OREANDA-NEWS. July 30, 2012. The winner of the international tender for the Syderiai Underground Gas Storage Facility project being carried out by Lietuvos Energija has been selected.  The goal of the tender was to procure drilling and research services for exploratory wells.

Said services will be provided by the consortium of participants that won the international tender: Lithuanian-Danish joint ventures UAB Minijos Nafta and UAB LL Investicijos, as well as the Polish gas and oil company Poszukiwania Naftowe Diament. These companies have been offered 17.3 million LTL ex VAT for the work that is planned to be carried out.

According to the signed agreement, the contractor is committed to drill two vertical exploratory wells (with an average depth of 1.5 km) and two directional wells in the Telsiai district’s elderships of Luoke and Viesvenai, and then carry out comprehensive research in these wells. These measures will allow for the identification of seismic level speeds and will clarify the boundaries of the Syderiai geological structure; the integrity of the fractures which restrict it will also be evaluated.

All of this will help more accurately assess if the Syderiai geological structure is hermetic, and whether it is suitable for an underground gas storage facility. These studies will also help to prepare a program or subsequent actions. All surveys of the Syderiai geological structure are planned to be completed by the end of May, 2013.

The storage facility, which would be able to hold up to 1 billion m3 of gas, would help reduce the gas pipeline system load and would contribute to national and regional gas market development. The accumulated reserve would help Lithuania avoid sudden seasonal gas price fluctuations. It would be possible to purchase gas in summer, when demand is down, and use it in winter, when gas demand increases because of the heating season.  Furthermore, the underground gas storage facility would allow for the optimization of operations at the Klaipeda Liquefied Natural Gas Terminal.

Research work for the Syderiai project is financed from the State budget and the European Union, using Trans-European Energy Networks (TEN-E) project funds. The European Commission has allotted 3 million euro for implementation of the Syderiai project. In accordance with a decision made by the Government of the Republic of Lithuania, Lietuvos Energija is also contributing financially to the successful implementation of the project. There are currently 646 underground gas storage facilities in operation worldwide. The majority of them – 401 – are located in the United States; 170 are being used in Europe. Underground gas storage facilities can also be found in Lithuania’s neighboring countries: Latvia (1 underground facility), Poland (6), Belarus (3), and Russia (26).