Gazprom launches new stretch of Kaliningrad gas line

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Sept. 11 -- Russia’s state-owned natural gas monopoly OAO Gazprom, meeting the demand of the Russian government, has completed the construction of the second stretch of the 139-km Minsk-Vilnius-Kaunas-Kaliningrad gas pipeline.

“The Russian government tasked Gazprom with guaranteeing the supply of 2.5 billion cu m of gas to the Kaliningrad region in 2010,” said Gazprom Deputy Chief Executive Officer Valery Golubev.

“The existence of the two-stretch pipeline and a compressor station, which will be commissioned near Vilnius next year, allows us to say that the set goal will be achieved,” Golubev said.

The pipeline expansion is part of a Russian government action plan aimed at increasing supplies to Kaliningrad—a Russian enclave between Lithuania and Poland.

Besides the pipeline, the plan also calls for the upgrading of gas metering stations and for construction of a compressor station near Vilnius and an underground gas storage facility at Kaliningrad.

“The new gas pipeline will also increase the reliability of gas supplies to Lithuania, open up new prospects for more intensive development of gas-distribution networks in the republic, and increase gas deliveries to Lithuanian consumers,” Golubev said.

Pipeline ‘essential’
Viktoras Valentukevicius, head of Lithuania's gas company Lietuvos Dujos, 38.9% owned by Gazprom, said the pipeline was essential for his country.

“Natural gas will become a key energy resource for our country for decades. This line is very important for Lithuania as a guarantee of stable energy supplies from Russia,” said Valentukevicius.

In December, Lithuania will close its Soviet-era reactor in Ignalina, which will transform country a net energy exporter to an energy importer.

Since Lithuania has no direct link to Europe’s electric power grid, it has no choice but to import more energy from Russia—a matter that leaves many Lithuanians apprehensive, especially given Russia’s recent decision to cut off supplies to other countries in the region.

“Vilnius should not forget that the Kremlin is using Gazprom not only as [an] economic [tool], but also a very efficient political tool,” said Raimundas Lopata, director of the International Relations and Political Science Institute in Vilnius.

While acknowledging the concerns of Lithuanians about the reliability of Russia as a supplier, analyst IHS Global Insight felt the new line represents a step in the right direction for the country’s energy security.

“The additional gas supplies that can be delivered via the new string of the Minsk-Vilnius-Kaunas-Kaliningrad pipeline will be a net benefit to Lithuania, even if the Baltic state is not yet entirely convinced,” IHS Global Insight said.

LNG to Lithuania
Meanwhile, Golubev said Gazprom is prepared to supply LNG to Lithuania if a regasification terminal is built at the Baltic Sea port of Klaipeda.

"We regard this project as a very interesting, promising direction. It is needed now. We have discussed this issue and we believe that it is very good that countries are building such terminals," said Golubev, who added that Gazprom believes it is necessary to build a gas pipeline link to Klaipeda.

In September, Lithuania and the US agreed that the US Trade and Development Agency (USTDA) would provide an $800,000 grant to conduct a feasibility study for an LNG import terminal in Lithuania.

The study will determine the possibility of building a terminal with a capacity of 1.5-2 billion cu m of LNG and will evaluate three potential sites, including one offshore.

According to current plans, the terminal will be 80% state owned, with the remaining 20% to be held by AB Achema, a private producer of nitrogen fertilizers and chemical products.

According to a statement by a Lithuanian economy ministry official, construction of the terminal could start 3-4 years after the completion of the feasibility study, which is expected in 2010.

Lithuania’s Energy Minister Arvydas Sekmokas recently said his country is looking for a strategic investor in the terminal from a foreign country “rich in natural gas.”

Contact Eric Watkins at hippalus@yahoo.com.

Related Articles

Security takes center stage

12/15/2014

Thwarting terrorists, repelling pirates, and routing organized crime: sounds like themes of familiar, big-budget Hollywood movies.

Linn exits Anadarko basin in deal worth $1.95 billion

12/12/2014 Linn Energy LLC has agreed to sell all of its oil and gas properties and related midstream assets in the western Anadarko basin for $1.95 billion t...

Barton introduces bill to remove US crude export limits

12/11/2014

US Rep. Joe Barton (R-Tex.) introduced legislation that would remove US crude oil export limits that have been in place for nearly 40 years.

Study improves subsea pipeline preheating

12/01/2014 A higher flow rate at lower temperatures can more effectively preheat subsea crude oil pipelines than currently used techniques. This article found...

US crude exports debate prompts a fresh look at the Jones Act

12/01/2014 The Jones Act, which requires that maritime transportation of goods between domestic ports take place on US-flagged vessels, is becoming more promi...

Legislative vote delays St. Croix refinery sale

12/01/2014 The Senate of the 30th Legislature of the US Virgin Islands has voted unanimously to send back a proposed agreement that would provide for the rest...

PAA, EPP to expand Eagle Ford pipeline, build terminal

11/04/2014 Plains All American Pipeline LP (PAA) and Enterprise Products Partners LP (EPP) are constructing a condensate gathering system into their Three Riv...

Pipeline, CNG top Cyprus gas export options

11/03/2014 Pipeline and CNG are the best options for exporting natural gas production from Cyprus to relatively close markets in terms of both initial cost an...

White Papers

AVEVA NET Accesses and Manages the Digital Asset

Global demand for new process plants, power plants and infrastructure is increasing steadily with the ...
Sponsored by

AVEVA’s Approach for the Digital Asset

To meet the requirements for leaner project execution and more efficient operations while transferring...
Sponsored by

Diversification - the technology aspects

In tough times, businesses seek to diversify into adjacent markets or to apply their skills and resour...
Sponsored by

Engineering & Design for Lean Construction

Modern marketing rhetoric claims that, in order to cut out expensive costs and reduce risks during the...
Sponsored by

Object Lessons - Why control of engineering design at the object level is essential for efficient project execution

Whatever the task, there is usually only one way to do it right and many more to do it wrong. In the c...
Sponsored by

Plant Design for Lean Construction - at your fingertips

One area which can provide improvements to the adoption of Lean principles is the application of mobil...
Sponsored by

How to Keep Your Mud System Vibrator Hose from Getting Hammered to Death

To prevent the vibrating hoses on your oilfield mud circulation systems from failing, you must examine...
Sponsored by

Duty of Care

Good corporate social responsibility means implementing effective workplace health and safety measures...
Sponsored by

Available Webcasts


On Demand

Optimizing your asset management practices to mitigate the effects of a down market

Thu, Dec 11, 2014

The oil and gas market is in constant flux, and as the price of BOE (Barrel of Oil Equivalent) goes down it is increasingly important to optimize your asset management strategy to stay afloat.  Attend this webinar to learn how developing a solid asset management plan can help your company mitigate costs in any market.

register:WEBCAST


Parylene Conformal Coatings for the Oil & Gas Industry

Thu, Nov 20, 2014

In this concise 30-minute webinar, participants have an opportunity to learn more about how Parylene coatings are applied, their features, and the value they add to devices and components.

register:WEBCAST


Utilizing Predictive Analytics to Optimize Productivity in Oil & Gas Operations

Tue, Nov 18, 2014

Join IBM on Tuesday, November 18 @ 1pm CST to explore how Predictive Analytics can help your organization maximize productivity, operational performance & associated processes to drive enterprise wide productivity and profitability.

register:WEBCAST


US HYDROCARBON EXPORTS Part 3 — LNG

Fri, Nov 14, 2014

US LNG Exports, the third in a trilogy of webcasts focusing on the broad topic of US Hydrocarbon Exports.

A discussion of the problems and potential for the export of US-produced liquefied natural gas.

These and other topics will be discussed, with the latest thoughts on U.S. LNG export policy.

register:WEBCAST


Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected