Cargo, Latvia, Lithuania, Oil, Railways, Transport

So far, Lietuvos Gelezinkeliai has transported fuel produced by Orlen Lietuva only in Lithuania.

Lietuvos Gelezinkeliai's CEO Mantas Bartuska and Orlan CEO Daniel Obajtek on Tuesday signed an agreement on the companies' cooperation in Mazeikiai, northwestern Lithuania.

"We have signed an annex to the agreement, thanks to which we will be able to transport more cargo. It will be profitable for both Poland and Lithuania," Obajtek told a joint press conference on Tuesday.

Lietuvos Gelezinkeliai says it plans to transport several hundred thousand tons of Orlen Lietuva products in the Polish direction. The company now transports around 9 mln tons a year.

The CEOs also laid a symbolic rail at the Mazeikiai-Renge railway section, now being rebuilt, linking the Mazeikiai plant with Renge in Latvia.

"The laying of this rail has not only an economic but also symbolic meaning as we are resolving those misunderstandings Lietuvos Gelezinkeliai and Orlen faced in the past," Lithuanian Transport Minister Rokas Masiulis told the press conference.

In his words, the Lithuanian government will seek to create favorable conditions for Orlen investments in Lithuania.

In late March, the Lithuanian government and Poland's Orlen signed a cooperation declaration stipulating that the Polish company would invest into the Mazeikiai plant and would not cut jobs, and the government pledged to reconsider the tariffs for public interest services that apply to the company and also consider the possibility of building a pipeline to Klaipeda.

Lietuvos Gelezinkeliai was last year fined almost 28 mln euros by the European Commission for the dismantling of the 19km Mazeikiai-Renge railway and the company plans to rebuild it by the end of the next year.

The Lithuanian government hopes the rebuilding of this railway section will improve cooperation with Orlen Lietuva which used it for transporting its oil products to Latvia.

The Mazeikiai-Renge railway section was dismantled in 2008. Lietuvos Gelezinkeliai paid the 27.87 mln-euro fine in early June and later filed an appeal against the European Commission with the EU General Court.