German defence manufacturer Rheinmetall and its Lithuanian partners will soon begin preparatory work on a new artillery ammunition plant in northern Lithuania, a project worth between EUR 260 million and EUR 300 million.
The facility will be built in Baisogala, Radviliskis district, with construction expected to take place in stages until early 2027.
“Physically things will be visible probably in a few weeks – fencing and preparatory work on the site will begin in September or October,” said Mindaugas Keizeris, CEO of state-owned energy group Epso-G, one of the project stakeholders.
Contractors have already been chosen to fence the site, and bids for preparatory work, including access roads and temporary facilities, are being finalised.
Keizeris acknowledged the project was not moving as quickly as originally planned. Preparatory work was initially expected to begin this past summer or autumn.
He added that Rheinmetall had ordered a full scan of the plot to check for unexploded ordnance and other wartime hazards before construction begins. The main construction contractor has yet to be selected, with negotiations ongoing.
Despite delays, Keizeris said the plant remained on schedule to be operational in early 2027.
“This project is definitely not just another ordinary project,” he said.
Equipment for the facility has already been ordered, with advance payments made, and a second instalment due buntil the end of September.
The project’s financing includes a EUR 73-million long-term loan from Swedbank, additional investments from Epso-G, and capital injections by Valstybes Investicinis Kapitalas (VIK), another state-owned stakeholder, which also plans a state-backed bond issue of up to EUR 54.5 million this autumn.
Rheinmetall, together with Epso-G Invest and Lithuania’s Giraites Ginkluotes Gamykla (GGG), signed an investment agreement in summer 2024 to launch the plant, which will produce 155 mm artillery shells. The company has pledged to create at least 150 new jobs.
Rheinmetall holds 51% of Rheinmetall Defence Lietuva, while Epso-G Invest owns 48% and GGG 1%. (LRT)