Lithuania to buy less gas from Statoil under new agreement

Lithuania renegotiated the gas supply contract with Norway's energy company Statoil amid falling demand for gas, Algirdas Butkevicius, Lithuania's prime minister, informed on Monday.

Litgas, Lithuania's state controlled natural gas supplier for the country's liquefied natural gas (LNG) terminal in Klaipeda and trader, renegotiated the terms of the supply agreement with Statoil and managed to lower the annual gas supplies Lithuania imports from Statoil from 540 million cubic meters to 350 million cubic meters, Dalius Misiunas, the head of the state-controlled energy company Lietuvos Energija, was quoted as saying by business news website vz.lt.

"Supply contract is extended by additional five years," added Misiunas. Under the previous terms, Lithuania had to buy natural gas from Statoil until 2019.

Butkevicius said the new agreement will allow Lithuania to lower the costs of supplying gas from the terminal by 25 percent, or 25.5 million euros annually.

"I think an essential agreement for Lithuania has been reached in the Litgas's negotiations with Statoil," Butkevicius told the news conference. He noted the local businesses and domestic consumers will feel the positive impact of the new agreement.

Lithuania has been in talks with Statoil since the mid of 2014. The country has found itself oversupplied with natural gas to its newly built LNG terminal amid falling gas demand, warm weather, increasing use of biomass fuel for heating.

The LNG terminal and its floating storage and regasification vessel Independence officially started its commercial operations on the first day of 2015 in order to provide energy independence from Russia's Gazprom, the once sole supplier of natural gas for Lithuania. Endit