Italy to Set Up Natural-Gas Exchange as Oil Power Comes Online
February 10, 2012, 2:56 AM ESTBy Matthew Brown
Feb. 9 (Bloomberg) -- Italy plans to set up a natural-gas exchange to avoid future shortages of the heating fuel after below-average temperatures led Enel SpA to switch on oil-fired power stations.
Europe’s third-largest gas user needs “structural changes” in its supply to avoid emergencies, Development Minister Corrado Passera said in remarks to the Chamber of Deputies in Rome today. Italy has received less gas from Russia than it asked for since Jan. 27, according to data from Milan- based Snam Rete Gas SpA, the national gas-pipeline operator.
Italy gets most of its gas under long-term contracts from Algeria’s Sonatrach and Russia’s OAO Gazprom. The country’s gas trading at Punto di Scambio Virtuale lacks liquidity compared with hubs such as the Title Transfer Facility in the Netherlands, the biggest in mainland Europe.
“We also need to intervene in the market rules in order to create more liquidity and competition,” Passera said. “We will shortly present the regulations for a gas exchange.”
Enel started three oil-fired power stations, in Livorno, Piombino and Monolto di Castro, Luigi Michi, head of energy management at the company, said yesterday.
The Piombino plant has 30,000 metric tons of fuel oil stockpiles, which allows it to be operational for six days before refueling. Livorno has 6,400 tons in stock, enough to cover seven days and Montalto has 100,000 tons, or 10 days’ consumption, in storage, Michi said.
Depleted Storage
Enel expects the current situation, which has resulted from Italy importing 13 percent less gas from Russia than it requested, to last for some time, he said.
Consumption in Italy climbed to 450 million on Feb. 6, a level that requires the activation of emergency measures in line with European Union policies.
Storage at the PSV, Italy’s gas-trading hub, was 56.8 percent full yesterday, a drop of 1 percentage point from a day earlier, and down from more than 100 percent of released capacity on Oct. 24. At current rates, the stockpiles will be depleted in 20 days, Gianni di Giovanni, a Rome-based spokesman for Eni SpA, said Feb. 7.
Italy’s natural-gas emergency is easing with the activation of the oil-fired plants, reduced consumption by some corporate customers and an increase in imports, the Rome-based Industry Ministry said in an e-mailed statement today.
Two regasification plants remain out of use and are likely to be supplied next week, when temperatures are forecast to rise to average seasonal levels, the ministry said. Corporate customers who have seen their gas supplies interrupted may return to normal consumption levels tomorrow morning, the ministry said.
--With assistance from Lorenzo Totaro in Rome, Jeffrey Donovan in Prague, Chiara Vasarri in Milan and Rupert Rowling in London. Editors: Rob Verdonck, Rachel Graham
To contact the reporter on this story: Matthew Brown in London at mbrown42@bloomberg.net
To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net
