European Commission has confirmed that the state aid to be given for the LNGT project performed by AB Klaipėdos Nafta is state aid compatible with the internal market

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| Source: Klaipedos Nafta AB
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On 20 November 2013, the European Commission has found that state aid for the liquefied natural gas terminal (hereinafter, the LNGT) project, developed by AB Klaipėdos Nafta (hereinafter, the Company), is state aid compatible with the internal market. In present value terms, the various public support elements for the LNGT project (including state guarantees and the LNGT supplement) amount to about EUR 448 million (LTL 1,5 billion).

The European Commission has concluded that the investment into the LNGT contributes to the security of gas supply and that the aid is necessary and proportionate to realise the investment. Moreover, the LNGT will be open to third parties on non-discriminatory terms, ensuring that there are no undue distortions of competition.

The European Commission has also found that compensation for LNGT maintenance costs is in line with the EU Framework on services of general economic interest.

This approval of the European Commission is one of the main conditions provided for in Resolution No.  XII-479 of the Seimas of the Republic of Lithuania “Regarding giving state guarantee to the European Investment Bank”, dated 2 July 2013, in order that the European Investment Bank (hereinafter, the EIB) and the Ministry of Finance of the  Republic of Lithuania (acting in the name of the state) could sign a state guarantee agreement in the amount of EUR 81,093,605 (LTL 280 million) regarding the loan up to EUR 87 million (up to LTL 300 million) to be granted by the EIB to the Company, which will be used to finance up to 50 percent of the implementation of the  LNGT project.

For more information on the approval of the European Commission, please go to: http://europa.eu/rapid/press-release_IP-13-1124_lt.htm. The non-confidential versions of the decisions will be made available under the case numbers SA.36740 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved.

Essential terms of the EIB loan agreement and conditions for signing the state guarantee agreement are specified in the notifications on material events of the Company, dated 2 July 2013 and 9 July 2013.

         Mantas Bartuška, Director of the Finance and Administration Department, +370 46 391 763