Eni slashes 4-year capex plan by 21%, hopes to divest $7.9 billion

Italy’s Eni SPA has set group capital expenditures during 2016-19 at $41.78 billion, down 21% from the 2015-18 plan.

The new plan includes a disposal program targeting $7.9 billion of asset sales mainly through the dilution of high working interest stakes in recent material discoveries. In 2015, Eni met 90% of its previous 4-year plan disposal target.

Hydrocarbon production during the 2016-19 period is expected to rise 3%/year, the firm says, explaining the target will be met mainly through the ramp-up and start-up of new projects with a total contribution of 800,000 boe/d in 2019.

Eni expects 1.6 billion boe in oil and gas discoveries during the period while maintaining average exploration spending in line with 2015 levels. Notwithstanding an 18% reduction in overall upstream capex, cumulative production growth of 13% to 2019 is expected.

The firm notes that it has reduced its average breakeven price of new projects to $27/boe from $45/boe, citing portfolio flexibility, ongoing successful exploration strategy, synergies with existing assets, and contract renegotiations.

In its refining segment, Eni plans to address “structural weaknesses” by lowering its breakeven price to about $3/bbl by 2018 while maintaining its current refining capacity, resulting in cumulative cash flow from operations of $3.27 billion over the plan period.

“We are continuing to restructure our mid-downstream businesses successfully,” said Claudio Descalzi, Eni chief executive officer. “In refining and marketing, we are focused on lowering our breakeven while enhancing the efficiency of our operations and defending our retail market share.”

Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now


Making DDoS Mitigation Part of Your Incident Response Plan: Critical Steps and Best Practices

Like a new virulent strain of flu, the impact of a distributed denial of service (DDoS) attack is...

The Multi-Tax Challenge of Managing Excise Tax and Sales Tax

To be able to accurately calculate multiple tax types, companies must be prepared to continually ...

Operational Analytics in the Power Industry

Cloud computing, smart grids, and other technologies are changing transmission and distribution. ...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...