The largest and fastest growing domestic fuel trader and local energy company in Latvia AS Virši-A (hereinafter – Virši) has signed an agreement with AS Skulte LNG Terminal to acquire 20% of its shares and announces plans to jointly develop a liquefied natural gas (LNG) terminal at the port of Skulte.
The development of this project will increase the energy independence of Latvia and the Baltic region and will contribute significantly to the diversification of natural gas supplies and the further development of the natural gas market.
“The LNG terminal is a matter of Latvia’s energy independence, and Virši, as a locally owned energy company, wants to contribute to the diversification of the country’s energy supply routes. Participation of Virši in the development of the Skulte project is a well-considered step towards achieving the strategic goal of also becoming an energy company. We have studied in depth the location and financial model of the LNG terminal and concluded that it is the most cost-effective and functional natural gas import route in the Baltics, which is why we have decided to support the development of this infrastructure facility by participating in the project as a shareholder. We are confident that the consumers and businesses of Latvia will benefit from the successful implementation of this project,” emphasizes Jānis Vība, Chairman of the Board and CEO of AS Virši-A.
“We are very pleased with the involvement of Virši in the Skulte project as a leading national capital energy company. It is a strong confirmation of the Skulte terminal’s position on the region’s energy map, allowing us to offer natural gas at attractive prices to consumers and businesses. The experience, capacity and capability of Virši as a local partner will contribute to a faster implementation of the terminal project. AS Skulte LNG Terminal is also continuing negotiations with a pre-selected group of foreign industrial investors on the implementation of the project on the most favorable terms for the Latvian and regional market,” says Renārs Miķelsons, General Manager of AS Skulte LNG Terminal.
“Virši have researched and developed various energy solutions and have concluded that the consumption of methane in the region, including in the form of biomethane and natural gas as a transitional energy carrier, has a good outlook in the next ten years. This trend will continue for industrial users, households and the transport sector. The LNG terminal in Skulte as an infrastructure facility in combination with the Inčukalns underground natural gas storage facility is an excellent tandem not only for supplying Latvian consumption, but also for creating competitive natural gas supplies for the wider region, which includes the Baltic States as well as Finland and Poland,” explains Jānis Vība.
The Skulte LNG terminal project has unique geographical, economic and technological advantages. The Skulte project requires only 34 km of direct pipeline connection to the Inčukalns underground gas storage facility and does not require investment in LNG storage infrastructure, which typically accounts for 70-80% of a terminal’s investment.
Virši announced its strategic goal of growing into also an energy company more than a year ago, becoming an energy trader actively using local green energy resources. Since April 2021, Virši has been offering electricity trading services to the business segment, thus being one of the few market players to successfully combine the opportunities to purchase several energy resources. Gradually strengthening its position in the electricity market, Virši currently supplies electricity to more than 300 connection points throughout Latvia.