Business Outlook 2021

Business and financial outlook 2022

Management expectations for our business operations are provided below.

Business and financial outlook 2022

The Company is issuing the following updated operational and financial guidance for the FY ’22 based on information available to date, management’s judgement of potential risks and uncertainties and assuming no additional material disruptions to Russian gas flow:

  • E&P: Hydrocarbon production is expected at 1.67 million boe/d, in line with previous guidance of 1.7 million boe/d adjusted for force majeure effects and at the Company’s updated price deck of 105 $/bbl.
  • E&P: Around 700 million boe of new exploration resources are expected to be discovered in 2022, up from 600 million boe previously guided.
  • GGP: Reaffirmed guidance of adjusted EBIT of at least €1.2 billion. Second half EBIT is expected to be concentrated in the fourth quarter.
  • Plenitude & Power: Reaffirmed Plenitude’s EBITDA guidance, expected to be higher than €0.6 billion. We also confirm our guidance of more than 2 GW of installed renewable generation capacity by year-end.
  • Downstream: Adjusted EBIT (R&M with ADNOC pro-forma and Versalis) is raised to the range of €1.8- 2 billion vs previous guidance of just positive territory, assuming a SERM of 6 $/bbl in the second half of 2022.
  • Our main price sensitivities foresee a variation of €130 million in free cash flow for each one-dollar change in the price of Brent crude oil and around €700 million for a 5 USD/cent movement in the USD/EUR cross rate vs our new assumption of 1.08 USD/EUR for 2022 and considering 105 $/bbl Brent price.
  • Adjusted cash flow before working capital at replacement cost is now expected to be €20 billion at 105 $/bbl, vs our previous guidance of €16 billion at 90 $/bbl.
  • Organic capex is seen at €8.3 billion, in line with previous guidance of €7.7 billion adjusting for EUR/USD exchange rate updated assumption.
  • Cash neutrality on a normalized basis is expected at a Brent price of around 40 $/bbl, reflecting current strong underlying performance and cost management across our businesses.
  • 2022 leverage ante IFRS 16 is seen at 0.13 at our price assumption.