Estonian Eesti Gaas prepares to buy Latvijas Gāze subsidiary

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The Estonian company Eesti Gaas looks forward to receiving the necessary permits for the purchase of natural gas distribution system operator in Latvia AS “Gaso” this summer, said Margus Kaasik, Chairman of Eesti Gaas Board, in an interview with LETA on May 23.

“Of course, we'll get the permits when we get them because we don't have any influence on it. However, I hope that if everything happens as planned, we will get the necessary permits in the summer,” Kaasik said.

Asked about the reasons why Eesti Gaas decided to buy Gaso, he said the first was a desire to expand Eesti Gaas.

“Eesti Gaas seven years ago was in the same situation as Latvijas Gāze today. We were a relatively small company that only worked in Estonia. In recent years, since we have new owners and new management, we have grown significantly and we have been working from Finland to Poland,” said Kaasik.

“The other reason is that we believe in gas,” the head of Eesti Gaas said.

He noted that it is currently seen that renewables are far more popular and investors no longer believe in fossil fuels. However, changes in energy will take not only a few years but probably several decades and at this time, while fossil resources will still be needed, gas is a very good choice because there are resources that will have to be abandoned earlier, such as coal, shale, oil, propane.

“There will still be a need for energy at this time and we don't want to find ourselves in a situation where when the sun doesn't shine and the wind doesn't blow, we don't have electricity. We also need intensive heating in our region during the winter and for some time gas will be the best choice,” said Kaasik.

He noted that the company has now focused on preparing the necessary information in order to obtain the authorization of Gaso, so it is too early to talk about whether Gaso will undergo any changes. 

As reported, Latvijas Gāze signed a final agreement on the sale of Gaso to Eesti Gaas in mid-April. At the end of April, Eesti Gaas submitted an application to the Competition Council for the assessment of the purchase transaction for Gaso, as well as an application to the Cabinet for a permit to purchase Gaso from Latvijas Gāze.

Latvijas Gāze started the sale process for Gaso this year, because under the current regulation, Gaso cannot be managed by Russian or Belarusian shareholders, but Latvijas Gāze has shareholders representing the Russian state.

“Gaso” is the only natural gas distribution system operator in Latvia. The only shareholder of Gaso is Latvijas Gāze.

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