Activities

MAIN PRODUCING FIELDS/INTERESTS MAIN START-UPS 2010-2013 Adriatic Sea - Barbara, Angela-Angelina, Porto Garibaldi, Cervia and Tea-Arnica-Lavanda (Eni 100%-Op.) 2010 - Cerro Falcone (Eni 60.77%, Op.) Central -Southern Appennines - Val D'Agri (Eni 60.77%-Op.) 2010 - Annamaria (Eni 90%, Op.) Sicily - Gela, Ragusa, Giaurone, Fiumetto e Prezioso (Eni 100% - Op.) 2011 - Aquila, phase 2 (Eni 100%, Op.) 2013 - Offshore Ibleo (Eni 60%, Op.)

Eni has been operating in Italy since 1926. Operations are carried out in Val Padana, the Adriatic Sea, the central-southern Apennines and in both the onshore and offshore areas of Sicily for a total area that at the end of 2008 amounted of 25,522 square kilometres (20,409 of which are attributable to Eni). All exploration and production operations are regulated by concession contracts. In 2008, Eni had 159 mining licences and 87 deposits in production and held definite hydrocarbon reserves of 681 million barrels of oil equivalent (boe), corresponding to over 10% of its worldwide reserves.

In June 2009, Eni identified 44 mining licences it intends to assign to three newly set-up companies (NewCo) entirely controlled by Eni, each with a separate geographical base. The first of these is in northern Italy (Pianura Padana and Emilia Romagna), the second in central Italy (Marche, Abruzzo and Molise) and the third in southern Italy(in the Crotone area). 
The two companies in northern and central Italy may eventually disposed of and the operation is expected to be completed by the end of the year.

Exploration
In 2007, exploration operations led to the discovery of gas in the Abruzzo offshore area at the Colle Sciarra 1 well. In July 2008, Eni made another important discovery of gas in the Sicilian Channel, approximately 22 kilometres off the Agrigento coast, at the Cassiopea 1 well at a depth of around 560 metes. In September 2008, Eni discovered more gas in the Sicilian Channel, approximately 20 kilometres off the coast of Agrigento. The discovery was made as a result of drilling operations carried out at the Argo 2 well (where Eni is the operator and holds a 60% stake). Argo 2 confirmed the presence and extension of the gas deposit discovered in 2006 at the nearby Argo 1 well and also identified further quantities of gas in the area at a greater depth. The Argo 2 discovery confirms the high potential of the offshore area of the Sicilian Channel.

In 2008, Eni was awarded two new exploration permits in the offshore area of Puglia.

Development
Operations in Val Padana were mainly aimed at optimising operations at the Villafortuna deposit and developing the Longanesi and Canonica d’Adda deposits, where start-up is expected in 2011.
In the Adriatic Sea operations were intensified to recover potential mining residue from the main deposits, in particular Antares, Cervia, Emma, Fratello Nord, Giovanna, Hera-Lacinia and Luna. These operations included improving the water injection system and upgrading the facility at the Angela-Angelina field, sidetracking and infilling operations at the Annalisa, Barbara and Bonaccia fields, completing operations at the Cervia and Luna fields and developing the Annamaria and Guendalina fields.

As for operations in Val d’Agri, these were mainly aimed at continuing the drilling programme, carrying out sidetracking operations, upgrading the production facility and completing the first phase of the development programme at the Val d’Agri permit.
In Sicily work concentrated on carrying out workover and infilling operations on the Gela and Fiumetto deposits for the recovery of potential mining residue and upgrading the facility at the Bronte and Gagliano power stations. Other onshore work currently being carried out includes sidetracking operations at the Gela and Bronte fields and developing the Tresauro oil field, while offshore operations include finalising the joint development programme for the three recent gas discoveries at Panda, Argo and Cassiopea, where start-up is expected in 2011.

Production
In 2008, Eni produced 199,000 boe/day of natural gas. The main areas that provided the biggest contribution to Eni’s production in Italy were the Adriatic Sea (48%), Basilicata (29%), Pianura Padana (3%) and Sicilia (9%).
In the Adriatic Sea the main contributions came from Barbara (3.5 million cubic meters per day), Angela-Angelina (1.6 cubic metres per day), Porto Garibaldi (1.4 cubic metres per day), Cervia (1.1 million cubic metres per day) and Tea - Arnica - Lavanda (1.2 million cubic metres per day). Production in the area comes from 87 platforms and is transported by sealines to the land, where it then joins the national gas transportation network.
Eni is the operator in Basilicata of the Val d’Agri permit (60.77% owned by Eni), which in  2008 produced 95,000 boe/day (58,000 net to Eni). Production from the Monte Alpi, Monte Enoc and Cerro Falcone deposits comes from 21 production wells (out of the 47 provided for in the approved development project), which is treated at the Viggiano oil centre that has a treatment capacity of 104,000 barrels of oil per day. The oil is transported along a 136-kilomete pipeline and is then treated at Eni’s refinery at Taranto.
In Sicily Eni is the operator of 15 permits in both the offshore and onshore areas. The main deposits are situated at Gela, Ragusa, Giaurone, Fiumetto and Prezioso, and in 2008 they were responsible for 9% of Eni’s total production in Italy.

In this sector Eni is involved in all the phases including supply, storage, transportation, distribution, sales and liquefied natural gas (LNG), based on a unique integrated business model.
 

Supply of Natural Gas
The demand for natural gas from Eni in Italy is currently met by supplies from abroad, including Algeria, Libya, Russia, the Low Countries and Norway.

Transportation, Distribution and Sale of Natural Gas

Eni, through Snam rete gas, owns almost the entire national gas transportation network, as well as the only natural gas re-gassification plant currently operating in Italy (the Panigaglia terminal).
Distribution operations consist of transporting natural gas along local networks of gas pipelines, which are mainly low pressure, to the final customers in the civil, third-party and small-scale industries sector in urban areas. Eni, through Italgas and other subsidiary companies, is involved in the distribution of natural gas to 1,318 towns and cities by means of a network of gas pipelines that serve 5.6 million customers. In 2008, the volume of gas transported by Eni in Italy amounted to 85.64 billion cubic metres. The network of gas pipelines currently in use extends over an area of 31,474 kilometres, comprising 8,779 kilometres of large-dimension pipelines and 22,695  kilometres of smaller-dimension pipelines, dedicated to local distribution.
Eni owns a terminal at Panigaglia for receiving and re-gassifying natural gas, and the terminal is capable of supplying the national transportation network with approximately 3.5 billion cubic metres/year when operating at full capacity. In 2008, a total of 1.52 cubic metres of natural gas was supplied to this network. Eni has plans to increase the re-gassification capacity of the Panigaglia terminal from the current figure of 3.5 billion cubic metres to 8 billion cubic metres at full capacity, in 2014.

In 2008, Eni sold approximately 52.87 billion cubic metres of natural gas (including gas for fuelling cars) in Italy. 

At the end of June 2009, Eni completed the operation for the disposal of 100% of the share capital of Italgas and Stogit (Italian gas storage) for €4.5 billion. The operation took place following sales agreements signed Snam rete gas (50.03% of which is owned by Eni) in February 2009. Following this operation, Eni transferred to Snam rete gas all operations concerned with the distribution and storage of gas in Italy, thereby favouring important structural synergy objectives.

Production of Electricity
Eni is involved in producing electricity at its sites at Ferrera Erbognone, Ravenna, Livorno, Taranto, Mantova, Brindisi and Ferrara. At 31 December 2008 the installed capacity was 4.9 gigawatts. In 2008 Eni sold 29.93 terawatts of electricity, mainly on the Italian market whilst it produced 23.33 terawatts, a decrease of 2.16 terawatts compared with 2007 (equal to 8.5%), mainly as a result of a decrease in demand due to the economic crisis. Eni is the third biggest producer of electricity in the Italian market.
Work is currently being carried out on defining initiatives aimed at increasing Eni's presence in the renewable energy sector. These initiatives are mainly concerned with the construction of three photovoltaic power stations and a biomass-fuelled power station with a total capacity of 45 megawatts.

Work is currently going ahead on a development programme at the Ferrara power station (51% owned by Eni) where, in partnership with EGL Luxembourg, the construction phase of two new combined-cycle groups with a capacity of 390 megawatts each is nearing completion, with start up expected by the end of 2009. Work is also expected to start, in 2009, on the construction of a 240-megawatt capacity group at the Taranto power station (current capacity of 75 megawatts). Eni estimates that in relation to the energy produced (electricity and heat), using CCGT technology to produce 26.5 terawatts reduces the emissions of carbon dioxide by approximately 5 million tons compared with emissions from conventional thermoelectric power stations.

CO₂ Storage
In October 2008, Eni and Enel signed a strategic cooperation agreement for the development of technology for capture, transportation and geological gathering of carbon dioxide (CO2) and for the joint setting up of the first project in this sector in Italy. According to the agreement, Enel will construct a plant for capturing and liquefying CO2 at Brindisi, while Eni will inject the CO2 into the exhausted Stogit deposit at Cortemaggiore (Piacenza).

Natural Gas Storage Operations

Eni, through Stogit (Italian gas storage), has been operating in the natural gas storage sector in Italy since 2001. Storing natural gas is used to compensate the differences between the demand and supply of gas since there is a significantly higher demand in winter than in summer. Storage services are concentrated at 8 operational licences, with 4 in Lombardy (Brugherio, Ripalta, Sergnano and Settala), 3 in Emilia Romagna (Cortemaggiore, Minerbio and Sabbioncello) and 1 in Abruzzo (Fiume Treste). The storage sites are situated in deposits that previously produced natural gas and have subsequently been converted into storing natural gas by the construction of special infrastructure and facilities connecting them to the national gas network. Gas injecting operations are generally carried out during the period April-October.

Refining
Eni is the leading operator in Italy in the Refining & Marketing sector, where its strategy is aimed at developing the refining system, increasing the quality standard of the products it offers and implementing efficiency recovery programmes.

Refining
Eni's refining system in Italy consists of five refineries situated in Sannazzaro, Gela, Taranto, Livorno and Porto Marghera, and a 50% stake in the Milazzo refinery in Sicily. The refineries entirely owned by Eni have a combined capacity of 27.2 million tons per year (equal to 544,000 barrels per day).

Logistics
Eni is the leading company in Italy for storing and transporting petroleum products, with an integrated logistics structure composed of an oil pipeline network and a system of 21 storage facilities (with a capacity of 3,740 million tons) throughout the country that are destined for the marketing and storage of finished products, LPG and crude oil. Eni holds stakes in 5 companies set up in collaboration with the most important Italian oil operators and situated in Vado Ligure - Genoa (Petrolig), Arquata Scrivia (Sigemi), Venezia (Petroven), Ravenna (Petra) and Trieste (DCT).
Eni also operates in the transportation of oil and petroleum products sector:
• across land, through a network of oil pipelines that cover a total area of 3,019 kilometres (1,447 of which are owned by Eni);
• across the sea, using tankers leased through spot contracts and future contracts.
The secondary distribution of oil products for the network and non-network market is assigned to third parties, in some of which Eni holds a minority interest. 

Distribution and Marketing
In Italy Eni, trading under Agip, is the leader in the distribution of oil products in the network market with a market share that in 2008 amounted to 30.6%.  At the end of 2008, the distribution network in Italy comprised 4,409 petrol stations trading under Agip. In 2008 total sales of oil products in Italy amounted to approximately 8.81 million tons.
During 2008, as part of the European ZeroRegio project, a plant for producing small-concentration hydrogen (20 Nm3/h), based on Short Contact Time-Catalytic Partial Oxidation (SCT-CPO) technology developed by Eni was installed and came into service at the multi-fuel petrol station in Mantua. SCT-CPO technology is designed to transform gas and liquid hydrocarbons (natural gas, LPG, fuel gas and low-quality liquid fractions) into syngas (carbon monoxide and hydrogen) by using reactors that are up to 3 times smaller than those currently in use.

In July 2009 Eni, FIGISC-Confcommerciio and FAIB-Confesercenti signed a company agreement to modernising and innovate the Agip fuel distribution network and provide personnel with additional professional training as part of the Training, Sustainability, Professional Relations and Non-Oil Development.

In February 2006 Saipem bought from Eni the entire stake in Snamprogetti, one of the most important engineering and construction companies operating on the international market in the sector concerned with the planning and construction of onshore plant for the production and treatment of hydrocarbons and the development of natural gas. In July 2008, the Board of Directors of Saipem resolved to merge Snamprogetti into Saipem, and in October 2008 the operation was finalised.
In May 2009, following the completion of the project to rationalize the company's associated structures that began the year before, the Board of Directors of Saipem approved the merger of Snamprogetti Sud.

Saipem is the market leader in the production and construction of offshore projects for the production and transportation of hydrocarbons, and it also constructs onshore projects. With the merger of Snamprogetti, Saipem acquired a position of competitive excellence for supplying engineering, procurement, project management and construction services for the oil industry with specific experience of working under particularly difficult conditions, such as in deep water and in remote areas, and with high-level technology, such as for developing natural gas and heavy oil.

In July 2006, Saipem was awarded a contract for exclusively supplying Eni, up to the first quarter of 2012, with maintenance services for its hydrocarbon production plant in Italy, both offshore and onshore. These services concern both ordinary and extraordinary maintenance and cover the entire maintenance process from engineering to procurement and operational maintenance.
During 2008, land-based drilling operations were carried out in Italy on behalf of Eni using two drilling rigs and workover operations for the deep wells. These operations were particularly concerned with:
• completing workover operations on a deep-well rig and commencing workover operations on an existing well in the province of Novara;
• transferring a medium/high capacity plant from the province of Reggio Emilia to the province of Novara.

In July 2009, Eni awarded Saipem a turnkey contract for work to be carried out in the Mediterranean Sea. The Saipem Castoro 7 ship (formerly Acergy Piper), purchased at the beginning of 2009, will carry out the marine work which is due to be completed during the third quarter of 2009.
In November 2009, Saipem was awarded a €1 billion contract for the supply and management of an FPSO (Floating Production Storage and Offloading ) unit.
The contract will cover a total period of 20 years, with the first 8 years being dedicated to the development of the Aquila deposit, situated at a depth of 815 metres in the Adriatic Sea off the Italian coast and around 50 kilometres north-east of Brindisi. For the remaining part of the contract the FPSO unit will be used for the development of deposits indicated by the client.  
The contract, awarded by Eni, entrusts Saipem with converting an oil tanker, which it already owns, into an FPSO unit  and subsequently installing and operating the unit. The FPSO will have a production capacity of 12,000 barrels of oil per day, while production is expected to commence in the fourth quarter of 2011. 

Also in November 2009, Saipem was awarded a new contract to provide various types of Technical Services and for the planning and implementation of new projects in the "Renewable and Environment" business area.
Technical services are generally engineering and project management services provided to Saipem clients during the front end and executive phases. The "Renewable and Environment" business area has recently been set up as part of the onshore business unit, and it concerns new projects for decontaminating land and water, reducing harmful emissions and producing electricity from renewable energy sources.

Polimeri Europa operates in the basic petrochemical (aromatics, olefins and intermediaries), styrene, elastomers and polythene sectors, and it has 11 production facilities in Italy.