The sustainable mobility unit of Italy's Eni (ENI.MI) and petrochemicals maker LG Chem (051910.KS) have teamed up to explore the potential development of a biorefinery in South Korea, the two companies said in a statement on Thursday.

Eni believes biofuels made from vegetable oil, waste cooking oil and grease will play a key role in decarbonising the truck, aviation and shipping sectors in the next few years.

The Italian group, which already operates two biorefineries at home, recently said it also wanted to develop plants in Asia and the United States.

The new project, which is designed to process around 400,000 tonnes of bio-feedstocks per year, aims to meet growing demand for both sustainable fuels and plastics produced through low-carbon processes.

It will have the flexibility to process renewable bio-feedstocks and produce multiple products including sustainable aviation fuel (SAF), hydrotreated vegetable oil (HVO), and bio-naphtha.

A final decision for the investment is scheduled to be made by next year and the plant is set to be completed by 2026 at LG Chem's existing integrated petrochemical complex in Daesan, southwest Seoul.

Eni will provide the South Korean biorefinery with sustainable feedstock mainly sourced from waste and residue from the processing of vegetable oils, used cooking oil, and also vegetable oils from drought-resistant crops.

The Italian group recently signed several agreements with African and Asian countries to develop farming ventures able to produce these crops in degraded, semi-arid or abandoned soils not used for food production.