By Liam Moloney
ROME--ERG SpA (ERG.MI), one of Italy's biggest independent
refineries, Monday said it will pull out of the still-to-be-built
Sicilian liquefied natural gas project as the demand for the fossil
fuel has dropped following the economic slowdown in Europe.
In a statement, ERG said the board of directors had decided to
exit the equally owned joint venture project with Royal Dutch Shell
PLC (RDSA). The Sicilian regasification terminal project had an
annual capacity of 8 billion cubic meters, or about 10% of Italy's
demand.
The project is still waiting for final approval from the
Sicilian region.
"The decision to withdraw from the project stems from the
profound changes that have occurred in both the energy and the
economic and financial scenarios, following the recession that
began in 2008," it said.
Industry Minister Corrado Passera has envisioned turning Italy
into a gas hub with new LNG import terminals and pipelines in the
country supplying the fossil fuel to other European countries.
Write to Liam Moloney at liam.moloney@dowjones.com
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