Duo finalizes acquisition of shares in ‘key energy infrastructure’ to boost Italy’s security of supply

Following the acquisition of shares, VTTI, the Netherlands-headquartered energy infrastructure player, has taken the largest stake in an Italian liquefied natural gas (LNG) terminal, while Snam, Italy’s energy infrastructure operator, also increased its interest in the same project. The duo intends to work together to strengthen and further diversify the security of the European country’s energy supplies.

Snam exercised the pre-emption right to boost its stake in Italy’s Terminale GNL Adriatico from 7.3% to 30% once VTTI inked a deal to get a hold of the majority ownership, or 70%, in the project after establishing a consortium with IKAV, a German asset management group. Terminale GNL Adriatico owns the Adriatic LNG regasification terminal, operating in the waters off Porto Tolle (Rovigo), Italy.

The transaction has been finalized upon completion of necessary regulatory approvals. As a result, this asset, which is said to be Italy’s largest LNG terminal, is now owned by VTTI and Snam with 70% and 30% ownership, respectively. In this new structure, Alexandra Thomas has been appointed as CEO and Alessandro Conta as COO of Adriatic LNG.

Guy Moeyens, CEO of VTTI, commented: “Facilitating the import and distribution of LNG aligns with VTTI’s strategy to support the global energy transition and ensure security of supply. Together with Snam, we can provide financial strength, operational efficiency, market access and future-proof infrastructure to leverage this asset even further as an important secure and reliable energy source for Italy and other European markets.’’

Thomas is joining Adriatic LNG from Neptune Energy, where she was most recently Managing Director for Egypt. Previously, she held roles at Statoil, Shell, Vattenfall, and Tullow Oil, managing businesses in various countries across Europe and Africa. On the other hand, Conta is coming to Adriatic LNG from Snam Rete Gas, where he gained experience in operating plants and complex systems across the oil and gas industry.

In pursuit of its ‘Strategy 2028,’ VTTI claims to be building on its foundation as an energy storage and service terminal operator at key ports worldwide while investing in and developing additional energy infrastructure needed for the energy transition. This encompasses LNG regasification terminals, renewable natural gas (RNG), waste-to-value production facilities, ammonia and hydrogen infrastructure, and other renewable energy storage and services.

The Dutch player is set on accelerating growth, with 50% of its earnings coming from transitional and sustainable energy sources by 2028. On this quest, Adriatic LNG represents VTTI’s second acquisition of a stake in an LNG regasification terminal, after Dragon LNG in the United Kingdom, where the firm owns 50% of the terminal.

The enlarged stake in Adriatic LNG also benefited Snam, bolstering its presence in the LNG business. This fossil fuel is perceived to be increasingly strategic for the security and diversification of Italy’s energy supplies, with LNG accounting for approximately 25% of Italy’s overall gas consumption.

The firm also holds interests in all the remaining regulated LNG regasification terminals currently operating in Italy, such as the Panigaglia terminal, in operation since 1971 near La Spezia; the OLT FSRU Toscana offshore Livorno, operational since 2013; and the FSRU Italis LNG, operating in Piombino since July 2023, for a total regasification capacity of about 23 billion cubic meters.

Furthermore, the floating and storage regasification unit (FSRU) BW Singapore, acquired by Snam in 2023, is set to start activities by the first quarter of 2025 offshore Ravenna. This will bring Italy’s regasification capacity to 28 billion cubic meters, evenly distributed between the Tyrrhenian and Adriatic coasts, at an amount corresponding to overall volumes imported via pipelines from Russia in 2021.

Stefano Venier, Snam’s CEO, highlighted: “This transaction marks a key milestone towards further diversification and security of Italy’s energy supplies. The 30% stake in Adriatic LNG and our operational role in the company underscore our LNG portfolio’s relevance in the European energy context, where Snam is now the third largest operator for regasification capacity. We look forward to working closely with VTTI and ensuring optimal management of key energy infrastructure for the country.”

Adriatic LNG regasification terminal, which has been in operation since November 2009, is estimated to ensure the import of about 15% of national gas consumption in Italy; thus, it is seen as a strategic infrastructure for the country, given its contribution to the diversification of energy supply since its inception.

This LNG asset has contributed to national natural gas consumption by delivering more than 100 billion cubic meters of gas to the pipeline network, coming from different areas of the world, including Qatar, the United States, Trinidad and Tobago, China, and Mozambique. These supplies were transported by a variety of carriers up to 217,000 liqcm capacity.

During the first 11 months of 2024, Adriatic LNG injected more than 8 billion cubic meters of natural gas into the Italian gas grid, equivalent to 15% of national consumption, 3% more compared to the same period in 2023. VTTI underlines that Adriatic LNG is Italy’s third entry source for gas imports, right after pipeline imports from Algeria and Azerbaijan.