(Bloomberg) – Eni SpA’s deal to sell half of its carbon capture and storage unit to BlackRock Inc.’s Global Infrastructure Partners will likely value the business at around $1.2 billion (€1 billion), according to people familiar with the matter.
The Italian energy giant and GIP, which agreed in May to hold exclusive talks for a 49.99% stake in Eni’s CCUS Holding, aim to close the deal by the end of summer, the people said, asking not to be named because they’re not authorized to comment publicly. The negotiations are ongoing, the valuation could still change and a final decision hasn’t been made, they said.
A representative for Eni declined to comment. GIP also declined to comment.
A deal with GIP would mark yet another step in Eni Chief Executive Officer Claudio Descalzi’s push to spin off units to reduce risk while retaining a stake — what the company calls a satellite model. Last month, Eni agreed to sell 20% of its renewable arm Plenitude to Ares Alternative Credit Management for about €2 billion, its second sale of a stake in the unit.
See also: Eni in talks to sell 49.99% stake in carbon capture business to GIP
The assets that will be under the new business are set to include the HyNet North West and Bacton Thames NetZero projects in the UK and the L10CCS project in the Netherlands, according to the people. CCUS Holding could be expanded at a later stage, with the right to acquire a project in Ravenna, Italy, and also add other storage projects, said the people.
CCS is one of the oil industry’s favored ways to improve its carbon footprint because it provides a way to cut net emissions without forcing companies to slash fossil-fuel production. But it’s costly and largely unproven to be effective at the vast scale needed to reach net zero.
