Italian giant Eni sees oil peak just six years away By | Feb. 28, 2020, 6:27 a.m. | Share:
- Eni SpA predicted its oil and gas output will top out within six years as it announced a more ambitious climate plan, following the lead of peers in pledging to offset emissions from the fuels it makes and sells.The Italian energy giant sees output reaching a plateau in 2025 and targets an 80% cut in net emissions by 2050, it said Friday. That commitment illustrates the mounting pressure on oil companies to act on climate change -- not only from environmental activists but a growing proportion of major investors too.“The market is changing, our customers are changing,” chief executive officer Claudio Descalzi said on a conference call. “We are really building a new Eni.”The company’s plan expands on a previous goal to reach net-zero emissions from its own exploration and production operations by 2030. The new strategy refers to so-called scope 1, 2 and 3 emissions, covering “the entire lifecycle of the energy products sold and a 55 per cent reduction in emission intensity compared to 2018,” Rome-based Eni said in a statement.The raft of recent climate pledges by Europe’s major oil companies marks a big step for an industry that produces the bulk of the world’s planet-warming gases. Earlier this month, BP Plc stunned investors with a promise to eliminate emissions from its operations by 2050. It also vowed to halve the carbon intensity of the fuel it sells but doesn’t produce itself. That followed moves by Royal Dutch Shell Plc and Repsol SA to adopt new emission targets.“Eni is not the first international oil company to announce its intention to get on the right side of the climate debate, but it is now the most specific and aggressive,” Alastair Syme, an analyst at Citigroup Inc., said in a note. “Clearly management feel that inaction has too big a cost.”Eni’s oil and gas production will grow at an annual rate of 3.5 per cent up to 2025, followed by a “flexible decline, mainly for oil,” with gas making up about 85 per cent of total output by 2050. The company sees a “strong” ramp-up of renewables to more than 55 gigawatts of installed capacity in that period.What Bloomberg Intelligence SaysEni’s strategy shift “establishes the company as a leader among its integrated oil peers,” according to BI global energy analyst Will Hares. The new climate targets accompany a “gradual portfolio evolution into a predominantly gas and renewables company.”The expansion of renewables will be across a broad geographic area, with a focus on large-scale projects and potential for both partnerships and acquisitions, according to Eni.“In a few years, if you’re not able to deliver green products, you’re going to lose your customers,” Descalzi said on the call. “We need to make an evolution in our business.”Eni made its strategy presentation on the same day as it published fourth-quarter earnings. Profit missed analyst estimates as lower oil prices countered higher production, and as the refining and chemicals division posted a loss.© 2020 Bloomberg L.P.
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Feb 28, 2020
Italian giant Eni sees oil peak just six years away
By Bloomberg |Feb. 28, 2020, 6:27 a.m. |Share:
Eni SpA predicted its oil and gas output
Italian giant Eni sees oil peak just six years away By Bloomberg |Feb. 28, 2020, 6:27 a.m. |Share: Eni SpA predicted its oil and gas output