Eni S.p.a. · MIL:ENI
Eni — Investor Day (March 2010)
41 slides from Eni's investor day presentation, Mar 12, 2010
Slide 1: 2010-2013 Strategy
2010-2013 Strategy 12 March 2010 eni.com
Slide 2: eni 2004-2009: a stronger company
eni 2004-2009: a stronger company Enhanced E&P portfolio Leading production growth +200kboe/d Best in class lifting costs per barrel of $7.3 10 billion boe of new resources added From local to international gas leader Doubled international sales to ~ 60 bcm Steadily growing profits: Eb
Slide 3: eni 2010-2013: growth driven by a unique business model
eni 2010-2013: growth driven by a unique business model E&P: build on enhanced portfolio G&P: leverage on European leadership R&M: limit exposure Financial Integration Efficiency discipline 3
Slide 4: E&P 2010-2013: build on enhanced portfolio
E&P 2010-2013: build on enhanced portfolio More production >2.5%/y More giants +400 kboed More operatorship +1.5 mmboed Profitable growth 4
Slide 5: G&P 2010-2013: leverage on European leadership
G&P 2010-2013: leverage on European leadership Grow gas sales +14 bcm Strengthen market share >22% in EU Preserve profitability ~€4.4 bln Ebitda/y A prize asset 5
Slide 6: R&M 2010-2013: limit exposure
R&M 2010-2013: limit exposure Improve cost position Grow market share in Italy Upgrade of marketing network Managing market weakness 6
Slide 7: Exploration & Production
Exploration & Production Claudio Descalzi, COO eni.com
Slide 8: 2009: further enhanced E&P portfolio
2009: further enhanced E&P portfolio Access to 3 new giant projects Delivery all planned start ups 3 main FID in core areas 1 bln boe conventional resources discovered Leadership in efficiency and cash generation 8
Slide 9: strengthened the resource base
strengthened the resource base Total resources* Bln boe 30 20 Of which ~50% in giant fields 2004 2009 2P reserves Other reserves/ resources Brent 30 60 ($/boe) Life Index 34 46 (years) * P1 + P2 + P3 + Contingent Resources + Risked exploration 9
Slide 10: confirmed leadership in efficiency and cash generation
confirmed leadership in efficiency and cash generation Lifting cost E&P cash flow $/boe $/boe 16 30 26.6 26.7 12 25 22.8 19.8 8 20 7.2 6.6 5.9 5.3 4 15 2004-06 2005-07 2006-08 2007-09 2004-06 2005-07 2006-08 2007-09 Brent avg ($/boe) 53 64 78 77 eni Benchmark group* * XOM, CVX, COP, BP, Shell, Total
Slide 11: 2010-2013: build on enhanced portfolio
2010-2013: build on enhanced portfolio More production More giants More operatorship Profitable growth 11
Slide 12: more production
more production Production >2.0% >2.5% Low depletion rate Strong pipeline of start-ups 2009 2010 2013 2016 CAGR 12
Slide 13: stable production platform
stable production platform Depletion 2009-2013* Rest Rest of of the the OECD Africa Africa OECD world world -5.4% -1% -1% -5.4% -2.9% -2.9% Exposure to 0% giant fields Efficient reservoir management Avg. Avg. eni eni portfolio portfolio c. c. -3% -3% Young resource 0 300 600 900 1200 1500 1800
Slide 14: strong pipeline of start-ups
strong pipeline of start-ups Others 3 start-ups FSU 2 start-ups 14 OECD start-ups Africa & Middle East 22 start-ups 2010-2013 start-ups kboed 560 kboed contribution @ 2013 600 75% operated 400 50% with FID and an additional 200 40% within 2010 0 70% liquids 2010 2011 2012 2013 Giants* * Gross
Slide 15: more giants
more giants Kashagan EP Junin 40%/ Zubair Val D’Agri ph2 CAFC/MLE Samburgskoye 16.8% (op) Perla 33% (op) 32.8% (op) 60.8% (op) 75% (op) 29.4% (op.) Plateau 450 kboed Plateau 370 Plateau 1200 kboed Plateau 65 kboed Plateau 120 kboed Plateau 150 kboed kboed Block 15/06 Goliat Congo Gas A-L
Slide 16: Zubair: a giant gateway into Iraq
Zubair: a giant gateway into Iraq One of the most promising fields in Iraq Currently in production but largely undeveloped Lead contractor with a 32.8% stake Plan to reach a production level of 1,200 kboed Zubair Estimated recoverable reserves above 6 bln boe 16
Slide 17: Venezuela: two giants for an integrated development
Venezuela: two giants for an integrated development Junín 5 Cardon IV – Perla discovery Junín 5 block Perla Joint development of Junín 5 block Perla giant gas discovery (PDVSA 60%, Eni 40%) Reserves of > 8 TCF of gas 35 bln boe of certified oil in place (> 1.3 bln boe) Early production of
Slide 18: more operatorship
more operatorship Operated production Mboed 4.0 More control over 12% project execution and time-to-market 2.5 Efficiency of operations Increasing know how and practical experience Strengthening 2009 2013 relationships with host countries CAGR 18
Slide 19: investing in long-term sustainable growth
investing in long-term sustainable growth Capex 2010-2013 Bln € 37 33 4 Production 4 Optimization Growth post-2013 32 27 Growth in 2010-13 2009-12 2010-13 Development Exploration Other* 2010 capex: € 10.5 billion * Includes integrated projects (LNG, transport, power generation, etc.) 19
Slide 20: capturing the upside
capturing the upside 2010-2013 new production 2010-2013 new production break-even* sensitivity to oil prices NPV in bln USD +6.5 80 70 60 BEP Brent Eq. ($/bbl) 50 avg. 40 +3.0 30 20 10 0 28.006 Cumulative 2013 Start-up (kboed) 70$/bbl 80$/bbl Δ vs NPV at eni scenario @ 65$/bbl * Based on WACC adjust
Slide 21: Gas & Power
Gas & Power Domenico Dispenza, COO eni.com
Slide 22: 2009: proved resilience in a tough market
2009: proved resilience in a tough market Pro-forma adj. EBITDA Strong impact of economic Bln € crisis on EU gas demand 4.3 4.4 (down over 7%) 0.7 0.7 Gas oversupply 1.3 1.3 Spot/LT price decoupling Increasing competition 2.3 2.4 EBITDA growth despite the 2008 2009 challenging scenario Marke
Slide 23: 2010-2013 and beyond: gas demand recovery and growth
2010-2013 and beyond: gas demand recovery and growth Gas demand EU27 Bcm CAGR CAGR Recovery of European gas demand 2010-20 2010-20 ~1.5% 600 ~1.5% by 2013 Italy 500 Expected reduction of spot gas price discount vs long-term 400 Rest of EU contracts 300 2008 2010 2013 2020 Renegotiation or revi
Slide 24: 2010-2013: leveraging on European leadership
2010-2013: leveraging on European leadership Gas sales Pro-forma adj. EBITDA Bcm Bln € 118 104 4.4 4.4 74 63% 64 40 44 37% 2009 2013 2009 Avg. 2010÷2013 Abroad* Italy Int. Transp. Snam Rete Gas Marketing & Power Preserve profitability * Including E&P gas sold in Europe and Gulf of Mexico 24
Slide 25: boost international sales
boost international sales Sales in EU (excl. Italy) Bcm 59 47 7 6 European growth supported by: 52 41 improving competitiveness of supply portfolio 2009 2013 multi-country offer Extra-EU sales stronger integration with Distrigas Bcm further development of merchant branches, particularly in
Slide 26: confirm leadership in Italy
confirm leadership in Italy Maintain market share Constant effort in reducing cost-to-serve Gas offer enhancement Diversified product structure Market approach tailored on local conditions Increasing capillarity through wide salesforce presence Combined gas and power offer for both busin
Slide 27: capex plan: focus on regulated
capex plan: focus on regulated Total capex € 8.3 billion € 6.4 billion in regulated 2% business to expand Italian assets with definite returns 21% € 1.8 billion in merchant activities mainly for: 77% power plant completion and increase of generation flexibility international marketing activi
Slide 28: Refining & Marketing
Refining & Marketing Angelo Caridi, COO eni.com
Slide 29: 2009: unfavourable trading environment
2009: unfavourable trading environment EBIT Adjusted Mln € 579 43 (979) (357) FY 2008 Performance Scenario FY 2009 +7% -169% -162% Squeeze in light-heavy crude differential Weak refining margins Strong marketing performance: retail share in Italy up 90 bp to 31.5% Cost savings through effici
Slide 30: 2010-2013: managing market weakness
2010-2013: managing market weakness Refining Marketing Operational improvement Growth in European retail Process Utilization Index: +10 pp market share Italy +2.5 pp Selective increase of complexity Selected European countries Middle distillate yield: +2 pp Upgrade marketing network
Slide 31: 2010-2013: disciplined capex plan
2010-2013: disciplined capex plan Bln € 2.8 80% Development 2.7 25% 40% 20% Stay in business 75% 60% EST in HSE Sannazzaro 49% 28% Plan Plan refinery 09-12 10-13 15% Refining Marketing 8% Stay in Flexibility business enhancement 31
Slide 32: financial outlook
financial outlook Alessandro Bernini, CFO eni.com
Slide 33: efficiency: enhanced programme
efficiency: enhanced programme Bln € E&P 11% 1.1 G&P 14% Corporate & others 48% R&M 10% 1.3 Chem. 12% E&C 5% 0.3 2004-05 2006-09 2006-13 2004-05 achievements 2006-09 achievements 2010-13 target Technology improvements Commercial & supply optimization Process streamlining 33
Slide 34: capex 2010-2013: fueling long term growth
capex 2010-2013: fueling long term growth Bln € 4.0 52.8 1.1 Upstream focus: 70% 48.8 Others 1.0 3.3 Saipem 3.9 2.7 Commitment on giant R&M 2.8 projects: ~50% 8.3 G&P 8.5 Devoted to sustain growth beyond 2013: 35% 37.4 E&P 32.6 2010 guidance Capex: € 14 bln, in line with 2009 2009-2012 Variati
Slide 35: financial debt: low risk quality
financial debt: low risk quality 2009 net debt Snam Rete Gas Lowering risk profile of eni’s portfolio Self financing 2010 guidance € 10 billion Divestment ~€3 bln Saipem Net debt to equity Completion of major in line with 2009 investments by 2010 € 3 billion Going forward Strong backlog
Slide 36: dividend policy and closing remarks
dividend policy and closing remarks Paolo Scaroni, CEO eni.com
Slide 37: a progressive dividend policy
a progressive dividend policy Under eni’s four-year oil price assumption, we are committed to pay a €1 a share dividend for 2010, and thereafter growing it in line with OECD inflation 37
Slide 38: closing remarks
closing remarks pursue profitable growth in E&P strengthen leadership in G&P deliver shareholder value 38
Slide 39: disclaimer
disclaimer This presentation contains forward-looking statements regarding future events and the future results of Eni that are based on current expectations, estimates, forecasts, and projections about the industries in which Eni operates and the beliefs and assumptions of the management of Eni. In
Slide 40: Appendix
Appendix eni.com
Slide 41: details of E&P start-ups
details of E&P start-ups 2010 2011-2013 Project Operated Peak kboe/d Project Operated Peak kboe/d 100% 100% Zubair √ 1,200 Kashagan EP √ 450 Morvin 51 Junin 5 √ 235 Cerro Falcone √ 42 A-LNG 176 Rom Integrated √ 29 El Merk 146 Tuna √ 28 Samburgskoye √ 145 Hapy 9 26 Perla (Cardon IV) √ 140 M'Boundi Ga