Commission greenlights Lithuanian State Aid to Litgas UAB for LNG terminal operations
The Commission has approved Lithuania’s compensation to Litgas UAB for supplying a mandatory quantity of liquefied natural gas (LNG) to the Klaipėda LNG terminal.
The original measure, approved in October 2018, compensates Litgas for the operation of the terminal between 2016 and 2024. In 2021, the General Court partially annulled the decision, ruling that an in-depth investigation was needed to assess the compatibility of compensation for boil-off and balancing costs incurred between 2016 and 2018.
Boil-off costs arise from the natural loss of LNG which occurs in the period from injection of LNG into tanks until its release to the natural gas system while balancing costs cover imbalances between supply and demand, including operations under swap contracts. Following the Court ruling, the Commission conducted a detailed investigation and found that the methodology used by Lithuania to calculate the amount of compensation for the period was appropriate and correctly applied and that the entirety of the boil-off and balancing costs incurred by Litgas between 2016 and 2018 could be compensated for. The measure was approved as it complied with the Services of General Economic Interest Framework.
For more information, see the Commission’s PR.