Italy says Eni pipeline case is a security issue

BRUSSELS, March 20 Fri Mar 20, 2009 2:54pm GMT

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BRUSSELS, March 20 (Reuters) - Italian Prime Minister Silvio Berlusconi defended Eni (ENI.MI) on Friday after the European Commission warned the oil company over alleged restrictive practices on pipelines.

"We have already responded that the matter is an issue of national security, Berlusconi told a news conference in Brussels, where he is attending a European Union summit.

"We can't make concessions," Berlusconi said, "there are requirements that are more important than the rules, in particular (the requirement) of national security."

The Commission has been probing alleged restrictive practices by Eni on the TAG, Transitgas and TENP gas import pipelines since 2007. It has sent preliminary charges to Eni, a Commission spokesman said on Thursday.

ENI said it had received a statement of objections from the Commission, the European Union's executive arm, saying that from 2000 to 2005 it limited access by third parties to the pipelines.

If the alleged violations are confirmed, the Commission intends to impose structural remedies involving the sale of all of Eni's interests in ownership and capacity rights on the three pipelines "together with a monetary sanction", Eni said in Thursday's statement.

Such a forced sale would expose Italy and the European Union to a deterioration of gas supply security, Eni said, referring to the dispute between Russia and Ukraine that disrupted European gas supplies this winter. (Reporting by Paolo Biondi; writing by Gavin Jones; editing by Simon Jessop)