Friday 28 February 2020

Claudio Descalzi, CEO of Eni, said: “The strategy we announce today represents a fundamental step for Eni. We will set out the evolution of our Company in the next 30 years combining the objectives of ongoing development in a fast changing energy market and a significant reduction in our carbon footprint, a combination considered impossible by many. We will be the first in the industry to provide a business strategy to address these issues. Our strategy will rely on the quality of our assets, our technologies and our competencies.

The principles that guide our journey will remain fixed. The promotion of all UN SDGs is a fundamental element of our mission as is a strong financial position.

The Eni of the future will therefore be even more sustainable. It will reinforce its role as a global player in the world of energy with renewables and circular economy activities. These nascent businesses will develop strongly and be highly connected to our existing businesses. The production of oil and gas is expected to reach a plateau in 2025 followed by a flexible decline in the following years mainly for the oil component. The result will be a portfolio that is more balanced and integrated and will be stronger for its adaptability and competitive shareholder remuneration.

We have quantified our carbon footprint reduction targets giving ourselves a comprehensive method of calculating emissions, which includes both direct and indirect emissions deriving from the end use of our products, whether from our own production or purchased from third parties. Consequently, our targets for reducing our absolute GHG emissions cannot be compared with other methodologies given the wider scope of emissions considered in our method. We have fixed a target of an 80% reduction in net GHG emissions of our energy products by 2050, which exceeds the 70% indicated by the IEA in their SDS scenario which aims to be compatible with the Paris Agreement.

We have designed a strategy that combines economic sustainability with environmental sustainability and we have done so by defining an action plan based on technologies – existing or developed in-house - that we know how to implement. This will allow Eni to be a leader in the market supplying decarbonised energy products and actively contributing to the energy transition process.”

Long-Term Stragteic Plan to 2050 - Prinicipal Objectives

• Upstream production growth at an annual rate of 3.5% up to 2025, subsequent flexible decline mainly for oil. Gas production by 2050 will make up about 85% of total production.
• Resilient and flexible 3P Reserves: $20/bbl average breakeven, 94% of value realised by 2035 assuming a constant Brent price of $50/bbl. Ability to modulate future investments in exploration and development to respond to the evolution of the market.
• Sustainable gas production: forest conservation and CO2 capture and storage projects for a total of over 40 million tons/year by 2050. Electricity production from gas combined with CO2 capture and storage projects will complement renewables power supply.
• Renewables strong growth to over 55 GW by 2050. Developments mainly in OECD countries to supply energy to our clients, with retail customers expected to grow to over 20 million by 2050
• Refining: gradual conversion of Italian sites by focusing on new technologies for the production of decarbonised products from the recycling of waste materials. Increase in bio-refining capacity to 5 million tonnes per year, palm-oil free from 2023, 7 years ahead of the EU ban.
• Marketing: transformation from traditional petrol station to sales service station distributing only new generation sustainable fuels and providing differentiated services.
• Chemicals: gradual conversion of existing sites to produce more specialties and utilising more bio and plastic recycling technologies.
• Carbon footprint: developed methodology, reviewed and verified by third parties, for the comprehensive measurement of emissions. On this basis, fixed 2050 reduction targets of 80% of absolute emissions (well above the 70% threshold indicated by the IEA in the Sustainable Development Scenario that tracks the reduction of emissions compatible with the Paris Agreement) and of 55% on emission intensity.

Long-Term Stragteic Plan to 2050 - Priniciles, Targets and Strategy

After a period of profound transformation, which has allowed the group to grow and diversify its portfolio, whilst strengthening its financial structure, Eni is now ready for a new phase of evolution of its business model, strongly oriented towards creating value over the long-term that combines economic and financial sustainability with environmental sustainability. This evolution will, once again, be achieved by leveraging our know-how, proprietary technologies, innovation and the flexibility and resilience of our assets, which will allow us to seize new opportunities for development and efficiency, as well as further improve workplace safety.

The founding principles that inspire and guide the Plan's activities and actions are to:

• actively contribute to the achievement of all 17 UN SDGs, which are at the heart of Eni's mission;
• maximize the integration of the portfolio along the entire value chain, from production to end-customers;
• ensure rigorous financial discipline in investment policies and a solid capital structure for the group to support cash generation;
• maintain a progressive shareholder remuneration policy.

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