Eni signs up for decarbonization initiative challenge while fostering closer gas and LNG ties with Japan

Italy’s energy giant Eni, which has become a member of an initiative that aims to curb greenhouse gas (GHG) emissions from liquefied natural gas (LNG) to enable a net zero era, has strengthened its bonds with Japan by joining forces with the Asian country’s government agency, Japan Organization for Metals and Energy Security (JOGMEC), to pool gas and LNG resources in search of carbon neutrality.

Eni has joined the Coalition for LNG Emission Abatement toward Net Zero, also known as CLEAN Initiative, which aims to facilitate global assessments of LNG projects and share information and know-how on industry best practices to reduce emissions along the entire value chain.

The CLEAN initiative, launched by major Japanese and Korean liquefied natural gas importers, has the backing of their respective governments. This initiative highlights the commitment of Tokyo and Seoul, which are said to be the world’s second and third-largest LNG importers respectively, to the decarbonization movement.

Furthermore, Eni has also inked a memorandum of understanding (MoU) with JOGMEC to work together in the gas and LNG arenas, aiming to increase the diversification of supply sources. The MoU aims to promote the role of gas and LNG in the energy transition pathway. This follows JOGMEC’s MoU with Petronas for cooperation in energy transition initiatives towards achieving decarbonization targets.

The latest MoU emphasizes the importance of achieving carbon neutrality against the backdrop of economic growth and the protection of energy security, including LNG supply opportunities provided by Eni to Japan and the support of Japanese financial institutions for the Coral North project in Mozambique.

The LNG project in the Area 4 concession gives Japan access to Mozambique’s Rovuma supergiant gas basin allowing the Asian country to participate in what is seen as one of the world’s largest gas discoveries in the past fifteen years.

This concession encompasses the operational Coral Sul FLNG facility, the planned Coral North floating LNG (FLNG) development, and the Rovuma LNG onshore facilities, both expected to be sanctioned during 2024/25. The Area 4 block is estimated to contain approximately 85 trillion gross cubic feet of natural gas.

While the proposed Coral North development is expected to produce 3.5 million tons per annum (mtpa) of LNG through an FLNG facility to process and liquefy natural gas for export, the 18-mtpa Rovuma onshore LNG development has a modular, electric-drive design that is anticipated to dramatically reduce the carbon intensity of the LNG it will produce compared to industry benchmarks.

Recently, front-end engineering design (FEED) contracts were launched to enable potential contractors to compete for the engineering, procurement, and construction (EPC) of the proposed Mozambique LNG project.

Among the players that signed FEED deals are a consortium consisting of McDermott, Saipem, and China Petroleum Engineering and Construction Corporation (CPECC), along with Japan’s JGC Holdings Corporation and France’s Technip Energies, which confirmed the award of FEED days before the first consortium did the same for the concession within the Rovuma supergiant gas basin.

While ExxonMobil will lead the construction and operation of all future natural gas liquefaction and related facilities, Eni will continue to lead the Coral floating LNG project and all upstream operations. 

The partners in Mozambique Rovuma Venture (MRV), comprising Eni, ExxonMobil, and the China National Oil and Gas Exploration and Development Company (CNODC), a subsidiary of China National Petroleum Corporation (CNPC), are jointly optimizing development plans to reach a final investment decision (FID).

MRV holds a 70% interest in the concession with the remaining 30% stake split evenly between KOGAS, Empresa Nacional de Hidrocarbonetos (ENH), and, as of recently, ADNOC, after it inked a deal to acquire Galp’s 10% interest in May.