London-listed Zenith Energy has signed a binding letter of intent to acquire 100% of an Italian biogas development company, marking its entry into the country's biogas and biomethane sector.
The unnamed target owns the rights to a fully permitted, fully engineered and construction-ready biogas facility. Once operational, the plant will produce around 3 million cubic metres of methane per year for injection into the Snam Rete gas network, through which Zenith has sold natural gas since 2013 via its subsidiary Canoel Italia.
The purchase price is capped at €1.6 million, with final consideration to be determined following confirmatory due diligence. Zenith expects to complete the acquisition in Q4 2026, with construction beginning immediately afterwards and operations targeted for Q3 2027. The company aims to secure green project financing by the end of Q3 2026.
A long-term feedstock supply contract with a major Italian regional authority, comprising roughly 50% municipal waste and 50% agro-industrial waste, underpins the project. Projected annual revenues at full capacity are estimated at approximately €5 million, with EBITDA of around €2.5 million.
The project will benefit from a 40% capital cost subsidy and a 15-year incentive providing a 20% uplift on methane sales under Italy's biomethane support framework. The country's National Energy and Climate Plan targets 5.7 billion cubic metres of biomethane production per year by 2030.
'The proposed acquisition marks the beginning of Zenith's second Italian renewable energy division and establishes a strong platform from which to build a diversified biogas and biomethane business in Italy,' said Andrea Cattaneo, CEO of Zenith Energy.
'Biogas is a natural extension of our Italian platform. We have operated as a natural gas and electricity producer in Italy since 2013, giving us extensive experience of the Italian energy market, its regulatory framework and the commercialisation of gas production.'
Zenith said the identity of the target, the vendor and the project's location will be disclosed on completion, to reduce the risk of competing offers. The deal follows the company's previously announced solar development portfolio in Italy and is intended as the first step in building a wider biogas and biomethane business alongside it.
Zenith Energy to acquire Italian biogas developer
