Italy PM Conte gives green light to contested TAP gas pipeline

ROME (Reuters) - Prime Minister Giuseppe Conte on Friday gave Italy’s final approval to the Trans Adriatic Pipeline (TAP), a gas transport project which had been strongly contested by the 5-Star Movement, one of the two parties in the ruling coalition.

FILE PHOTO: Italian Prime Minister Giuseppe Conte speaks during a joint news conference with Russian President Vladimir Putin following their talks at the Kremlin in Moscow, Russia October 24, 2018. Sergei Chirikov/Pool via REUTERS

“It’s no longer possible to intervene in this project, which was planned by previous governments and carries contractual constraints,” Conte said in a statement.

Interrupting the process would involve “unsustainable costs of tens of billions of euros,” he said, adding that “the accords signed in the past take us down a path with no way out.”

TAP, the last leg of the $40 billion Southern Gas Corridor that will bring Azeri gas to Italy, is due to start pumping gas in 2020 but local opposition to the project has raised concern that work at the Italian end may not be completed in time.

The 4.5 billion euro ($5.13 billion) TAP is viewed as strategic by the European Union as it moves to wean itself off its dependency on Russian gas.

Grassroots opposition revolved around alleged environmental risks and the fear the pipeline could discourage tourism in Italy’s southern Puglia region where it is due to arrive after crossing the Adriatic sea.

Ahead of an election in March the 5-Star Movement, which campaigns on an environmentalist platform, had promised to halt the project, but Conte said this was no longer possible.

“We have done everything we could,” he said, including a lengthy cost-benefit analysis, “but now the time has come to take the necessary decisions.”

Earlier on Friday the environment ministry said it had found no legal irregularities in the pipeline project, after assessing complaints brought by the local community.

At a meeting with U.S. President Donald Trump in Washington in July, Conte said he was aware of the strategic nature of the pipeline. The Trump administration is keen to see the project completed on time.

Matteo Salvini, head of the right-wing League which governs with 5-Star, welcomed Conte’s announcement, saying work on the pipeline should now go ahead to ensure “lower energy costs for Italian firms and families.”

Conte is close to 5-Star but is not affiliated to either of the ruling parties.

TAP shareholders are BP, Socar, Snam, Fluxys, Enagas and Axpo.

($1 = 0.8777 euros)

Reporting By Gavin Jones”