Lithuania to purchase LNG vessel amid cost cutting efforts

Lithuanian government prepares purchasing its leased floating gas storage and regasification unit (FSRU) Independence used in newly built liquefied natural gas (LNG) terminal, revealed the cabinet on Tuesday.

"We will make the final decision on the purchase of the LNG vessel in fall, but we have to prepare for this from now," Algirdas Butkevicius, Lithuanian prime minister, said in a press release from the government.

The plans were revealed a day after the government met with Klaipedos nafta, state controlled company operating oil and liquefied natural gas terminals, to discuss possible ways of cutting the costs of the LNG terminal.

"After taking into account the consistently decreasing consumption of natural gas not only in Lithuania, but in Baltic States as well, we see that the component of infrastructure costs in the price for providing natural gas can increase," admitted Butkevicius.

"That's why we have already been thinking on how to diminish the burden," added Butkevicius.

After the meeting both sides agreed to prepare all the documentation necessary to decide on the borrowing for the vessel's purchase by fall.

The government's decision to purchase the vessel is based on financial markets conditions which are favorable for borrowers due to cheap financing.

The government revealed expecting that Klaipedos nafta will be ready to acquire a long-term loan of up to 300 million euros (327 million U.S. dollars) this year.