Eni Remains Fairy Valued Following a Fair Value Estimate Increase

Eni’s latest strategy to achieve carbon neutrality in 2050 mirrors that of many peers as it seeks to invest in new low-carbon businesses. However, as with others its legacy hydrocarbon business will remain the primary earnings driver during the next decade and command the majority of investment. It plans to grow production to 1.89 million barrels of oil equivalent per day, or mmboe/d in 2025 from 1.68 mmboe/d in 2021 while reducing its break-even level to below $25/bbl on average through 2025 and earning returns of 21% on new projects. Hydrocarbon production and investment post-2025 remain uncertain and market dependent, though management plans for natural gas to compose 90% of what will likely be a much smaller portfolio in 2050.