In accordance with the currently applicable version of the Resolution No. O3-350 of 28 October 2011 of the National Energy Regulatory Council (NERC) “On the Approval of the Regulations for Public Consultation on Draft Legal Acts of the National Energy Regulatory Council”, KN ENergies is launching a public consultation on the draft amendment to the Regulations for the Use of the Liquefied Natural Gas Terminal (hereinafter – the Draft Regulations).
AB “KN Energies” invites stakeholders to review the Draft Regulations and submit comments or suggestions by 6th November 2025.
Please send your comments and suggestions directly to AB “KN Energies” via email: [email protected] or [email protected]
After the consultation period, the Company will evaluate the feedback received and submit the final version of the Regulations to the National Energy Regulatory Council.
Amendments Introduced by the Draft Regulations
In order to ensure the efficient use of the Klaipėda Liquefied Natural Gas (LNG) Terminal capacities and a clearer service allocation process, AB “KN Energies” has prepared a draft amendment to the Regulations for Use of the Liquefied Natural Gas Terminal (hereinafter – the Draft Regulations), which introduces the following changes:
Update of the Annual Capacity Allocation Procedure
It is envisaged that the Annual Terminal Capacity Allocation Procedure will be carried out as follows:
- Capacities shall be allocated for the mandatory volume of the Designated Supplier;
- Terminal capacities shall be allocated to Applicants in accordance with the Law on Natural Gas of the Republic of Lithuania and the Resolution No. 163 of the Government of the Republic of Lithuania of 26 February 2008 “On the Approval of Measures to Ensure the Security of Natural Gas Supply”, in order to ensure sufficient gas supply to certain groups of natural gas consumers and to electricity producers providing Isolated Operation Service (hereinafter – Isolated Operation Service);
- The remaining capacities shall be allocated to market participants based on the auction principle according to the highest value formula;
- If the values are equal – the auction shall be repeated;
- If the capacities are not allocated according to the highest value – the “First Come, First Served” principle shall apply.
- If, based on the Request submitted by the Applicants, the capacities are not allocated because the Requests received do not correspond to the volume of capacities determined by the Operator for allocation, the order of allocation shall be determined according to the same value calculation formula, but the quantities of capacities requested in the Applicants’ Request shall be evaluated instead of those determined by the Operator. However, in such cases, the Operator shall take into account the technical possibilities to ensure the use of the requested LNG regasification capacities.
- If there is no demand for regasification during the Annual Procedure, the Operator shall have the right to organize an auction for LNG reloading or combined services, applying the same allocation principles and procedures.
- If, after completion of the Annual Terminal Capacity Allocation Procedure, regasification capacities remain unallocated, they may, at the Operator’s discretion, be allocated according to the Spot Cargo Capacity Allocation Procedure.
Update of the Spot Cargo Capacity Allocation Procedure
It is envisaged that Spot Market Cargo Regasification Capacities shall be allocated as follows:
- The 60-day period previously applied to entities providing the Isolated Operation Service for submitting Applications shall be eliminated;
- Priority shall be given to entities providing the Isolated Operation Service when submitting Applications for capacity allocation;
- If capacities are not allocated for the Isolated Operation Service, as before, they shall be allocated to market participants whose Applications have the highest value, calculated according to the highest value formula;
- If the values are equal – the auction shall be repeated;
- If the capacities are not allocated according to the highest value – the “First Come, First Served” principle shall apply.
- If, based on the Requests submitted by the Applicants, the capacities are not allocated because the Requests received do not correspond to the volume of capacities determined by the Operator for allocation, the order of allocation shall be determined according to the same highest value formula for LNG Terminal services, but the quantities of capacities requested in the Applicants’ Requests shall be evaluated instead of those determined by the Operator. However, in such cases, the Operator shall take into account the technical possibilities to ensure the use of the requested LNG regasification capacities.
- If there is no demand for regasification during the Spot Cargo Capacities Allocation procedure, the Operator shall have the right to organize an auction for LNG reloading or combined services, applying the same allocation principles and procedures.
Amendments Related to the Submission and Evaluation of Applications for Spot Market Cargo Capacity Allocation
Requests for Terminal capacities, together with the Monthly Schedule Request, shall be submitted as follows:
- When the Operator announces an Invitation for Spot Cargo Capacity Allocation, the Requests shall be submitted and evaluated within the deadlines and according to the procedure specified in the Invitation;
- In the absence of a published Invitation during the year, Terminal Users or Applicants shall have the right to submit Requests for the allocation of LNG regasification or LNG reloading capacities no earlier than 25 (twenty-five) calendar days before the beginning of the month in which the requested capacities are to be used.
- In the Request for the provision of LNG reloading capacities, in addition to the information specified in the Regulations, the Terminal User shall indicate the preliminary LNG reloading dates and LNG quantities. In such cases, after assessing the technical possibilities to provide the requested capacities, the Operator may, where possible, allocate Terminal capacities according to the following priorities:
- In the case of Requests for LNG reloading capacities, priority shall be given to those Terminal Users whose requested LNG reloading capacities, in whole or in part, are intended to ensure the supply of LNG to consumers not connected to the natural gas transmission system and are accordingly transported to an LNG distribution station. Such an Applicant or Terminal User shall submit, together with the Request, documents confirming that the LNG will be transported to an LNG distribution station from which part of the LNG is delivered to consumers not connected to the gas transmission system. For such Applicants or Terminal Users, the Operator, taking into account technical feasibility and compatibility with the Terminal Service schedules, may allocate capacities for a period not exceeding three (3) upcoming months, and such Applications shall be satisfied if they do not exceed three (3) LNG transshipment operations per calendar month;
- All other Request submitted by Applicants or Terminal Users shall be reviewed and capacities allocated based on the “First Come, First Served” principle, considering the final submission time of the Request and/or their revisions that meet the requirements of the Regulations.
Amendments to the Procedure for Preparing the Draft Annual Terminal Schedule
In view of the amendments to the Regulations regarding the Annual and Spot Cargo Capacity Allocation Procedures, the provisions of the Regulations (i.e. Clauses 22, 112, 113 and its sub-clauses, 115, 116, 117, and the removal of Clause 132) are adjusted accordingly to ensure that the preparation of schedules aligns with the updated Annual and Spot Cargo Capacity Allocation Procedures.
Additional Amendments to the Regulations
Technical adjustments are made in the Regulations concerning means of securing the performance of obligations. The Regulations are supplemented to provide that, in the case of LNG reloading services, an advance (prepayment) may be used as an alternative to a bank guarantee as a means of securing the performance of obligations.
Amendments to the Annexes of the Regulations
- Annex 1 (“Inter-Use Terminal Contract”) is amended to specify that, in cases where an Associate Inter-User does not intend to enter into Loan Transactions with the Initial Inter-Users, such Associate Inter-User shall submit an Accession Application, and the Operator shall inform the Initial Inter-Users thereof; however, no Loan Transactions shall be carried out with the Associate Inter-User, and this shall have no effect on the rights and obligations of the Initial Inter-Users. Accordingly, such a Inter-User shall not have any obligations related to securing the Loan Transactions or providing collateral or other measures to ensure the fulfillment of obligations as stipulated in this Contract.
- Annex 6 (“Liquefied Natural Gas Terminal User’s Contract”) is amended as follows:
- The provisions of Clauses 8.1.2, 8.1.4, and 8.1.4.3 are revised to remove the requirement that a totality of the Terminal User’s activities must be insured, while retaining provisions specifying the areas and cases that must be insured;
- Additional provisions are introduced in cases where the LNG reloading service is provided without carrying out LNG import, i.e., without delivering LNG to the Terminal and using only the LNG quantities already present at the Terminal;
- The provisions concerning liability for environmental pollution are clarified, specifying that the insurance object is the liability for environmental pollution to the extent that such liability, under applicable legislation, lies with the insured party and arises from its actions or omissions in the use of Terminal services;
- Taking into account the recommendations of the Commission for the Coordination of the Protection of Facilities of Importance to National Security, the provisions on contract termination are supplemented to stipulate that, if during the term and/or performance of the Agreement it is determined that the Terminal User or the provision of Operator’s services to the Terminal User does not comply with national security interests (based on received information and a corresponding decision of the Commission), the Operator shall immediately terminate the contract unilaterally, and in such a case all liability and risk of loss due to the unfulfilled transaction and/or unprovided services shall rest with the Terminal User, and the Operator shall not compensate any losses.
- In view of the updated provisions of the Regulations regarding the alternative means of securing the performance of obligations in the case of LNG reloading services, corresponding adjustments are also made to Annex 7 (“List of Terminal Services Prices and Formulas”).
- Annex 16 (“Cargo Measurement Procedure”) is amended to introduce technical adjustments based on practical issues identified in the cargo measurement procedure. Amendments relate to the calculation of the consumed boil-off gas onboard the vessel and introduce a requirement for an independent expert to assess the impact of the remaining LNG in the vessel on the final unloaded quantity, which was not previously covered in the Cargo Measurement Procedure.
For questions related to the public consultation or the proposed amendments:
Regulations:
Annexes to Regulations:
