Lithuania Puts Off Shale Gas Plans Indefinitely

Lithuania says it has not scrapped its shale gas exploration and mining plans, but that it is putting them off indefinitely. Back in April, the country's the Lithuanian Ministry of Environment and Government announced that it was postponing a tender for shale exploration and extraction.

It was not the first time Lithuania's nascent shale gas industry faced a setback. In 2012, U.S. explorer Chevron was awarded mining rights to search for shale in Lithuania but announced it was exiting the country in October 2013, blaming the ever-changing legislative, taxation, and regulatory environment. Chevron’s decision earlier this year to give up on Romanian shale gas exploitation marks the the U.S. company’s final departure from its Eastern European shale gas adventure.

Given the uncertain global market for traditional oil and gas, the time is not right for unconventional exploration, one Lithuanian politician told Natural Gas Europe.

“The dynamics of global oil and gas prices have been very adverse to hydrocarbons and we might be seeing it for very long, so pursuing alternatives does not make much sense," Kestutis Dauksys, a Lithuanian lawmaker and member of Lithuanian Parliament’s Energy Committee, said. "Especially [because] Lithuania puzzles where to put the excessive amount of liquefied natural gas in the Klaipeda LNG terminal."

Shale gas is also unlikely to find the government support it needs in Lithuania at this time. Lithuania's Minister of the Environment, Kestutis Treciokas--unlike his predecessor Valentinas Mazuronis who was a staunch supporter of shale gas exploration--has always been hesitant about the pursuit.

Previously the minister said that there “had been several serious investors,” but after scrutinizing the ministry’s submitted geological data they concluded that Lithuanian resources “aren’t of interest to them” and withdrew from the bid.

According to estimates, Lithuania's recoverable shale gas reserves could amount to 100-120 billion cubic metres. However, those stimates are uncertain without further evidence from exploration.

“The latest geological drills were suggesting that we may have oil shale, not shale gas as it was long thought,” Kestustis Dauksys said.