COMPANY

HIGHLIGHTS

Strategies

To maximize the efficiency in all business areas with the aim in particular to maintain top execution and security standards, preserve competitive supply costs, optimize the utilization rate of the fleet, increase structure flexibility in order to mitigate the effects of negative business cycles as well as develop and promote a company culture that will permit the identification and management of risks and business opportunities.
To continue to focus on the more complex and difficult projects in the strategic segments of deepwater, FPSO, heavy crude and LNG upgrading (offshore and onshore, for the monetization of stranded gas reserves) in order to consolidate the Company’s competitive position in large offshore and onshore projects for the development of hydrocarbon fields.
To promote local content in terms of employment of local contractors and assets in strategic countries where large projects are carried out supporting the development of delocalized logistic hubs and construction yards when requested by clients in order to achieve a long-term consolidation of its market position in those countries.
To leverage on the capacity to execute internally more phases of large projects on an EPC and EPIC basis, pursuing better control of costs and terms of execution adapting with flexibility to clients’ needs, thus expanding the Company’s value proposition.
To complete the expansion and revamping program of its construction and drilling fleet in consideration of the future needs of the oil&gas industry, in order to confirm the Company’s leading position in the segment of complex projects with high profitability.

Engineering & Construction

Eni operates in engineering, construction and drilling both offshore and onshore for the oil&gas industry through Saipem, a subsidiary listed on the Italian Stock Exchange (Eni’s interest is 43%). Saipem boasts a strong position in the relevant market leveraging on technological and operational skills mainly in frontier areas, harsh environments and complex projects, as well as on engineering and project management capabilities and ownership or availability of necessary technologies as a result of a challenging internal (investments on offshore fleet) and external (acquisition of Bouygues Offshore and Snamprogetti) growth process.

In spite of the uncertainty on the time of the recovery of global economy, Saipem plans to continue consolidating its position in the main business segments, implementing its strategic guidelines:

Orders acquired
Orders backlog
Capital expenditures

Order acquired at period end Orders acquired amounted to €9,917 million, down €3,943 million from 2008 (-28.4%), in particular in onshore construction and onshore drilling activities.

Order backlog at period end Order backlog was €18,730 million at December 31, 2009 (€19,105 million at December 31, 2008), related in particular to projects in North Africa (30%), West Africa (15%) and the Rest of Europe (13%).

In 2009 capital expenditures in the Engineering & Construction segment (€1,630 million) mainly regarded:

Offshore: purchase of the lay barge Acergy Piper renamed Castoro Sette, construction of a new pipelayer and the ultra-deep water Field Development Ship FDS2, construction of a new fabrication yard in Indonesia and the activities for the conversion of a tanker into an FPSO;
Offshore drilling: construction of the two semisubmersible rigs Scarabeo 8 and 9, the new ultra deep water drillship Saipem 12000 and the jack up Perro Negro 6;
Onshore drilling: construction/development of operating structures;
Onshore: maintenance and upgrading of the existing asset base.