China’s top national oil company China National Petroleum Corporation (CNPC) plans to create a new investment vehicle to gear up the development of its renewable energy portfolio.

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The new investment vehicle, CNPC Kunlun Capital, will have a registered capital of 10 billion yuan ($1.54 billion) to focus on investments in what are termed emerging industries.

CNPC Kunlun Capital, which will be incorporated either in Beijing or Hainan province, will be have a three-way shareholding structure, with CNPC’s listed arm PetroChina on 29% , CNPC on 51% and CNPC Capital on 20%.

The three companies have committed to injecting the full funds into the new company within three years.

The new entity will be a major investment vehicle for CNPC to implement its new strategy to focus more on green and low-carbon development.

In April, CNPC announced plans to reorganise its nine business segments into four subsidiaries while furthering its energy transition drive. The four units cover: oil, gas and new energy; refining, sales and new materials; support and service; and capital and finance.

It is the first time CNPC has put new energy development on a par with oil and gas in terms of business priorities.

Chairman Dai Houlaing has said CNPC will take a three-stage approach to achieving its own target for a carbon emission peak in 2025 and net-zero emission in 2050.

Initially, CNPC will maximise its gas operations by raising the gas portfolio in its energy supply mix to 55% by 2025.

Dai said CNPC will promote solar and wind-based energy projects in oil and gas blocks licensed by the government in China.

The company will also apply carbon capture and storage technology to cut emission and replace fossil fuels with renewables.