The conflict between the Lithuanian government, Russia's gas giant Gazprom and E.On Ruhrgas took a new twist on Monday with the two companies warning that if Vilnius maintains EU gas reforms, it may lead to gas supply failures.
The statement sparked a furious response from the Lithuanian government which called the statement "unacceptable."
To comply with an EU directive under which gas production and transportation must be separated, Lithuania has amended its legislation stating that the gas supply system and the system of cross-country gas pipelines must be operated by two different companies.
Lietuvos Dujos, in which Gazprom and E.On Ruhrgas hold 37.1 and 38.9 percent respectively, is engaged in the purchase, transportation, distribution and sales of gas on the territory of Lithuania. It also manages pipelines of more than 1,600 kilometres.
Russia's Gazprom and Germany's E.On Ruhrgas called on the Lithuanian government, in an open letter on Monday, to stick to the terms of their existing contract, which says the state has no right to influence the company without consulting shareholders.
Lithuanian Prime Minister Andrius Kubilius said that part of the letter which said that "a hasty separation of gas transportation from the rest of the company's activities will have a serious impact on all processes and structures of Lietuvos Dujos and may lead to breaks in gas supplies," was a public threat.
"Not to supply gas if the government of Lithuania implements EU directives ... such threat is unacceptable. It is absolutely unacceptable and intolerant. I believe that Lietuvos Dujos' shareholders will hear the words," said, adding that he believed that "shareholders will behave in a civilized manner."
Gazprom and E. On Ruhrgas said that the government was avoiding talks on the fate of Lietuvos Dujos.
"Direct and confidential letters to the president, the government and prime minister of Lithuania as well as one open address calling for direct constructive talks to implement EU's Third Gas Directive have so far been ignored by the Lithuanian government," the companies said in an open letter.
Kubilius said that a working group, which included a Lietuvos Dujos representative, had been set up to reform the gas industry.
"To say that there is no possibility of taking part in drafting the law is incorrect, and if the shareholders think they should participate ...they have an opportunity to participate in public debates, as well as all other interested parties," he said.
Gazprom and E.On Ruhrgas said the government used the directive "as an instrument of a de facto re-nationalization of the gas network". The companies added the directive allowed Lithuania not to stick to the EU requirements as long as it remained an isolated market with only one supplier.
Kubilius said the accusations "did not correspond to the truth," adding that the government's actions in the gas industry "had nothing to do with the nationalization".
VILNIUS, September 20 (RIA Novosti)
