Italy’s largest power company, Enel, and its biggest oil and gas company, Eni, will partner to create the country’s first project to capture carbon dioxide from a coal-fired plant and store it underground.

The companies’ chief executives signed a strategic agreement last week at Italy’s Ministry of Environment headquarters to join forces and develop an initial integrated pilot project to test the entire carbon capture and storage (CCS) process—from carbon capture and injection to monitoring and checking the stability and safety of the deposit.

The pilot project will integrate two projects that have already been independently launched by each company.

According to the agreement, Enel is to build a carbon dioxide (CO2) capture and liquefaction plant at a coal-fired power station in Brindisi, in southern Italy. Eni will then inject the liquefied gas into an exhausted natural gas field at Cortemaggiore, near Piacenza, some 580 miles to the north.

Enel has already begun work on Brindisi thermal power station, Italy’s first industrial carbon capture plant—and a project that Enel said is capable of removing 2.5 tons of CO2 per hour. The pilot plant will be ready in the fall of 2009.

Meanwhile, Eni has started to implement a project aimed at injecting about 8,000 tons of CO2 per year at the Stogit exhausted field at Cortemaggiore.Underground injection is set to start in the fall of 2010.

The integration of these two projects requires the creation, in Brindisi, of a system for the capture and liquefaction of carbon dioxide and for its transport to the Cortemaggiore site.

In order to gain experience in the pipeline transport of CO2, Enel and Eni have also decided to lay a pilot dense-phase CO2 transport line at the Brindisi site.

The companies expect that the integrated project will encourage the development of skills over the whole carbon dioxide capture, transport, and sequestration process chain. These will be applied subsequently to large-scale demonstration projects, whose implementation is strongly encouraged by the European Commission.

In order to achieve this goal, the agreement foresees that Enel and Eni will undertake a detailed feasibility study for the construction of a large-scale integrated demonstration plant. The companies anticipate that Enel’s clean-coal power station will ultimately be proposed as a candidate for the European demonstration program.

The companies last week also signed a memorandum of understanding with the Environment Ministry aimed at the verification and diffusion of carbon capture techniques and at the promotion of renewable energy.

“Our commitment is to implement a technology that will [revolutionize] the world of energy: capture, transport and sequestration of CO2 from coal-fired power generation,” said Eni CEO Paolo Scaroni.

“As a final result, we will be able to use freely coal for power production whilst offering a significant contribution on three fields: the environment, through the segregation of carbon dioxide from the atmosphere; the safety of energy supply, through the utilization of a resource which is widespread in our planet; and, last but not least, the final consumer, who will benefit from low-cost electricity.”

Enel and Eni will also prepare a joint study of Italy’s CO2 storage potential. While implementing these activities, Enel and Eni will rely on cooperation initiatives already in place with the main Italian research bodies and institutes, which are already active in the field.

Sources: Enel, Eni