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Lithuania, Poland Seek EU Gasline Funding

Maritime Activity Reports, Inc.

August 21, 2014

Lithuania and Poland have asked the European Union to cover up to 75 percent of the costs of a gas link between the two countries, their national gas grid companies said on Thursday.

The link is a part of an EU plan to end the energy dependency of the three ex-Soviet Baltic states, which currently rely totally on natural gas imports from Russia.

"The submission of a joint applications for the EU support is an important step into the implementation of the project aimed to integrate the isolated gas markets of the Baltic States into the EU gas market," said Saulius Bilys, general manager of Lithuania's gas transmission grid operator Amber Grid

The link would also increase the security of natural gas supply and competitiveness of the regional market, he added.

The 500-km link, estimated to cost 558 million euros, will be able to carry 2.3 billion cubic metres (bcm) of gas per year.

Lithuania plans start importing liquefied natural gas (LNG) from Norway in 2015, but planned imports will cover only about 20 percent of consumption.

Poland, which gets most of natural gas from Russia, also plans to start importing LNG.

The request for EU funding was sent after the European energy agency ACER solved a dispute over its cost distribution.

Baltic states, which will be the main beneficiaries of the gas link, will have to pay 85.8 million euros in compensation to Poland, which will bear about three-quarters of total costs or 422 million euros, the agency has ruled.

Lithuania, Latvia and Estonia consume about 5 bcm of gas per year.

Reporting by Andrius Sytas

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