Latvia plans to boost gas sales, build pipeline

After construction of the planned gas pipeline by Itera Latvija from Latvia to Mazeikiai in northern Lithuania, some 100 million to 200 million cubic meters of natural gas could be supplied to Lithuania from the gas company's storage facilities, said Juris Savickis, head of Itera Latvija.

Latvijas Gaze (Latvia Gas) is presently selling natural gas in Latvia, Estonia and Russia with total sales volume this year expected to reach 1.4 billion cubic meters. After natural gas sales in Lithuania are launched the company's gas sales could grow by another 7 percent to 14 percent.

Itera Latvija, which owns 25 percent of Latvia Gas' shares, is one of the natural gas suppliers to Latvia.

Savickis said that at present negotiations are under way for the gas pipeline construction. In September the Mazeikiai city council accepted Itera Latvija's plan to build the pipeline.

Savickis said that natural gas could be supplied to Mazeikiu Nafta during the summer from the newly built pipeline, and then during the winter from the Incukalns underground gas storage facility.

Itera Latvija's natural gas could be supplied to other companies as well. Mazeikiu Elektrine, for instance, which consumes some 200 million cubic meters of gas annually, is also cited as a potential customer.

Savickis said earlier that Itera Latvija plans to invest some 3 million dollars in the pipeline construction, extending from Latvia to the Mazeikiai area.

Three entities - Itera Latvija, Valentinas Domogatsky, a Lithuanian investor, and Dolaurus, a Kaunas-based company - established Itergas exclusively for the construction of the new pipeline, pouring 116,000 euros into the new company.

Itera Latvija, which is controlled by the U.S.-registered Itera International Energy and Almera Investment, holds 60 percent of Itergas shares. Dolaurus owns 25 percent, while the rest is held by Domogatsky's partnership.