Following its assessment of the disruptions in the trading environment due to Covid-19 pandemic and amid a scenario of lower crude oil prices , Eni on Monday confirmed its decarbonisation strategy over the next 30 years that it said will contribute actively to the energy transition process, the Italian major said in statement on Monday.
“We confirm our strategy to become a leader in the decarbonization process, notwithstanding the enduring impacts of the COVID-19 pandemic on the global economy and the company," Eni's chief executive officer Claudio Descalzi said in a statement.
"We are assessing how to speed up our plans. This ongoing evolution will allow the company to achieve a better balanced portfolio, reducing the exposure to the volatility of hydrocarbon prices, while progressing towards our targets of sustainability and profitability.
The distinctive element of this strategy – as Eni earlier announced to the market - is the fixed 2050 absolute emissions reduction target of 80% covering all of the company’s products, according to the statement.
This target well above the 70% threshold indicated by the International Energy Agency in the Sustainable Development Scenario that tracks the reduction of emissions compatible with the 2015 Paris Agreement - a global pact to fight climate change.
"The even more sustainable evolution of Eni’s business model is underpinned by maintaining rigorous financial discipline in capital allocation and a robust capital structure," said the statement.
In view of the COVID-19 pandemic having an enduring impact on the global economy and the energy outlook, Eni said has revised its view of market fundamentals to "factor in" certain emerging trends. The revised scenario adopted by Eni foresees a long-term price of the marker Brent of 60 $/barrel in 2023 real terms compared to the previous assumption of 70 $/barrel.
For the years 2020-2022, Brent prices are seen respectively at 40, 48 and 55 $/barrel (compared to the previous assumptions of 45, 55 and 70 $/barrel), said the statement.
"Based on information available to management and on the current progress of assessments, Eni currently expects to record in the results of the second quarter 2020 estimated non-cash, post-tax impairment charges against non-current assets, including a devaluation of tax credits recorded in connection with tax-losses carryforwards, of € 3.5 billion, plus/minus 20%," the statement said.
"At its mid-point, this estimation represents a limited decrease of around 4% in the value of non-current assets," the statement went on.
Eni’s consolidated results for the second-quarter 2020 due to be released on 30 July, the statement added.
Eni’s interim consolidated financial report for the first half of 2020 is due to be published by the first week of August upon completion of a limited review by the Group’s independent external auditors, the statement concluded.