Lithuanian EnergMin wants Leo LT off power link, N-plant projects

June 4, 2009 at 11:12 pm Leave a comment

As the BNS reported the Energy Ministry proposes that the much-criticized national energy company Leo LT should not be allowed to build either a new nuclear power plant or power links with Sweden and Poland, and that a state-owned company should take charge of the projects.

The ministry also proposes that Leo LT should not be allowed to administer EU funds.

Energy Minister Arvydas Sekmokas presented the preliminary proposal to the Cabinet on 3 June.

“A state-owned company will build both the interconnection with Sweden and a new nuclear power plant. Leo LT will not have EU funds at its disposal. Those two principles are laid down in the [ministry’s] conclusions,” Ridas Jasiulionis, the prime minister’s spokesman, told reporters after the Cabinet meeting BNS wrties.

The Cabinet is likely to discuss the proposal next week, he said.

The spokesman could not say which state-owned company would implement the projects.

The European Union has earmarked 175 million euros for the planned power interconnection under the Baltic Sea from Sweden to Lithuania, including the reinforcement of the power transmission network in western Latvia.

The countries are to submit their joint application for the EU’s funds by Jul. 15.

Additionally the BNS informed that a special-purpose governmental task group has proposed to raise the state’s interest in Lithuania’s national energy company Leo LT to at least 66 percent thus conferring more powers to the government to make decisions on the future of the company.

The government then could decide to use the assets of Leo LT for the financing of planned construction of a new nuclear power plant and power links, or to reorganize the company.

The Cabinet will consider the conclusions of the task group, a transcript of which has been obtained by BNS, as well as proposed legislative amendments, next week.

The construction of new nuclear facility and power links with Poland and Sweden is expected to be handed over to public companies, some shares of which could be assigned to the companies controlled by Estonia, Latvia and Poland.

The state’s holding in Leo LT could be raised to at least 66 percent via the issue of new shares exclusively to the government.

New shares might be paid up by property contributions, which would be determined via reappraisal of existing state’s contribution to the authorized capital of Leo LT. Estimation of value of the state’s property contribution will include Kruonis Hydro Accumulative Power Plant and the Kaunas Hydro-Electric Plant.

The state’s interest in Leo LT would have to be raised to 66 percent no later than in six months from the enforcement of relevant legislative amendments.

The government owns 61.7 percent of Leo LT, which was established last year as an investment vehicle in the planned new nuclear power plant and other multi-billion-litas energy projects. NDX Energija, a privately owned firm, holds the remaining 38.3 percent.

Entry filed under: Baltic States, Economics, Energy, Estonia, EU, Latvia, Lithuania, Northern Europe, Poland, Politics, Scandinavia, Sweden. Tags: .

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