France discusses TransMed pipeline extension

France expressed interest in receiving gas from the Galsi pipeline, which will import 8 billion cu m/year of Algerian gas to Italy.

Uchenna Izundu
OGJ International Editor

LONDON, June 1 -- France expressed interest in receiving gas from the Galsi pipeline, which will import 8 billion cu m/year of Algerian gas to Italy.

Chakib Khelil, Algeria's energy minister, said France wants to add a branch to the proposed 850-km line, which will link Algeria to Sardinia to Tuscany. He told reporters construction of the pipeline would begin next year. "All of the studies concerning the pipeline have been completed, and the two partners in the project, Algeria and Italy, have decided to begin investment in 2010," he said.

Khelil met with Italian Economic Development Minister Claudio Scajola over the weekend. With Europe keen to lessen its dependence on Russian imports, Scajola described Transmed as a "strategic project for the energy security of Europe."

Galsi is an 840-km pipeline and in 2,800 m of water will be one of the deepest offshore pipeline ever laid. It will deliver Algerian gas into Italy starting in 2013, a year later than originally scheduled due to technical difficulties (OGJ Online, Dec. 15, 2008). The final investment decision will be made June 30, 2010.

"We will try to accelerate things on the Galsi project," Khelil said. Sonatrach is leading the project along with Snam Rete Gas SPA, Edison SPA, Enel SPA, and the Hera Group.

The ministers agreed to increase capacity of the TransMed pipeline by 7 billion cu m by the end of this year. Its current capacity is 27 billion cu m/year of gas. It delivers gas from Algeria via Tunisia to Sicily.

Once the Galsi and upgrades to the TransMed pipeline are completed, Algeria's export capacity to Italy will rise to nearly 40 billion cu m/year. But some industry experts have expressed concerns whether Algeria can boost production to fill these pipelines as Algeria's recent gas finds have been relatively small, and there was little interest from foreign energy majors to develop Algeria's fields under the last licensing round.

Algerian officials attributed the lack of interest in its energy sector to the global economic slowdown.

Contact Uchenna Izundu at uchennai@pennwell.com.

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