Zenith Energy Ltd has signed a binding letter of intent and exclusivity agreement to acquire 100% of an Italian biogas development company that owns the rights to develop a fully permitted and construction-ready biogas production facility in Italy.
The proposed acquisition, which is subject to completion, marks Zenith’s entry into the Italian biogas sector as it seeks to expand its renewable energy portfolio beyond solar power, Energy Global reported.
According to the company, the project has secured all required permits, licences and engineering approvals, enabling construction to begin once the acquisition is completed.
The facility is expected to produce around 3 million cubic metres of biomethane annually for injection into Italy’s natural gas network. The gas will be sold at prevailing domestic market prices while qualifying for government-backed incentives for 15 years.
Zenith said the project’s feedstock supply risk had been significantly reduced through a long-term agreement with a major regional authority in Italy. Under the arrangement, the plant will receive a mix of approximately 50% municipal waste and 50% agro-industrial waste, ensuring a stable supply of raw material and improving the project’s bankability.
At full operational capacity, the project is expected to generate annual revenue of about €5 million, with annual earnings before interest, taxes, depreciation and amortisation (EBITDA) estimated at around €2.5 million, representing an EBITDA margin of about 50%.
The company said it would provide operational expertise for gas production and injection into the Italian grid, while also arranging non-dilutive green project financing for both the acquisition and construction, similar to the financing model adopted for its solar portfolio.
Chief Executive Officer Andrea Cattaneo said the acquisition would establish Zenith’s second renewable energy business in Italy and provide a platform for building a diversified biogas and biomethane portfolio.
He said the project had already achieved key permitting, engineering and commercial milestones, positioning it to move quickly into the construction phase.
Cattaneo added that Zenith intends to replicate its strategy of acquiring advanced renewable energy assets, securing project financing and creating value through construction and operation. He noted that Italy’s supportive policy framework, including government grants covering up to 40% of eligible capital expenditure and 15-year biomethane incentives, makes the sector an attractive long-term investment opportunity.
The company expects to complete the proposed acquisition during the fourth quarter of 2026.
