Two state and privately-owned power distribution grids and a state-owned transmission grid were merged into a 7 billion litas ($3.13 billion) venture to boost financial power for building a new nuclear plant and interconnections to Poland and Sweden.
"Setting up LEO LT will speed up preparations for building the new plant, and we are to start negotiations with our partners from Poland, Latvia and Estonia on June 16," Rymantas Juozaitis, the chief executive officer of LEO LT, told Reuters.
He said the talks would be about setting up a project development company.
"Our goal is to have a power plant of over 3,000 megawatts capacity ... Depending on the choice of reactor, it can be built by 2015 or 2017 to 2018," he added.
U.S. General Electric Co.'s (GE.N: Quote, Profile, Research), French state-run nuclear group Areva (CEPFi.PA: Quote, Profile, Research) and Atomic Energy of Canada Ltd (AECL) have said they were interested in taking part in the tender to supply reactors to Lithuania.
"We would prefer smaller reactors as they give you more flexibility and require less reserve base load," Juozaitis said.
Preliminary results of an environmental study on the maximum possible capacity of the plant are expected in August.
Poland has said it wanted to get no less than 1,000 megawatts from the plant, while Latvia and Estonia were talking about 400-600 megawatts each.
Only after the reactor's supplier has been chosen and the final cost of the plan is known will generating capacities be shared among the partners, Juozaitis said.
"I expect the tender to be over in 2010," he added.
The cost of a 3,200-3,400 megawatts plant has been estimated at about $9 billion.
The majority state-owned LEO LT will also be involved in the planned construction of two power interconnections with Poland and Sweden, which are expected by 2015.
That will put Lithuania at the crossroad of three electricity systems - UCTE of continental Europe, Nordel of Scandinavia and the IPS/UPS system of Russia.
"Then Lithuania will be able to transmit electricity in all directions, earning on the transit and being able to provide reliable energy at the best price to our customers," he said.
He said that would also allow exporting Russian electricity to Western Europe. Lithuania wants to join UCTE, which will also have an influence on the choice of new reactor, but membership is only possible after 2020, Juozaitis said.The new plant is to replace Lithuania's Soviet-era plant, which is to be shut down at the end-2009, as the European Union considers it to be unsafe.