State can't afford to buy national gas company

Take note – story published 9 years ago

The government cannot afford to purchase the 47.23% share of Latvijas Gāze currently put out on the market by Germany’s E.ON Ruhrgas, Prime Minister Laimdota Straujuma told LTV morning news program Rita Panorāma Tuesday.

“There are various ways of following up on the development of this strategic enterprise,” she said. “In a word, yes,” Straujuma responded to being pressed on the state’s withdrawal of offers for the available E.ON Ruhrgas stock, citing its prohibitive price in the face of insurmountable budgetary constraints.

She evaded declaring conclusively that the state was entirely declining the purchase of any of the energy utility’s shares, hinting at legislative work underway on the liberalization of the gas-delivery, storage and distribution markets to be passed and in effect by 2016.

According to TV3 independent news program Nekā personīga, two Lithuanian companies have made offers for shares in Latvijas Gāze to E.ON Ruhrgas, being interested in securing ownership ties to the Inčukalns Underground Gas Storage Facility.

Last year Latvijas Gāze earned profits of €32.2m, down 1.3% from 2012, when it earned €32.6m.

Besides the 47.2% share up for sale by E.ON Ruhrgas, Russia’s Gazprom owns 34%, and Latvian distributor Itera Latvija 16% of Latvijas Gāze under its current ownership structure.

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