Gasum, Lietuvos Dujos Form Lithuanian Gas Exchange

Finnish importer and distributor Gasum Oy and Lithuania's Lietuvos Dujos have jointly announced the creation of a natural gas exchange in Lithuania.

The exchange, which was announced on Friday, was established by the two companies to enable the electronic trading of gas between the two countries and will facilitate the trading of gas without the need for long-term contracts. The companies say the exchange will encourage greater flexibility in the gas market, with gas trades being conducted in a single click on the Internet.

"It will be particularly relevant in cases where gas consumers need to purchase additional gas volumes for short periods, whereas other gas consumers need to sell their surplus gas volumes," the joint statement said. "This will increase the flexibility in the gas market and promote the efficient use of gas."

Currently, Lithuania has a single supplier for gas, Russian major Gazprom. However, in recent times the country has been making concerted efforts to move its supply away from Gazprom in a bid to diversify supply. Besides the creation of the gas exchange, Lithuania has also passed legislation to ensure that 25 per cent of the country's supply comes from LNG.

CEO of Lietuvos Dujos, Viktoras Valentukevičius says that the creation of the exchange will help to attain the competition in the market that Lithuania is working towards.

"It (the exchange) will create additional opportunities for quick and simple buying or selling of natural gas volumes, depending on the changing needs of natural gas consumers," he said.

"At the same time, it is another step towards the formation of a joint and integrated gas market in the Baltic Region through the implementation of the National Energy Strategy. In order to bring benefits to our consumers and the entire gas sector, market integration is important not only in terms of the development of a competitive environment, but also in terms of securing stable operations of gas systems."

The exchange system is based on one already in use in Finland for the past ten years, which has been operated by a subsidiary of Gasum Oy for that time.