Economics secondary in LNG decission

VILNIUS - Some Lithuanian energy experts support the construction of the Baltic Natural Liquefied Gas (LNG) terminal in Latvia rather than in Lithuania, reports Lithuanian daily Lietuvos Rytas. Developing the liquefied natural gas terminal jointly with Latvia would be the cheapest option for Lithuania, the daily points out.

“It is unprofitable for each country to have its own terminal. Latvians have the entire infrastructure [in place] and they propose to work together. Obviously, this is a better option than building [a terminal] in Lithuania and investing 700 million litas (203 million euros) in it,” said Vidmantas Jankauskas, a former head of the National Control Commission for Prices and Energy.
“Commercially, it would be the most suitable for the Baltic countries. Latvians are capable of building such a terminal, as they have the experience and will receive EU aid. Also, that will require less investment,” Jurgis Vilemas, a Lithuanian energy scientist, said to Lietuvos Rytas.

Vilemas also opposes Lithuania building its own nuclear plant. Lietuvos Rytas is a wolf in sheep’s clothing, some consider, as on many occasions it seems to be Russian gas monopoly Gazprom’s promotional mouthpiece in Lithuania.
Lithuania’s government is not convinced that a Baltic liquefied gas terminal should be built in Latvia, since it could be built, and controlled, by companies related to Gazprom. “If, as the word is, the builder would be a Gazprom subsidiary, it would be a Gazprom terminal, and Lithuania will not approve of this. It would not be an actual gas supply alternative. There are reports that the terminal would be intended for exports, which is clearly in line with Gazprom’s interests,” Ceslovas Stankevicius, the chairman of the Lithuanian parliament’s European Affairs Committee, told Alfa.lt.

Lithuania does not object to Latvia building its own liquefied natural gas terminal, though Vilnius will also build its own LNG terminal, Lithuanian President Dalia Grybauskaite has pointed out. “Both projects do not conflict with each other; Lithuania still plans to build a terminal of lower capacity in its territory but wouldn’t mind if Latvia built a bigger center,” Grybauskaite said on Feb. 10, 2011.

The issue centers on the Baltic States moving away from dependence on Russia for energy needs. Gas is currently imported solely from Russia’s Gazprom, and building LNG terminals on the Latvian or Lithuanian shores would allow for additional supply routes, providing for a more competitive energy market and better energy security.