Italy Eying Two Floating LNG Plants to Cut Russia Gas Reliance

MILAN (Reuters) — Italy is looking to install two floating storage and regasification units (FSRUs) to boost LNG imports as part of plans to cut reliance on Russian gas, three sources familiar with the matter said on Tuesday.

The units, which are expected to have a combined capacity of more than 10 billion cubic meters (Bcm), will be located in the Tyrrhenian Sea and, possibly, in the Adriatic Sea, one of the sources said.

The vessels will be located close to existing pipeline infrastructure, the source said.

Rome imports around 30 Bcm of gas from Russia every year — some 40% of its total gas imports — and is looking to diversify its energy supplies in response to Moscow's invasion of Ukraine.

Ecological Transition Minister Roberto Cingolani said this month it would take at least three years to fully replace Russian imports but said 20 Bcm could be replaced in the "near to medium term" through measures including using more LNG. 

Italy is keen to increase LNG imports from markets like Qatar, the United States and Mozambique, but currently has just three LNG plants that account for around 20% of daily imports.

Talks are ongoing with FSRU providers though nothing has been concluded yet, another source said.

Energy group Eni, which has its own extensive LNG portfolio, and gas company Snam, which runs Italy's gas transport grid, have been assisting the government.

The Ecological Transition ministry was not immediately available for a comment.

Installing FSRUs is quicker than building fixed terminals but demand for vessels has risen sharply as governments across Europe scramble to find quick ways to secure more LNG cargoes.

Dutch network operator Gasunie is in talks with Germany to use FSRUs in the port town of Brunsbuettel, while the Netherlands, Belgium and Turkey are said to be testing the market.

"There are ambitions by governments to bring additional regasification capacities to Europe. We will see additional 6 FSRUs this winter," an industry source said.

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