Saturday , October 16 2021

Parliament – Amendments to the liberalization of the gas market

The Seimas begins discussions on how to stimulate competition in the natural gas market and increase the liquidity of the gas market.

The Seimas adopted amendments to the three laws – the LNG terminal, the heat and energy market on Thursday, after December 11 – and will continue to consider them on December 11.

It is proposed to abolish the obligation of large-regulated energy producers to buy gas from the import company "Litgas" as a matter of priority to charge them to buy part of the gas on the stock exchange.

Manufacturers, consuming 50 GWh or more gases per year, will have to purchase at least half of them by the Baltic GET.

Yygimantas Vaičinnas, the Minister of Energy, said that "LITGAS" will continue to be obliged to purchase the required amount of gas – 4 LNG cargo per year – to maintain the terminal, but will be able to market it on the market basis in the Lithuanian market, regional or international LNG in the most economically viable manner.

The LNG price sold by the terminal will be unregulated, according to the new model, and the costs of operating and balancing activity, gas exchange and storage will no longer be compensated, and will have to cover their business from income.

He also announced that, by improving the sales model of LNG terminal, 6 million liters from around 20 million euros. Up to 14 million USD – the additional security component for gas consumers will decrease during the year.

According to him, the second advantage is that over the years the liquidity of Lithuanian gas exchange and the volume of trading will increase 4-fold.

"A more active trade in the gas exchange will significantly facilitate the entry of new suppliers into the Lithuanian gas market," the minister explained.

In the context of the EU, the Lithuanian gas market is classified as lacking liquidity and at the initial development level.

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