Tempting business opportunities in the energy trade? Yes if Italy becomes a European gas hub. The hypothesis is realistic even if talking about business opportunities in energy these days may seem like a regrettable temptation, a guilty heresy. It is not so. For us Italians, the gas crisis represents, surprisingly but not too much, aopportunity not to be missed. “Italy continental gas hub” many analysts warmly suggested already a decade ago. There was more than one objection: at that time the infrastructures were even overabundant compared to our needs, which weren't growing either at the moment or on a trend basis. Counter-objection: the ecological transition would in any case have hinged on gas for many years, because the combined decommissioning of nuclear power and the most polluting fossil fuels (coal and fuel oil) would have given a new impetus to European consumption of methane, making a massive investment both appropriate and profitable in new infrastructure, to develop a continental supply scheme that sees our country as a transit infrastructure. A hub, in fact.
Here is now the crisis, the war, the gas in fits and starts. And so the combination of the new creed of diversification from Russian gas and the awareness that we will not be able to do without massive quantities of methane for at least twenty years, or more likely thirty years, give a new voice to the hub's supporters gas Italian.
Italy gas hub? What is going on
The signs of the deal are developing these days, precisely in the name of the crisis: with the activation (late and abundantly opposed) of the gas pipeline TAP which brings us gas from Azerbaijan from Greece and with the strengthening of existing import infrastructures, Italy has shown that it is not in such a bad shape compared to the crisis of imports from Russia. Or rather: it is put better than the others. Storage almost 90% full, better than feared, flows from Algeria and the eastern quadrant at the maximum possible today, regasification plants (albeit few) at full capacity. With the minimum range envisaged by the European recommendations and by the consumption performance plan drafted by the outgoing government in recent weeks, we could do it. We'll get through the winter, at the cost of passing out a bit anyway, then we'll see.
The price of gas rises in Europe but falls in Italy
The fact is that in the price balances that have been taking place in the tangled system of European exchanges and transactions for several days now, the gas brought to Italy has been costing us much less than half of the generalized peaks in the rest of the continent: the TTF index, which expresses the quotations on the Amsterdam stock exchange which channels practically all European transactions, last Monday exceeded 220 euros per megawatt hour, while our values at PSV, the virtual trading point which refers to our methane costs , touched the minimum tip of 80 euros to MWh.
It will be for predatory logic perhaps not very appropriate, it will be because even momentary business must be seized on the fly, the fact is that Italy is exporting these days large quantities of gas in the rest of Europe, or rather it is "passing" it to other countries in transit through gas pipelines imported from the north thanks also to the providential technical adjustments made in recent years to allow the flow reversal in the large pipes. This happens above all at the entrance to Tarvisio, to the north, where we retain less than a third of the gas that would be destined for us, passing the rest on at a high price to our European partners.
Appropriate choice considering our nonetheless continuing needs to fill the storages? And perhaps it would not be the case to capitalize on naturally controlled gas in view of the imminent decision of the Energy Authority (Arera) on bill increases to be decided for the next few months for gas after the setback for electricity? He will judge and, if necessary, the right person will intervene, starting with the sector Authority.
Because Italy can become strategic for gas
One thing is certain: the proponents of Italy's gas hub are absolutely right. The reason is obvious: regardless of the possibility of repairing the catastrophic failures of these hours in the two mega-gas pipelines Nord Stream 1 and 2 which carry Russian gas to Europe through the Baltic (our German partners even support the thesis of the irreparability absolute) Europe will for many years ask for substantial and perhaps even increasing quantities of methane coming from the other quadrants.
Leave it up to Spain and its initiative in building new regasification plants for gas arriving by ship from the Atlantic and new gas pipelines to the west intended to distribute this gas in Europe? Probably the way forward is not that of competition but rather of collaboration, in synergy with the Iberian strategy: they have the bulk of the new regasifiers, we have the task of developing a good mix by combining a few more very useful regasifiers than the few we have and strengthening the gas pipelines from the south and east. There is no shortage of Italian projects. Indeed, on closer inspection there are many in the field, in some cases already in the pre-operative phase.
In 2021 we consumed 71,34 billion cubic meters of gas in Italy, 37,8% Russian, with Algeria in second place in our imports with 28,4%. Well, meanwhile with the escalation of the crisis we have already managed to replace nearly two-thirds of the gas we imported from Russia. We did this with additional quotas of gas from Algeria (which thus became our main supplier, displacing Russia) and Norway.
We have pushed the three regasification terminals already operating in Italy to maximum capacity, which will also be called upon to process the additional quantities of liquefied gas which, with the new contracts recently signed by our Government, promises to come from countries such as Qatar, Congo but also the 'Egypt. The Rovigo terminal is now capable of 8 billion cubic meters a year, while Panigaglia guarantees 3,5 billion cubic meters and Livorno just under 4, for a total regasification capacity of just over 15 billion cubic meters a year. But the two regasification ships will soon follow (they transport and regasify directly on board once landed, with great flexibility in the operational location) just purchased from Snam, which each promise to add 5 billion cubic meters a year. Buy (or build, given the merits of our shipbuilding) others? The decisions could (should, many hope) arrive shortly.
Diversifying gas suppliers: we are on the right track
To make realistic the hypothesis of a structural solution not only to our natural gas problems but also to the hypothesis of Italy as a gas hub to be created with a structural surplus of imports compared to our needs, there is a range of other projects, some concrete, others all to be verified. The TAP (Trans Adriatic Pipeline) pipeline which brings us gas from Azerbaijan is already making a concrete contribution to maximizing our gas supplies. The most concrete hopes of an increase in the short term are pointing to the TAP: from 7,5 billion cubic meters in 2021 we have already risen to a flow of 9 billion a year, and an expansion up to 20 billion cubic meters a year promises to materialize in two or three years with only the adaptation of the pumping systems, thanks to the fact that the operation had already been prepared during its tormented construction, which, as you will recall, had been opposed in its Italian route by many environmental associations (despite the shown ecological neutrality of the work) with the support of a good portion of the political forces in the name of the most irresponsible local propaganda.
The EastMed pipeline will also land in Italy but Turkey…..
However, there is more than one unknown for another project that could be decisive for our "hub": to transport to Europe the enormous quantities of new gas from recent discoveries in the eastern Mediterranean off the coast of Israel, Cyprus and Egypt, thinking of a new mega pipeline that would pass through Cyprus, Crete and mainland Greece. It's about the EastMed project, which sees our country as an ideal landing place in Europe. There is talk of at least 20 billion cubic meters of gas per year but the production potential of the new reservoir (whose consistency is initially estimated at a good 3,5 thousand billion cubic meters of excellent quality methane) could reach and exceed 30 billion cubic meters per year. The project was officially classified by the European Union as "priority".
Technically, EastMed could start supplying gas, once the pipeline has been built, as early as 2027. But to actually start the project there is a first problem to solve: the Turkey considers most of the areas that include possible deposits as "of its own exclusive economic interest", claiming the rights, as well as part of the areas where the transport structures should be built. Not a trivial problem, if we consider the role and attitude of the countries concerned in the geopolitical scenario of this shattered beginning of the millennium. Scenario in which Italy has solid reasons to play its role. Starting right from the new gas hub between the Mediterranean and Europe.
