Eni Announces Strategic Plan, Targets for 2007-2010

Paolo Scaroni, CEO of Eni, on Friday presented the company's 2007-2010 strategic plan to the financial community. The new industrial plan is focused on growth across all Divisions. Over the 2007-2010 period Eni will continue to create value for its shareholders through the implementation of a disciplined investment program, focused on increasing growth and efficiency throughout the business.

Exploration and Production

Eni's strategy in E&P confirms the company's objective to deliver industry leading production growth, targeting hydrocarbon production in excess of 2 million barrels of oil equivalent per day by 2010, representing a 3% average annual increase. Moreover, we expect growth to remain strong beyond the plan period, and aim to reach an average annual production growth of 3% to 2013.

Increases in production will be achieved through organic growth in core areas such as North and West Africa and the Caspian region, which are among the fastest-growing producing regions in the world. Eni will build on its unique position in such areas and on its exposure to world-leading projects.

The large Kashagan project has revealed potential above initial expectations. Plateau production is now forecast to exceed 1.5 million barrels of oil equivalent per day, with first oil from 2010.

Gas and Power

Eni confirms its objective to strengthen its leading position in the European Gas Market. Eni aims to reach a cash flow generation of up to 2.1 billion euro by 2010, representing an average annual growth of 3%. This will be achieved by leveraging on the company's unrivalled supply portfolio and its unique European infrastructure network.

Eni will increase its total gas sales by an average of 10% a year over the period to over 105 billion cubic meters by 2010, including 50 billion cubic meters of gas sold in the Italian market. In Italy, the commercial strategy will focus on the launch of the dual offer of power and gas, leveraging on our large costumer base and our power generation assets.

Refining and Marketing

Eni's strategy in the R&M Division will be to maximize returns from the existing assets, targeting an EBIT increase of 40% by 2010 based on the 2006 scenario, through focused investments and the implementation of an efficiency program across the businesses.

In particular, in refining, Eni will continue to upgrade its assets in order to increase both throughput and conversion index to best-in-class European standards.

In marketing, Eni aims to increase sales through the improvement of service levels and by broadening its non-oil offering.

Cash allocation

In order to implement its growth strategy Eni plans to invest 44.6 billion euro in 2007-2010. This represents a 20% increase on the previous plan. At the same time Eni has launched the first round of an efficiency program that will enable the company to reduce costs by approximately 1 billion euro by 2010 through process streamlining and procurement optimization. In the 2007-2010 period Eni will continue to create value for its shareholders and undertake a sustainable dividend plan targeting a top dividend yield performance.

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