IFC (International Finance Corporation) and the Italian Climate Fund today announced a $210 million investment in Eni S.p.A.’s Kenya subsidiary to expand the production and processing of advanced biofuels, supporting the decarbonization of the global transport industry and the livelihoods of up to 200,000 small-scale Kenyan oilseed farmers.
The investment consists of $135 million from IFC and $75 million mobilized from the Italian Climate Fund, as part of the implementation of the Italian Government’s Mattei Plan in Kenya. It will help Eni increase both the production of advanced biofuel feedstock grown in Kenya and processing capacity through the construction of new processing plants. Production of oilseeds, which is the primary feedstock, is expected to increase from 44,000 tons to 500,000 tons per year.
The project will also work with farmers, providing inputs, mechanization, logistics, certification, and training to help them produce oilseeds, which are grown on degraded land not suitable for food production and/or grown in rotation with food crops, helping enhance soil fertility.
The agreement was announced at the 2024 Africa CEO Forum in Kigali, Rwanda.
“This project marks the dawn of a new industry for Kenya, an industry where Kenya could become a world leader,” said Makhtar Diop, IFC Managing Director. “Producing biofuels will not only help decarbonize our transportation system, it will also generate income for farmers and create jobs along the value chain. We’re proud to partner with a company like Eni, which is leading the efforts to reduce the carbon footprint of the transport industry.”
“By partnering with IFC and the Italian Climate Fund, Eni further enhances its agrifeed stock projects in Kenya, expanding its reach to up to 200,000 small-scale Kenyan farmers over the next five years, and strengthens the country’s integration in the biofuels value chain,” said Claudio Descalzi, Eni CEO. “This cooperation fits with Eni’s model to leverage public-private partnerships to support communities, generate long-term value, and create virtuous, lasting alliances with African countries.”
“We welcome this first operation of the Italian Climate Fund established at the Ministry of the Environment and Energy Security and managed by Cassa Depositi e Prestiti,” said Gilberto Pichetto, Italy’s Minister of the Environment and Energy Security. “This first operation, in line with the inspiring principles of the Mattei Plan, captures two major priorities: investing in the strategic biofuels supply chain, which is decisive for the future of transportation, and addressing the growth of the Kenya’s agricultural sector with an intervention of undoubted socio-environmental impact, strengthening resilience to climate change.”
Global biofuel demand has increased by nearly 6 percent annually for the last five years, as the transport industry looks for solutions to decarbonize. In a net zero by 2050 scenario, the use of biofuels in transportation is expected to more than double to 9 percent by 2030. While production of sustainable biofuels is currently more expensive than traditional fuels, costs are expected to fall as more capacity is built up and technology advances. This new investment will support these efforts.
IFC will also provide advisory services that will support the development of the advanced biofuel value chain in Kenya, including through the promotion of good agricultural practices and the professionalization of farmer aggregators. All of ENI biofuel feedstock will receive International Sustainability and Carbon Certification (ISCC). ISCC is a globally recognized scheme for biofuels with rigorous environmental, social, and economic sustainability standards, audited across the entire supply chain. The success of the project can open up opportunities for replication elsewhere in Africa.
The Italian Climate Fund’s loan is provided through Cassa Depositi e Prestiti, the manager of the Fund. The Italian Government’s climate fund (Fondo Italiano per il Clima) is aimed at financing public and private projects in emerging and developing countries that contribute to the achievement of climate and environmental targets, in line with Italian international climate commitments.
About IFC
IFC — a member of the World Bank Group — is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2023, IFC committed a record $43.7 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org. Stay Connected with IFC on social media.
About Eni
Eni is a global energy company operating in more than 60 countries worldwide. The company’s goal is achieving net-zero by 2050 for its products and operations, leading the energy transition through its distinctive approach. Starting from Kenya, Eni is integrating several African countries into the biofuels value chain. For more information visit www.eni.com
About the Italian Climate Fund
The Italian Climate Fund is the innovative financial instrument promoted by the Italian government to support climate finance projects in developing countries and emerging markets. The Fund, established by the Budget Law 2022 at the Ministry of Environment and Energy Security and managed by Cassa Depositi e Prestiti S.p.A., has an endowment of 4.2 billion euros and is dedicated to finance initiatives across both public and private sector aimed at fostering the achievement of the goals set by international agreements on climate and environmental protection to which Italy is a party. For more information, visit https://www.mase.gov.it/pagina/italian-climate-fund
About Cassa Depositi e Prestiti (CDP)
CDP is the Italian National Promotional Institution and the Financial Institution for International Development Cooperation entrusted by the Italian State to foster the sustainable development of Italy and partner countries. CDP supports economic growth, social inclusiveness and ecological transition by investing in innovation, business competitiveness, infrastructures and local development. According to its 2022-2024 Strategic Plan, it is expected to mobilize a total of €128 billion investments within 2024. For more information visit: www.cdp.it
