Energy Security of Lithuania and Impact of Nord Stream Project

1
Energy Security of Lithuania and Impact of Nord
Stream Project

• dr.Tomas Janeliunas
• The Institute of International Relations
• and Political Science

2
Priorities of Lithuanias Energy Security

• Ensuring reliable energy supply and functionality
  of energy infrastructure
  
• Diversification of energy supply sources
• Reduction of dependence on energy resource import
  (by reducing energy intensity and switching to
  alternative or renewable energy recourses).

3
Energy Dependence from Russia -lessons learned

• Energy blockade from Russia/Soviet Union in 1990
• Disruption of gas supply in 2004
• Stopped supplying of oil by Druzba pipeline since
  July 2006
  

4
Oil supply and refining in Lithuania
5
Importance of Butinge oil terminal

• Butinge terminal was considered to be the main
  instrument for prevention of energy blockade
  
• The terminal became an important element of oil
  export system and provided an opportunity for
  Lithuania to become an oil transit country
  
• Currently Lithuania has physical capability to
  import oil by see and in this way Mazeikiu oil
  refinery can still function profitably

6
Oil loading in Butinge terminal 2001-2005
7
Oil sector the main conclusion

• The development of oil sector in Lithuania has
  proved one simple principle mediation in energy
  sector (that is - participation in transit and
  process of refining) strengthens energy security
  and economically is more useful than being just a
  consumer

8
Dependence in gas sector

• Gazprom is the only gas supplier to Lithuania.
• Natural gas is transported to Lithuania via the
  only Minsk-Vilnius-Kaliningrad, pipeline, which
  is controlled by Gazprom.
  
• Gazprom is one of the biggest stockholders of the
  main Lithuanian gas operator Lietuvos dujos.
  (Gazprom has 37, his main partner in Western
  Europe E.ON Ruhrgas International AG share 39,
  and 18 is left for Lithuanian government).
• There are no gas storage facilities in Lithuania.
  
  
• Lithuania does not have capabilities to deliver,
  recast or store big quantity of liquid natural
  gas (LNG).

9
Lithuanias reaction to the Nord Stream project

• Dissolved hopes about possibility to become a gas
  transit country
  
• Fears about increasing pressure of Gazprom on gas
  price
  
• Evoked clash between the CEE and Western European
  countries.

10
Possible gas pipelines from Russia to Europe
11
Impact of the Nord Stream project for Lithuanias
energy security

• The Nord Stream, compared to more favourable
  Amber pipeline, will increase Lithuanias
  energy insecurity.
  
• Lithuania will remain just a gas consumer, state
  budget will not get extra money from gas transit.

12
Impact of the Nord Stream project for Lithuanias
energy security (2)

• The Nord Stream project (among other recent
  Russias moves) contributed to become energy
  security one of the main topics in the global and
  EU agenda.
• Baltic and Central European countries have got a
  chance to strengthen regional cooperation in the
  energy sector The Nord Stream project gives to
  Baltic states and Poland a new impulse for
  solving the energy security problems by common
  efforts

13
Future of Lithuanias Energy Security

• The main structural changes in Lithuanias energy
  security sector could take place only if EU
  consolidates its Common Energy Policy.
  
• More intense consolidation of interest may take
  place rather in Baltic and CEE countries. Two-way
  movement of energy security policy may emerge in
  EU
• Lithuania need to take a very proactive position
  in its EU policy to ensure the security interest
  in energy sector.