Lithuania expects increased revenue under new agreement with Gazprom on gas transit to Kaliningrad

MOSCOW. Dec 16 (Interfax) - Lithuania and Russia are finalizing negotiations on a new agreement for the transit of Russian natural gas to the Kaliningrad region, with Vilnius expecting an increase in transit revenue, according to a report on the BNS agency's website.

Preliminary estimates indicate that Lithuania's annual income from the transit will be around 29 million euros, the chairman of the Lithuanian National Energy Regulatory Council, Renatas Pocius, told BNS.

Currently, the annual revenue of the state-owned company Amber Grid from this transit under a ten-year agreement with Gazprom expiring on January 1, 2026, is around 13 million euros. The Lithuanian Energy Ministry said that the country receives up to 20 million euros in revenue annually.

An expert consulted by BNS for comment said that Vilnius has all the leverage to earn more from the transit of Russian gas.

When signing the contract with Gazprom ten years ago, Lithuania calculated the cost of gas transportation individually, but now it must do so in accordance with the unified EU methodology, Pocius said. Transit will also become more expensive due to Lithuania's investment in gas transportation infrastructure.

"Significant investments were made during the period of signing the transit agreement [in 2015], and those costs or prices that were set ten years ago do not correspond to current costs. This is one of the main reasons for revising the tariff system and tariffs themselves. The second aspect is that the tariffs themselves are set today in accordance with European legislation, the requirements of the European Network Code," he said.

"According to publicly available information we have, the revenue level [the annual revenue of Amber Grid from transit] will be about 29 million euros. These are forecasted, preliminary [calculations]," Pocius said.

Technical negotiations have been held with the EU's Agency for the Cooperation of Energy Regulators (ACER) regarding the terms of gas transit, Energy Minister Zygimantas Vaiciunas said.

Former Energy Minister Dainius Kreivys told the LRT television channel that the initial transit price in the new contract presented by Amber Grid to the Russian side was sometimes higher than the one in effect over the past decade.

Negotiations on the new agreement and its terms are being conducted by the Lithuanian gas transmission system operator Amber Grid and Gazprom. According to unofficial information from BNS, a five-year contract is currently being discussed.

According to BNS data, Amber Grid's contractual annual revenue is around 12 million to 13 million euros, but depending on the calorific value of the gas and its market prices, this revenue fluctuates and in some years reached 20 million euros.

According to estimates by politicians and experts interviewed by BNS, Lithuania now has all the conditions to receive greater revenue from transit compared to, for example, 2014, primarily because the country is completely independent of Russian energy.

In 2024, the transit level to the Kaliningrad region through Lithuania increased 9% to 26.1 TWh, or 2.5 billion cubic meters.

Lithuania completely stopped importing Russian gas, except for transit to the Kaliningrad region, in April 2022.