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Gazprom to continue dominating Latvian market, gas operator says

RIGA, March 31. /TASS/. Russia’s biggest gas producer Gazprom will remain the dominating gas supplier on the Latvian market even following its liberalization on April 3, Chairman of Latvijas Gaze management board Aigars Kalvitis told TASS.

"Consumers will be able to buy gas from various suppliers. However, Gazprom is the dominating supplier in the region, which means that the same gas will be supplied (further on)," he said.

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According to Aigars Kalvitis, the planned projects on the construction of gas pipelines in the Baltic region, such as Balticconnector connecting Finland and Estonia, will improve the access to the market for other companies. "I expect those connectors to give more access to Estonian, Finnish gas companies to the Baltic market, but as of today it is unlikely any changes will take place resulting in the formation of a new supplier. Gazprom will still be playing a dominating role," he said.

Last year Latvian Saeima, the national parliament, finally approved the law on liberalization of the country’s gas market, according to which Latvijas Gaze should be split into two independent companies - gas transportation and storage operator and gas distribution and trade operator by April 3, 2017.

In December 2016, Conexus Baltic Grid was established to take over distribution and storage of gas functions of Latvijas Gaze.

Latvijas Gaze shareholders are: Gazprom (34%), Marguerite Fund (28.97%), Uniper Ruhrgas International GmbH (18.26%) and Itera Latvija (a company controlled by Rosneft, 16%).

The new Latvian legislation bans gas producers from holding stakes in gas transportation assets. Considering this, Gazprom, Uniper and Itera Latvija should withdraw from Latvia’s gas transportation business before 2018. The new Latvian legislation prohibits gas-producing companies from holding shares in gas transportation assets, which is why Gazprom, Uniper and Itera Latvija will have to quit the country’s gas transportation businesses by 2018.

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