VILNIUS — The two main shareholders of the country’s gas company Lietuvos Dujos protested against the potential unbundling of the utility into separate companies, saying it would increase cost to the consumer.
Lietuvos Dujos is 38.9 percent owned by the German E. ON Ruhrgas and 37.1 percent owned by the Russian government via its gas company Gazprom. The European Union is supporting the unbundling of the company into [private_supervisor]separate functions — transport and production — to increase efficiency.
Gazprom and E.ON Ruhrgas released a statement that they disagreed with the Lithuania government’s plan to break up the company into separate entities, a move that would hopefully make gas cheaper by increasing transparency and breaking up vertical ownership chains.
“In the Lithuanian context, the separation of ownership would reduce efficiency and increase costs — at the expense of consumers,” the statement from the two main shareholders said.
However, Lietuvos Dujos is already planning on increasing prices 15 to 20 percent starting in July despite a first-quarter profit that was up 144 percent year-on-year.
Planned split
The company would be split into at least two, but maybe three companies. Transmission, production and infrastructure would be separated under the plan. It will create favorable conditions for innovation and investment, particularly into new infrastructure that would reduce Lithuanian dependence on Russian gas. Currently Lithuania is almost totally reliant on Russian gas because of the lack of infrastructure.
The prime minister’s office reported that the EU supports the new model because it provides the best guarantee of national energy security interests and benefits to users.
The two shareholders in its statement said that the country should reconsider before splitting up the company.
The country needs new infrastructure in the natural gas sector. Two projects to diversify the country’s gas imports are being worked on — the construction of a floating liquid natural gas terminal off the coast of Klaipėda and a pipeline to Poland.
The state via the State Property Fund owns 17.7 percent of the Lietuvos Dujos. These shares cannot be privatized. [/private_supervisor] [private_subscription 1 month]separate functions — transport and production — to increase efficiency.
Gazprom and E.ON Ruhrgas released a statement that they disagreed with the Lithuania government’s plan to break up the company into separate entities, a move that would hopefully make gas cheaper by increasing transparency and breaking up vertical ownership chains.
“In the Lithuanian context, the separation of ownership would reduce efficiency and increase costs — at the expense of consumers,” the statement from the two main shareholders said.
However, Lietuvos Dujos is already planning on increasing prices 15 to 20 percent starting in July despite a first-quarter profit that was up 144 percent year-on-year.
Planned split
The company would be split into at least two, but maybe three companies. Transmission, production and infrastructure would be separated under the plan. It will create favorable conditions for innovation and investment, particularly into new infrastructure that would reduce Lithuanian dependence on Russian gas. Currently Lithuania is almost totally reliant on Russian gas because of the lack of infrastructure.
The prime minister’s office reported that the EU supports the new model because it provides the best guarantee of national energy security interests and benefits to users.
The two shareholders in its statement said that the country should reconsider before splitting up the company.
The country needs new infrastructure in the natural gas sector. Two projects to diversify the country’s gas imports are being worked on — the construction of a floating liquid natural gas terminal off the coast of Klaipėda and a pipeline to Poland.
The state via the State Property Fund owns 17.7 percent of the Lietuvos Dujos. These shares cannot be privatized. [/private_subscription 1 month] [private_subscription 4 months]separate functions — transport and production — to increase efficiency.
Gazprom and E.ON Ruhrgas released a statement that they disagreed with the Lithuania government’s plan to break up the company into separate entities, a move that would hopefully make gas cheaper by increasing transparency and breaking up vertical ownership chains.
“In the Lithuanian context, the separation of ownership would reduce efficiency and increase costs — at the expense of consumers,” the statement from the two main shareholders said.
However, Lietuvos Dujos is already planning on increasing prices 15 to 20 percent starting in July despite a first-quarter profit that was up 144 percent year-on-year.
Planned split
The company would be split into at least two, but maybe three companies. Transmission, production and infrastructure would be separated under the plan. It will create favorable conditions for innovation and investment, particularly into new infrastructure that would reduce Lithuanian dependence on Russian gas. Currently Lithuania is almost totally reliant on Russian gas because of the lack of infrastructure.
The prime minister’s office reported that the EU supports the new model because it provides the best guarantee of national energy security interests and benefits to users.
The two shareholders in its statement said that the country should reconsider before splitting up the company.
The country needs new infrastructure in the natural gas sector. Two projects to diversify the country’s gas imports are being worked on — the construction of a floating liquid natural gas terminal off the coast of Klaipėda and a pipeline to Poland.
The state via the State Property Fund owns 17.7 percent of the Lietuvos Dujos. These shares cannot be privatized. [/private_subscription 4 months] [private_subscription 1 year]separate functions — transport and production — to increase efficiency.
Gazprom and E.ON Ruhrgas released a statement that they disagreed with the Lithuania government’s plan to break up the company into separate entities, a move that would hopefully make gas cheaper by increasing transparency and breaking up vertical ownership chains.
“In the Lithuanian context, the separation of ownership would reduce efficiency and increase costs — at the expense of consumers,” the statement from the two main shareholders said.
However, Lietuvos Dujos is already planning on increasing prices 15 to 20 percent starting in July despite a first-quarter profit that was up 144 percent year-on-year.
Planned split
The company would be split into at least two, but maybe three companies. Transmission, production and infrastructure would be separated under the plan. It will create favorable conditions for innovation and investment, particularly into new infrastructure that would reduce Lithuanian dependence on Russian gas. Currently Lithuania is almost totally reliant on Russian gas because of the lack of infrastructure.
The prime minister’s office reported that the EU supports the new model because it provides the best guarantee of national energy security interests and benefits to users.
The two shareholders in its statement said that the country should reconsider before splitting up the company.
The country needs new infrastructure in the natural gas sector. Two projects to diversify the country’s gas imports are being worked on — the construction of a floating liquid natural gas terminal off the coast of Klaipėda and a pipeline to Poland.
The state via the State Property Fund owns 17.7 percent of the Lietuvos Dujos. These shares cannot be privatized. [/private_subscription 1 year]
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