(Yicai) June 10 -- Shanghai Electric said it would put the first phase of its large-scale green methane production project, the first such project in China, into operation next month, with French shipping giant CMA CGM to receive all the methane to speed up global carbon neutrality efforts.

The plant, located in Taonan, northeastern Jilin province, will take advantage of the local wind power and biomass resources to produce 50,000 tons of green methane a year in its first phase, the Shanghai-based power equipment giant told Yicai yesterday.

The project will generate green hydrogen using electrolysis of water and then add it to carbon monoxide and carbon dioxide produced by biomass gasification to synthesize methane, Shanghai Electric noted.

Green methane is made entirely from renewable energy rather than fossil fuels such as natural gas and oil. It is mainly used as an alternative fuel for large ships to boost carbon emission cuts in the shipping industry.

The first phase of the Taonan plant is a pilot project to put through the synthesis process of green methane, Ni Jianjun, deputy general manager of Shanghai Boiler Works, the unit of Shanghai Electric that oversees the factory, said to Yicai. After the first phase goes live, the parent firm will bring in investors to jointly build the second phase with an annual output of 200,000 tons, which will likely become operational in 2027, he added.

Green methane is in short supply, Ni noted. Global demand is expected to reach tens of millions of tons by 2030 amid carbon neutrality efforts, while the current annual output is only about a few hundred thousand tons, so Shanghai Electric's green methane plant has great development prospects, he pointed out.

In March, Shanghai Electric entered into a long-term supply deal with Marseille-based CMA CGM. The pair agreed that the green methane from the Taonan factory will be shipped by Shanghai International Port Group to the Port of Shanghai, the world's largest port by container throughput, to provide bunkering service for CMA CGM's vessels.

With pilot projects coming into operation, more companies will likely join the green methane production sector, and Shanghai Electric will be committed to providing them with engineering solutions to promote the industry's overall development, Ni said.

Shanghai Boiler is one of the first companies to focus on designing and manufacturing power station boilers in China. It has turned into a comprehensive energy solution provider involved in traditional coal power, hydrogen, and solar energy, as well as carbon capture, utilization, and storage.

Shenergy Group, another Shanghai-based energy giant, is building a green methane factory in the city with a capacity of 100,000 tons a year. The plant is expected to become operational at the end of this year.

Editor: Martin Kadiev