This is an HTML version of an attachment to the Freedom of Information request 'The development and realization of the EU strategy for liquefied natural gas and gas storage'.



LNG AND NATURAL GAS 
MARKET PERSPECTIVES IN 
BALTIC STATES
September, 2015
DOMINYKAS TUČKUS


CONTENTS
I. Baltic market trends
II. Natural gas and alternatives
III. Emerging uses of LNG in Baltics
2



I   BALTIC MARKET TRENDS
3




Natural gas consumption and competition
2013
2014
ESTONIA
ESTONIA
0.7 BCM
3 wholesalers 
0.5 BCM
3 wholesalers (2 
(only 1 active)
active)
LATVIA
LATVIA
1.5 BCM
Vertically 
1.3 BCM
Vertically 
integrated 
integrated 
monopoly
monopoly
2.7 BCM
2.6 BCM
LITHUANIA
LITHUANIA
3 wholesalers
6 wholesalers
4


Natural gas prices in Baltics
(EUR/MWh)
50
45
40
35
30
25
20
15
10
5
0
2010 H1
2010 H2
2011 H1
2011 H2
2012 H1
2012 H2
2013 H1
2013 H2
2014 H1
2014 H2
Lithuania
Latvia
Estonia
Natural gas prices for industrial consumers
Source: Eurostat
5



Natural gas import balance
In 2015:
 LNG terminal starts operations
Estonia, 2015 H1
 Trade between Lithuania and Estonia begins
18%
2013
2015 H1
%
82%
ESTONIA
%
om 82 
Lithuania, 2015 H1
18%
om 100 
Gazpr
52.9 MCM  LATVIA
zpr
Ga
  l
LITHUANIA
oitaSt 18 %
82%
Gazprom
Other sources
Source: elering.ee, Amber grid
6


Trade in Lithuania
Volumes traded on natural gas 
Participants in natural gas 
exchange
exchange
GWh
50
500
45
450
48
40
400
35
350
469,3
300
30
250
25
27
200
20
150
15
100
10
50
24,87
5
0
0
2014 Q1
2015 Q1
2014 Q1
2015 Q1
Source: Get Baltic (Lithuania)
7


Price trend in Lithuania
Eur/MWh
Lithuanian average weighted natural gas import price
45,0
40,0
35,0
In May 2014:
30,0
 LITGAS signs terms sheet with Statoil
 AB Lietuvos Dujos negotiates a ~20% 
discount from Gazprom
25,0
20,0
Source: National Commission for Energy Control and Prices (Lithuania)
8



II   NATURAL GAS AND ALTERNATIVES
9



Consumption: Biomass vs. Natural gas
Biomass consumption, TWh
Natural gas consumption, TWh
16
+10%
14
-20%
12
10
8
6
4
2
0
2010
2011
2012
2013
Lithuania
Latvia
Estonia
Source: Eurostat, Energy Control and Prices (Lithuania), Central Statistical Bureau of Latvia, Estonian Ministry of Economic Affairs and Communications
10


Price: Natural gas vs. Biomass
EUR/MWh
40,00
35,00
30,00
25,00
20,00
15,00
10,00
Average price of natural gas
Average price of biomass
* Prices are provided for natural gas and biomass used for heating
Source: National Commission for Energy Control and Prices (Lithuania)
11



III   EMERGING USES OF LNG IN BALTICS
12





Emerging uses of LNG in Baltics
LNG marine + onshore small scale 
 New gas interconnectors 
LNG regasification markets (BCM)
markets (BCM)
will increase market 
reach
 Bunkering – fuelling LNG 
capable ships, ferries in 
+3.7
the sea

Baltic-connector
Shipping to small LNG 
terminals onshore the 
0.6
Baltic Sea
0.5 – 1.5 
1.3
 Transporting by land to 
2.6
consumers not connected 
to a natural gas grid
GIPL
+15.4
Markets accessible starting the 1st of January, 2015
LNG terminals (5.000-30.000m3) in development
Markets accessible after regional interconnections are finished
Markets accessible through reloading terminals and by ground transport
13


Emerging uses of LNG in Baltics
1
LNG bunkering: ship-to-ship
3
LNG bunkering: onshore storage-to-ship
Klaipedos Nafta
Supply Co.
infrastructure
Supply Co.
Onshore 
LNG
FSRU
storage
Independence
LNG
LNG capable 
LNG capable 
Bunkering 
ship, ferry
Bunkering 
ship, ferry
ship
ship
2
LNG bunkering: LNG truck-to-ship
4
LNG reloading: ship/truck-to-industrial consumer
Supply Co.
Supply Co.
LNG
LNG
LNG
LNG capable 
Bunkering 
LNG
ship
ship, ferry
Bunkering 
ship
14



Emerging uses of LNG in Baltics
Start of LNG terminal 
Joint venture with Statoil
operations
Baseload supply 
Small scale commercial
MoU with Statoil
agreement with Statoil
operations
2014
2015
2016
2017
15


Conclusions
 Baltic states no longer isolated from the global gas markets 
 Alternative supply source encouraged competition and new 
business opportunities
 First cross Baltic gas trading transactions took place
 Cross border trading increases security of the supply
 Decreasing consumption, low liquidity – a legacy of the 
monopoly and green energy support schemes
 Regulation still lagging behind
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THANK YOU!