Natural resources and energy
Since Lithuania's independence from the
Soviet Union in 1991, Lithuania has struggled to reduce
its dependence on Russian gas imports for its energy
supply. When a new liquefied natural gas terminal was
inaugurated in Klaipéda in 2014, the country's
opportunities to achieve this goal significantly
increased.
Lithuania's traditional natural resources are arable
land, forest and peat. Smaller amounts of oil are
extracted in the western part of the country, and oil
has also been found in the Baltic Sea. Lithuania also
has small natural gas assets. Building materials such as
minerals, gravel, sand and cement are produced, also for
export.
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COUNTRYAAH:
Major exports by Lithuania with a full list of the top products exported by the country. Includes trade value in U.S. dollars and the percentage for each product category.
Lithuania's great dependence on Russian oil and gas
imports was created during the Soviet era (1944-1991).
The privatization of the oil industry that took place
after independence was supposed to reduce dependence on
Russia. Instead, the sale caused a prolonged political
battle over the Soviet-built oil refinery Mažeikių Nafta
in Lithuania. Mažeikių Nafta was the Soviet Union's most
modern refinery and the largest company in the Baltic.
It accounted for a tenth of Lithuania's gross domestic
product (GDP) and also included oil pipelines and the
Būtingė oil terminal on the Baltic Sea coast.
Mažeikių Nafta, the Baltic's only oil refinery, was
sold in 1999 to the US company Williams International.
As a result, Russia abandoned its oil supplies. Mažeikių
Nafta suffered a loss until the Russian oil giant Yukos
was admitted as a partner in 2002. Yukos modernized the
company, made it profitable and guaranteed oil supplies.
Williams sold his stake in Mažeikių Nafta to Yukos, who
now became the majority owner. But when Yukos went
insolvent through tax claims from the Russian state,
Mažeikių was sold in 2006 to the Polish company PKN
Orlen. Once again Russian oil supplies were abandoned,
but in the mid-2010s the refinery was able to show a
good profit.
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Abbreviationfinder: A popular acronym site in the world covering abbreviation for each country. For example, LT stands for Lithuania.
Ignalina closes
In 2002, part of the state-owned Lithuanian gas
company Lietuvos Dujos was sold to German Ruhrgas and in
2004 Russian Gazprom also became part owner. The state
still has a minority share. Gazprom significantly raised
the gas price for Lithuania, which in 2012 paid the most
for Russian gas in the EU.
For both political and economic reasons, therefore,
Lithuania is trying to reduce its dependence on Russian
energy through its own production and by connecting its
electricity grid to the Nordic countries and the EU. In
the autumn of 2014, a terminal for liquefied natural gas
was installed in Klaipéda, which created the opportunity
for Lithuania to import gas from, for example, Norway,
thereby breaking dependence on Russian gas. Shortly
thereafter, Gazprom agreed to lower the gas price by 23
percent.
Heat is mainly produced in oil and gas-fired power
plants, while three-quarters of the electricity has long
come from the Soviet-built nuclear power plant Ignalina.
It was commissioned in the 1980s to supply power to the
Baltic States, Belarus and Kaliningrad. Ignalina's two
reactors were then the world's largest of its kind and
were constructed in the same way as the Chernobyl
accident reactors in Ukraine.
Following Lithuania's independence, security at
Ignalina was improved with the help of, among others,
Sweden. However, in the negotiations for a Lithuanian EU
membership in the early 2000s, the EU stipulated that
Ignalina should be closed. Lithuania was forced to
accept a closure since the EU had promised to partially
finance the settlement. Lithuania fought hard to
postpone the closure, but both reactors were shut down
in 2004 and 2009, respectively.
Severe environmental problems, but improvements
Domestic political struggles and corruption had made
Lithuania poorly prepared for a restructuring of
electricity production after the closure of Ignalina.
The country again became dependent on Russian gas
imports. There have long been plans to build a new
nuclear reactor in Visaginas, where the closed Ignalina
is located. But the project has been plagued by
political problems, both at home and with the intended
partner countries Poland, Latvia and Estonia. Visagina's
future is uncertain since voters voted against the
construction plans in a 2012 referendum.
In the same year, work began on building an electric
cable between Sweden and Lithuania. It was put into
operation at the end of 2015, while Lithuania could be
linked to Poland's electricity grid. Thus, Lithuania
took another step to reduce dependence on Russian
energy. The goal is that Lithuania, together with the
Baltic neighboring countries, should be integrated into
the European energy grid from 2025 and then completely
detached from the dependence on Russian energy.
About one fifth of Lithuania's energy needs are
covered by renewable energy types, mainly biomass but
also hydropower and wind power.
The environment in Lithuania suffered great damage
from industrialization during the Soviet era. The Kaunas
region, which has a number of large companies, was
particularly hard hit. Wastewater treatment plants have
been built in several major cities, often with the help
of international financing, including from Sweden, and
considerable progress has been made in improving air and
water quality. In 2014, however, only a third of
household waste was recycled.
FACTS - ENERGY AND ENVIRONMENT
Energy use per person
2,387 kilograms of oil equivalent (2014)
Electricity consumption per person
3821 kWh, kWh (2014)
Carbon dioxide emissions in total
12 838 thousand tonnes (2014)
Carbon dioxide emissions per inhabitant
4.4 tons (2014)
The share of energy from renewable sources
29.0 percent (2015)
2012
December
Four-party government is formed
Social Democrat leader Algirdas Butkevičius forms government together with
the Labor Party, Order and Justice and the Election Campaign for Poles in
Lithuania.
October
No to a new nuclear reactor
The government is also losing the referendum on a new nuclear reactor. Almost
63 percent of the voters say no and 34 percent agree to a new reactor.
The opposition wins the election
In the parliamentary elections, the opposition Social Democratic LSDP becomes
the largest party with 38 seats. The governing Confederation of Finland will be
the second largest with 33 seats and the third will be the Labor Party
with 29 seats. Order and justice receive 11 seats, the Liberal Movement
10, the Election Campaign for Poles in Lithuania 8, The
Brave Road 7 and the Farmers 'and the Greens' Association
1 mandate.
The state sues Russian Gazprom
The state-controlled Russian oil and gas company Gazprom is sued by Lithuania
before the Stockholm Chamber of Commerce Arbitration Institute for incorrect
pricing. According to Lithuania, Gazprom has six times the gas prices between
2004 and 2012 and requires the company of EUR 1.45 billion.
April
The Minister of the Interior resigns
Interior Minister Raimundas Palaitis resigns after he dismissed the
leadership of Prime Minister Kubiliu's leadership of the country's eco-criminal
authority. The issue has been close to cracking the government coalition.
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