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Sunday 25.06.2017 | Name days: Maiga, Milija
LatviaLatvia

Following gas market’s liberalization, 7,000 clients will be forced to choose gas traders

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUFollowing the liberalization of Latvia’s gas market in April 2017, approximately 7,000 Latvijas Gāze clients will have to choose their preferred gas traders, LG board member Zane Kotane announced during a virtual conference.

This requirement will not apply to households. It is planned to keep providing them with natural gas at current prices until 3 April 2019.

Commenting on LG’s financial indexes, Kotane admitted that LG has stable positions on the Baltic gas market. The gas giant services more than 440,000 clients. According to Kotane, LG can service even more clients.

As it is known, on 22 February Saeima approved amendments to the Energy Law in order to govern the gas market’s liberalization and the separation of LG into two companies. Latvijas Gāze is now obligated to separate its gas management and storage from trade and supply by creating two separate companies by 3 April 2017. By 31 December, the unified gas management and storage company (system operator) has to become a gas trader independent from natural gas supply.

On 22 March, LG shareholders agreed on the launch of reorganization within the company to ensure the separation of the necessary equipment and property by April 2017 in full accordance with the Energy Law.

LG Chairman Aigars Kalvitis informed the shareholders that the company’s council decided to divide the concern into two subsidiaries. Both companies will be associations with separate assets and independent shareholders – one company will work in gas trade and the other will focus on storage and management. Kalvitis explained that the entire process will not be a simple one.

Economy Minister Arvils Aseradens had previously mentioned in an interview to LETA that LG’s new shareholder Marguerite Fund confirmed the wish to become a shareholder of the separated LG gas management company, which would make it easier for Latvia to make decisions in regards to involvement in company matters.

During a meeting with Marguerite Fund, the company confirmed its wish to remain LG’s shareholder in its divided form.

Aseradens believes it is important for Latvia to buy the divided LG company, because the country has to ensure stable market transition period. ‘If there is a unified Baltic gas market, the government can begin searching for other solutions. Right now I believe that the country should be the company’s shareholder during the transition period,’ – said the minister.

Economy Ministry intends to attract a consultant to help with the matter regarding LG’s separation and procurement of company shares.

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