Under the agreement signed, Italian contractor Saipem will build the offshore regasification plant. The agreement signed with Saipem, valued at Euro 390 million, entails the transformation of a methane tanker into a floating regasification terminal.The project’s holding company, OLT Offshore LNG Toscana S.p.A., is 30.5%-owned by Endesa Europa, 30.5% by the Iride Group and 16% and 23% owned by Golar LNG and OLT Energy Toscana, S.A., respectively.Pilot testing of the facility is slated for 2010 and commercial operations in completed year are scheduled in 2011.

OLT Offshore LNG Toscana S.p.A., majority owned by Endesa Europa and the Iride Group, has signed an agreement with Italian contractor Saipem for the construction of the offshore regasification plant at Livorno, in the Italian region of Tuscany. The company also signed a contract with Snam Rete Gas to build the gas pipeline to connect the facility to the Italian mainland gas network.

In addition to the stakes held by Endesa Europa and the Iride Group (30.5% apiece), OLT Offshore LNG Toscana S.p.A. is 16%-owned by Golar LNG and 23%-owned by OLT Energy Toscana, S.A.

The Saipem contract entails the transformation by the Italian contractor of a methane tanker (Golar Frost), acquired by OLT in January 2008 for almost Euro 160 million, into a floating regasification terminal, extending to all the activities required to locate the facility offshore and put it into operation. The facility will be anchored approximately 12 miles off the Tuscany coast and will have annual natural gas regasification capacity of 3.75 bcm (5% of Italy’s gas supply needs).

The Saipem contract is valued at around Euro 390 million. The total cost of the Livorno regasification facility is estimated at around Euro 600 million.

Although the contract has just been signed with Saipem, site preparation work in the town of Collesalvetti already began in February 2007, following receipt of all necessary permits.

Pilot testing of the facility is slated for the end of 2010 while commercial operations are scheduled to begin in 2011.

According to Jesús Olmos, CEO of Endesa Europa, “this is very good news for supply continuity in Italy and good news for Endesa and its shareholders. This agreement will facilitate completion of a project that is unique in Italy at present. It entails the vertical integration of Endesa’s business in Italy and the corresponding value creation for its assets as a whole".

Roberto Bazzano, Chairman of Iride (shareholder in the project), noted that the "execution of this contract with Saipem marks the last step in making the Livorno facility a reality".