Eni Profits Rise with Better Margins

Italian producer Eni reported April 24 profits of €1.092bn ($1.15bn) for Q1 2019, up 15% on Q1 2018. Adjusted operating income was down 1% at €2.354bn, of which upstream (E&P) contributed €2.308bn (up 11%), Gas & Power €372mn (up 16%) and Refining, Marketing and Chemicals made a loss of €55mn, compared with last year's profit of €77mn. Eni sold 4.5% less gas, owing to mild winter weather.

Hydrocarbon production averaged 1.83mn barrels of oil equivalent/day, down by 1.3% net of price and portfolio effects. Negative effects including field decline and the ending of a Libyan production asset (Intisar) were almost completely offset by strong organic production increases at the Egyptian Zohr field and 2018 project start-ups, adding 200,000 boe/d in all.

CEO Claudio Descalzi said the E&P business had improved its operating profit by 25% compared with the first quarter of 2018, “confirming our expectations of the business growing cash generation for the full year. The results of the G&P segment also improved; the 16% increase in operating profit to €372mn puts us on the path to achieving our €500mn profit target for the full year.”

Capital expenditure was €1.6bn, mainly relating to new fields development and ramp-ups of fields started up in 2018. Progress at initiatives designed to increase 2019 production capacity are in line with plans, he said.