Shortfall
may prompt Italy to look elsewhere for gas supplies
AFP
ROME
Petroleumworld.com 01 25 06
The sudden shortfall in Italy's gas supplies has highlighted Rome's
over-dependence on Moscow for its energy requirements amid calls
to diversify gas sources and even to reconsider a return to nuclear
power, mothballed in 1986.
For the eighth consecutive day Tuesday, Italy's oil and gas giant
ENI warned deliveries of Russian gas would fall below the country's
daily requirements.
Millions of Italians were meanwhile urged to turn down their thermostats
as Prime Minister Silvio Berlusconi's cabinet met to impose a
temperature cap on homes and offices.
ENI predicted Tuesday's shortfall at six million cubic metres,
or 1.4 percent of national consumption. ENI imports more than
70 percent of its gas from Russia and Algeria alone, with the
rest coming from Dutch and Norwegian supplies.
"We are in a situation of penury, by which I mean that the
supply is quite simply inferior to the demand," said Davide
Tabarelli, director for Italy's Industrial and Energy Research
centre (RIE).
"If the government adopts the measures it says it will, we
can hope to save around 30 million cubic metres of gas a day,
but if there continues to be a squeeze in the supply from Russia,
we'll be really up the creek by March," Tabarelli told AFP.
Tabarelli's private research group believes Italy has already
made considerable inroads into its estimated 12 billion cubic
metre gas reserves, and could yet face more drastic measures before
the winter is out.
The crisis -- a combination of a political standoff between Russia
and Ukraine and a lethal cold snap that caused a spike in demands
for Russia's gas -- is forcing a rethink about nuclear power.
"We need to re-launch nuclear energy," Industry Minister
Claudio Scajola said last week.
Italians voted to reject nuclear power as an energy source in
a referendum in 1987, shortly after the Chernobyl disaster in
Ukraine.
An Italian rethink would tie-in with French calls in Brussels
Tuesday for a radical shake-up of Europe's energy policies, which
stressed the need for nuclear power amid growing concern at the
bloc's dependence on oil and gas.
However, a more immediate step for Italy would be the construction
of a number of re-gasification terminals, which many see as vital
if the country is to diversify its gas sources.
"All this can give a push to building re-gasification plants
for imports of liquid natural gas," said Lucio Cannamella,
chief analyst with Abaxbank in Milan.
"With these terminals we can buy gas from a wider range of
suppliers, including from a long way off," he said.
Italy relies for its gas imports on just one 3.5 bln cubic metre/year
capacity re-gasification terminal, owned by ENI, and ENI-controlled
pipelines from Russia and north Africa.
Electricity company ENEL "has said several times that it
has been blocked in building re-gasification terminals,"
according to Cannamella.
UBS's chief analyst in Milan, Marco Cipelletti, agreed that in
the long-term the current gas emergency will bring "less
resistance" for building Liquid Natural Gas regasification
terminals.
Re-gasification is the process by which LNG is heated, converting
it into its gaseous state.
The only re-gasification plant being built is an Edison project
at Rovigo, near Venice, while eight other projects were said by
Italy's energy regulator last year to be in the planning stage.
AFP
01/24/06
Copyright
© 2006 AFP. All rights reserved
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