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Investor Presentation • Oct 27, 2023
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Eni 9M 2023 Results OCTOBER 27, 2023
North Ganal PSC, Indonesia
STRATEGIC & OPERATIONAL PROGRESS
ADVANCING OUR STRATEGY ON A CONSISTENT PATH
KEY QUARTER ACHIEVEMENTS
GENG NORTH-1 DISCOVERY LARGEST IN INDUSTRY IN 2023
BALEINE STARTUP < 2 YEARS FROM DISCOVERY
PORTFOLIO HIGHGRADING
MAJOR NEW LNG SUPPLY
SIGNIFICANT STEPS FORWARD
REACHED FIRST POWER DELIVERIES IN DOGGER BANK
NEW BIOREFINERY UNDER-STUDY IN SOUTH KOREA
NOVAMONT ACQUISITION CLOSED
| S E C R U |
UPSTREAM | PRODUCTION GROWTH |
FOCUS ON TIME TO-MARKET AND PHASED DEV. |
SCALING UP CCUS TO TACKLE |
BALEINE STARTUP < 2 YEARS |
|---|---|---|---|---|---|
| O S E R L A R |
CCUS | SECURITY OF SUPPLY DUAL EXP. MODEL |
SHIFT TO GAS & GEOGRAPHICAL DIVERSIFICATION |
UNABATED EMISSIONS NET ZERO UPSTREAM |
FROM DISCOVERY PORTFOLIO HIGHGRADING |
| U T A N |
GGP | AND FOCUS ON VALUE |
EQUITY DRIVEN GLOBAL GAS AND LNG MODEL |
SCOPE 1+2 BY 2030 | MAJOR NEW LNG SUPPLY AGREEMENTS |
| N | PLENITUDE | CUSTOMER - ORIENTED BUSINESS MODELS |
GROWING RES CAPACITY AND EV CHARGING |
GROWTH OF CIRCULAR AND BIO BASED CHEMICALS |
FOR CCS |
| O TI U L O V E Y G R E N |
ENILIVE | ADDRESSING SCOPE 3 EMISSIONS |
ROLLOUT DEVELOPING AN ADVANTAGED |
BRINGING INNOVATION IN TRADITIONAL |
REACHED FIRST POWER |
| CHEMICALS | CRYSTALLISING VALUE VIA MARKET |
BIOFUELS BUSINESS EVOLVING RETAIL STATIONS INTO |
PROCESSES SELECTIVE M&A |
NEW BIOREFINERY UNDER STUDY IN SOUTH KOREA |
|
| E | REFINING | VALORISATION | MOBILITY HUBS | NEW TECHNOLOGIES | NOVAMONT ACQUISITION CLOSED |
2
9M 2023 | GROUP RESULTS
CONTINUING MOMENTUM THROUGH 2023
3
EBIT and Net Profit are adjusted. Cash Flows are adjusted pre-working capital at replacement cost. Leverage: before IFRS 16 lease liabilities.
NATURAL RESOURCES
DELIVERING VALUE FROM OUR ASSETS
ADJ. EARNINGS PRE-TAX | € BLN
PRODUCTION 1.64 MBOED IN 3Q +4% YOY GROWTH KAZAKHSTAN, INDONESIA PLUS ALGERIA HIGHER ACTIVITIES, MOZAMBIQUE RAMP-UP AND CÔTE D'IVOIRE START-UP
HIGHGRADING UPSTREAM PRODUCTION PORTFOLIO OPTIMIZING AND ALIGNING CONTINUED ASSET OPTIMIZATIONS OF THE GAS ASSET PORTFOLIO
GGP SECURED OPPORTUNITIES DESPITE TIGHTER SPREADS AND SOME MAINTENANCE IN INFRASTRUCTURE
SCENARIO DOWN Y/Y, STABLE Q/Q
REALISATIONS: –17% Y/Y; +7% Q/Q BRENT: -14% Y/Y, +11% Q/Q PSV: -83% Y/Y, -9% Q/Q
E&P
PRODUCTION GROWTH +1% Q/Q, +4% Y/Y IN LINE WITH FY GUIDANCE
EBIT RESILIENT IN A LOWER SCENARIO
INCLUDING JV/ASSOCIATES EBIT PRO-FORMA ADJ € 3.4 BLN
GGP
ADDED 6.5 BCM/Y (AT PLATEAU) OF CONTRACTED LNG VOLUMES FOR CONGO, INDONESIA, QATAR
9M EBIT +29% YOY
2023 GGP EBIT GUIDANCE CONFIRMED AT € 2.7-3.0 BLN
FOCUS ON INDONESIA
A NEW PRODUCTION HUB IN THE KUTEI BASIN
FROM SIZEABLE PLAYS...
WE HAVE BEEN IN THE COUNTRY SINCE 2001 EQUITY PRODUCTION IS AROUND 80 KBOED
| Discovered resources |
Exploration Upside |
|
|---|---|---|
| NORTHERN AREA | 10 Tcf * |
multi Tcf |
| SOUTHERN AREA | 3.5 Tcf * |
a few Tcf |
* gas initially in place
…TOWARDS GROWING A WORLDCLASS GAS HUB
JUNE 2023 ACQUISITION OF NEPTUNE ENERGY
JULY 2023 PURCHASE OF CHEVRON'S ASSETS
OCTOBER 2023 GENG NORTH1 GIANT GAS DISCOVERY
STRENGTHENING SOUTHERN AREA HUB
FAST TRACKING A NEW NORTHERN AREA HUB
FURTHER EXPLORATION UPSIDE POTENTIAL IN BOTH AREAS
GENG ALIGNS TO OUR DISTINCTIVE STRATEGY
FOCUSING ON GAS
REINFORCING EQUITY POSITION ALONG LNG VALUE CHAIN IN A KEY MARKET
OPTIMISING NEARBY INFRASTRUCTURE AVAILABILITY
EXPLORATION AT SCALE SUPPORTS OUR DUAL EXPLORATION MODEL AND FAST-TRACK DEVELOPMENTS
LEADING VALUE IN EXPLORATION
Source: Wood Mackenzie (July 23)
ENERGY EVOLUTION: DOWNSTREAM
FULLY CAPTURING SCENARIO; GROWING BIO
ADJ. EBIT PRO FORMA | € BLN
ENILIVE
9M EBITDA €0.82 BLN BIO-REFINING CAPACITY 1.65 MTPA
TRADITIONAL REFINING
OPTIMIZED PERFORMANCE IN A STRENGTHENED SCENARIO
TRADITIONAL REFINING IMPROVING VS Q2 DUE TO HIGHER SERM AND UTILISATION
ADNOC REFINING CONTRIBUTION REMAINS STRONG
ENILIVE RESILIENT MARKETING BETTER PLANT PERFORMANCE
LAUNCHED NEW MARKETING BRAND 'ENILIVE'
CHEMICAL WEAK SCENARIO, HIGH ENERGY COSTS AND INTENSE COMPETITION
ENERGY EVOLUTION: PLENITUDE
DELIVERING GROWTH AND VALUE
INCREASED GUIDANCE: 2023 EBITDA ~ €0.9 BLN (>2x vs 2019)
A DISTINCTIVE PROPOSITION
INTEGRATED PLATFORM
- SYNERGIES ALONG THE GREEN POWER VALUE CHAIN
- RETAIL AS ROUTE TO MARKET
ESTABLISHED AND CREDIBLE
- WORLDWIDE OPERATIONS IN 15 COUNTRIES
- EXECUTION TRACK RECORD
STRONG GROWTH
- ALREADY MATERIAL CFFO FROM RES AND RETAIL
- 2026 EBITDA >2X VS 2023
- TARGETING >7GW BY 2026
2023 GUIDANCE
| PRODUCTION | 1.64-1.66 MBOED | |
|---|---|---|
| DISCOVERED RESOURCES | > 700 MBOE | target will be exceeded |
| GGP EBIT | € 2.7-3.0 BLN | |
| PLENITUDE EBITDA1 | ~ € 0.9 BLN | |
| DOWNSTREAM EBIT1 | ~ € 1 BLN | |
| ENILIVE EBITDA1 | ~ € 1 BLN | |
| EBIT | ~ € 14 BLN | € 2.6 bln outperformance |
| CFFO2 | ~ € 16.5 BLN | |
| DIVIDEND | € 0.94/SHARE | |
| BUYBACK | € 2.2 BLN | accelerating pace in '23 |
| CAPEX | ~ € 9.0 BLN | below original guidance |
| LEVERAGE | 10%-20% | confirming robust FCF |
EXCELLENT CASH CONVERSION
SHARE BUYBACK ACCELERATED DURING QUARTER
SECOND INTERIM QUARTER 2023 DIVIDEND TO BE PAID IN NOVEMBER
BALANCE SHEET REMAINS SOLID WITH LEVERAGE UNCHANGED AT 15%
1 Plenitude and Enilive: EBITDA is pro-forma; Downstream: EBIT is pro-forma.
2 Cash Flows are adjusted pre working capital at replacement cost and exclude effects of derivatives.
Updated 2023 Scenario is: Brent 84 \$/bbl (from 80 \$/bbl); SERM 10.4 \$/bbl (from 8 \$/bbl); PSV 474 €/kmc (from 484 €/kmc); average EUR/USD exchange rate of 1.08 (unchanged)
CONCLUDING REMARKS
CALENDAR UPDATE:
4Q RESULTS FEB 16TH 2024 CMD MAR 14TH 2024
DELIVERING STRONG OPERATING AND FINANCIAL RESULTS
TRACK-RECORD OF BUSINESS OUTPERFORMANCE
MAINTAINING RESILIENT FINANCIAL POSITION IN VOLATILE TIMES
REWARDING SHAREHOLDERS ALONGSIDE INVESTING FOR GROWTH
ANNEX
10
3Q 2023 RESULTS SUMMARY
PRE-TAX TO CASHFLOW AND NET DEBT
3Q 2023 EARNINGS SUMMARY
EBIT TO PRE-TAX RECONCILIATION
E&P CAPTURES SCENARIO AND
3Q 2023 vs 2Q 2023 EARNINGS
BUSINESS PERFORMANCE AND MACRO LARGELY OFFSET ABSENCE OF VERY STRONG 2Q PERFORMANCE IN GGP
PERFORMANCE IMPROVEMENT CONTRIBUTES €0.6BLN TO EBIT VS MID-YEAR
RESULTS AT THE TOP OF OUR HISTORICAL QUARTERLY PERFORMANCES
3Q 2023 vs 3Q 2022 EARNINGS
3.29 3Q22 Adjusted Pre-tax Scenario Angola decons. Corridor decons. E&P Performance GGP Performance Scenario Turnaround Performance Scenario Performance & Growth Associates Others 3Q23 Adjusted Pre-tax NATURAL RESOURCES DOWNSTREAM PLENITUDE POWER 6.2 3.3 -1.7 -0.3 -0.2 0.3 -0.8 -0.2 -0.1 0.1 -0.0 0.1 -0.3 0.2 NORMALISATION FROM EXCEPTIONAL SCENARIO AND SATELLITE DECONSOLIDATION DRIVES LOWER EBIT UPSTREAM RESULTS AIDED BY CONTINUING COST OPTIMISATION AND 4% PRODUCTION GROWTH RESILIENT ENILIVE AND REFINING RESULT 80% INCREASE IN BIO THROUGHPUTS 51% INCREASE IN RENEWABLE ENERGY PRODUCTION
€ BLN
14
3Q MARKET SCENARIO
PSV| €/kcm STANDARD ENI REFINING MARGIN| \$/bbl
UPSTREAM KEY START-UPS IN THE PLAN [1/2]
| COUNTRY | PROJECT | OPERATOR | W.I. | PRODUCTS | FID | START UP | PRODUCTION (KBOED)A |
|---|---|---|---|---|---|---|---|
| ANGOLA | Agogo West Hub Integrated |
J | 18% | Liquids | 2022 | 2026 (FPSO) | 175 (100%) |
| (Azule Energy) |
NGC Quiluma & Mabuqueiro |
J | 19% | Gas | 2021 | 2026 | 100 (100%) |
| CONGO | Congo LNG | Y | 65% | Gas | 2022 | 2023 | 123 (100%) |
| EGYPT | Melehia ph.2 | Y | 76% | Liquids/Gas | 2022 | 2024 (Gas Plant) |
37 (100%, Oil&Gas) |
| Merakes East |
Y | 65% | Gas | 2023 | 2025 | 15 (100%) | |
| INDONESIA | Maha | Y | 40% | Gas | 2024 | 2026 | 34 (100%) |
| ITALY | Cassiopea | Y | 60% | Gas | 2018 | 2024 | 27 (100%) |
aAverage yearly production in peak year/at plateau Operatorship legend: Y (yes), N (no), J (joint) 16
UPSTREAM KEY START-UPS IN THE PLAN [2/2]
| COUNTRY | PROJECT | OPERATOR | W.I. | PRODUCTS | FID | START UP | PRODUCTION (KBOED)A |
|---|---|---|---|---|---|---|---|
| Baleine ph.1 |
Y | 83% | Liquids/Gas | 2022 | 2023 | 18 (100%) | |
| IVORY COAST | Baleine ph.2 |
Y | 83% | Liquids/Gas | 2022 | 2024 | 38 (100%) |
| LIBYA | A&E Structure | Y | 50% | Gas | 2023 | 2026 (Struct. A) |
160 (100%) |
| Balder X | N | 58% | Liquids | 2019 | 2024 | >70 (100%)b | |
| NORWAY (Vår Energi) |
Breidablikk | N | 22% | Liquids | 2020 | 2023 | ~58 (100%)c |
| Johan Castberg | N | 19% | Liquids | 2017 | 2024 | ~190 (100%)d | |
| UAE | Dalma Gas | N | 25% | Gas | 2019 | 2025 | 56 (100%) |
aAverage yearly production in peak year/at plateau bSource: Vår Energi Q1 2022 results (total Balder field production)
cSource: Vår Energi Q3 2023 results
dSource: IPO prospect Operatorship legend: Y (yes), N (no), J (joint) 17
BIOREFINING KEY PROJECTS 2023-26
| COUNTRY | PROJECT | W.I. | START UP | CAPACITY | STATUS | ADDITIONAL NOTES |
|---|---|---|---|---|---|---|
| Production capacity increase from 360 to 560 kt/y |
2024 | Firm | ||||
| ITALY (VENICE) |
Enhanced flexibility to allow other biomass processing (incl. low bio ILUC) |
100% | Ph1 in 2023 Ph2 in 2027 |
560 kton/y |
- | |
| ITALY (VENICE & GELA) |
Product mix enrichment to grow HVO diesel & biojet production |
100% | 2024-2025 | ~740 kton/y (Gela) |
Firm | - |
| ITALY (LIVORNO) |
Building 3 new plants for hydrogenated biofuel production |
100% | 2025 | 500 Kton/y |
Firm | Biogenic feedstock pre treatment unit, 500 kton/y ecofining™ plant and hydrogen plant |
| USA (CHALMETTE) |
New biorefinery conversion (expanding presence in North America) |
50% | IH 2023 | 550 kton/y (equity) |
Onstream | Access to premium HVO market and ample bio feedstock availability |
| MALAYSIA (PENGERANG) |
New biorefinery under study (flexible configuration to max SAF & HVO prod.) |
Under eval. |
FID by 2023, completion by 2025 |
650 kton/y (gross) |
Under study |
Strategic location close to Singapore on major international aviation and shipping routes, with easy access to Asian market expected to grow (especially in SAF) |
| SOUTH KOREA (DAESAN) 18 |
New biorefinery under study (flexible configuration to max SAF & HVO prod.) |
Under eval. |
FID by 2024, completion by 2026 |
400 kton/y (gross) |
Under study |
Synergies with the existing LG Chem industrial complex for bio-based polymers production |
PLENITUDE KEY PROJECTS
| COUNTRY | PROJECT | WORKING INTEREST |
EQUITY INSTALLED CAPACITY (MW) |
TECHNOLOGY | COMPLETION | YEARLY PRODUCTION (GWH) |
|---|---|---|---|---|---|---|
| SPAIN | Guillena & Caparacena |
100% | 380 | 2024 | 800 | |
| USA | Brazoria | 100% | 263 | 2022 | 450 | |
| USA | Guajillo | 100% | 200 | B | 2024 | 150 |
| SPAIN | Orense | 100% | 100 | 2024 | 210 | |
| FRANCE | Samoussy | 100% | 90 | 2022 | 90 | |
| GREECE | Toumba | 100% | 80 | 2025 | 130 | |
| ITALY | Borgia, Corleone & Salandra |
100% | 65 | 2023-2024 | 100 | |
| KAZAKHSTAN | Shaulder | 100% | 50 | 2023 | 90 | |
| ITALY | Montalto & Castelvetrano |
60% | 65 | 2024-2025 | 110 | |
| UK | Dogger Bank (A, B, C) |
13% | 470 | 2023-2026 | 2.100 |
Storage: BESS production refers to annual energy dispatched.
19
Completion represents the final construction stage excluding the grid connection, meaning that all principal components have been installed. Pre-commissioning activities fall within the construction phase.
SENSITIVITY 2023
| SENSITIVITY 2023 | EBIT ADJ (€ bln) |
Net adj (€ bln) |
CFFO before WC (€ bln) |
|---|---|---|---|
| Brent (1 \$/bbl) |
0.18 | 0.13 | 0.13 |
| European Gas Spot Upstream (1 \$/mmbtu) | 0.15 | 0.12 | 0.13 |
| Std. Eni Refining Margin (1 \$/bbl) | 0.14 | 0.10 | 0.14 |
| Exchange rate \$/€ (+0.05 \$/€) |
-0.53 | -0.30 | -0.62 |
Brent sensitivity applies to liquids and oil-linked gas. Sensitivity is valid for limited price variation. For energy use purposes PSV variation of 1\$/MMBTU has an impact of -15 mln € on SERM calculation.