Snam to Invest $3.8 Billion in Italy's Gas Network, Including Proposed Adriatic Pipeline
(Reuters) — Italy's gas grid operator Snam will invest 3.7 billion euros ($3.76 billion) in the national gas network to improve transport facilities from the south to the north of the country and boost supply from Africa, it said on Thursday.
Speaking with analysts at a post-results conference call, CEO Stefano Venier said the project to build the so-called Adriatic pipeline would be completed by 2027.
"It is an extremely important project," Venier said.
After Russia's invasion of Ukraine the Italian government has leveraged long-standing relationships to secure more gas from Algeria and Egypt to replace part of the gas it was sourcing from Moscow.
Rome authorities also mandated Snam to buy two new floating terminals for liquefied natural gas (LNG) imports and asked the group to help to fill the country's gas storage tanks.
Along with investments to improve gas transport, the group also has a project to create new gas storage sites in northern Italy, Venier said.
The state-controlled group confirmed its guidance for full-year net profit after reporting a 10% rise in nine-month revenue to 2.4 billion euros ($2.41 billion).
The gas grid operator reported a 9% decline in gas consumption by the industrial sector between January and September in a sign that companies in Italy have reduced activity or switched to alternative energy sources in the face of high commodity prices and supply difficulties.
Total gas demand in the first nine months of 2022 was down 3% year on year at 51.7 billion cubic meters.
Snam reported an adjusted net profit of 932 million euros between January and September, nearly flat year on year as the good performance of its associates, mainly Britain's Interconnector, compensated for a lower rate of return on investments in regulated infrastructure.
Net profit for this year is still projected to be at least 1.13 billion euros, the group said.
Snam, which manages Italy's gas grid and the bulk of its gas storage, recently won approval to set up a floating storage and regasification unit (FSRU) in the Tuscan port of Piombino in the spring and to build a second FSRU off Ravenna in 2024.
By Thursday gas storage had been filled to 95.2% of total capacity, exceeding a target of at least 90%, Snam said.
($1=0.9979 euros)
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