and the need for security for supplies, we wish to look for alternatives. We have to be certain if there would even be a need for a ship after 2024. Only then will we be able to consider other scenarios,» said the minister.
Lithuania’s lease of the floating gas storage facility ends in 2014. The contract was signed with Norwegian Hoegh LNG for ten years.
According to the minister, Lithuania hopes to receive several gas supply scenarios in the first quarter of 2018.
Technical specifications detailed in the contest state that participants are expected to answer the questions if economically speaking Lithuania is interested in having a liquefied natural gas import terminal after 2014. If it turns out that Lithuania does not need such a terminal in the future, contenders will be asked to offer economic solutions to secure access to international markets for Lithuanian gas market players.
Last year, Lithuanian government commenced discussions with European Commission about possible financial support to buy back Independence. It was estimated that this support would reach approximately EUR 100-150 million. Brussels, however, put forth a condition that all three Baltic States would have to reach an agreement in regards to the location of a regional liquefied natural gas terminal. Unfortunately, no such agreement was reached in time.
Talks regarding regional gas infrastructure commenced in 2006, when Baltic States decided to evaluate the idea regarding construction of a regional terminal. After failing to reach an agreement, Lithuanians decided to build a terminal in Klaipeda on their own. Lithuania later asked neighbouring countries to recognize the terminal as a regional one so that it would be possible to receive support from the EU. Estonia refused because it wanted to build its own terminal in Paldiski. Lithuania was fine with Estonia building a smaller terminal, hoping to request support from the EU for both terminals and Latvia’s gas storage facility in Inčukalns. However, when Latvia decided to postpone making its decision as to whether or not to support Baltic States’ agreement in regarding to a unified liquefied natural gas market until next year, Lithuanian Prime Minister Saulius Skvernelis said it is no more than a stalling tactic. Because of that, he said Vilnius will search for alternatives to reduce the existing terminal’s maintenance costs.