Eni S p A : for 2023 – A Just Transition (printable version)

The global context presents us with complex, fragmented and constantly evolving dynamics. The two wars, in the Middle East and Ukraine, among all, give us back a socio-political and energy volatility that calls into question our feeling of personal and communal security, undermining the certainties on which we used to base our actions and oper- ations. At the same time, however, we are called upon to find answers to these challenges and to give our support. Energy remains a crucial junction, since it inherently provides a sense of security and opportunities for development: the energy transition is irreversible, and we must ensure its realisation without sacrificing the production system and social sustainability.

For Eni, 2023 has been the 70th anniversary year, an opportunity to reflect on the distinctive features of the com- pany's journey: the ability to evolve and anticipate changes, the willingness to take new paths, while holding on to our

shared values and, last but not least, our commitment to generate value for all our stakeholders. In designing and embarking on our path towards a just energy transition, we have been able to initiate a radical change, both industrial and cul- tural, focusing on scientific research and innovation, starting with the technologies we have developed. Significant investments in research and development have put Eni in the position of operating with the aim of progressively decarbonising its activities and transforming its industrial processes, products, and services, which allow to generate new businesses for the energy transition, along with new opportunities for Eni and the people and territories involved.

Eni has made decarbonization an integral part of its business strategy to achieve carbon neutrality by 2050, with clear intermediate targets. In 2023, we achieved a 40% reduction in net Scope 1 and 2 emissions in the Upstream sector and a 30% reduction of the total com-

pany's emissions compared to 2018. Particular attention is given to reducing methane emissions, an issue on which Eni has been a frontrunner for several years, also contributing to the reduction of its sector emissions. For this reason, Eni is part of numerous international initiatives, including the World Bank's Global Flaring and Methane Reduction fund, which helps Governments and operators in developing countries to eliminate routine flaring and reducing methane emissions to near zero target by 2030.

Over the past year, methane emissions from the Upstream business have been reduced by more than 20%, also through the measurement and reporting cam- paigns, whose accuracy has enabled Eni to obtain the 'Gold Standard' recognition under the Oil & Gas Methane Partnership 2.0 programme promoted by the United Nations Environment Programme (UNEP). We have also signed agreements to support our partners'

work in this area, such as Sonatrach in Algeria, EGAS in Egypt, and ADNOC in the United Arab Emirates.

Eni has also actively contributed to facilitate the dialogue with stakeholders and the Presidency of COP28 - the United Nations Climate Change Conference

• and it was among the first companies to join the Oil & Gas Decarbonization Charter (OGDC) initiative.
  In line with the agreement reached at COP28, Eni agrees with the need for a progressive reduction ('transitioning away from') of fossil fuels while rec- ognising that this transition must take place in a fairy, orderly and equitably manner. In this perspective, both Eni's acquisition of Neptune Energy, a lead- ing company in exploration and pro- duction with more than 70% of its port- folio in the gas sector, and the start-up of the production from the Congo LNG project are part of a response to Eni's need to increase access to safe and low-emission energy such as natural gas, which is essential to accompany the energy transition.
  In addition, we started the production from Baleine field, in the Ivory Coast, the first project in Africa's Upstream sector with net zero Scope 1 and 2 emissions.
  Decarbonising also means taking ad- vantage of new opportunities that transformation offers us. COP28 sup- ported an approach that focuses on the solutions that accelerate the transition: they are all part of Eni's strategy, and we consider it crucial to apply them ac- cording to the geographical context and cost-efficiency logic.
  Also, we are integrating traditional activ- ities with transition-related businesses, leveraging proprietary technologies, and developing a satellite model based on the creation of independent entities that can independently access the cap- ital market to grow and enhance their business. For example, the expansion in the renewable sector, where Pleni- tude reached 3 GW of installed capacity from renewable sources in 2023 as it was planned, and the birth of Enilive, a company aiming at a more sustainable

mobility transformation. The actions implemented have allowed the achievement of a 21% reduction in the Net GHG Lifecycle Emissions indicator (Scope 1+2+3) compared to 2018. We are fully committed to offering our customers an increasingly comprehensive range of progressively decarbonized products and services, contributing to reduce the emissions that the energy products sold by Eni generate throughout the entire value chain.

In 2023, we also achieved major breakthroughs in our Carbon Capture

• Storage projects, a key lever of de- carbonization, especially in the United Kingdom, where we reached an agree- ment in principle with the Department of Energy Security and Net Zero on the key elements of the economic, regu- latory and governance model for CO2 transport and storage at the HyNet North West cluster.
  On this path, convinced of the crucial role of chemistry from renewable sources, we also completed the acquisition of No- vamont by Versalis, in line with our strat- egy of transformation and repositioning of the chemical business according to the drivers of: portfolio specialisation, circularity and biochemistry.
  In tackling the transition, Eni is firmly committed in safeguarding the health and safety of people and the integrity of its assets, and also protecting the environment, biodiversity and water re- sources. Furthermore, a commitment to respect human rights underpins our ac- tivities: our Code of Ethics and the new Policy 'Respect for Human Rights at Eni' explicitly state this, and we demand the same promotion and protection from all the stakeholders with whom we main- tain relations.
  For Eni, Just Transition translates into a commitment to managing the social im- pact of transformation, maximising the opportunities for conversion of existing activities and development of new sup- ply chains that consider the Countries' specificities. We are convinced that a sustainable transition must be inclusive and able to bring tangible benefits to all

communities involved, in the name of the 'dual flag' model, working in partnership with local governments, institutions and organisations such as the ILO (International Labour Organisation), to improve the occupational safety and health of farmers in agri-feedstock supply chains, and IRENA, to promote the development of skills for the transition. In the Countries where we operate, business activities are always accompanied by action plans that respond to the needs of the territory, improving job opportunities, and access to education, health, water, and energy. An interesting example is the Oyo Centre of Excellence for Renewable Energy and Energy Effi- ciency, promoted and supported by Eni and managed by the Ministry of Higher Education, Scientific Research and Technological Innovation of the Republic of Congo and together with UNIDO (United Nations Industrial Development Organisation).

The strategic path that Eni has undertaken and the future progress cannot be separated from our colleagues and partners' skills, ideas, and team spirit: in this sense, collaborations with insti- tutions, public and private stakeholders, international and civil society organisa- tions, universities, research institutes, and innovation hubs are fundamental. The awareness of the value of our skills and of these partnerships, the desire to integrate those who work alongside us, the sense of responsibility for the communities that host our activities worldwide are and will continue to be crucial elements for achieving the results that Eni has set itself.

Claudio Descalzi

Chief Executive Officer

With over 32,000 people, Eni is facing the triple challenge of ensuring affordable, reliable and increasingly sustainable energy that are essential for the function of the economy and society. In addition to focusing on a decarbonization strategy for the Group's products and industrial processes, with the aim of Carbon neutrality by 2050, Eni is committed to a socially fair and just energy transition, as stated in its Mission. This includes concrete actions to promote universal access to efficient and more sustainable energy by focusing on innovative and proprietary technological solutions, diversifying energy sources and while generating long-term shared value. To pursue a Just Transition, costs must be distributed fairly, without burdening vulnerable communities, introducing concrete plans and adopting alternative solutions that safeguard different geographies and actors while considering the whole system overall. The strong involvement of top management and the inclusion of all its people demonstrate Eni's ongoing commitment to ensuring the dissemination of core values for an ethical and socially just energy transition.

2023 KEY FACTS

7061

SUSTAINABLE MOBILITY

Enilive is born // JV with PBF Energy for the St. Bernard biorefinery in the USA // Feasibility study with LgChem for new biorefinery

in South Korea // HVOlution, the first 100% renewable feedstock diesel launched

(EU Directive) // Kenya Airways makes first flight from the African continent with SAF (Sustainable Aviation Fuel) supplied by Eni

RENEWABLES AND BIO CHEMISTRY

Inauguration of photovoltaic plants in Texas and Kazakhstan // Dogger Bank for offshore wind energy field in the UK goes into production // Agreement (completed in 2024) with Energy Infrastructure Partners (EIP) to enter Plenitude's share capital // Versalis completes the acquisition of

Novamont

EXPLORATION AND UPSTREAM

Growing role of gas with the discovery of Geng North in Indonesia and Nargis in Egypt // New Mexican offshore discovery // Start of production at Baleine in the Ivory Coast // Launch of the Congo LNG project with the introduction of gas into the Tango FLNG liquefaction plant // Acquisition of Neptune and Chevron's assets in Indonesia // Signature of a long-term LNG supply contract in Qatar

PEOPLE

Partnership with the International Labour Organization (ILO) to improve occupational safety and health of farmers involved in agri feedstock supply chains // Letter of Intent with Dompé for research on the health of people and communities

• Extraordinary action plan adopted to support 20,000 non-managementemployees

Eni's activities in the world

AMERICAS

1. COUNTRIES

EUROPE

22 COUNTRIES

5

10

18

12

AFRICA

12 COUNTRIES

12

3

7

ASIA AND OCEANIA

19 COUNTRIES

13

3

9

2

DECARBONIZATION

Achievement of the Gold Standard under the UNEP OGMP 2.0 programme, the UN programme for the environment // Emission reduction agreements with Sonatrach, EGAS and ADNOC // Participation in the COP28 Oil & Gas Decarbonization Charter and the World Bank's GFRM Fund to reduce methane and gas

flaring emissions

CAPACITY BUILDING

Launch of the first international network on energy transition in Africa, born from the collaboration between Eni and Luiss University // Inauguration of the Oyo Centre of Excellence for Renewable Energy and Energy Efficiency with UNIDO in the Republic of Congo // Training and job placement at the Centre of Excellence for Access to Employment in Port Said, Egypt

CARBON CAPTURE AND STORAGE

Strengthening of Eni's role in the UK for the development of the first regulated CCS business, with HyNet North West and the storage licence for Bacton // In Italy,

the Ravenna CCS project in the European list of Projects of Common Interest

INNOVATION

Agreement with CFS (Commonwealth Fusion Systems) to accelerate the industrialisation of fusion energy // Launch of ROAD (Rome Advanced District), a hub dedicated to technological research // Creation of Enivibes, a venture that enhances proprietary technology for pipeline monitoring

DEVELOPMENT OF

AGRI-FEEDSTOCK

PURCHASE

OF GAS FROM

THIRD PARTIES

OIL & GAS

PRODUCTION

PURCHASE OF BIO AND RENEWABLE RAW MATERIALS, WASTE AND RESIDUES