Overview

Italy
In detail:
  • the production and exploration of oil and gas in the country
  • electricity generation at the main power stations across Italy
  • the retail distribution of petroleum products, proprietary refineries in the country and the Green Refinery (the conversion into a bio-refinery)
  • the chemical sector
  • Eni offices and contacts in Italy

Upstream

Eni has been operating in Italy since 1926. In 2017, Eni’s oil and gas production amounted to 134 kboe/d. Eni’s activities in Italy are deployed in the Adriatic and Ionian Seas, the Central Southern Apennines, mainland and offshore Sicily and the Po Valley, on a total developed and undeveloped acreage of 20,332 square kilometers (16,380 square kilometers net to Eni).

Eni’s exploration and development activities in Italy are regulated by concession  contracts (50 operated onshore and 62 operated offshore) and exploration licenses (13 onshore and 9 offshore).

 

Adriatic and Ionian Sea

Production

Fields in the Adriatic and Ionian Seas accounted for 48% of Eni’s domestic production in 2017, mainly gas. Main operated fields are Barbara, Cervia/Arianna, Annamaria, Luna, Angela, Hera Lacinia, and Bonaccia. Production is operated by means of 69 fixed platforms (4 of these are manned) installed on the main fields, to which satellite fields are linked by underwater infrastructures. Production is carried by sealine to the mainland where it is input in the national gas network. The system is subject continuously to rigorous safety controls, maintenance activities and production optimization.

Development

Development activities in the Adriatic offshore concerned:

  • maintenance and production optimization, mainly at the Barbara and Porto Garibaldi-Agostino fields;
  • start-up of the Poseidon project in collaboration with national scientific Authorities and Institutes to transform certain platforms into scientific stations for marine environment research;
  • within the agreement with the Municipality of Ravenna, activities progressed with environmental protection projects and training initiatives to support youth employment by means of school-work alternation projects and first-level apprenticeship.

 

Central Southern Apennines

Production

Eni is the operator of the Val d’Agri concession (Eni’s interest 60.77%) in the Basilicata Region in Southern Italy. Production from the Monte Alpi, Monte Enoc and Cerro Falcone fields which accounts for 38% of Eni’s domestic production, is treated by the Val d’Agri Oil Center (“COVA”).

On July 18, 2017, Eni restarted operations at the COVA following approval from the Regional Council of the Basilicata Region. The resumption of the plant’s operational activities follows approval from the relevant Authorities confirming the functionality of the plant and the presence of all necessary safety conditions. The shutdown of the plant occurred on April 18, 2017.

Development

During the year, ten projects of the 35 projects launched as part of the 2014 Addendum to the agreement memorandum with the Basilicata Region were completed, with environmental and social initiatives as well as programs for sustainable development. In addition, school-work alternation projects and first-level apprenticeship were launched. Activities defined by the Gas Agreement progressed with a grant to support the gas consumption in the Municipalities of Val d’Agri and for energy efficiency programs.

 

Sicily

Production Eni operates 12 production concessions onshore and 3 offshore in Sicily, which in 2017 accounted for approximately 10% of Eni’s production in Italy. The main fields are Gela, Tresauro, Giaurone, Fiumetto, Prezioso and Bronte.

Following the Memorandum of Understanding for the Gela area, signed with the Ministry of Economic Development in November 2014, the Argo and Cassiopea offshore development projects progressed. Projects were submitted to the relevant Authorities and planned an optimization activities aiming to reduce environmental impact. The plan provides significant synergies with the Gela Refinery leveraging on the recovery of certain areas already reclaimed for the construction of gas treatment plants. This program is subject to the authorization of the relevant Authorities.

In addition, within the framework of sustainable local development programs defined by Memorandum of Understanding and in agreement with the Municipality of Gela and the Sicily Region were:

  • signed implementation agreements for the local upgrading and to boost economic activities;
  • school-work alternation projects,  first-level apprenticeship, programs to reduce school drop-out as well as university scholarship progressed.

Gas & LNG Marketing and Power

Natural gas supply

The supply of natural gas is a free activity where prices are determined by free negotiations of demand and supply involving natural gas resellers and producers. In order to secure mid and long-term access to gas availability, Eni has signed a number of long-term gas supply contracts with key producing Countries that supply the European gas markets. In recent years Eni renegotiated a number of the main long-term supply contracts, thus better aligning gas prices and related trends to market conditions 90% of supply concracts.

Eni could also leverage on the availability of natural gas deriving from equity  production, the access to all phases of the LNG chain (liquefaction, shipping and regasification) and to other gas infrastructures, and by trading and risk management activity.

Eni’s long-term gas requirements are met by long-term natural gas supply contracts or holds upstream activities and by access to continental Europe’s spot markets.

 

Marketing in Italy and Europe

Eni operates in a liberalized market where energy customers are allowed to choose the gas supplier and, according to their specific needs, to evaluate the quality of services and offers. Overall Eni supplies approximately 8.8 million clients in Italy and Europe.

Households, professionals, small and medium-sized enterprises and public bodies located all over Italy are approximately 7.7 million.

In a trading environment characterized by a slight recover in demand in 2017 (up by 6% in the Italian market compared to the previous year and up by 4% in the European Union), and a market still depressed and characterized by a raised competitive pressure, Eni carried out a number of initiatives − such as renegotiation of supply contracts, efficiency and optimization actions − in order to preserve the business profitability.

Domestic sales amounted to 37.43 billion cubic meters, for a market share of 49.8%.

Power generation

Eni’s power generation sites are located in Ferrera Erbognone, Ravenna, Mantova, Brindisi, Ferrara and Bolgiano. As of December 31, 2017, installed operational capacity of Enipower’s power plants was 4.7 GW (unchanged from December 31, 2016).

In 2017, power generation was 22.42 TWh, up by 0.64 TWh, or 2.9%, from 2016. Electricity trading (12.91 TWh) reported a decrease of 15.5% thanks to the optimization of inflows and outflows of power.

In 2017, power sales of 35.33 TWh declined by 4.6% from the full year of 2016 and were directed to the free market (75%), the Italian power exchange (15%), industrial sites (8%) and other (2%).

Compared to 2016, power sales marketed in the free market decreased by 0.96 TWh or by 3.5%, due to lower volumes sold to middle market (down by 2.69 TWh), wholesalers (down by 2.35 TWh), residential segment (down by 0.92 TWh) and small and medium-sized enterprises (down by 0.46 TWh) partially offset by higher volumes sold to large customers (up by 5.46 TWh).

Refining & Marketing and Chemicals

Retail sales in Italy

Eni is a leader in the Italian retail market of refined products with a 25% market share, up by 0.7 percentage points from 2016. In 2017, retail sales in Italy were 6.01 mmtonnes with a slight increase compared to 2016 (about 80 ktonnes from 2016 or 1.3%). Average gasoline and gasoil throughputs (1,588 kliters) increased by approximately 40 kliters from 2016.

As of December 31, 2017, Eni’s retail network in Italy consisted of 4,310 service stations, down by 86 units from December 31, 2016 (4,396 service stations), resulting from the release of low throughput stations (25 units) and negative balance of acquisitions/releases of lease concessions (56 units) and of motorway concessions (5 units).

Wholesale business

Eni markets gasoline and other fuels on the wholesale market in Italy, including diesel fuel for automotive use and for heating purposes, for agricultural vehicles and for vessels and fuel oil.

Major customers are resellers, manufacturing industries, service companies, public utilities and transporters, as well as final users (transporters, condominiums, farmers, fishers, etc.). Eni provides its customers a wide range of products covering all market requirements leveraging on its expertise on fuels’manufacturing. Customer care and product distribution are supported by a widespread commercial and logistical organization presence all over Italy and articulated in local marketing offices and a network of agents and dealers.

Wholesale sales in Italy amounted to 7.64 mmtonnes, decreased by 0.52 mmtonnes or 6.4% from the previous year, mainly due to lower volumes marketed of gasoil, bunkering and fuel oil partly offset by higher sales of jet fuel and bitumens.

Supplies of feedstock to the petrochemical industry (0.86 mmtonnes) decreased by 15.7%.

 

Refining System

Eni’s refining system in Italy is composed by three wholly-owned refineries (Sannazzaro, Livorno and Taranto) and a 50% interest in the Milazzo refinery. Each of Eni’s refineries in Italy has operating and strategic features that aim at maximizing the value associated to the asset structure, the geographic location with respect to end markets, the integration with Eni’s other activities.

Moreover, Eni in Italy has converted the former refinery in Venice in a green refinery (the first example in the world of transformation in biorefinery) and initiated the green project conversion in the industrial site of the former refinery in Gela.

 

Sannazzaro: refinery has a balanced capacity of 200 kbbl/d and a conversion index of 73%. Located in the Po Valley, in the center of the North Italy, Sannazzaro is one of the most efficient refineries in Europe. The high flexibility and conversion capacity of this

refinery allows it to process a wide range of feedstock. The main equipments in the refinery are: two primary distillation columns and two associated vacuum units, three desulphurization units, a fluid catalytic cracker (FCC), two hydrocrackers (HDC), two

reforming units, a visbreaking thermal conversion unit integrated with a gasification producing a syngas used in a combined cycle power generation, and finally the Eni Slurry Technology (EST) plant, started up at the end of 2013. The EST plant exploits a proprietary technology to convert extra heavy crude residues (vacuum and visbreaking tar) into naphtha and middle distillates, with a conversion factor of 95%.

 

Taranto: refinery has a balanced capacity of 104 kbbl/d and a conversion index of 56%. Taranto has a strong market position due to the fact that is the only refinery in southern continental Italy, and is upstream integrated with the Val d’Agri fields in Basilicata (Eni 60.77%) through a pipeline. The main equipments are a topping-vacuum unit, an hydrocracking, a platforming and two desulphurization units.

 

Livorno: refinery, with a balanced refining capacity of 84 kbbl/d and a conversion index of 11%, is dedicated to the production of lubricants and specialties. The refinery is connected by pipeline to a depot in Florence (Calenzano). The refinery has a topping-vacuum unit, a platforming unit, two desulphurization units and a de-aromatization unit (DEA) – for the production of fuels; a propane de-asphalting (PDA), aromatics extraction and de-waxing units, for the production of base oils; a blending and filling

plant – for the production of finished lubricants.

 

Milazzo: jointly-owned by Eni and Kuwait Petroleum Italy, the refinery has balanced primary refining capacity of 100 kbbl/d (Eni’s share) and a conversion rate of 60%. Located on the Northern coast of Sicily, it is provided with two primary distillation columns and a vacuum unit, two desulphurization units, a fluid catalytic cracker (FCC), one hydrocracking unit for the conversion of middle distillates (HDC), one reforming unit and one unit devoted to the residue treatment process (LC-Finer).

 

Green refineries

 

Venice: green refinery entered into production in June 2014, with a production capacity of 360 ktonnes/y. The refinery exploits the proprietary EcofiningTM technology to transform vegetable oil in hydrogenated bio-fuels. A second phase of development is underway.

At full capacity, the refinery production will satisfy approximately half of Eni bio-fuels needs required for being compliant with the EU environmental normative aimed at reducing CO2 emissions.

Gela: in November 2014, Eni defined with the Ministry for Economic Development, the Region of Sicily and interested stakeholders a plan to reconvert this plant in a biorefinery. The reconversion activities are ongoing and in line with the commitments signed with parties. In August 2017 the project obtained the environmental impact

assessment and authorization (VIA/AIA) by the Italian Ministry of the Environment and the Ministry of Cultural Heritage. The project is expected to come on stream by the end of 2018. The refinery will have a capacity of 750 ktonnes/y. The conversion will leverage on the application of the EcofiningTM proprietary technology, developed and

licensed by Eni, to convert unconventional and second generation raw materials into green diesel, a highly sustainable biofuel. The plant properties will allow the production of green diesel in compliance with the last regulatory constraints in terms of reduction of GHG emissions throughout the whole production chain, deploying the full capacity in process second-generation feedstock.

Logistics

Eni is a leading operator in the Italian oil and refined products storage and  transportation business. It owns an integrated infrastructure consisting of 16 directly managed depots and a network of oil and refined products pipelines. Eni logistic model

is organized in three hubs (Southern, Central and Northern Italy).

These hubs manage the product flows in order to guarantee high safety and technical standards, as well as cost effectiveness. Eni is also in joint venture with six Italian operators (Sigemi, Petroven, Petra, Seram, Disma and Toscopetrol) to optimize its logistic footprint and increase efficiency.

Eni transports oil and refined products:

  • by sea through spot and long-term contracts of tanker ships;
  • through a proprietary pipeline network extending approximately 1,462 kilometers.

 

Secondary distribution to retail and wholesale markets is outsourced to independent tanker carriers, selected as market leaders in their own field.

 Oxygenates

Eni, through its subsidiary Ecofuel (100% Eni’s share), sells approximately 1 mmtonnes/y of oxygenates, mainly ethers (approximately 3% of world demand), and methanol. About 85% of oxygenates are produced in Eni’s plants in Italy (Ravenna), in Saudi Arabia (in joint venture with Sabic) and Venezuela (in joint venture with Pequiven) and the remaining 15% is purchased.

Offices and contacts

Corporate headquarters

Roma
Piazzale Mattei, 1
00144
Tel. +39 06 59 82 1
Fax +39 06 59 82 21 41

Milan
Piazza Ezio Vanoni, 1
20097 San Donato Milanese (MI)
Tel. +39 02 52 01
Fax +39 06 59 82 21 41

Operations headquarters

Exploration & Production
Via Emilia, 1 20097 San Donato Milanese (MI)
Tel. +39 02 52 01

Gas & Power
Piazza Ezio Vanoni, 1 20097
San Donato Milanese (MI)
Tel. +39 02 52 01

Refining & Marketing
Via Laurentina, 449
00142 Roma
Tel. +39 06 59 88 1

Chimica
Versalis Spa
Sede legale
Piazza Boldrini, 1- 20097 San Donato Milanese (MI), Italia
Tel +39 02 520.1
info@versalis.eni.com

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