Capex Data
In 2008, management expects to spend approximately €13.3 billion on capital expenditures, up 25% from 2007 (€10.59 billion in 2007). Major increases are expected in the development of oil and natural gas reserves, upgrading of construction vessels and rigs, and of natural gas transport infrastructures.
On the basis of planned cash outflows to fund capital expenditures, the completion of the acquisition of Burren Energy, and shareholders remuneration, management expects the Group's leverage to achieve a level in line with 0.38 as reported in 2007, assuming the revised Eni's scenario for Brent prices at 88 $/barrel for 2008 full-year and absent any further acquisition. Assuming also the exercise of the call options granted to Gazprom to purchase stakes in Eni's Russian assets (these include a 20% interest in OAO Gazprom Neft and a 51% interest in three gas companies), management's expects the Group's leverage to come in below the level reported in 2007.
Future Plans
Outlook for 2008
The outlook for Eni in 2008 remains positive, with key business trends for the year as follows:
- Production of liquids and natural gas is forecast to be greater than in 2007 (actual oil and gas production averaged 1,736 mmboe/d in 2007) also in a high oil price environment. Management expects a full-year production level in excess of 1.8 mmboe/d assuming Eni's original planning scenario for Brent prices at $64/bl.
Additional production flowing from assets acquired in 2007 in the Gulf of Mexico and Congo, Burren Energy assets from the start of the year, as well as field start-ups in Angola, Egypt, Venezuela, Congo, and the USA will sustain production performance against expected mature field declines.
- Worldwide natural gas sales are expected to increase by approximately 4% over 2007 (actual sales volumes in 2007 were 98.96 bcm) driven by strong seasonal sales in the quarter and international growth. The increase expected to be achieved in international sales will be driven by growth in a number of markets in the Rest of Europe, mainly in France, Iberian Peninsula and Turkey, and in the LNG business.
- Refinery throughputs are expected to be unchanged from 2007 (actual throughputs in 2007 were 37.15 mmtonnes). Higher throughputs are forecast at the Ceska Refinerska as a result of the acquisition of an increased stake in 2007. This improvement will be partly offset by an expected decrease in Italy due to facility downtime at the Venice refinery.
- Retail sales of refined products are expected to increase by approximately 2% from 2007 level (11.8 mmtonnes were the comparable volumes achieved in 2007, which exclude volumes marketed in the Iberian Peninsula in 2007) driven by higher sales in Europe due to the full contribution of assets acquired in 2007 in Central-Eastern Europe.