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    Lithuanian Adviser Urges no Russian LNG Imports


A long-term contract with a non-Russian supplier would be preferable to spot purchases from Novatek, says a former energy minister.

by: Linas Jegelevicius

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Lithuanian Adviser Urges no Russian LNG Imports

A former energy minister of Lithuania, now advisor to the president, has urged the Klaipeda LNG terminal owner against taking further deliveries of Russian gas.

“From the long-term perspective, the terminal should undoubtedly remain an alternative supply channel and the capacities of the facility, which was built with Lithuanian consumers' money, should not be given away to players from the east," Jaroslav Neverovic said.

If LNG prices are indeed favourable, the state-owned energy group Ignitis (formerly Lietuvos Energija) and other gas importers should look for opportunities to sign new long-term LNG supply contracts.

He said there is “potential” for this as LNG prices are “attractive”, and an increasing number of suppliers is emerging, and such a long-term contract could help ensure, in a sense, a gas price ceiling for the entire market.

Lithuania's fertiliser manufacturer Achema, the Klaipeda terminal's biggest customer, has been actively importing LNG from Russia, buying small LNG cargoes from Novatek's plant at Vysotsk. It has also imported a large shipment from the Russian supplier's Yamal LNG terminal through intermediaries.

Achema does not comment on whether it has long-term contracts, nor does it disclose who its LNG suppliers are. It is known that the company also imports LNG from Norway's Equinor.

Ignitis has also bought a cargo of Novatek LNG from Vysotsk via an intermediary. The state-owned company has a 10-year LNG supply contract with Equinor (former Statoil), effective until 2024. 

Before the launch of the Klaipeda terminal in 2015, pipeline gas from Russia's Gazprom was the only source of gas imports for the Baltic countries. The natural gas transmission system operator Amber Grid says that Gazprom's gas accounted for 42% of Lithuania's total gas imports in January-September 2019.

Klaipedos Nafta (KN), operator of the Klaipeda LNG jetty, told NGW that KN does not apply any “geographical restrictions” to the origin of gas it accepts. “Notably, Lithuanian gas trading firms are not obliged to reveal information of the kind to us,” it told NGW.

Arturas Ketlerius, spokesman of Ignitis, told NGW that the company has bought only one Novatek LNG cargo. Asked if Ignitis would take heed of the adviser's recommendation he said there is no long-term contract with Novatek and nor was one envisaged.