Sinopec, TotalEnergies come closer for building decarbonized energy system

TotalEnergies, a French energy major, said it will further strengthen cooperation with China Petroleum and Chemical Corp (Sinopec), in the fields of oil, liquefied natural gas, oil product trading and engineering, as both China and France are actively seeking ways to enhance energy security amid green transition.

The two companies signed a strategic cooperation agreement to deepen collaboration, notably in low-carbon energies, during the state visit by the Chinese President to France this week.

"We are pleased to reinforce our partnership with Sinopec, a major Chinese energy player which is already our partner in several countries," said Patrick Pouyanne, chairman and CEO of TotalEnergies.

"This strategic cooperation agreement reflects our shared will to combine our multi-energies expertise to address today's growing global demand, while simultaneously building the decarbonized energy system of tomorrow."

TotalEnergies and Sinopec have been working together for many years, notably in Angola and Brazil in upstream operations, and more generally in various domains such as oil, LNG, oil product trading and engineering.

Recently, the two companies have joined forces to develop a sustainable aviation fuel (SAF) production unit with an annual capacity of 230,000 metric tons at a Sinopec refinery in China. The planned unit will produce SAF and process local waste or residues from the circular economy, including cooking oils and animal fats.

This strategic cooperation agreement aims to further develop the partnership between the two companies and seize new opportunities by leveraging their respective expertise, it said.

Luo Zuoxian, head of intelligence and research at the Sinopec Economics and Development Research Institute, said China and France have carried out extensive cooperation in exploration and production, LNG, biofuels and trading in recent years, while strengthening their partnership by exploring more opportunities in the fields of sustainable aviation fuel, green hydrogen and CCUS (carbon capture, utilization and storage).

The burgeoning expansion of multinational energy firms in China, especially in the renewable energy sector, will further consolidate their position in the industry, said Luo.

Yu Yongjian, chairman of TotalEnergies China, said the French company's cooperation with Chinese partners has been continuously deepening as China intensifies its exploration in the field of energy transition, expanding from the local market to the global market, and extending from traditional industries to cover new energy fields.

China's carbon neutrality plan is significant for building a green future, and will lay a solid foundation for the success of multinational energy companies in the country, he said.

China has begun to turn policies into actions, formulating dynamic and pragmatic road maps, and Total Energies is committed to deepening its partnerships with Chinese companies to achieve the common goal of net-zero emissions, Yu said.