Natural gas supply and trading company LITGAS, part of Lithuania’s state owned energy holding Lietuvos Energija, and Statoil signed a memorandum of understanding (MoU) to establish later this year a joint venture company in Lithuania to develop small scale LNG bunkering services. The new initiative would supply LNG as a fuel to ships, small terminals in the Baltic Sea, and transport LNG by trucks to on-shore customers.
“This marks an important milestone in Lithuania’s energy industry and will enable LITGAS to diversify its activities internationally”, said General Manager of LITGAS Dominykas Tuckus. “Increased usage of the Klaipeda terminal will help to reduce infrastructure and maintenance costs incurred by the Lithuanian and Baltic gas consumers and position Klaipeda as an important hub in the Baltic LNG market”.
“We believe that the small scale LNG market in the Baltic Sea has the potential to become commercially attractive business opportunity. The combined competencies of the two companies put the joint venture in a position to successfully develop this market and contribute to the usage of environmentally cleaner fuel in the Baltic region,” Geir Heitmann, Chief Origination Officer, LNG, Statoil, said.
It is predicted that Baltic Sea small scale LNG market can reach from 0.5 to 1 BCM a year by 2020. The joint venture company would be well positioned to supply this growing market due to convenient logistical setup capturing one of the shortest supply chains in the region and operational flexibility. The joint venture company is expected to start its small scale supply operations in the Q4 of 2017 or sooner.