Lithuania accuses Russia's Gazprom of blackmail

27th December 2010, Comments 0 comments

Lithuania accused Gazprom of blackmail Monday, after the Russian gas giant reportedly said it would not offer the Baltic state the same discounts that it was prepared to give neighbouring nations.

"If that is confirmed as the official Gazprom position, we would treat it as economic blackmail against Lithuania," Prime Minster Andrius Kubilius told reporters.

Russian media last week quoted Gazprom's deputy chief executive Valery Golubev as saying that the group was considering discounts for the Baltic states of Latvia and Estonia, but not Lithuania.

Lithuania and Gazprom have been locked in a war of words over Vilnius's plans to reform its energy market by "unbundling" the country's gas system, separating bulk supply from that piped to consumers.

Currently Gazprom is Lithuania's sole supplier and also has a 37.1 percent share in the country's gas distributor Lietuvos Dujos.

Germany's E.ON Ruhrgas International is another major stakeholder with 38.9 percent while the Lithuanian state controls 17.7 percent.

Gazprom and E.ON have asked Lithuania to seek an exemption from European Union competition regulations on gas market reform, but Vilnius has refused.

"Lithuania is being punished because it plans to implement an EU directive," Kubilius said.

In a statement later Monday, he added: "Such a discriminatory approach by a monopolist concerning gas prices for Lithuanian consumers is a big challenge for the European Commission."

The Lithuanian government said it planned to appeal to the European Commission, the executive body of the 27-nation EU, which polices its trade and competition rules.

Lithuania, a nation of 3.3 million that joined the EU in 2004, is seeking to cut its dependence on supplies from Russia, a legacy of its five decades as a Soviet republic before the communist bloc collapsed in 1991.

© 2010 AFP

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