Enefit Power is a subsidiary of the state-owned Eesti Energia, and the supervisory procedure was requested by competitor Viru Keemia Grupp AS (VKG).

Enefit and VKG operate adjacent mines on the Uus-Kiviõli oil shale field.

Under current environmental permits, Enefit is permitted to mine up to 4 million tonnes of oil shale per annum, while VKG is permitted to extract half that amount.

However, Enefit has not yet needed to begin mining in Uus-Kiviõli.

VKG's Uus-Kiviõli environmental permit includes a provision allowing the company to mine up to 5 million tonnes of oil shale annually from its allotted part of the field, provided Enefit does not mine from its own allotted portion.

This condition is in place as the result of a joint environmental impact assessment which limits the total extraction from Uus-Kiviõli to no more than 6 million tonnes of oil shale per year.

VKG sought to remove this condition to secure the permanent right to mine 5 million tons annually. VKG interpreted Enefit's refusal to agree as an abuse of its dominant market position.

During its investigation, the Competition Authority found that Enefit holds a dominant market position, as a 2009 directive from the Ministry of the Environment assigned the company 75 percent of Estonia's annual oil shale mining volume.

This makes up 75 percent of the oil shale market. Additionally, regulatory barriers, including those from the Earth's Crust Act, bar new companies from entering the oil shale market in Estonia, while existing operators cannot easily expand their activities.

Enefit's market position is strong and stable, the Competition Authority noted.

However, the authority found that Enefit was not abusing its market leading position in the oil shale sector, since VKG is currently guaranteed a mining volume of 5 million tonnes per year from the Uus-Kiviõli mining field in any case.

The Competition Authority said that market abuse would be present if Enefit, notwithstanding not requiring any additional oil shale, began mining minimal volumes simply to bar VKG from extracting oil shale.

Consequently the Competition Authority wrapped up the supervisory procedure against Enefit, on the condition that if Enefit does decide to start mining operations at Uus-Kiviõli, it must promptly submit data to the authority covering its oil shale reserves and needs.

This will, the authority says, enable it to assess whether the decision to start mining is based on genuine needs or constitutes an abuse of Enefit's dominant market position after all.

The Competition Authority initiated the supervisory procedure at the end of 2023 following a request from VKG to examine whether Enefit's actions were in line with the provisions of paragraph 16 of the Competition Act.

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