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

Prime Minister Algirdas Butkevicius says the new prices will be lower than Lithuania used to pay and "will be competitive compared with regional partners."

However, the prime minister has not revealed how much exactly the price will be reduced.

"Viktoras Valentukevicius, Director General of Lietuvos Dujos, paid a visit today and told that an agreement with Gazprom was inked on the new price for natural gas imported into Lithuania until 31 December 2015," said the prime minister on Thursday.

According to Butkevicius, the formula which is used to calculate the price of gas purchased from Gazprom will be improved.

"In the nearest meeting of the Board of Lietuvos Dujos the decision will be made on what the price could be. Calculations are needed because it has to be assessed how the currency rate varied in certain months. Later the National Commission for Energy Control and Prices (VKEKK) will be referred to which will determine gas tariff for Lithuania's consumers. The new price has to come in effect on 1 July," Butkevicius said.

Butkevicius refused to give all details when asked what discount Gazprom granted to Lithuania and whether it was close to 20% or USD 370 per 1,000 cubic metres.

"It might be 20, might be 21, 22 or 23%. Let's calculate at first. I would not like to be mistaken but the price will be competitive compared with what our regional partners are paying," said the prime minister.

Negotiations with Gazprom are continuing, according to the head of the Government, "We are waiting for answers to our questions and proposals. We hope to hold talks after receiving them."

As reported, the Government has brought a legal action against Gazprom as it applied unfair prices to Lithuania. Representatives of Lietuvos Dujos also decided to address to the arbitrage but have not done so.

"The Board of Lietuvos Dujos is dealing with the arbitrage issue. Several months ago the company raised a question to refer to the arbitrage if a right price is not applied to Lithuania. I think now that the contract with Gazprom is signed the price is right if you compare it with prices of regional partners," Butkevicius said.

The prime minister said further talks with Gazprom will be directed at long-term aspects.

"I think a certain result has been reached. Hopefully further negotiations will be related to certain agreements after 31 December 2015," said Butkevicius.