TALLINN - The energy utilities of Estonia, Latvia and Lithuania agreed on Feb. 19 that Lietuvos Energija, Lithuania's state-owned power transmission company, would join the Estonian-Finnish underwater cable project that will connect the four countries' energy markets.
Eesti Energia (Estonian Energy) spokeswoman Riina Vandre told the Baltic News Service that the parties agreed in principle, but talks over concrete terms of participation would continue.
The news came as a surprise after Lithuanian government officials had decided to prevent Eesti Energia, which is wholly state-owned, from acquiring Rytu Skirstomieji Tinklai, the eastern half of Lithuania's national power grid. Eesti Energia offered the highest bid - 150 million euros - for a 71.35 percent stake in RST in December.
Nonetheless Eesti Energia sent a letter to Lietuvos Energija inviting the company to discuss plans for investment in the project that will link the Baltic countries to the Nordic power grids, the daily Lietuvos Rytas reported on Feb. 19.
Eesti Energia also asked Lietuvos Energija as to how much electricity it could export through the new undersea cable in the period between November 2005 and April 2008, the paper reported.
The project is aimed at building a 350-megawatt undersea power cable between Estonia and Finland. Total investments for the project amount to some 380 million litas (110 million euros)- 414 million litas.
If the deal goes through, the cable could become operational by the end of 2005.
Prior to the invitation to Lietovos Energija, parties in the cable project included Eesti Energia, Latvenergo, Pohjalan Voima and Helsingin Energia.
The Lithuanian government has yet to make a final decision on the RST privatization, though Prime Minister Algirdas Brazauskas previously reiterated his opinion that the grid should not be sold to Eesti Energia, which is still state-owned.
Eesti Energia has already claimed compensation for its participation in the tender, which could amount to some 1 million euros.
