Lithuania sets 2014 deadline for gas-market reform

28th October 2011, Comments 0 comments

Lithuania on Friday pegged October 2014 as the deadline for an EU-piloted reform on its natural gas market that has sparked tensions between the ex-Soviet Baltic state and Russian giant Gazprom.

The EU competition measures -- which bar suppliers from also running the gas-mains system -- poses a challenge to natural gas goliath Gazprom, which owns 37.1 percent of Lithuania's gas-mains company Lietuvos dujos, bought in 2004.

Lietuvos dujos is Lithuania's sole natural gas distributor of Gazprom gas, Lithuania's only supplier.

"Under the plan, the separation of transportation, distribution and supply activities in Lietuvos dujos must be completed by October 31st, 2014," the government of the ex-Soviet Baltic state which joined the EU in 2004 said in a Friday statement.

Vilnius's measures were agreed with the European Commission and Germany's E.ON Ruhrgas International, which owns 38.9 percent in Lietuvos dujos, the government said.

Aside from Gazprom and Germany's E.ON, the Lithuanian state controls 17.7 percent of the company. An additional 6.3 percent is held by unidentified minor investors.

Gazprom did not immediately provide any comment and had not taken part in discussions on the so-called de-bundling measure, according to Lithuanian government statement issued Friday.

Lithuania's parliament approved the energy sector reform in June, but the law did not define specific terms, leaving the details to the cabinet.

Ex-Soviet Lithuania has locked horns with Russian gas giant Gazprom, accusing it of unfair pricing, and in January filed a complaint against it with EU competition authorities.

Gazprom denies abusing its clout and has faulted Lithuania's reform plans.

The Baltic Sea state plans to build a liquefied natural gas terminal on its coast by 2014, to help diversify suppliers.

Lithuania's reliance on Russia for gas is a legacy of five decades of Soviet rule, which ended in 1991.

Vilnius joined NATO and the European Union in 2004, has had rocky relations with Moscow since it broke free after five decades of Kremlin rule.

© 2011 AFP

0 Comments To This Article