Lithuania Signs New Long-Term Deal With Russia's Gas Giant

Lithuania's natural gas transmission system operator Amber Grid and Russia's biggest gas producer Gazprom both announced yesterday that the two sides have signed a long-term deal for gas transportation to Russia's Kaliningrad region.

Lithuania currently already transports gas from mainland Russia to the remote Kaliningrad region via Amber Grid's transmission system. The new agreement is comparable to an existing one between Gazprom and Amber Grid, which expires at the end of this year.

In a brief statement released on its website, Gazprom said that the new long-term agreement on Russian gas transit via Lithuania to the Kaliningrad region (which is bordered by Poland and Lithuania) would cover a period of a decade.

"The document signed for a 10-year term provides for gas transit via the Republic in the amount of up to 2.5 billion cubic metres of gas a year," it said. "The agreement will become effective on January 1, 2016."

The new agreement ends on December 31, 2025.

In a separate statement, Amber Grid expanded significantly on the agreement, including the daily capacity of the transmission.

"In the agreement the capacities of 10.5 million m3/ day at the System Entry Point for the Belarussian Transmission System and capacities of the same size at the System Exit Point to the Kaliningrad Region are booked," the company said. "Any additional capacities at these points or at other Entry Points would have to be booked in line with the procedures as provided for by the Rules for the Use of the Natural Gas Transmission System of AB Amber Grid."

Amber Grid also says that, under the agreement, it will charge €10 to €11 million annually to transit the gas, a figure comparable to the current revenues it receives for doing so.