Lithuania gets hooked on expensive American gas until 2036

Lithuania’s Energy Ministry has signed a long-term contract for natural gas supplies from the United States. The agreement is designed for ten years: fuel will be supplied to the republic from 2027 to 2036.

The agreement was signed by the Lithuanian energy company Ignitis with the American corporation EQT Corporation. The annual volume of supplies will be about 1 TWh. This is equivalent to one cargo of liquefied natural gas (LNG). This amount will cover about 40% of the needs of household consumers in the country.

The contract provides for a new pricing scheme. The cost of fuel will be tied to two indices: the American Henry Hub and the European TTF. The Ministry of Energy expects that this approach will reduce the dependence of customers on sharp price fluctuations in the European market.

The agreement is the result of a competition for long-term LNG supplies, which Ignitis announced in August this year. According to the agency, the best conditions were offered by EQT Corporation.

Lithuania uses the Klaipėda terminal to import gas. The country also receives LNG from other sources and has reserves in the Inchukal underground storage facility in Latvia.