Eni S.p.a. · MIL:ENI

Eni — Investor Day (March 2012)

44 slides from Eni's investor day presentation, Mar 15, 2012

  1. Slide 1: 2012-2015 Strategy

    2012-2015 Strategy 15 March 2012 eni.com

  2. Slide 2: eni: well-positioned to deliver a decade of sustainable growth

    eni: well-positioned to deliver a decade of sustainable growth 2011 2012-2015 2021  Confirmed growth profile  Libya restart  A decade of E&P  Strengthened  Start-up of giants with long plateau sustainable resource base growth  Increased investment in exploration  Improved  Recover profitabil

  3. Slide 3: E&P: consistent exploration success ...

    E&P: consistent exploration success ...  Sangos-Ngoma  Sankofa (Ghana)  Perla (Venezuela)  Mamba South  Perla (Venezuela)  Jangkrik (Indonesia) (Mozambique) (Angola)  Cabaca Norte (Angola)  Sankofa (Ghana)  Skrugard (Norway)  Kitan (JPDA)  Hadrian Nord (US-GOM)  Area D (Libya)  Cabaca S

  4. Slide 4: ... drives organic growth, in the plan period...

    ... drives organic growth, in the plan period... Production growth kboe/d >3% adj >3% CAGR 2011-15 Russia and Caspian in a higher oil price scenario Sub-Saharan Africa  Strong contribution from exploration successes Far East Latin America  Confirmed focus on giant, conventional projects Europe and

  5. Slide 5: ... and beyond

    ... and beyond Production growth kboe/d ~3% Yamal giants, Kashagan ramp up, further potential from Kashagan development Russia and Caspian Major contribution from Angola Block 15/06 Sub-Saharan Africa and Mozambique, additional exploration potential Far East Latin America Junin 5 & Perla FF developm

  6. Slide 6: G&P: positioned to tackle difficult short term scenario...

    G&P: positioned to tackle difficult short term scenario... 2011 EBITDA pro-forma adjusted* (€ mln) TAG/TENP/Transitgas Marketing: facing difficult scenario  Slower than expected demand growth  Spot/LT differential remains significant in 2012 Marketing Other Snam G&P eni 2012-2015 strategy  Levera

  7. Slide 7: … and capture medium-term recovery opportunities

    … and capture medium-term recovery opportunities Long-term scenario European demand recovery:  Strong European market position EU 27 (bcm) ~18%  Consolidated brand -8%  Expertise in innovative offering structure  Diversified and flexible supply portfolio  Competitive cost position in tightened

  8. Slide 8: R&M: increasing efficiency and complexity

    R&M: increasing efficiency and complexity  Refining: a cyclical business in a difficult short term scenario  Increased focus on complexity and efficiency Optimisation to benefit from potential scenario recovery & efficiency  EST completion by 2012 + €400m  Increased system integration  Exploit

  9. Slide 9: Chemicals: a new turnaround strategy

    Chemicals: a new turnaround strategy Enhanced  Increase revenues from added value products differentation from <30% to >40% Regaining competitiveness within chemicals business  > 10% of revenues from International outside Europe by 2015 expansion  Licensing, production alliances/JVs 2015 target >

  10. Slide 10: enhanced value creation opportunities from non-core listed assets

    enhanced value creation opportunities from non-core listed assets Snam Galp Separation by September 2013 Non-core shareholding Process evaluated on 3 criteria: High potential business, with exciting positions in Brazil, Mozambique  Benefits to eni shareholders Upside from market value recovery  Pr

  11. Slide 11: Exploration & Production

    Exploration & Production Claudio Descalzi eni.com

  12. Slide 12: E&P strategic goals and drivers

    E&P strategic goals and drivers  Strong focus on exploration strategy and execution  Fast time-to-market of exploration discoveries Organic growth &  Rapid and efficient development of project pipeline value creation  Effective reservoir management and production optimization activities  Leadin

  13. Slide 13: HSE results

    HSE results Lost time injury frequency rate* Drilled wells 0.77 437 0.73 0.66 327 250 0.41 0.42 0.41 0.00 0.00 0.00 Avg 2007-2010 2011 2005 2008 2011 Company Contractor Global Drilled wells per year Blow-out frequency (per thousand) * n. of LTI/Mln of worked hours 13

  14. Slide 14: exploration objectives

    exploration objectives Drivers Barents Sea (Norway)  Large upside GoM (USA) Near field exploration  Materiality and Pacific gas (Indonesia and Australia)  High potential in profitable gas market cost-effectiveness  Short time to market West Africa  Focus on  Transform margin play in Ghana, Tog

  15. Slide 15: focus on exploration: Norway - Barents sea

    focus on exploration: Norway - Barents sea Discoveries  500 Mbbl of recoverable oil in Skrugard and Havis Havis/Skrugard hub PL226 2012-2015 work program PL608 PL532 Skrugard/Havis  Resources upside in the area: 500 PL533 mboe PL229  8 wells in the Barents Sea: €220m PL529 Goliat equity investmen

  16. Slide 16: focus on exploration: Mozambique – Rovuma basin

    focus on exploration: Mozambique – Rovuma basin Mamba discovery Area 4  Gas in place estimate at 30 Tcf  High gas quality  Expected rate in production configuration up to 140 mmsfcd Mamba North 1 per well Mamba Tertiary North East 1 proven 2012-2015 work program gas play Mamba South 1  Up to 8 e

  17. Slide 17: focus on exploration: Pacific Area

    focus on exploration: Pacific Area Discoveries  ~700 Mboe already discovered in Australia and Indonesia 2012-2015 work program  Resources upside: ~500 Mboe BUKAT/ BULUNGAN  24 wells: €300m equity investments North Ganal Arguni 1 JANGKRIK JANGKRIK NE Synergies NT/P68- Heron NT/48-  Indonesia: Jan

  18. Slide 18: exploration capex

    exploration capex 2012-2015 bln € +~50% 5.5 By area By type 3.6 2011-14 2012-15 18

  19. Slide 19: time to market: from resources to production…

    time to market: from resources to production… 2009-2011 Total resources* discoveries bln boe 31.0 32.1 Mozambique 2P reserves Other reserves/ resources Brent 79 111 ($/boe) 90% with first oil in production in <8 years Life index 47 50 (years) * P1 + P2 + P3 + contingent resources + risked exploratio

  20. Slide 20: … through identified and solid start-ups

    … through identified and solid start-ups Main start-ups Samburskoye Goliat Yaro/Yakhinskoye Skrugard/Havis Urengoskoye Yevo Culzean Severo Kashagan EP Great Hadrian Jasmine area W.Franklin Ph.2 MLE Kashagan Ph.2 CAFC Karachaganak Ph.3 Hadrian El Merk South Wafa compression Sankofa Gye Nyame Perla FF

  21. Slide 21: Yamal Nenets region: new gas giants

    Yamal Nenets region: new gas giants Samburgskoye Production (kboed, equity) Samburgskoye Yaro-Yakhinskoye Severo- Chaselskoye Urengoskoye  Samburgskoye and Urengoskoye sanctioned in 2011  GSA signed with Gazprom  Samburgskoye start up confirmed 2012 21

  22. Slide 22: Barents Sea: Goliat first oil development

    Barents Sea: Goliat first oil development Goliat Production (kboed, equity) Barents Sea  First oil development in the Barents Sea  Subsea templates installation campaign completed in 2011 and ready for drilling  FPSO delivery in 2013 22

  23. Slide 23: Kazakhstan: near-term growth and significant long-term potential

    Kazakhstan: near-term growth and significant long-term potential Kazakhstan Production (kboed, equity)  Kashagan EP Karachaganak  Construction completion and commissioning ongoing Kashagan  Tranches 1&2 progress for KCP: 99%, in line with commercial production start up within 2012  Karachaganak

  24. Slide 24: Venezuela: super giants with long-term plateau

    Venezuela: super giants with long-term plateau Venezuela Production (kboed, equity) Perla  Perla Junín-5  Gas Sales Agreement and FID for Phase 1 achieved in 2011  Phase 1: construction and installation of three offshore platforms, 60-km pipeline to shore, onshore processing facility  Junìn EP 

  25. Slide 25: Sub-Saharan: legacy area with further growth prospects

    Sub-Saharan: legacy area with further growth prospects Block 15/06 West Hub Production* (kboed, equity)  Development of Sangos, Ngoma, Cinguvu fields (1,250-1,450m water depth)  16 wells (10 producers, 6 injectors)  First drilling campaign: ongoing  FPSO will be delivered in 1Q 2014 * exploratio

  26. Slide 26: investment plan

    investment plan Capex 2012-2015 bln € +14% 44.8 By area By type 1.7 39.1 5.5 1.8 3.6 Mozambique 3.1 33.7 37.6 N. Africa/M. East America Onshore Europe Asia Pacific Offshore Central Asia/Russia West Africa Deepwater Development Other Exploration 26

  27. Slide 27: our commitment: production

    our commitment: production Organic production growth CAGR ~3% >3%  Strong production growth of over 3% a year to 2015 adjusted for Libya in 2011  Resilient to oil price increases: 2011-2015 CAGR at 100$/bbl ~3%  Long-term growth target raised from ~2% to ~3% Libya force majeure New production 201

  28. Slide 28: our commitment: value

    our commitment: value Cash flow NPV 2P by areas CF/boe (%) 120 110 100 90 2010 2015 Sub-Saharan Africa North Africa Brent avg Europe & America Asia & Pacific 85 85 ($/boe) Solid cash generation 28

  29. Slide 29: Gas & Power

    Gas & Power Umberto Vergine eni.com

  30. Slide 30: European gas market: a difficult short term environment…

    European gas market: a difficult short term environment… Supply Demand  Increasing capacity from  Weak economic situation in Russia (North Stream) Europe impacting industrial clients  Availability of lower-priced make up gas  Increased competition in powergen from renewable  No additional LNG c

  31. Slide 31: ... gradually rebalancing in the medium term

    ... gradually rebalancing in the medium term Europe  Demand recovery (+60bcm 2015 Americas vs. 2011) Pacific Basin  Domestic production decline (-17 bcm)  North American  Demand escalation in  Marginal shale gas contribution production continues to emerging markets (+89 expand  Increased inter

  32. Slide 32: eni strategy: building on a more competitive supply portfolio …

    eni strategy: building on a more competitive supply portfolio … Market Price Flexibility reflectivity • Alignment • Improved and between eni faster Objective cost position responsiveness and average to market costs of supply changes in the market • Foundation for competitive positioning in • Negotia

  33. Slide 33: … to grow sales to business customers…

    … to grow sales to business customers… B2B volume increase • Dedicated and capillary direct sales (bcm/y) force to grow position in Italy and key +18% European countries 85 • Tailor made offers for different 72 segments • Energy intensive customers  Multi-country approach  Flexible contractual str

  34. Slide 34: ... and increase exposure to the retail segment

    ... and increase exposure to the retail segment • Larger retail presence in Italy and Europe Retail customers (mln)  Organic growth  Selected M&A opportunities +28% 12 • Well-proven commercial mix  Single brand identity 9.4  Distinctive product portfolio  Customer driven innovation  Competitiv

  35. Slide 35: gradual recovery in profitability

    gradual recovery in profitability Pro-forma adj. EBITDA Bln € Marketing  Supply cost improvement  Benefit from retroactive 2.6 renegotiations in 2012  Impact of retail tariff revision in Italy  Development of integrated trading activities International transport  Resilient profitability despite

  36. Slide 36: Financial Outlook

    Financial Outlook Alessandro Bernini, CFO eni.com

  37. Slide 37: Snam deconsolidation: a resulting strong capital structure

    Snam deconsolidation: a resulting strong capital structure Net debt Capital employed bln € bln € Snam 15.4 Mkt value of Snam eni’s stake 11.2 6.9 eni 9.9 eni Mkt value 65.3 of eni’s stake 6.9 eni D/E 0.46x eni ROACE 9.8% Snam deconsolidation 0.30x Snam deconsolidation 10.4% Including cash-in <0.20x

  38. Slide 38: 2012-2015 capex: supporting stronger growth

    2012-2015 capex: supporting stronger growth bln € Russia/ Snam Caspian 0.5 59.6 2.3 Sub 6.7 2.5 Europe/ 53.3 Sahara 1.4 2.8 North 2.4 -1.1 America 2.9 7.2 Snam Snam 7.5 Mozambique North OPL245 Africa/ME Jangkrik Far Latam East Skrugard/Havis 44.7 39.1 Uncom- mited 2011-14 Forex E&P Others 2012-15 Co

  39. Slide 39: selective capex plan

    selective capex plan G&P R&M Chemicals Total €7.2 bln Total €2.8 bln Total €1.6 bln International transport Marketing 0.1 0.9 Stay in Marketing business 0.9 New 0.4 initiatives Efficiency Snam Refining 0.8 0.2 6.2 1.9 Green chemical 0.2  Focus on projects for integration, efficiency and energy savi

  40. Slide 40: efficiency programme

    efficiency programme bln € E&P 11% 5.0 G&P 6% 1.6 Corporate R&M 11% & others 49% 3.1 Chemicals 0.3 20% E&C 2004-05 2006-11 2004-15 3% 2004-05 2006-11 2012-15 achievements achievements target  Almost €600m of savings achieved in 2011  4-year target increased by €600m, mainly in R&M and Chemicals 40

  41. Slide 41: increasing cash flow to support investments and reduce debt

    increasing cash flow to support investments and reduce debt 2012-15 cash flow* bln €  Organic cash-flow more than covers capex requirements  Net debt to equity <40% within the plan period at constant perimeter  Additional cash-inflows expected from disposals  Impact of Snam deconsolidation on fr

  42. Slide 42: a sustainable dividend policy

    a sustainable dividend policy  2011: dividend +4% in line with our policy  Dividend policy of growth in line with inflation sustainable throughout the four-year plan Confirmed dividend policy 42

  43. Slide 43: Closing remarks

    Closing remarks Paolo Scaroni, CEO eni.com

  44. Slide 44: entering a new growth phase

    entering a new growth phase A decade of faster, sustainable growth E&P • Raised production targets to 2015 and beyond • Increased exploration effort in highly promising basins Consolidation of leading position in Europe G&P • Improved competitiveness of supply • Medium-term recovery leveraging on se

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