Home Energy assets Eni promises more gas for Europe to reduce reliance on Russia, Energy News, ET EnergyWorld

Eni promises more gas for Europe to reduce reliance on Russia, Energy News, ET EnergyWorld

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MILAN: Italian energy group Eni said on Friday it could provide additional gas to Europe to help reduce dependence on Russian supplies following Moscow’s invasion of Ukraine.

Eni has pledged to set out its strategy until 2025, promising investors better returns and promising to accelerate the pace of its climate ambition to be carbon neutral by 2050.

“We are leveraging our global upstream business and partnerships with producing countries to find alternative sourcing opportunities for Europe,” Chief Executive Claudio Descalzi said on a conference call.

The European Union, which depends on Russia for 40% of its gas and 27% of its oil, has proposed plans to replace nearly two-thirds of Russian gas imports this year and aims to phase out dependence on regard to all Russian fossil fuels by 2027.

Eni could supply more than 14 trillion cubic feet (TCF) of additional gas resources in the short and medium term, including from Algeria, which has a gas pipeline to Italy, and Egypt, where Eni is also active.

Eni’s current gas reserves and resources are 50 TCF.

Eni could supply 15 million tonnes per year of liquefied natural gas (LNG) by 2025, based on increased production from Congo, Angola, Egypt, Indonesia, Nigeria and Mozambique.

Eni is Africa’s largest foreign oil and gas producer, has grown rapidly in the Gulf and is looking to expand in Asia.

“We are increasing our gas production and will send to Italy and southern Europe all the gas we find,” Descalzi said.

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But Eni said producing more gas would not mean abandoning the company’s climate targets. Like its peers, Eni is revamping its oil and gas business and turning to renewable and low-carbon energy which will form the backbone of the business going forward.

He said he would cut absolute emissions by 35% by 2030, compared to 2018 levels, and by 80% by 2040, giving more ambitious targets than previously announced.

Listing plans for Plénitude, Eni’s renewable energy and retail business, were continuing despite the Ukraine crisis and a registration document for the process was filed, he said.

The company plans to create a sustainable mobility business combining biofuels and service stations, Descalzi said, adding that it was too early to say if it could be listed.

Eni is divesting assets to help fund its renewable and low-carbon energy business. It plans to raise 3 billion euros ($3.3 billion) through these portfolio management moves through 2025.

The company will launch a €1.1 billion share buyback, if shareholders back the move in May, with room for more if Brent oil stays above $90 a barrel. Brent was $107 on Friday.

Eni increases its annual dividend to 0.88 euro per share from 0.86 euro.

“The free cash flow outlook is really strong… Eni is clearly on track to deliver secure energy, it’s a good strategy,” said Jason Kenney, energy analyst at Santander.

($1 = 0.9062 euros)