Italian gas grid operator Snam to invest 11.5 bln euros by 2027
MILAN, Jan 25 (Reuters) - Italy's Snam will invest 11.5 billion euros ($12.5 billion) by 2027 to expand its infrastructure to support the country's energy transition, 15% more than in its previous business plan, the gas network operator said on Thursday.
In its new strategy, the state-controlled group will focus on the construction of a new pipeline and the completion of liquefied natural gas (LNG) infrastructure.
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It will also invest in energy transition businesses including a carbon capture and storage hub and the development of a European hydrogen network.
"We will invest 11.5 billion euros to develop an increasingly flexible infrastructure ...thus supporting the carbon neutrality pathway for Italy," CEO Stefano Venier said in a statement.
The group expects 7.4% average annual growth for its adjusted core earnings in the period versus 7% under its previous plan.
Adjusted net income is projected to rise by around 4% each year on average, up from 3% in the previous strategy.
The group also promised minimum annual dividend growth of 3% starting from its payout on its 2024 results.
Net debt is expected to rise to 19 billion euros by 2027 with the average cost of debt projected to rise to 2.6%.
Part of the investments will be dedicated to the Adriatic Line, the new pipeline aimed at boosting capacity to transport gas from southern Italy - where the fuel arrives from Africa - to the industrialised north and abroad.
The infrastructure will be hydrogen-ready to be part of a new network dubbed SoutH2 aimed at bringing the fuel from Africa to northern Europe in the long-term.
The group is also working with energy group Eni on a carbon capture and storage hub offshore Ravenna.
In its plan, Snam added a commitment to achieve net zero across all emissions by 2050.
($1 = 0.9189 euros) (Reporting by Francesca Landini, editing by Giulia Segreti, Jason Neely and Emelia Sithole-Matarise)