Italy moves to speed oil, gas projects in energy security push

By Giuseppe Fonte and Angelo Amante

ROME, Sept 11 (Reuters) - Italy adopted measures on Thursday aimed at boosting domestic oil and gas production, Prime Minister Giorgia Meloni said, seeking to cut red tape for drilling licences and reduce dependence on fossil fuel imports.

Italy currently produces about 29 million barrels of crude oil a year, mainly in the southern region of Basilicata, and around 3 billion cubic metres of natural gas, covering only a small fraction of its fossil fuel needs, according to official data.

"We want to move ahead with increasing domestic oil and gas production, because it makes little sense to buy this energy from abroad when we can also produce it here in Italy," Meloni said in a video message after a cabinet meeting.

To speed up permitting, the government said it would appoint special commissioners in cases where local authorities fail to take decisions on applications within the required timeframe.

"We are addressing an issue that can no longer be postponed: we cannot allow procedures that are strategic for the country's energy security to remain stalled for years because no decision has been taken," Energy Minister Gilberto Pichetto Fratin said.

The government had long considered appointing special commissioners to speed up renewable energy projects as the U.S.-Iran war pushed up energy prices, but ultimately took steps to boost fossil fuel output.

The conflict has disrupted supplies through the Strait of Hormuz, which before the war carried about a fifth of the world's oil and liquefied natural gas supplies.

Italy is heavily dependent on natural gas, which is used to produce almost half of its electricity, the highest proportion in the European Union, data showed.

Seeking to ease fuel prices, Meloni's government introduced a temporary cut in excise duties in March and has repeatedly extended the measure, including on Thursday.

The tax relief has so far cost the state more than €2.6 billion ($3.02 billion) when also including tax breaks for truck drivers.

National fuel producers association UNEM said in June that Italy was expected to spend almost €60 billion this year to import energy, up €8 billion to €9 billion from 2025.

Shell and TotalEnergies operate in Italy's hydrocarbon sector, along with state-controlled Eni.

($1 = 0.8615 euros)

(Reporting by Giuseppe Fonte and Angelo Amante. Editing by Mark Potter)