Lithuania Opens Door to LNG Re-exports

Lithuania's parliament on Tuesday approved amendments which will allow the Baltic state to re-sell liquefied natural gas (LNG) on the international markets, the energy ministry said.

 

The current laws require the country's regulated energy and heat producers to buy at least 540 million cubic metres (mcm) from a floating LNG terminal in Klaipeda on the Lithuanian coast to ensure it remains operational.

 

But gas demand has been falling due to increased use of biomass for heating and warmer weather, leaving the energy companies with surplus gas.

 

Lithuanian LNG importer Litgas asked the government to change the rules to allow the sale of surplus gas on the local gas exchange GET Baltic or on the international spot markets.

 

Litgas has a five-year contract with Norway's Statoil to buy 540 mcm annually and this also allows re-sale of cargoes destined for Klaipeda, the company said.

 

Litgas planned to supply about 280 million cubic meters of gas out of all its contracted volumes to Lithuania's regulated heat and electricity producers next year, and will sell the rest in the domestic or international market, company spokesman Paulius Jakutavicius told Reuters.

 

But volumes available for international sales will be limited so that the terminal at Klaipeda can receive enough supply to keep it operating, he said.

 

The minimum import volumes still have to be determined by the terminal's operator Klaipedos Nafta.

 

The terminal expects to receive five new LNG cargoes up to the end of October 2016 with one arrival scheduled on Nov. 26-30, loading plans from Klaipedos Nafta showed.

 

The Baltic state might become the first in Europe to receive LNG cargo from the United States next February, two industry sources have said.

 

Lithuanian Energy Minister Rokas Masiulis told Reuters in October the country was in talks to buy gas from the U.S. as it wanted to cut on Russian imports and its long-term supply contract with Gazprom was expiring in December.