US Backs Lithuanian Energy Independence Drive: Clinton

Washington backs Lithuania’s bid for energy independence, US Secretary of State Hillary Clinton said Friday (7/1/2011) in the Baltic nation, which relies entirely on Cold War master Russia for its gas.

“We strongly support Lithuania’s energy independence strategy, which includes regional development of nuclear power, liquefied natural gas, unconventional oil and gas, as well as gas and electricity links between the Baltic states and the rest of the European Union,” Clinton told journalists. Lithuania’s Prime Minister Andrius Kubilius said his country hoped to draw on US expertise to help it extract natural gas.

Experts estimate that Lithuania has sufficient reserves of gas trapped in shale — rock containing hydrocarbons — to cover its needs for between 30 and 50 years.

Though generally more expensive to extract than conventional natural gas, and widely criticised by environmentalists who charge that tapping it pollutes groundwater, shale gas is seen as a way to cut dependence on imports.

In a joint statement, Washington and Vilnius pledged to cooperate in the shale-gas sector.

In a legacy of its decades as a Soviet republic, Lithuania relies entirely on Russia for gas imports.

That has been highlighted since the end of 2009 when Lithuania closed down its only nuclear power plant, a Soviet-era facility, under the terms of its EU entry four years earlier.

It is planning by 2020 to build a new plant with neighbors Poland, Latvia and Estonia, but meanwhile has had to turn to mothballed gas-fired power stations.

In another Soviet hangover, Lithuania lacks power-supply links with Western Europe.

Relations between the republic of three million and Moscow have remained rocky since it won independence from the Kremlin as the Soviet Union unravelled in 1991.

Lithuania has locked horns with Russian gas giant Gazprom, accusing it of unfair pricing, and in January filed a complaint against it with EU competition authorities.

Gazprom denies it is abusing its clout and has faulted Lithuania’s decision to get in line with EU rules on “unbundling” — barring bulk suppliers from also managing a country’s gas mains system for consumers so as to boost competition.

Passed by Lithuania’s parliament Thursday and due to enter into force in 2013, the reform is a challenge to Gazprom, which owns over a third of national gas distributor Lietuvos Dujos.

Lithuania plans to build a liquefied natural gas terminal on its coast to help diversify suppliers, and US investors aim to take part.

Clinton was in Lithuania for a meeting of the Community of Democracies, an informal grouping of more than a hundred countries set up in 2000. By Energy Daily Staff