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UPDATE 1-Saras 2011 at risk from lengthy Libya conflict

Published 04/28/2011, 07:14 AM
Updated 04/28/2011, 07:16 AM
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* Q1 not affected by Libya due to stocks

* No significant damage to Libya export terminals

* Contacts for commercial jv with oil companies

(Adds management comments, background, shares)

By Stephen Jewkes

MILAN, April 28 (Reuters) - Italy's No. 3 oil refiner Saras said on Thursday its first-quarter results would be unaffected by Libyan turmoil but warned its full-year results could suffer if the conflict was drawn out.

Saras is normally a big buyer of Libyan crude, with some 35 percent to 40 percent of supplies coming from the North African country.

"Our results in the first three months will not be affected since we have adequate stocks of Libyan crude," Managing Director Dario Scaffardi said on the sidelines of the group's shareholders meeting.

Full-year results could be hurt by events in Libya depending on the duration and intensity of the crisis, he said. Rebels have been fighting to oust leader Muammar Gaddafi since mid-February.

Scaffardi said Saras will probably have to replace Libyan crude with other alternatives starting in the second quarter. He added that he was not aware of any significant damage to Libyan export terminals.

In another sign of the impact of fighting in Libya, Italian oil and gas group Eni said on Wednesday it expected Libyan turmoil to cut its full-year production after a drop of nearly 9 percent in the first quarter. Eni is the biggest foreign operator in Libya.

Because of its high quality Libyan crude is not easy to replace. Saudi Arabia oil is not an alternative.

Saras is looking to Kazakhstan, Azerbaijan, and countries in West Africa such as Gabon and Nigeria to replace lost volumes in Libya, Scaffardi said.

Saras has maintenance at its Sarroch refinery in Sardinia planned for April and early May.

Asked about joint ventures with oil companies, Scaffardi said there were contacts on possible commercial agreements but added there was nothing concrete at the moment.

At 1025 GMT, Saras shares were down 0.71 percent at 1.668 euros while the STOXX Europe 600 Oil and Gas index was down 0.1 percent.

(Editing by Elaine Hardcastle)

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