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Roundup: Lithuanian PM reveals new LNG development project

Xinhua, February 7, 2015 Adjust font size:

Lithuania will start a new liquefied natural gas (LNG) project for the newly built LNG terminal in Klaipeda seaport, revealed Lithuanian Prime Minister Algirdas Butkevicius on Friday.

Butkevicius chaired a meeting of a commission responsible for the LNG terminal project in Klaipeda seaport. After the meeting he said the commission had decided to start a project of a new 5,000 cubic meter onshore LNG terminal-distribution station with gas transportation vessel.

"The main task for this project will be to fill in tank trucks with the gas from the smaller terminal and transport the supplies to different areas in Lithuania or Belarus," said Butkevicius to business news website vz.lt after the meeting.

"The new vessel will be capable of providing gas to other ships," added Butkevicius.

The new project is expected to expand distribution capabilities of a newly built LNG terminal in Klaipeda seaport which started its operations at the end of 2014.

Butkevicius emphasized that the terminal won European gas project of the year award last week, and the government wants the terminal in Klaipeda to become the most efficient and reliable.

"In order to achieve this, in 2015 one will pay the most attention to implement exploitation processes and increase qualifications of the personnel," said Butkevicius in a press-release.

According to Butkevicius, the terminal in Klaipeda opens up new possibilities for the whole Baltic region. However, it's essential for neighboring Latvia to liberalize its gas market in order to expand these possibilities, emphasized Butkevicius.

"When forecasting the prices of the gas provided via the terminal, it's likely that the prices will be very attractive," said Butkevicius.

"That's why it is very important that neighboring Latvia would open the entrance to the three countries in gas market," he added.

Last month Lithuania's state controlled natural gas supply and trading company LITGAS announced two contracts to provide Estonian energy companies with natural gas supplies from the new terminal in Klaipeda. Estonian companies will receive the supplies via pipeline in Latvia. Possibility to deliver natural gas to Estonia from Lithuanian LNG terminal was tested in December.

Nevertheless, Butkevicius admits the possibilities to provide the region with the gas from the terminal are limited as Latvian gas market is influenced by Russian state controlled energy company Gazprom.

"Latvian market is controlled by Gazprom, which holds a huge stake in the Incukalns underground gas storage facility that gives it the operational rights," said Butkevicius to national television LRT after the commission meeting.

Butkevicius urged Latvia to speed up the implementation process of the third energy package which separates generation and sale operations from transmission networks in European gas and electricity companies. Endit