Italian energy firm Eni said it would work on a long-term LNG supply deal with China’s Zhejiang Energy as part of a memorandum of understanding revealed on Tuesday.
The memorandum establishes a cooperation framework aimed at facilitating joint initiatives between Eni and state-owned Zhejiang Energy across the gas and LNG value chain in China and internationally, the Italian firm said.
In addition, the memorandum builds on the companies’ “shared goal of promoting a reduction in emissions by favoring a switch from coal to gas in the production of electricity,” it said.
Eni said the initiatives identified in the agreement range from “developing long-term LNG supply agreement to joint participation in gas and LNG projects.”
Using gas to produce electricity instead of coal reduces by as much as half the greenhouse gas emissions of a power plant, providing an “immediate” step forward in decarbonizing the sector, Eni said.
Moreover, Eni said the agreement represents a “further step” in its energy transition process as the company plans to become neutral by 2050.
In the future, gas would represent more than 90% of Eni’s production, it said.
Eni has been present in China since 1984 and has recently established a new representative office in Beijing.