Regulator moves against gas giant

The Latvian regulator, the Public Utilities Commission (SPKR), has launched an administrative case against Latvijas Gaze natural gas utility in relation to its dispute with Latvenergo power utility on possible gas supplies from Lithuania.

Latvijas Gaze rejected Latvenergo access to the gas company's infrastructure to purchase gas from Lithuania. The regulator believes that such Latvijas Gaze's decision contradicts the Energy Law.

The regulator also said that Latvijas Gaze had delayed its reply to Latvenergo, failing to reply within 30 days as provided by the law.

Latvijas Gaze representatives rejected the criticism and said that there are no grounds to launch the administrative case.

Latvijas Gaze also underscored that the company in its letter had not denied Latvenergo access to the company's infrastructure. However, new legal obstacles had occurred that made Latvijas Gaze to turn to the regulator and hear the dispute between both companies and explain how Latvijas Gaze should revise Latvenergo's application.

Latvijas Gaze spokesman Vinsents Makaris told LETA that Latvijas Gaze had sent a letter to Latvenergo, explaining that it is unclear for the gas concern how it should react to the application as the newly adopted Energy Law contradicts the privatization agreements and Latvijas Gaze's exclusive license.

Latvenergo's spokesman Andris Siksnis said LETA that the letter from Latvijas Gaze had not allowed the power company to access gas infrastructure in order to import natural gas from the third parties. Thus, Latvenergo's request has been turned down for the third time.

Latvenergo has resolved to take the necessary measures to execute its rights to purchase natural gas from another company outside Latvia and use it for its own needs as provided by the Energy Law and regulations of the Public Utility Commission.

Latvenergo wished to make a test purchase of gas from a Lithuanian supplier already in March. Lithuania's Litgas has expressed readiness to supply gas to Latvenergo for a better price than offered by Latvijas Gaze.

The Latvian government on February 9 adopted regulations on supply and use of natural gas, allowing companies to purchase gas outside Latvia. The new regulations allow Latvenergo purchase gas from the third parties before liberalization of the gas market in 2017.

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