JPRS ID: 10020 WEST EUROPE REPORT

• Document Type: CREST
• Collection: JPRS
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00850R000400050070-5
• Release Decision: RIF
• Original Classification: U
• Document Page Count: 34
• Document Creation Date: November 1, 2016
• Sequence Number: 70
• Content Type: REPORTS

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JPFiS L/ 10020
29 September 1981
West E u ro e Re ort
p p
(FOUO 49/81)
Fg~$ FOREIC~N BROADCAST INFORMATION SERVICE
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JPRS L/10020
29 September 1981
WEST EUROPE REPORT
(FOUO 49/81)
CONTENTS
ENERGY ECONOMICS
ITALY
FSI Views on Soviet, Algerian Gas Pipelines
(Franco Mimmi; IL MONDO, 31 Jul 81) 1
Roundtable on Infrastructural Problems of Coal Industry
- (IL SOLE-24 ORE, 24 Jul 81) 4
ECONOMIC
T'fALY
Negotiations for Labor Contracts Get Underway
(Lorenzo Scheggi; IL MONDO, 31 Jul 81) lb
Feralpi Steel 1980 Balance Sheet; Libyan Purchase
(IL MONDO, 31 Jul 81) 20
POLITICAL
- FEDERAI, REPUBLIC OF GERMANY
Polls Indicate Belief Coalition Cannot Prevail
(CAPITAL, Sep 81) 21
- a - [III - WE -.150 FOUO]
, ,
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ENt~kG'r." LCI~DTOriTCS IT~Y
pS I V i;i;G1G r?!~; SOVIET ~ ALGERIAN GAS PIPELINES
~ti] an LL MC~NDO in Italian 31 Ju1 81 p 21
[Arr..icle hy Franco Mi.mmi: "Th.e PSI Has Two Gas Lobbies"]
jT~-ct] Lc wa.s already apparent in rae economic plan that the PSI submitted a few
ho~,r~~ b~:fore the government crisis co Arnaldo Forlani and right after~~rards to
Gio~ra~~,,~ Spadolini that the two pij,elines create a problem. Item 9, under the
t:~t:le~ "~nergy Top Pri.ority," stated: "Algerian methane in the South. Diversify
st~~~~~~.ie.s. Loak into USSR ~~ipeline." Thus, ever since a request arrived from
A11;ie.r~; apnroxi.mately 20 days ago for a review of the price of inethane which it
is ~ugply ~o Ita1y starting at the end of the year (the request was re~ected by
ENI,) one fears that quite a bundle was spent (about 3,000 billion lire) for the
c~nstructiou of a pipeline from the Sahara to Italy, to be faced in the ~nd with
th~: ~urch~~se af gas at unsuitable prices. '
4li.Lt~ regar3 to the USSR pipeline ~it is to carry methane fram Siberia to various
i,urop~an countries, including Italy,) there are svme who believe that Moscow,
th?~3~i~h chese additional supplies, (however not yet quantitatively identified) would
evenrt!%~.1~_~ place a rope around Europe's neck. Thus the agreeme~tt shifts from econ-
U:4LC3~ CO political and is furthermore complicated by a suspicion of payoffs made by
5~~~~hf c; ;,'~�lI:'s affiliate in charge of natural gas) to persons unknown and for unknawn
r.E::~sc~~~s for a 20-year nethane contract stipulated with the USSR in 1973.
'Phc~ c:ae.~~ts eanc.erning the Algerian pipeline began in the 1960's, and then evolved
zn i973 into a contract between ENI and SNAM on one aide and Sonatrach (ENI's Alger-
a.a~i r_our.t~}rp~rt) on the other. In 1977 the contrac:: was updated and, as far as we
~ lcnow, ttze pri.cP of inethane (12 billion cubic meters a year fram the end of 1981
wl,f.;, ~_?;e pipel~Lne is campleted, destined to become 18 and perhaps more when the
ni~t:~i,~e ;.s doubled,} was set at approximately two dollars per BTU, depending on oil
~~~~:.cc:s. A B.T.U is equivalent to 27.69 cubi~ meters. Today, according to some re-
ur:rt;;, ?:t~e pri.~.e requested is around seven dollars, which means an expense of ap-
prcxima~.ely 3,500 billion lire a year. ENI does not feel it is a fair price, be-
cause. it does not take inta account the costs that must be met after the delivery.
Some ~~rpeaoes already have been fired from Algiers to exert pressure by blocking
~ ~om~ huge contracCs with Italian firms and favoring others with competing countries.
~lse ~lie Sibazian pipeline, a gigantic undertaking of 4,50J kilometers, costing
ab~i~t 15,000 billioii lire, already has an ancient history, but is at a standstill.
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A few days ago an Italian delegation went to Moscow. "We have further clarified our
respective viewpoints," declared Giuseppe Borga, head of the office for economic af-
fairs of the foreign ministry," but surely we are not yet close. "The Farnesina
[foreign ministryJ expert swnmarized the aspects of the neg~tiations as follows:
"The first aspect is the supply on the part cf our industries, and here all is we11!
we are qualified. Then there is the fin,anc:tal aspect, and it is a huge problem.
kTe should lend the money, and Moscow is asking for a highly ~rivileged rate compared
to the current cost of money. Finally, there is the technical-energy aspect. The
quantity and price of gas are still to be defined. They are asking much more than
we can pay. Certainly it is an interesting project--for us, as a diversification of
source and for them, as recipients of foreign currency."
How and why have two ~.conomic problems become a political problem? The answer can
be found, above all, speaking to representatives of the PSI, the only party that, at
this time, seems willing to handle the matter (and their cammitment to this is also
demonstrated by the government choices madE: the PSI has the ministry of foreign
trade wi.th Nicola Capria, the presidency of the canmittee for industry with Enrico
Manca, and has requested that Roberto Palleschi, undersecretary for foreign affairs,
be given the responsibility for the department o� co,operation and development). ~
But withi~z the PSI too, not all the voices are in a~cord. The most reliable one
should be that of Frencesco Forte, who is the new person responsible for the party's
- economic sector. And Forte, discussing the argument, comes up with Manzoni-like
statements such as; ''The Russian pipeline should not be done." According to him,
ttiere is at ~NI "a group in favor of the USSR which has always adopted an unbalanced
policy."
The Algerian position can be discussed. A refusal to discuss it would mean pushing
forward the USSR. Forte does not steop here. "It must not be forgotten," he warns,
- that Enrico Mattei died because of a screwdriver in the engine o� his plane four day
days before a trip to Algeria for a global agreement. It was the strategy of di-
versification for ba~.an.cing three sectors: Iran-Traq, Libya, Algeria. We do not
today need the USSR which, in �our years, will be dependent on foreign countries for
oil." Palleschi agrees: "The Siberian pipeline is a political choice for which
the reasons c~.nnot be seen. It is not an undertaking for peace: When you hand
your house keys to the enemy you do not establish peace."
Nicola Cacace, president of the Institute for the Study of Industrial Relations and
Manca's economic consultant when the latter was at foreign trade, is of a different
opinion. "With x�espect ta Algeria, it is only a question of pr.ice which has been
dramatized. As far as Russia is concerned, instead, the contract ts still up in
the air, but the Italian firms are very interested: because the offer involves
works fc~r 2,000 billion lire, Moscow's reliability? In 20 years the Soviets have
always k~~pt their commitments. As far as dependence on Moscow is concerned, it
must not be forgotten that a pipeline has two faucets: the Russians have that for
the gas and Tae have that of the dollars they need. 7'he financial cost? One can
discuss with socialist countries the way to do business, but all data must be ac-
counted for: also the cost of keeping our plants underutilized and that of unem-
ployment compensation for the workers in factories without orders. Not even Manca
believes that the Siberian pipeline could choke Europe. "Among other things," he
affirms, "Italy has an advantage over other European countries, ~ust because it can
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"gamblE on the Algerian gas. Caution is needed, not fear. Whar must be achieved is
that European countries be united in the negotiations."
While the discussion goes on, a weekly magazine published a document according to
whicli, ~s said before, SNAM is making large payoffs for methane it purchases �rom the
USSR. Some right-wing Christian Democratic deputies have questioned the government
on the subject. "But is it possible," says Palleschi, that the Italian government
lacks the means to find out who are the recipients of the payoffs?" And Forte:
"Recently someone sent me, in a sealed envelope, a document requesting that the
money be paid. It was signed by ENI's Carlo Sarchi. I don't know if it is genuine
or forged. It seems highly unlikely that the payoffs have been collected by the
PCI:: it is not possible that the PCI would get involved in a matter as naive as
payoffs over a 20-year period."
COYYRIGHT: I~ MONDO 1981
~ ~7ss _
CSO: 3104/353
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- FNERGY ECONOMICS ITALY~
ROUNDTABLE ON INFRASTRUCTURAL PROBLEMS OF COAL INDUSTRX
Milan IL SOLE-24 ORE in Ttalian 24 Jul 81 pp 15T16
' [Article: "Untying the Infrastructure Knot"]
[Text] The results of a roundtable held in Rome by
IL SOLE-24 ORE concerning implementation of the coal
report. Difficulties have begun since the political
phase of the "energy choice~': ports of debarkation
(all to be named) and distribution of coal to users,
- The choice of coal in the search for an alternative energy strategy brings with it
not only general planning problems but also that of the infrastructures necessary
f.or the receiving, transport and use of coal,
To discuss infrastructure problems, IL SOLE~24 ORE held a roundtable recently in Rome
with the participation of the Honorable Francesco Compagna, then minister of the Mer-
. chant Marine. With him were the general director of the Energy Sources bureau of
_ the ministry of Industry, Giuseppi Ammassari�; the supply director of ENEL [National
Electric Power Agency], Marco Gatti; Gian Ranieri Cuturi, representing CONFINDUSTRIA
[General Confederation of Italian Industry]; the president of the coal division of
AGIP [National Ttalian Oil Cor~panyJ, Francesco Coffrini; the vice-president of CON-
FITARMA [Italian Confederation of Free ShipbuildepsJ, Eraldo Valle; FINMARE [Shipping
Finance Corporation] President Luciano Paolicchi; Silvio Bobbi, president of AGI-CAR-
BONI [National Italian Coal CompAnyJ; and attorney Giuseppe Perasso, director of CON-
FITARMA.
The moderator of the roundtable was the public relations director of IL SOLE.-24 ORE,
- S