* TAP to start removing olive trees in a matter of
* Project aims to curb Russia's share of European gas market
* As confidence grows, threat of re-routing TAP out of Italy
* Other challenges still face TAP to deliver Azeri gas by
By Stephen Jewkes and Oleg Vukmanovic
MILAN, March 7 Developers of a strategic
pipeline bringing central Asian gas into Europe say they will
start in a few days to remove an obstacle that threatened to
delay the $40 billion project -- an grove of olive trees dating
back centuries in southern Italy.
The trees, including some more than 100 years' old on a site
used to farm olives for centuries, stand in the way of the Trans
Adriatic Pipeline (TAP), the final stage of the so-called
southern gas corridor which is meant to reduce the European
Union's dependence on Russian energy.
The TAP developers had hoped to begin moving the first of
roughly 10,000 trees almost a year ago, but local opposition to
shifting them slowed the process, shortening the construction
timetable and jeopardising their goal to deliver first gas into
Italy in 2020.
"We're going to start moving the olives in a few days," a
TAP spokesman said on Tuesday, adding the developers had
complied with regulations required before moving the trees.
The last requirements -- a health check to ensure any sick
trees are destroyed rather than moved -- was now well underway
by authorities in the region of Puglia, he said.
Some trees carry Xylella, a deadly bacteria that has wiped
out tens of thousands of trees in recent years.
Any threat to old olive trees can stir strong emotions in
Puglia, the country's biggest producer of olive oil, where the
regional governor has been lobbying for the pipeline to come
ashore in an industrial area further north, away from the grove.
If the trees are not shifted by April, when they go through
a six-month growth spurt and cannot be moved, the TAP consortium
must wait until late November to complete the removals.
Under the project plan, the trees are to be returned to
their original positions once the pipes are laid and buried, a
condition imposed by Rome when it approved TAP in 2015.
At a removal rate of 20 trees per day, the critical first
batch of trees could take just over a week to clear.
TAP's confidence in meeting its timetable has grown to a
point where two investors, Enagas and Snam,
decided this year to put the 2020 arrival date for gas in their
long-term business plans, a source close to the matter said.
That contrasts to mid-December when TAP chief Ian Bradshaw
voiced frustration at delays during a board meeting. He mooted
the idea of rethinking the route, a remark aimed at stinging the
Italian shareholders into action to help end the stalemate, said
a source familiar with the deliberations.
When asked about the meeting, Bradshaw declined to comment.
NOT OUT OF THE WOODS
Yet the project may face other obstacles.
Even if TAP can remove the olive trees by end-April, the
project must meet a check-list of more than 30 other conditions,
providing scope for fresh delays. These include measures to
preserve the natural environment and wildlife habitats - on land
and at sea.
Puglia governor Michele Emiliano has been lobbying Rome to
shift the pipeline's landing point, but he says the government
was afraid this could prompt TAP to re-route away from Italy.
"The government is worried any change of landfall could
persuade TAP to leave Italy and reroute through the Balkans,"
Emiliano told Reuters.
Italy's Industry Ministry said work had already begun and
local administrative procedures to move the trees completed,
declining to add any more.
The EU has also been concerned about the prospect of delays
at the Italy end of the project.
"Time is running out. The landing point in Italy is still an
issue," an EU official said recently.
Italy lost another major energy project in Puglia in 2012
when Britain's BG Group scrapped an LNG terminal it had
already spent 250 million euros on, blaming red tape.
TAP's shareholders, who also include BP, SOCAR,
Fluxys, Enagas and Axpo, is the largest project aimed at
bringing new supplies of gas to European consumers.
It is expected to carry around 10 billion cubic metres (bcm)
per year of Azeri gas from the giant Shah Deniz II field to
Italy and could be enlarged to 20 bcm.
(Additional reporting by Giancarlo Navach in Milan and Alissa
De Carbonel in Brussels; Editing by Edmund Blair)