Lithuania may launch new shale gas tender in spring

Jonas Satkūnas, director of the Lithuanian Geological Survey, said that a new tender might be launched next spring.

Matonienė, who is the head of a shale gas exploration and production tender commission, said that the panel had discussed the changed legislative and geopolitical situation earlier this week and decided to prepare the terms and conditions of a new tender by its next meeting scheduled for 26 January.

“It was decided during the meeting to proceed according to plan. The terms of the tender will be prepared based on the previous tender, but taking into account the changes in the legal regulation,” she told BNS.

The Geological Service’s director told BNS that it was realistic to launch a new tender in the spring.

“There are no obstacles to launching the tender, unless a certain political decision is made. Legislation is being drafted, which means that preparations are underway for a new tender,” he told BNS.

Satkūnas mentioned last year that China’s oil giant Sinopec, whose scientists visited Lithuania last summer, was interested in the country’s shale hydrocarbons.

However, the director said on Friday that it would be clear if the Chinese were really interested after the tender had been announced.

Lithuanian Prime Minister Algirdas Butkevičius said last December that he expected that the tender would attract bidders, noting that some US companies had already expressed their interest.

The US energy giant Chevron, the sole bidder in the previous tender for a shale gas exploration and production license, pulled out in October 2013, citing unfavorable tax and legal environment in Lithuania as the reason.

The Seimas (parliament) in early December passed certain legislative amendments providing for taxing shale gas production in Lithuania at a 1 percent rate in the first three years of operation, but no longer than until 2020, after which a 15 percent rate is to be applied. The amendments are yet to be signed by the president into law.