Chevron leaves Lithuania

Map of Lithuania
Source: DollarPhotoClub

The U.S. company Chevron has decided to completely pull out of Lithuania and divest its 50 percent equity interest in the Lithuanian company LL Investicijos – the company announced on its website. The move comes after it ceased the exploration of shale gas in the country last year.

As a result, Sweden’s Tethys Oil said it has increased its indirect interest in the Rietavas licence onshore Lithuania from 14% to 30% as joint venture partner Chevron elects to leave the licence.

Chevron won a tender for exploration in Silute-Taurage in the west of the country in 2012 but pulled out of shale gas extraction in Lithuania in September last year before the final agreement was reached. At the time, Lithuanian parliament adopted proposals for 40 per cent taxation of shale gas production and announced a tightening of environmental regulations.

In April this year, however, the Lithuanian government decided that shale gas will not be taxed for the first 3 to 4 years of exploration. Another tender for the exploration of unconventional gas is planned for sometime this year.

According to a KPMG report published in May, Lithuania is believed to have about 180 bcm of recoverable shale gas.

Lithuania is keen on diversifying its energy sources and limiting its dependence on Russian gas. Apart from exploring its hydrocarbons, Lithuania is close to finalizing a deal with Norwegian energy giant Statoil that would ensure an annual supply of 0.54 billion cubic metres (19 billion cubic feet) of liquefied natural gas from Statoil’s Snoehvit LNG facility to a new LNG import terminal in Klaipeda.

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