Lithuania talks with Statoil to make LNG terminal more flexible, energy minister says

The minister admits that information about the talks with Statoil has been made public somewhat prematurely.

“Perhaps this should not have been made known to the public as a guaranteed and final thing. Even if we do not rule out this happening at some time, at this stage, it is consideration of possibilities. When there is an agreement on these possibilities, then decisions on a model of operations will be made,” he told BNS in an interview.

The minister last week pointed out an error in Bloomberg’s report that Klaipėdos Nafta (Klaipėda Oil), the LNG terminal’s operator, was in talks with Norway’s Statoil on lower LNG imports.

“There is an error, because Klaipėdos Nafta does not sell gas. Klaipėdos Nafta could not comment on what other companies are doing because it does not know it,” he said.

Therefore, BNS asked Masiulis during the interview if that could mean that Litgas or the Ministry of Energy was in talks with the Norwegian supplier.

“Litgas, which trades in gas, is in talks and has reached a deal with the Latvians on the use of the Incukalns storage facility and is looking for possibilities to store a certain part of gas in Incukalns, if needed. It is also talking with Statoil on increasing the flexibility of supplies, but I wouldn’t like to elaborate, because it is up to the company to comment,” the minister told BNS.

“But the ministry has asked the companies that are related to the terminal to look into all possibilities so that we know all the options when we map out a scenario of operations for next year,” he said.

Bloomberg reported last week, citing Klaipėdos Nafta CEO Mantas Bartuška, that Klaipėdos Nafta “is in discussions to cut volumes contracted from Norway” amid a significant drop in demand for gas in the country. A Statoil spokesman declined to comment on this information to Bloomberg. The news agency later published Bartuška’s statement in which he said that neither Klaipėdos Nafta, nor Lithuania was discussing lower imports with Statoil.

Under a long-term gas supply contract signed between Statoil and Lithuania’s state-controlled natural gas trading company Litgas, the Norwegian company is to supply 540 million cubic meters of gas to the Klaipėda LNG facility annually for five years.

Unofficial sources have said that Litgas will not be able to sell some 150-200 million cubic meters of the annual volume contracted from Statoil this year and around 240 million cubic meters next year.

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