China National Petroleum (CNPC) has signed an agreement with Italian energy producer Eni to acquire 20% of its 70% interest in Area 4 natural gas field located offshore Mozambique for $4.21bn.

Eni will own the remaining 50% interest in the block, while Empresa Nacional de Hidrocarbonetos de Mocambique, Kogas and Galp Energia each will hold 10% interest respectively.

Eni said the closing of the transaction is subject to approval from Mozambique’s authorities and fulfilment of certain standard conditions.

According to Bernstein Research, the Area 4 has potential reserves of 75 trillion cubic feet of gas, which is equivalent to about four years of total gas demand in Europe, reported The Wall Street Journal.

Eni CEO Paolo Scaroni was quoted by the publication as saying that the company is considering to sell more of its stake in the Area 4 field but has plans to retain its operatorship.

"CNPC will follow us" in related projects like the liquid-gas operation, Scaroni added.

In a press statement, Eni said that CNPC’s entry in Area 4 is important for the project due to the global significance of the company in the upstream and downstream sectors.