The world’s largest LNG project. Eni becomes QatarEnergy’s second international partner after France’s TotalEnergies to win a stake in the $28.75 billion Qatari project.
- The Italian energy company will take a 25 percent share in a new joint venture with QatarEnergy, which will own the remaining 75 percent.
- In turn, the new joint venture will own a 12.5 percent interest in the North Field East (NFE) expansion project, which includes four LNG trains with a combined nameplate LNG capacity of 32 million mt/year.
- Financial terms of the 27-year deal were not disclosed.
Why Qatar? According to S&P Global Commodity Insights data, Qatar took over as the world’s largest LNG exporter in April 2022 and remained top in May, ahead of the United States and Australia.
- Qatar enjoys some of the lowest production costs in the world.
- In 2021, Italy was the biggest European buyers of LNG from Qatar, followed by the United Kingdom, Belgium, Spain, and Poland.
Mr Descalzi’s strategic stewardship in Italy and Europe. Eni CEO, Claudio Descalzi, hailed the agreement as an important way “to positively contribute to increasing worldwide gas security of supply” and new energy sources.
- While Italy has been impacted by Russia’s Gazprom decision to send only 50% of the gas Eni had requested, Mr Descalzi’s strategy to consolidate Italy’s leadership to move away from Russian energy is paying off.
- According to S&P, Germany is expected to be a much bigger concern than Italy moving forward, given its lack of access to LNG.
- Mr Descalzi is a recognized “trusted and a reliable partner to everyone who does business with him,” as Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology, said last month when he introduced him as the Atlantic Council’s “Distinguished Business Leadership Award” recipient in a ceremony in Washington DC.
- Mr Descalzi and Eni have worked in lockstep with the Italian government “to accompany Italy and Europe on the pathway to reduce dependency on Russian supplies,” as he said at the Atlantic Council award ceremony. “I take pride in contributing to this journey,” he said.
Climate footprint. Mr Descalzi told reporters that the Qatari project’s low carbon footprint appealed to the company.
- LNG is not emissions-free, but has been eyed by European countries as an important alternative to Russian energy, way from using carbon-intensive coal.