Latvia's gas monopoly says no room for alternative suppliers (updated)

Latvijas Gaze AS

18/09/2015 13:39

(Adds Latvijas Gaze quotes, details) 
    RIGA, Sept 18 (Reuters) - Latvian gas monopoly Latvijas Gaze 
 GZE1R.RI , partly owned by Russia's Gazprom  GAZP.MM , said on 
Friday there was no room for alternative suppliers as the Baltic 
country was already contracted for more Russian gas than it is 
using. 
    Regulators have approved rules allowing consumers to look 
for alternative suppliers. ID:nL5N11G4D9  
    But Latvijas Gaze points out that last year it took 173 
million cubic metres (mcm) less gas from Gazprom than it was 
contracted for under a so-called take-or-pay contract.  
    That meant paying 35.7 million euros for deliveries it was 
not yet able to take. 
    "In light of Latvia's failure to meet the take-or-pay 
conditions agreed with the natural gas supplier (Gazprom)... 
supplies from other suppliers are currently impossible," 
Latvijas Gaze said in a statement. 
    "We have to take gas, which we cannot sell... (so any) 
supply from alternative source would increase our losses," 
spokesman Vinsents Makaris said. 
    The company also noted that under a 1997 privatisation 
agreement, its shareholders were granted exclusive rights to 
sell gas and operate Latvia's grid until April 3, 2017. 
    Latvia's energy market regulator, the Public Utilities 
Commission, was not available for immediate comment. 
    Latvia consumed 1.3 billion cubic metres (bcm) of gas in 
2014, down 28 percent from 1.8 bcm in 2010 due to warmer winters 
and an increased use of biomass for central heating. 
    Power company Latvenergo, the country's biggest gas 
consumer, told Reuters it was considering importing some gas 
from Lithuania, which opened a liquefied natural gas (LNG) 
terminal last year. 
    Latvijas Gaze said imports from that terminal were possible, 
but could only cover a part of the country's winter demand due 
to technical limitations. 
    The utility, however, said it would continue to provide grid 
access to other suppliers for gas transit. 
    Lithuania started selling gas to Estonia via Latvia this 
year, meeting about a quarter of Estonia's demand. 
    Latvia's government finalised a plan on Tuesday to split 
Latvijas Gaze in 2017 in line with European Union rules 
prohibiting gas suppliers from controlling transportation. 
    Germany's E.ON  EONGn.DE  holds a 47.2 percent stake in 
Latvijas Gaze which it is seeking to sell.  
        
 
 (Reporting by Gederts Gelzis and Nerijus Adomaitis; editing by 
Jason Neely) 
 ((nerijus.adomaitis@thomsonreuters.com; +47 9027 6699; Reuters 
Messaging: nerijus.adomaitis.thomsonreuters@reuters.net)) 
 
Keywords: LATVIA GAS/