Italy commissioner OKs new LNG terminal in Piombino

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A view shows the spot where a floating storage and regasification unit will be set up in front of the port city of Piombino, Italy, October 20, 2022. REUTERS TV via REUTERS

FLORENCE, Oct 25 (Reuters) - A state-appointed commissioner on Tuesday formally approved the set up of a new liquefied natural gas (LNG) terminal in the Italian port of Piombino, on the western coast of the country.

Preparatory works by gas grid operator Snam (SRG.MI) for the infrastructure could start on Wednesday, Commissioner Eugenio Giani said during a press conference in Florence.

The floating storage and regasification unit (FSRU) is part of a broader plan designed by the former government of Mario Draghi to replace dwindling Russian gas supplies.

Rome said the terminal needs to be operational by end-March.

The approval is subject to many conditions.

The port authority said that the tankers transporting LNG should enter the port of Piombino only during the night. It was necessary to have a ship able to monitor the FSRU 24 hours a day to prevent potential attacks, it said.

The harbour area will have to be dredged to create space for ship manoeuvring, the port authority added, according to documents published on the commissioner's website.

The National Health Institute asked for strict monitoring of air pollution in the port area.

The grid operator said it would study the conditions and confirmed it would work to have the 5 billion cubic metre capacity terminal up and running on schedule.

"Snam expresses satisfaction with the positive conclusion of the authorisation process for the FSRU Piombino Project, which will make a decisive contribution to the security and diversification of the country's energy supplies," it said.

The project received the go-ahead in less than four months, much quicker than usual in Italy for such projects.

"It's reasonable to believe that the conditions put in place are manageable by Snam," Giani said, adding he expected gas to be delivered through the terminal in mid-April.

The authorisation is also linked to the request of hundreds of millions of euros in investments for Piombino and an energy bill discount that will have to be approved by the new government headed by far-right leader Giorgia Meloni.

The mayor of Piombino confirmed on Tuesday he would challenge the approval of the infrastructure in court.

Snam, which has agreed to keep the FSRU docked in Piombino for three years, has 45 days to indicate the offshore area that it would move it to afterwards.

Reporting by Silvia Ognibene and Francesca Landini; editing by Agnieszka Flak and Bernadette Baum

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