A regasification terminal is a facility capable of converting liquefied natural gas (LNG) into gas. Italy has three of them, but the issue is hotly debated.
Among the most hotly debated topics — especially during the electoral campaign ahead of the 25 September general election that saw the government led by Giorgia Meloni take office — was the issue of regasification terminals. A regasification terminal is a facility capable of converting liquefied natural gas (LNG) into gas.
This is a central issue for Italy given the energy crisis triggered by the Russo-Ukrainian war. In order to become completely self-sufficient, Italy has decided to pursue new strategies, among which regasification terminals also feature.
The process of converting LNG back into a gaseous state involves several stages: the liquefied gas is transported on ships at a temperature of -162 degrees Celsius, which is necessary to keep it in a liquid state, and is then converted back into gas through a controlled heating process carried out inside a vaporiser.
The heating takes place by passing the liquefied natural gas through pipes submerged in seawater, which is at a higher temperature. This is why the facilities are located on the coast or at sea a short distance from the shore (in the latter case they are referred to as offshore platforms).
At present, the country has three:
Over the past year, two regasification terminal projects have been authorised, one in Piombino and the other in Ravenna. For the latter, Snam purchased the storage and regasification vessel Bw Singapore, which has a regasification capacity of approximately 5 billion cubic metres. The vessel will be positioned in the northern Adriatic, 8.5 kilometres from the coast of Ravenna, and is expected to become operational by the end of 2024.
The Piombino regasification terminal has been far more contentious. Here, a mobilisation of citizens — including notably the mayor himself, Francesco Ferrari of Fratelli d'Italia, the same party that leads the government — slowed down the process of obtaining permits and authorisations. Despite this opposition, the administrative court (TAR) rejected the mayor's appeal and in spring the works were unblocked. In early May the testing phase of the regasification terminal began, but the authorisation documents required from the ministry for the facility to enter regular operation — in particular the AIA, the integrated environmental authorisation — are still outstanding.
Snam's facility will have a total processing capacity of 5 billion cubic metres of gas per year. That is an amount capable of covering 7 per cent of Italy's entire LNG requirement, supplied entirely by Eni, which also controls 50 per cent of the liquefaction plant at Damietta, in Egypt, from which the supplies will come.
With the two new regasification terminals, liquefied natural gas will be able to cover approximately one third of Italy's annual requirement. 10 billion cubic metres of LNG will come from Ravenna and Piombino: considering that in 2022 Italy's annual gas requirement stood at 68.6 billion cubic metres, the two regasification facilities alone would account for 14.6 per cent, bringing the overall share of LNG to more than 35 per cent of imports. Italy buys liquefied gas primarily from Qatar, Algeria, the United States, Trinidad and Tobago, Nigeria and Norway. In the first three months of 2023, LNG accounted for 25.8 per cent of Italy's gas imports. Italy has also signed contracts to purchase LNG from Mozambique, Congo and Angola.
Furthermore, after almost 40 years of inactivity, a gas field in the province of Bologna was reactivated in July. It lies in the heart of the Po Valley, more precisely at Selva Malvezzi, in the municipality of Budrio. It was owned by Eni and has been inactive since 1984: the drilling authorisations were obtained by two foreign companies, the Australian Po Valley Energy and the British Prospex. Production, however, will be fairly low: approximately 150,000 cubic metres per day, which, based on the sales contracts signed by the two companies, could fall to 70,000.
A drop in the ocean when one considers that Italian demand stands at around 70 billion cubic metres. Yet it is a small signal that Italy intends to continue betting on this fossil fuel — so much so that the Draghi government, and subsequently the Meloni government, have backed the idea of turning Italy into a hub for distributing gas from Africa to the rest of Europe.
It is within this strategy that regasification terminals fit. And yet, not everyone agrees with this vision. "Italy's energy outlook fails to account for the impact of market dynamics, the real feasibility and cost-effectiveness of further infrastructure, and the impact of an expansion of fossil fuel sources relative to climate targets," comments the think tank Ecco Climate. According to the organisation, making Italy a gas hub would mean strengthening the transport infrastructure between Algeria and Italy, increasing the capacity of TAP (the pipeline running along the Adriatic coast) by up to double, and planning two further fixed regasification terminals in addition to the floating ones already planned at Ravenna and Piombino. The plan also envisages doubling domestic gas production in the Adriatic and more broadly across the Mediterranean.
A prospect that clashes with the main decarbonisation scenarios. Evidence of this is provided by the scenario put forward by the International Energy Agency (IEA), which shows global energy demand falling by 23 per cent in 2050 compared to 2021. With it, gas supply would fall by 90 per cent. In Europe in particular, the impact of RepowerEU, the transition plan adopted by the European Commission, would bring about a reduction in gas demand of around 40 per cent by 2030.
This is said by the very companies that have historically operated in fossil fuels. The latest report by BP (British Petroleum), for example, states: "A combination of faster growth in energy efficiency, rapid growth in renewable energy, wind and solar, and the increasing electrification of final energy consumption means that EU demand in 2030 will be around 50 per cent lower than 2019 levels. This demand is higher than the loss of gas imports from Russian pipelines, which implies that the level of LNG imports needed to meet the EU's domestic gas consumption in 2030 is lower than in 2019".
In short, gas consumption is falling steadily and ever more renewable sources are being installed. The risk is that continuing to bet on costly infrastructure built around outdated ways of producing energy will, in the long run, distance our country from the real needs of citizens and their consumption patterns. One justification put forward by those who support the development of the gas network is that in the future, millions of cubic metres of hydrogen will flow through the same pipelines. "It is very likely that the electrolysers needed for hydrogen production will be distributed within a logistics system radically different from the current gas system," is Ecco's reply. Which concludes: "The evidence is substantial. Making Italy and the Mediterranean a gas hub is uneconomical and counterproductive from every point of view. On the contrary, transforming Italy into a green hub by focusing on renewable energy, electricity grids, batteries, energy efficiency, critical materials, as well as securing water and food systems, could lay the foundations for a new and ambitious Mattei Plan, capable of building an ambitious and sustainable future for Italy and for Europe".