ALGIERS, Feb 6 (Reuters) - Economic and technical
problems are blocking the construction of a new gas pipeline
that would link Algeria to Italy, Algeria's energy minister was
quoted by a newspaper as saying, raising doubts the project will
come on stream on schedule.
Italy, struggling to diversify its gas supplies to meet
growing domestic demand, depends on imports for 90 percent of
its natural gas. Algeria provides it with around 35 percent of
its imported gas through an existing pipeline that passed
through Tunisia.
The 8 billion cubic metre Galsi pipeline, which was planned
to pump gas directly from Algeria to Sardinia and was scheduled
for start-up in 2014, was intended to make Italy's supplies more
secure.
"With regard to the Galsi project, the partners are waiting
for technical and economic conditions to be present and also to
obtain administrative authorisation in Italy to go ahead with
the project," El Khabar newspaper quoted Energy and Mines
Minister Youcef Yousfi as saying on Monday.
The minister did not give details of the problems blocking
the project, whose partners include Algerian state energy firm
Sonatrach and Italian utilities Edison, Enel
and Hera.
The Galsi project has already faced delays because of
concerns about the route and hold-ups in obtaining approvals
from the Italian government and local authorities.
Yousfi's interview is the first time, however, that a senior
Algerian official has raised the issue of "economic conditions"
for the project, suggesting that there may now be question marks
about its viability.
Italy's reliance on Algerian gas was underlined at the
weekend, when energy giant Eni said it was importing
more gas from Algeria to offset a fall in Russian supplies
caused by the cold weather in Europe.
(Reporting By Hamid Ould Ahmed, editing by Jane Baird)
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