Latvian LNG Terminal Might Be Less Expensive to Operate than Terminals in Neighbor Countries - MP
04.24.2022 - NEWS

April 23, 2022 [THE BALTIC Times] – The liquefied natural gas (LNG) terminal which the government is planning to build in Latvia might be significantly less expensive to operate than the LNG terminals in neighbor countries Lithuania and Estonia, Krisjanis Feldmans (Conservatives), chairman of the Saeima Economic, Agricultural, Environmental and Regional Policy Committee, said in an interview to Latvian Radio on Wednesday.

 

The lawmaker said that building the LNG terminal is in Latvia’s strategic interests and that the neighbor countries, too, would be offered to use the Latvian terminal.

“Our advantage is that this terminal would be less expensive to operate than the terminals in Klaipeda and Estonia and would be located closer to the Incukalns gas storage facility,” the MP said.

At the same time, Feldmans indicated that short-term solutions will have to be sought in cooperation with the Klaipeda and Paldiski LNG terminals to ensure gas supplies for the next two heating seasons.

“The terminals in Klaipeda and Estonia are the so-called mobile and leased terminals. They are not stationary structures at sea,” Feldmans explained, adding that these are fairly costly solutions, so the “neighbors would be motivated to use our potentially much cheaper terminal”.

As reported, the government on Tuesday agreed in principle to give up Russian natural gas imports and to build a liquefied natural gas (LNG) terminal in Latvia, Economics Minister Janis Vitenbergs (National Alliance) told journalists following a government meeting.

The minister said that these provisions would be included in the Energy Law. The most likely deadline for dropping Russian gas imports is January 1, 2023, Vitenbergs said.

The minister indicated that Latvia will be able to stop buying Russian gas once Estonia launches its LNG terminal in Paldiski. The Baltics will thus become the first region in Europe to give up Russian gas altogether.

Commenting on the planned construction of the LNG terminal in Latvia, Vitenbergs said that the terminal might be built by the end of 2023 or beginning of 2024. By May 31, the Economics Ministry is expected to present an assessment of the terminal’s potential location, benefits and costs.

“The state will propose the optimal gas supply security solution, which of course will be cost effective as well,” the minister said, adding that it is also important that such a project is implemented with a minimum involvement of the state and quickly enough.

For a short-term solution, Latvia will work with Estonia and Finland to implement the LNG terminal project in Paldiski, as it is the only way to ensure additional gas supplies to the region already this season. The government has authorized Vitenbergs to hold talks on the project with Estonia and Finland.

As a first step, the Latvian economics minister is expected to sign a legally and financially non-binding memorandum of understanding with the Estonian minister of economic affairs and communications and the Finnish minister of economic affairs and employment with the aim to deepen cooperation on this project.

As reported, the Saeima Economic, Agriculture, Environmental and Regional Policy Committee on April 6 supported a proposal to impose a ban on natural gas supplies from Russia to Latvia in the Energy Law.

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