Lithuanian PM promises cheaper gas, electricity

Lithuanian Prime Minister Algirdas Butkevicius promised Friday that gas and electricity prices for consumers would drop substantially as of July.

"The rates for consumers using gas for cooking should decrease by around 8.0 percent, and for those using gas for heating by 14 to 15 percent," Butkevicius was quoted as saying in a press release.

According to the prime minister, the government was able to push the prices down after renegotiating the terms of the gas supply contract with Norway's energy company Statoil, the main supplier of natural gas to Lithuania's liquefied natural gas (LNG) terminal in Klaipeda.

"This allowed for cutting maintenance costs of the LNG terminal by more than 30 percent," said Butkevicius.

Natural gas purchased from Norway under the new terms is cheaper than Russia's Gazprom and will reduce import prices by 15 percent on average, said the prime minister.

Lithuania launched its LNG terminal last year in order to diversify its natural gas sources. Before that, Gazprom was the only supplier of natural gas to Lithuania.

The head of the cabinet assured that electricity prices for consumers would also decrease as of July, though he wasn't able to specify the numbers.

"The launch of electricity interconnections with Sweden and Poland has cut the prices on imported electricity," said Butkevicius.

The Baltic country launched power links with Sweden and Poland at the end of last year in order to gain access to the European electricity market, diversify its electricity supplies, and lower the costs of electricity for consumers. Endit