As concerns the amendments to the Energy Law submitted to the Parliament and the status of public trader going toward, from the viewpoint of the JSC “Latvijas Gāze” the Latvian government can adopt such amendments and can task the JSC “Latvijas Gāze” as public trader with procuring gas reserves till July 1, 2022. With such conditions in place, the JSC “Latvijas Gāze” will effectively be forced to procure gas reserves for the historically highest price and keep them in the Inčukalns Underground Gas Storage Facility. In this regard, one needs to talk about state aid to households. The Latvian government began subsidising the household tariff already in January 2022 at a price of 50 EUR. When the conditions set out in the amendments to the Law come into effect, the tariff applicable to households will be substantially higher. Even assuming that a change of public trader is possible, customers will still be allowed to choose their supplier.

As concerns the decision to refuse Russian gas imports in Latvia, one needs to revert to the regional principle. Latvia alone cannot prohibit gas imports in the common market area – both Finland and Estonia need to do it as well. It is essentially an intergovernmental matter where a political decision is made upon agreement among three market participants. Finland and Estonia, too, have taken a wait-and-see stance, waiting for the European Commission’s decision on the future perspective of the gas market. The decision is delayed. Apparently, it needs more time due to the complex nature of the matter. We do not yet have a concrete plan from the Ministry of Economy, so we cannot comment on how this refusal could happen. There is a winter ahead of us, there are no alternative supply sources in the summer, and we need to take care of a portfolio of more than 350,000 customers, which is why the JSC “Latvijas Gāze” is thinking how to buy gas, including from Russia on condition that this is allowed. With the available reserves, we can keep the market in its current state till July 2022.

The JSC “Latvijas Gāze” would like to stress the utmost importance of internal security in Latvia under these war circumstances. Its destabilisation will lead to an energy crisis, so this matter needs to be addressed with high national responsibility.

The JSC “Latvijas Gāze” expects a professional discussion, concrete action plans from the Ministry of Economy, and well-considered political decisions. The JSC “Latvijas Gāze” has sufficient financial resources and knowledge to take part in this market and help our customers.

On behalf of the JSC “Latvijas Gāze”,
Chairman of the Board
Aigars Kalvītis

On the JSC “Latvijas Gāze”

Latvijas Gāze is one of the leaders of the Baltic energy industry. Our goal is to consolidate the leading position of the Latvijas Gāze Group in the Latvian and Baltic energy market by becoming the customers’ first choice among natural gas suppliers and providing the most reliable natural gas supply for the entire region.

The wholesale and sale of natural gas to business customers is carried out in Latvia, Lithuania and Estonia. Following the opening of the Finnish gas market on January 1, 2020, Latvijas Gāze has successfully started natural gas trading in Finland as well. In the household segment, Latvijas Gāze is the biggest and most prominent natural gas trader in Latvia.

After Latvia regained its independence in 1991, a joint state-owned company “Latvijas Gāze” was established by merging the Latvian gas infrastructure and institutions. The privatisation of the company was commenced in 1997 and completed in 2002. Since February 15, 1999, the shares of the JSC “Latvijas Gāze” have been quoted on the Nasdaq Riga stock exchange. Taking into account the requirements of the European Union for the establishment of the natural gas market and the expiry of the privatisation agreement between the state and the shareholders of Latvijas Gāze, the unified transmission and storage operator JSC “Conexus Baltic Grid” was separated from Latvijas Gāze in early 2017, followed by the separation of the distribution system operator JSC “Gaso” on December 1, 2017.

Contact information:
Sandra Joksta
investor.relations@lg.lv
phone + 371 67 374 369