Latvijas Gaze

Regulatory Filings • Dec 20, 2010

Agreement with Gazprom on natural gas supply price gets signatures

The Joint Stock Company „Latvijas Gāze” has signed an agreement with the OJSC „Gazprom” on the calculation of natural gas supply price for the next year. The agreement envisages a decrease by 15% in comparison to the previous price calculation formula at equal conditions.

The tariffs will decrease already from the beginning of the next year. As of January 1, 2011, the tariffs for households using gas in heating will be by 7% lower, while for those using stoves – by 4% lower. For industrial customers, the decrease is estimated to 5% on average.

The JSC „Latvijas Gāze” points out that the key role in the tariffs is still retained by the purchase price, which, for its part, significantly depends on the oil price and currency rates. Currently, both of them are on a negative trend, therefore the natural gas price in a longer term is difficult to predict. It should be borne in mind that the reduced VAT rate will rise from 10% to 12% in 2011, and the basic rate will increase as well. Moreover, on July 1, 2011, natural gas for household and heating needs will be applied the excise tax, resulting in higher end-user tariffs.

Vinsents Makaris

Phone + (371) 67 369 144

E-mail: IR@lg.lv