ERG SpA (ERG.MI), Italy's biggest independent refiner by capacity, expects to take three-to-four years to achieve the full synergies from its new local downstream joint venture with Total SA (TOT), Chief Executive Alessandro Garrone said Thursday.

ERG's CEO was speaking on a conference call, focusing on the joint venture announced earlier in the day.

ERG signed the joint venture with the French oil major Total as energy companies seek ways to deal with unprofitable refinery activities.

ERG sees annual synergies of EUR40 million at the earnings before interest, taxes, depreciation and amortization, or Ebitda, level, Garrone said.

He added the company needs to assess the venture better before giving more details of synergies.

The company's net debt at the end of last year was slightly less than EUR700 million, said the CEO. At the end of September the figure was EUR713 million.

The CEO also said the company doesn't plan to increase its refining capacity at its two inland facilities in Rome and Trecate in north-west Italy.

He said he couldn't exclude the closure of the Rome refinery as the company assesses how to "optimize" its assets.

Company Web site: www.erg.it

-By Liam Moloney, Dow Jones Newswires; +39 06 6976 6924; liam.moloney@dowjones.com
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