Pursuant to the decision of the Latvian government, the Skulte Liquefied Natural Gas Terminal project has been designated as one of the priority projects of Latvia regarding the attraction of funding under the Three Seas Initiative.
Founded in 2016, the Three Seas Initiative is a regional economic co-operation platform designed to implement physical infrastructure projects to bridge the north-south connectivity gaps in the energy, transport infrastructure, and digital communications sectors of the European Union. The investment fund established under the initiative will operate in 12 EU member states. Latvia is represented by the Development Finance Institution Altum, and the management of the fund is entrusted to the US-based investment company Amber Infrastructure Group. The USA, as a partner country, has planned to provide a significant contribution to the Three Seas Initiative Fund. The total amount of funding that will be available within the framework of the fund is estimated to be EUR 3 - 5 billion.
The Latvia-based company JSC Skulte LNG Terminal is developing the Skulte liquefied natural gas terminal project. An application which would see the project designated as a project of European common interest has been submitted and, like the project for the construction of the pipeline connecting the Skulte terminal and the Inčukalns underground natural gas storage (UGS), which was submitted by JSC Conexus Baltic Grid, it is included in the Ten-Year Network Development Plan of the European Gas Infrastructure Plan. The project is currently undergoing an environmental impact assessment and is expected to be completed by the end of 2024.
It is not necessary to build liquefied natural gas storage tanks for the Skulte LNG terminal, since the Inčukalns underground natural gas storage will be used for this purpose. As a result, the costs of the Skulte terminal will be 70-80% lower compared to terminals of similar capacity (for instance, in Klaipeda, Lithuania), and end consumers will be able to receive cheaper natural gas at the Skulte terminal.
The JSC Skulte LNG Terminal project has aroused considerable interest among potential suppliers and buyers of LNG; the project is expected to play a significant role in the common Latvian, Estonian, and Finnish natural gas trading area, which was established in 2020 after the abolition of cross-border tariffs and the construction of the Balticconnector gas pipeline that connects Finland and Estonia. The project will promote the diversity and flexibility of energy supplies and reduce the risks associated with using energy supply routes controlled by Russia. The implementation of the project will attract a significant amount of foreign investment to Latvia, create new jobs, and contribute to the Latvian economy.