Lithuania moves a step closer to energy independence

Lithuania’s state-controlled Litgas concluded negotiations with Statoil regarding LNG gas deliveries to the Klaipeda terminal, which arguably brings the country one step closer to full energy independence from the Russians, Polish newspapers reported.

”We are in the process of tying the loose ends of this transaction,” Dominikas Tuczkus, CEO of Litgas, told the papers on May 28. “We plan on completing the process by June.”

According to Statoil, LNG gas may start flowing to Lithuania’s terminal in Klaipeda as early as January 2015. By that time, the terminal, which has been under construction since mid-2013, is expected to be completed and operational. Litgas hopes to receive as much as 540 mln cubic meters of gas from Norway in 2015, which would be enough to satisfy one-fifth of the country’s demand.

The agreement reached with the Norwegians is in line with Lithuania’s long-term strategy with the final goal of complete independence from the Russian energy sources. One of the facts that triggered this new direction in the country’s policy was Gazprom’s alleged overcharging for the gas deliveries to Lithuania in the recent years. Lithuania has sued Gazprom to international arbitrage in Stockholm demanding retribution for the alleged overpaid gas payments.

The expected total capacity of the LNG gas terminal is supposed to allow Lithuania to become completely independent from gas from Russia. Apart from the deal with Statoil, Lithuania is also looking into other potential gas suppliers, including Qatar Liquefied Gas, the largest LNG gas supplier in the world. Vilnius is also reportedly in talks with US gas suppliers.