Offshore Technology

Daily Newsletter

27 October 2023

Daily Newsletter

Eni signs LNG supply deal to expand portfolio

The latest LNG supply agreement is in addition to the 1.4bcm per annum deal Eni has had in place with Indonesia’s Jangkrik LNG Sellers since 2017.

Italian energy company Eni has signed a liquified natural gas (LNG) supply deal with Indonesian company Merakes LNG Sellers.

Under the sale and purchase agreement, starting January 2024, Merakes LNG Sellers will supply 0.8 billion cubic metres (bcm) of LNG to Eni for three years.

The latest LNG supply agreement is in addition to the 1.4bcm per annum deal Eni has had in place with Jangkrik LNG Sellers since 2017.

According to Eni, the new agreement guarantees more flexibility and LNG supply diversification, while bolstering its position in expanding markets including the far East and South Asia.

This agreement, along with the contracts with the LNG suppliers in Qatar and the Democratic Republic of Congo (DRC), helps to expand Eni's LNG portfolio, the company added.

In April 2022, Eni agreed to boost gas production from the DRC by more than 4.5bcm per year.

Earlier this week, Eni signed a long-term LNG supply agreement with QatarEnergy.

As per the agreement, starting in 2026, QatarEnergy will deliver up to one million tonnes per year (mtpa) of LNG from its North Field East expansion project to Eni for 27 years.

Eni's agreement is in line with its energy transition plan, which seeks to raise the proportion of gas in total upstream production to 60% by 2030.

By 2026, Eni hopes to increase its contracted LNG volumes by more than twice as much, to more than 18mtpa, by leveraging synergy between sales and upstream operations.

Since 2001, Eni has been carrying out exploration, development and production activities in Indonesia.

Earlier this month, Eni made a significant gas discovery at the Geng North-1 exploration well offshore Indonesia.

“The recent announcement of the Geng North discovery, along with the acquisition of Chevron’s assets and the envisaged fast-tracking of Indonesia Deepwater Development (IDD), significantly reinforce Eni's presence in Indonesia's Kutei basin, close to the existing Bontang LNG facilities, and confirm the strong relationship with a country that continues to play a strategic role in Eni’s LNG portfolio,” Eni said in a statement.

Most O&G majors have set net zero targets, but few include Scope 3 emissions

GHG emissions generated by O&G operations accounted for 15% of total energy-related emissions worldwide in 2022. A further 40% of such emissions came from the use of oil and gas for power generation, heating, vehicle fuel, and industrial processes. Only 6 companies have targets covering Scope 3 emissions. To reduce Scope 3 emissions, O&G companies are switching their products to lower-carbon sources of energy including hydrogen, LNG, biofuels, and renewables.