As of August 31, 2022, JSC Latvijas Gāze (LG) will not be able to fulfil the obligation of a public trader to ensure there is in Energy Law set necessary amount of natural gas in the Inčukalns underground gas storage, according to the Nasdaq Riga stock exchange announcement.
According to the Energy Law, in a situation where the existing public trader (LG) does not perform the task stipulated by the law, the functions of the public trader are taken over and performed by JSC Latvenergo.
LG has repeatedly informed the Latvian government and the ministry responsible for the development of the energy sector about this situation, as well as requested the Ministry of Economics to call a meeting with the parties involved, with an aim to find a constructive and joint action plan, which has not yet happened, according to Latvijas Gāze statement.
Amendments to the Energy Law enter into force on August 11, while the ban on supplying natural gas from Russia enters into force on January 1, 2023.
Thus, LG is prohibited by law to receive natural gas from Russia, LAtvijas gāze explains in its sattement to stock exchange.
In the statement to the stock exchange sit is said that LG is taking the necessary steps to continue providing its natural gas service by purchasing from other alternative suppliers as part of its business operations.
Amendments to the Energy Law instruct the public trader of natural gas to ensure that no later than August 31 of each year, the amount of natural gas required for the consumption of households from October 1 to April 30 of the following year is stored in the Inčukalns underground gas storage.
The amount of natural gas owned by LG and stored in the Inčukalns underground gas storage facility is currently 0.75 terawatt-hours (TWh). As of 31 August, the volume of natural gas held by LG, considering the contractual obligations that already entered into force, will amount to 0.69 TWh.
From 10 August 2022 to 30 September 2022, LG must maintain natural gas stocks of 1 150 gigawatt hours (GWh) or 1.15 TWh in the Inčukalns storage facility. From 1 October 2022 to 30 April 2023, a balance of 1.15 TWh and the volume actually supplied to connected users or households must be available in the storage facility on the first day of each month.
The Prime Minister explained that the gas currently available in Inčukalns fully covers Latvia’s needs in the next heating season.
For additional security, the government decided to reserve gas in the storage belonging to LG, so that in the situation of high market demand, this gas would not be resold, but guaranteed to remain at the disposal of Latvian households. The amount is equal to household consumption in last season.
The Minister of Economics explained that the government did not purchase this gas, but reserved it in order to guarantee the necessary amount of natural gas for the related users or households for the next heating season.
Kariņš also repeatedly assured that Latvia will have enough natural gas for the whole upcoming heating season. He referred to information provided by the Ministry of the Economics and Conexus Baltic Grid, the operator of the Inčukalns underground gas storage facility.