VILNIUS, Lithuania,
July 2, 2015 /PRNewswire/ --
Natural gas supply and trading company LITGAS, part of
Lithuania's state
owned energy holding Lietuvos Energija, and Statoil,
leading global energy company in oil and gas
production, signed a memorandum of understanding
(MoU) on Thursday in Vilnius, Lithuania regarding
establishment of a joint venture company in
Lithuania to develop small
scale LNG bunkering services.
The new joint venture company is planned to be established in
Lithuania later this year and
would supply LNG as a fuel to ships, small terminals in the Baltic
Sea, and transport LNG by trucks to on-shore customers.
(Photo:
http://photos.prnewswire.com/prnh/20150702/227724 )
"This marks an important milestone in Lithuania's energy industry and will enable
LITGAS to diversify its activities internationally", General
Manager of LITGAS Dominykas Tuckus said. "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. Naturally, all relevant regulatory and corporate
approvals will need to be obtained prior to the final investment
decision." 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.
Securing vessel capacity is an important prerequisite for the
joint venture company and dialogue has been initiated with shipping
companies with the aim to secure vessel capacity from the time the
joint venture company becomes operational and received the final
regulatory approvals.
The possibility to cooperate on joint development of small scale
LNG bunkering services was identified in a 5-year supply contract
signed by LITGAS and Statoil in August
2014.