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The Public Utilities Commission on Thursday decided that joint-stock natural gas company Latvijas Gaze could not temporarily bar the power utility Latvenergo from accessing natural gas transmission and distribution system.

As reported, Latvernergo turned to Latvijas Gaze regarding storage of gas, which Latvenergo was planning to buy in Lithuania, in Latvijas Gaze's Incukalns underground natural gas storage facility. Latvijas Gaze, however, decided that Latvenergo could not use natural gas infrastructure.

Latvijas Gaze may contest today's decision of the regulator in court.

At the beginning of May, Latvijas Gaze asked the Public Utilities Commission for a temporary suspension of third persons' rights to use the company's natural gas infrastructure for transportation of natural gas purchased from other suppliers for consumption in Latvia's territory.

Latvijas Gaze said at that time that the company is a vertically integrated energy supply merchant that by April 2017 has exclusive license for transmission, distribution, trade and storage of natural gas in the territory of Latvia and has a long-term agreement with Russian energy concern Gazprom on natural gas supplies until 2030 on certain volumes of natural gas that should be purchased annually. Due to several factors, for example, warm winters, that reduce natural gas consumption in the region, and reduction of capacities of large industrial gas consumers, Latvijas Gaze already now is not able to meet its terms under the agreement with Gazprom. Latvijas Gaze said that for these reasons, and in accordance with Section 110 of the Energy Law, it could not grant Latvenergo access to natural gas infrastructure for the time being.

The Public Utilities Commission in April issued a warning to Latvijas Gaze for its actions in Latvenergo access to gas infrastructure so that the energy company could begin purchasing gas from Lithuania.