Italy Watchdog Auditing Saipem for Impairment Charges

Italy's market regulator started an audit of Saipem in November to gather information on write downs the oil service company booked last year, Saipem said in its annual report.

The Italian oil contractor announced impairments on a string of assets of around 2.1 billion euros ($2.2 billion) last October.

In its yearly report Saipem also said South Stream Transport BV (SSTBV), owned by Russia's Gazprom, had filed damages against it for around 541 million euros for alleged misrepresentation in an arbitration case revolving around a defunct pipeline project.

In 2015 Gazprom cancelled a contract with Saipem to build the first line of the South Stream project that would have run beneath the Black Sea.

Saipem, controlled by oil major Eni and state lender Cassa Depositi e Prestiti, is asking SSTBV for around 678 million euros in the arbitration case.

Besides the misrepresentation claim, Gazprom is seeking, additionally or alternatively, damages of 186 million euros for payments it says were above contracted terms as well as delays.

It is also asking for 10 million euros for damage to pipes, Saipem said.

Reporting by Stephen Jewkes