Italian Major Eni Uses Record Profits to Double Down on Fossil Fuel Investments

FOR IMMEDIATE RELEASE

May 10, 2023

Contact:
Valentina Stackl, Oil Change International Media Officer, valentina@priceofoil.org
Andrea Ghianda, ECCO,  andrea.ghianda@eccoclimate.org

Italian Major Eni Uses Record Profits to Double Down on Fossil Fuel Investments
Eni invested 15 times more in fossil fuels than in its renewables segment in 2022, on track to rank third among worst upstream oil and gas expanders this year
ROME, ITALY — Ahead of the Eni shareholder meeting, Oil Change International released Big Oil Reality Check 2023: Eni, exposing the Italian oil and gas major’s energy strategy as grossly misaligned with global efforts to stem the climate crisis. While Eni attempts to portray its business model as part of the energy transition, the company continues to prioritize oil and gas investments that fuel more climate chaos. In 2022, Eni invested 15 times more in fossil fuel-dominated business segments than its “Plenitude” segment that includes some renewable energy, while raking in record profits.

The briefing warns that Eni is on the cusp of greenlighting a new surge of oil and gas extraction. Eni could rank third among companies globally in 2023 in the volume of new oil and gas reserves approved for development, behind only QatarEnergy and Petrobras. Furthermore, Eni plans to increase its oil and gas extraction by 3-4 percent per year through 2026.

Kelly Trout, Oil Change International Research Co-Director, said: 

“Eni’s plans are in stark contrast to the Intergovernmental Panel on Climate Change’s findings that the world has already built too much fossil fuel infrastructure and that oil and gas production must decline substantially by 2030 to limit warming to 1.5ºC.

“Eni reported its record 2022 profits of €13.3bn (14bn), and the company has chosen to keep pouring money into oil and gas extraction and big payouts to shareholders, instead of transitioning to clean, renewable energy. Our analysis shows that in 2022, almost 90 percent of Eni’s year-on-year increase in capital expenditure was directed towards oil and gas extraction and exploration activities.”

David Tong, Oil Change International Global Industry Campaign Manager, said: 

“Eni’s pledges and plans are grossly insufficient in comparison to what is needed for alignment with the Paris Agreement. We need to keep oil, fossil gas, and coal in the ground and transition to clean, renewable energy as quickly as possible.

“Eni is moving in exactly the wrong direction, prioritizing investments that fuel more climate chaos. By Eni’s own calculations, its business activities in 2022 generated 419 million tonnes of net carbon emissions worldwide. That means that in 2022, Eni emitted more climate pollution than the entire country of Italy.

“We call on Eni to stop investing in new oil and gas extraction and exploration projects and instead pay for its climate damages and a just transition for workers and communities affected by the phase-out of fossil fuels. We need bold and immediate action to prevent climate catastrophe, and Eni’s plans are only accelerating us towards disaster.”

Luca Iacoboni, ECCO Head of Outreach and Strategy for Decarbonisation, said: 

“Eni is emerging globally as one of the main oil and gas companies still heavily focused on fossil activities with a high climate and environmental impact. The company plays on the misconception of gas as a transition fuel, continuing to invest in the fossil sector, often exploiting the guarantees and diplomatic role offered by the Italian state, which is its largest shareholder.

“Fossil fuel giants like Eni must radically transform themselves to survive the transition and make it an opportunity for growth. To do so, it is necessary to rapidly shift investments from fossil fuels to technologies compatible with climate goals. The risk goes much beyond climate. Demand for gas in Europe, according to estimates by the European Commission and the International Energy Agency, will fall by 40% between 2019 and 2030. According to Snam-Terna and RSE, Italy’s demand will drop by 21% and 34% respectively. We wonder to whom will ENI sell gas in 2030?  Will Descalzi’s confirmation at the helm of Eni be a continuation of risky and dangerous fossil investments – perhaps supported by public guarantees -, or will it be the chance to make the energy transition a driver of growth and innovation?”

Antonio Tricarico, Programs Director at ReCommon, said:

“The decarbonisation of Eni’s business remains a mirage and the sustainability-linked bond recently issued by the company is just smoke and mirrors. The Italian government, which still controls 30 percent of Eni, has chosen the confirmation for another three years of a CEO whose priority is to increase oil and gas production until at least 2030 and push for fossil gas expansion for the next decades. Despite the highest record profits ever, the company will invest 80 per cent in new oil and gas, selling the fairy tales of carbon capture and nuclear fusion that are unlikely to see reality.

“Because of this, the government and the company have decided to blatantly violate the goals of the Paris Agreement. It is time for investors who want to act against the climate crisis to make their voices heard before it is too late.”

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Note to Editors

The full briefing can be found here: https://oilchange.org/eni-reality-check.