August 25, 2006 - AFX news

TOCKHOLM (AFX) - Lithuanian state-owned energy company Lietuvos Energija and Sweden's Svenska Kraftnat have signed a deal to launch a feasibility study on linking the energy systems of two countries, the Lithuanian firm said Friday.

Svenska Kraftnat is a state utility that runs Sweden's national electrical grid.

Rymantas Juozaitis, head of Lietuvos Energija, said that Lithuania's and Sweden's energy grids could be connected via a 350-kilometre, 700 megawatt to 1,000 MegaWatt cable in the Baltic sea.

The value of the project according to preliminary estimates is some 400 mln euro. It could be implemented in 2010.

'Linking Lithuania's and Sweden's energy grids would be a major step in ensuring a reliable supply of energy in the future, and very important taking into account the closure of the Ignalina nuclear

power plan,' said Juozaitis.

Lithuania's ageing Ignalina plant supplies about 70 pct of the Baltic country's electricity needs. But it is to be shut down in 2009 under Lithuania's commitments to the European Union, which it joined in 2004.

Lithuania, together with Baltic neighbours Estonia and Latvia, gave their backing in February to the construction of a new nuclear power plant in Lithuania.

A feasibility study aimed at evaluating the technological, environmental, legal and economic aspects of the new nuclear plant is expected to be completed later this year.

Lithuania is heavily dependent on energy from Russia, its only supplier of gas and a major supplier of oil.

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