Italy: BG Group Puts LNG Terminal on Hold

UK's BG Group has said that it has been forced to put a planned LNG terminal on hold in Italy, following lengthy delays in obtaining the relevant permits for the project.

The terminal project, to be located in the Brindisi port in Italy, was initiated in 2001, but has yet to receive the permits it has applied for 11 years after the project began.

Luca Manzella, head of Italian arm BG Italia, told Italian newspaper Il Sole 24 Ore today that the company was disappointed with the progress made on the terminal.

"It is impossible to think that a big multinational company would have a project blocked for 11 years. There is a limit to everything," he said. "The parent company, disappointed and discouraged by an endless standoff with Italian authorities … has decided to reconsider from the basis the feasibility of the investment."

A spokesperson for BG Group confirmed that the company would now put the project on hold with the assets to be revisited at a later date.

"We have decided to freeze the project as after so many years it isn't a priority anymore for us," the Dow Jones news wire reports the spokesperson as saying.

The spokesperson also said that the company had shut down its Brindisi office and was considering suing the local authorities who have opposed the project. The Brindisi LNG terminal has cost €250 million so far, the spokesperson said.

The Brindisi LNG terminal was planned to have the ability to regasify six million tonnes of liquefied natural gas a year, in addition to that already regasified by two existing LNG terminals in Liguria and Rovigo. If it the terminal had gone ahead, BG Group estimated that it would be capable of supplying ten per cent of Italy's gas needs per annum.