VILNIUS (Reuters) - Russian gas giant Gazprom (GAZP.MM) has decided to pull out of a combined heat and power (CHP) plant in Lithuania’s second-largest city Kaunas, the plant’s chief executive said on Friday.
The Russian gas supplier bought a 99.5 percent stake in the plant in 2003, but the city’s council did not approve its expansion plans and the company faced legal arbitration over investments.
“Gazprom has informed us that it has decided to sell its stake to the minority shareholder Clement Power Venture Inc.,” Antanas Pranculis, the plant’s chief executive, told Reuters, confirming reports in the local media.
Gazprom’s plan to sell the 160-megawatt plant still requires approval by Kaunas city-owned utility Kauno Energija, Pranculis added.
A letter to Gazprom from Clement seen by Reuters expressed the U.S.-registered Clement Power’s readiness to exercise its preemptive rights to purchase shares owned by Gazprom.
Rimandas Stonys, a former president of gas importer Dujotekana, was behind the U.S.-registered buyer, the business daily Verslo Zinios reported on Friday.
Lithuania’s center-right government has been seeking to diversify away from Russian energy imports, and has approved a plan to unbundle its gas monopoly, which is one-third owned by Gazprom.
Reporting by Nerijus Adomaitis; editing by Jason Neely