Baltic States – CIS, Energy, EU – Baltic States, Gas, Legislation

Vygantas Vaitkus, a member of the National Commission for Energy Control and Prices, maintains that the conversations on creation of a single gas market have just been started, adding that the negotiations would take at least a few years.

"The issue is still being discussed, a Baltic regional task force has been formed and a Baltic regional study of the gas market was drafted last month," Vaitkus told BNS Lithuania.

In his words, the main objective of the model is to avoid additional payment for gas transportation on each border, and to have the Baltic States and Finland treated as a single market. In such case, access-exit points would remain at the exterior borders of the Baltic States, and after paying once for gas entrance into the market companies would not have to pay any additional fees, as the case is now.

Dominykas Tuckus, board chairman of Lithuania's state energy holding company Lietuvos Energija (Lithuanian Energy), told BNS that creation of a single Baltic market would lead to more similar prices. In his words, gas traders may incur losses due to the fact that Latvia is measuring gas in cubic meters rather than megawatt-hours, as measuring higher-calory gas received via the Lithuanian LNG terminal in Klaipeda in megawatt-hours is more profitable.

"Of course, there would be more competition on the retail market – Lithuania, as the biggest natural gas consumer in the Baltic States, would attract suppliers from Estonia and Latvia. It would be a win for clients. Speaking about export possibilities in the course of a few years is still difficult. As we know, a lot will depend on the strategy of (Russia's) Gazprom and the prevailing prices," Tuckus said.

In his opinion, even broader opportunities would be opened by inclusion of Finland and Poland into the single market, as they consume about 2.5 billion cubic meters of gas and 15 billion cubic meters of gas, respectively. The Baltic nations could link with the two countries after building gas pipeline interconnection: in 2020 with Poland and in 2019 with Finland.

Energy Minister Rokas Masiulis believes a single Baltic market would revitalize the Lithuanian market. He says he is expecting the best version of a single market model.

"We will wait for a version that would make the market as vital as possible," Masiulis told BNS Lithuania.