The Lithuanian Supreme Court Authorizes the Use of Hydraulic Fracturing for Shale Gas Exploration

On December 16, 2015, the Supreme Court of Lithuania upheld the constitutionality of the amendment to the Subsoil law permitting the use of hydraulic fracturing for shale gas extraction and also allowed hydraulic fracturing waste to be disposed of underground.

In November 2013, the Chairman of the Parliament’s Committee on Environmental Protection, along with some members of the legislature, argued before the Supreme Court that the amendment’s provisions as to hydraulic fracturing violated the right to environmental protection derived from the Constitution.

According to a media report, the Supreme Court’s decision was followed rapidly “by the news that the American major Chevron will revisit the country’s shale reserves”. In 2012, the Lithuanian government awarded to Chevron a tender for shale gas exploration, but in October 2013 Chevron decided to withdraw its bid due to the nation’s unattractive environmental regulations and tax regime.

Written by Chloe Marie - Research Fellow

01/13/2016

Shale Compendium: Baltic Nations

Estonia

• Neste Jacobs and Eesti Energia, state owned shale producing company, entered into an agreement to construct a shale oil condensation unit in 2010. (Reuters 2010, KPMG 2012 Central and Eastern European Shale Gas Outlook p. 76-77)

• Eesti Energia is testing its new Enefit280 technology on American oil shale with plans to start production in the Utah oil shale in 2020. Testing results and evaluations are planned for 2016. (ERR News Oct. 2012, ERR News Jan. 2013) 

Latvia

• Prime Minister reported expressing the country’s intent to explore shale gas opportunities to diversify domestic gas supply (KPMG 2012 Central and Eastern European Shale Gas Outlook p. 77)

Lithuania                       

• Lithuania’s six month EU Presidency starts July 2013, the government seems determined to proceed with shale explorations and get more informed about shale gas development (Baltic Times)

• Chevron expected to win the shale gas exploration tender of January 2013 in the Silute-Taurage field. (Natural Gas Europe)

• Chevron shale exploration agreement expected in May 2013 after the legislation to strengthen environmental regulations. Prime Minister Algirdas Butkevicius said “We’ll sign the agreement after Parliament adopts the legislation, which in the best case could be three weeks after Easter” (Bloomberg)

• Stable legal and regulatory framework for shale development (KPMG 2012 Central and Eastern European Shale Gas Outlook p. 62)

Written by Anna Leonenko, Research Fellow

Penn State Law, Agricultural Law Center

May 1, 2013