- Posted October 9, 2013 by
Chevron Abandons Shale Gas Project in Lithuania
US energy company Chevron has withdrawn its bid to explore for shale gas in western Lithuania. Gilbert Ankenbauer, CEO of Chevron Exploration & Production Lietuva, said the decision was due to legislative changes that came into effect after the company submitted its bid in January 2013.
The government chose Chevron as the winning bidder to begin exploring in the Silute-Taurage field in September 2013. Lithuania's Prime Minister, Algirdas Butkevicius, admitted that legislation on shale gas extraction was incomplete. The government would now discuss whether to call a new tender.
Chevron's decision to withdraw its bid to explore for shale gas in the western Lithuania would postpone the country's efforts for energy independence, Lithuania's President Dalia Grybauskaite said. She noted that the shale gas project was vital for the country's energy independence strategy.
Eligijus Masiulis, chairman of the opposition Liberal Movement, termed Chevron's withdrawal a "fiasco" for the government. He accused Social Democratic MPs of blocking Chevron's investment by "chaotic changes" in legislation. The government should call a new tender without delay, he urged.
Lithuania's former prime minister, Andrius Kubilius, said Chevron's move was a result of the government's inaction. He noted that the government had failed to decide on the taxation on shale gas. Mr Kubilius said Chevron's withdrawal was a victory for Lithuania's sole gas supplier, Russia's Gazprom.
Chevron had warned the government in May 2013 that it could withdraw its bid because of changes in legislation. The Lithuanian parliament adopted a number of pieces of legislation even after the government named Chevron the winner of the shale gas tender on 16 September 2013, the company noted.
Business daily Verslo Zinios reported that Lithuania's prime minister and environment minister found no time for talks with Chevron. The company was therefore forced to communicate with negotiators with no authority. Prime Minister Algirdas Butkevicius dismissed the allegation as "a pack of lies."