Snam boosts Italy's energy security with new regasification unit

(Reuters) - Italy's Snam has signed a $400-MM deal with BW LNG to buy a floating storage and regasification unit (FSRU), the gas grid operator said on Wednesday, as Rome rushes to find alternative supplies to Russian gas.

Last year Moscow supplied 40% of Italy's imports of gas, or 29 billion cubic metres. But since mid-June, Russia has been supplying less gas than requested by Rome, increasing pressure on the government to diversify its energy sources.

State-controlled Snam, which last month acquired a first regasification vessel from Golar LNG, said it expected the unit, called BW Singapore, to become operational in the third quarter of 2024, once a contract with a third party currently using the unit expires and the permitting process is completed.

"With this operation, we are providing Italy with its second new floating regasification unit thus making a decisive contribution to the country's energy security and diversification," Snam CEO Stefano Venier said in a statement.

The two FSRUs which have recently been acquired by Snam will contribute 13% of Italy's gas demand and bring the country's regasification capacity to over 30% of demand, Venier added.

The Italian group plans to install the BW Singapore in the upper Adriatic Sea, close to the town of Ravenna to intercept potential new LNG flows from North Africa and the Eastern Mediterranean, the Italian group said.

The acquisition will be financed by Snam from its own resources for a total of around $400 million, which will be paid in two tranches.

In the coming months, Snam will also begin activities to contract LNG regasification capacity which will gradually become available from the start-up of BW Singapore in Italy. (Reporting by Francesca Landini, editing by Maria Pia Quaglia and Keith Weir)

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