Sardinian Gas Network JV Approved

The European Commission said October 30 it has approved the proposed creation of the Sardinia Newco joint venture, by Snam and the much smaller Italian network operator Societa Gasdotti Italia (SGI).

The joint venture will build and operate a natural gas transmission pipeline on the Italian island of Sardinia, the largest island in the Mediterranean not yet with a natural gas network or regular supplies.

In December 2017, Italy's national gas grid Snam, SGI and the latter’s shareholders Macquarie and Swiss Life agreed to jointly develop gas distribution infrastructure in Sardinia, to be supplied from likely third-party small LNG regasification units at Cagliari, Oristano and Porto Torres; the scheme is one likely to be dependent on EU co-funding.

Sardinia is seen as a potential market for 0.5 to 1bn m³/yr by 2030, according to a detailed academic study published August 2016 by Sardinia's regional government. Although not supplied with natural gas today, it does already have 2,000 km of very localised distribution networks that supply gasified LPG (liquid petroleum gas) which could be converted.

The island was originally to have been served by the 8bn m³/yr 'Galsi' subsea natural gas pipeline from Algeria to mainland Italy, but the project was cancelled because of the downturn in EU gas demand from 2008 to 2014, with the Sardinian government deciding in May 2014 it would never be built.