2026 Eni Capital Markets Update

Alastair Syme, Citigroup. Al.

Thanks, John. I had a couple of questions on slide 21 on the cash flow growth, the 17 billion in 2030. Francesca, you made some comment about the cash tax rate. Could you tell us what rate we should assume in 2030 versus where it was in 2026? And then secondly, on slide 22, you've given all the cash in from the satellites over the period. Could you talk about how that's phased? Is there more of it coming in the back end of the profile?

About the cash tax rate. The tax rate that you have seen last year was in the range of 45%. You could expect this keeping a similar range in the coming two to three years, then dropping because the contribution from business combination clearly helps to reduce the tax rate. In terms of cash tax rate, the weight is in the range of 23%. Again, we will have a similar trend, relatively steady level and then dropping towards below 20% by the end of the plan.

It was really about the cash in from the satellites. You talk about a billion expected cash in?

The cash from the satellites. We were accumulating cash last year in the range of 2 billion, above 2 billion, through the dividend. By expanding the magnitude and the number of satellites, this will grow progressively. What we expect in the coming years is substantially to double that amount, that contribution, along the four-year plan.

Okay. So assume roughly 4 billion in 2030 then.

A good proxy. Yes. Clearly in our scenario.

Perfect. Sure. Great. Thank you.

Thanks, Al.

Okay. So hopefully that answered your question. We're going to move now to Alejandro Poggi at Mediobanca. Alejandro.

Good afternoon. Thank you for taking the questions. I have one on chemicals. I was wondering if you can give us perhaps new guidance on the break-even for the division. And the second question on cash flow guidance for 2026, if you can take us through the main moving parts for the 2026 guidance versus 2025.

Concerning the chemical scenario, compared to the previous one we have seen some deterioration, particularly stagnation in different markets and some lack of rebound of demand, in addition to a higher cost of feedstock for the chemical industry. This will have corresponded to two years of delay in our break-even of EBIT, but we are putting in place additional actions in order to mitigate one year at this moment, so we expect the break-even delayed by one year on the EBIT side. About the comparison between 2025 and 2026 cash flow from operations, we have to keep in mind that last year we benefited from a few one-off factors, mainly in Power, G&P, and E&P. This year we are also having the impact from the second half of the year of the 400 million of cash from operations that will be the net effect of moving Plenitude as a dividend contributor instead of cash flow from operations. For this reason we have raised the range in terms of distribution up to 45%. Overall, this year is actually an improvement like for like, removing all these one-off factors, by around 700 million versus last year.

Thank you, Alejandro. Thanks, Francesco. We're now going to move to Paul Redmond at BNP. Paul, if you're online.

Hi guys, thank you very much for your time. Two questions. First, on Eni Live, you've included a scenario assumption for refining margins which essentially fall and then plateau from 2028. Can you give me an update on your view on renewable fuel margins out to 2030 and whether that's different to what you're highlighting in your refining margin scenario? And then secondly on divestments. You're guiding to gross capex 29, net capex to 25 billion. That's 4 billion of divestments as I read it, with about 2 billion coming in 2026. Over the remaining four years you're not guiding to much in terms of divestment. How should we read that? Does that mean you're comfortable with where the portfolio stands?

Thanks for the question. On bio-refinery margin, we see increasing margins along the five-year business plan driven by strong fundamentals. Demand is expected to grow significantly, above 20 million in 2026, above 40 million in 2030, driven by policy. The Renewable Energy Directive number three from 14 to 29 is already in place, and in the US the RVO target is expected to increase by around 40%. We are already seeing market move upon expectations. REO is already $1.5 per gallon, pretty much a dollar above the level reached in the previous year, and margins are already significantly increasing. On the business plan, it's not just a matter of scenario but actually we are pulling all value creation levers to maximize results. It's capacity as a driver but also product optionality like SAF, feedstock flexibilization, maximizing the kind of feedstock we can process, and a strong contribution from agri production that gives us the unique competitive advantage of being fully integrated along the value chain. About the portfolio, this year we described a set of operations covering 2 billion as extra benefit but it doesn't include the benefit of the consolidation of Plenitude, which has a similar effect in terms of deleveraging. If you add that, the net effect for the year is more than doubling the amount of 2026. Similarly the amount over the plan will be almost double. We present every year a plan with a degree of visibility that progressively improves as a risked component, because we don't want to over-promise and instead we prefer to over-deliver. Through exploration and portfolio optimization we continue to generate optionality. So we are happy with our portfolio and also with the optionality embedded in it.

Thank you.

Thanks, Francesco. Thanks, Paul. We're now going to move to Matt Lofting at JP Morgan. Matt.

Thanks everybody for taking the questions. Congrats on the update. I think it's very reflective of the strength of strategic execution that Eni has delivered over the last few years. The 100% reserve replacement metric within the upgraded growth stands out. What are the key project FIDs or sanctions over the next few years that are required to deliver on that ratio, and whether there are particular projects that stand out disproportionately? And then secondly, it struck me that it was an important point on distributions, the rising quality of the dividend as cash break-evens fall. How are you thinking around the value proposition of buybacks as shares continue to re-rate, and to what extent is the move to 100% extra dividends above $90 reflective of that balance in terms of buyback versus dividend?

If I can add something about the capability to put new projects in production. It's true we have been very fast so we increase the reserve replacement, but also that comes from our exploration strategy. Our exploration strategy is really to focus exploration, reducing the risk where we have facility installations, and that clearly reduces the cost but also the possibility to go through the replacement ourselves very quickly. Everything starts from the strategy we applied in exploration in the last more than 10 years. That is another reason for low cost and the rapidity through which we can get this life index and replacement ratio.

About the buyback versus the dividend or the scope for the buyback. It's been almost a few years where we prove we are keen and able to share any upside with our investors during the year. So we set at the beginning of the year a conservative approach towards distribution. This is a floor, a promise we recognize immediately, and then during the year we execute our plan. We improve, we do better in production, disposals, execution, and sometimes there is improvement of the scenario. Actually in the last two years the scenario dropped during the year and in any case we were able to distribute more through an increased share dedicated to the buyback. This year, due to the exceptional conditions we are facing in the market, there is a continuous potential improvement in the magnitude of the buyback, but the possibility to execute a buyback is becoming less and less effective as the amount of cash flow grows, because there is a limitation in terms of trading per day or share that you could buy. For this reason, in a scenario above $90 we will be able to distribute more. We thought a one-off payment in the fourth quarter, decided in the third quarter, would be a way to execute that additional distribution. Taking into account gearing and the overall strength of the company in terms of investment opportunity, the one-off special dividend would be the more appropriate solution for sharing that upside.

Thank you, Francesco. And thank you, Matt. We're now going to move to Lydia Rainforth at Barclays. Lydia, if you'd like to ask your question.

Thanks, John. Two questions please. Coming back to the impressive upstream portfolio. You've talked in the slides of the FID schedule slippage being 5% versus the industry average of 15%, the FID cost growth lower as well. Just as you're doing more and more projects, how do you make sure you can keep that discipline? And then the second one is probably more for Francesco, to help me with my math. We're talking about returning 100% of additional cash to shareholders in the form of extraordinary dividends above $90. You talked about that being a 14 billion euro cash flow from operations bit. But we do have higher natural gas prices and higher refining margins. So is it 100% of any additional cash flow over that 14 billion euro level that gets returned, even if oil price is a bit lower but gas is a bit higher?

On how we keep track of this record and discipline. I like this word discipline on the delivery. We are building on our track record. We have the skills, the competencies. We've said several times that we never laid off people. We always took in-house the core competencies: G&G, engineering, production. We've maintained these competencies. We have an edge on technology, on super-high computational computing, on geographical diversification and diversification of the production mix. In the last 10 years, we've been the second largest in terms of FPSO built, second to Petrobras. But comparing with our peers, we are by far the largest in FBSO and floating LNG. We've trained our organization to build these units all along the years, and what is in front of us is exactly the same. We have to continue building FBSOs and floating LNG.

About the buyback versus the extra dividend. We're not limited. As we said during the presentation, the $90 is a trigger for the extra dividend, but potentially you could have a scenario where the average is 88 but on the other side you have a gas price or a refining margin that is much higher. Even in that case, we will distribute that excess cash flow 100% as extra dividend. Just to give you a ratio, it is substantially 50% above the current scenario, the current assumption in gas and Brent. It means $9 as a refining margin and around 54 euro per megawatt-hour for gas. These are the two equivalent numbers for the $90 Brent.

Thanks, Lydia. Just actually to add to what Claudio and Guido said, there was a nice stat in the slide pack: 90% of all the future production under development is either operated by Eni or one of Eni's affiliates. So the control over the pace of growth is very much in our own hands. Thank you, Lydia. We're going to move to Mark Wilson at Jefferies. Mark.

Thank you very much. On the growth to 2030 in the plan, the increased growth LNG, could I ask firstly, are both Argentina FLNG vessels included in that target? And I also note there has been talk of a third Mozambique FLNG vessel. Is that a potential, maybe not for 2030 but very close to it? And then secondly, about the business combination. I thought you said this included all of Petronas' production in Malaysia. Is that the case? And could you speak to how unprecedented it is for such a satellite setup with an experienced NOC like Petronas, and how the management will be set up?

On the LNG portfolio we're going to bring to market, the big share of the growth is underpinned by our upstream projects, notably Argentina, Cyprus, Mozambique, and Indonesia, where we have an approach which is mostly equity lifting. Our share of production is taken in our portfolio to be further marketed. We plan to have a 70% ratio in terms of equity LNG production into our overall contracted portfolio, which we expect to exceed 20 million tons by 2030.

Yes, I just wanted to get a comment on how precedented or unprecedented it would be for an experienced NOC like Petronas to set up a satellite venture like this with Eni, and how much of that Malaysian production that Petronas runs is going into it.

On the numbers, I'll shed a bit more light. We will include in the business combination all our Eni assets in Indonesia on production and blocks in exploration, barring the 10% mentioned by Francesco that will be monetized, 10% of our production assets in Indonesia. In Malaysia, we have five assets, two of which in Sarawak account for almost 70 to 75% of the total production, which will be contributed by Petronas, which is 230,000 barrels per day. The remaining 20 to 25% comes from three assets in the peninsula.

I think we can help you with some modeling offline if you want to contact the team. Thank you, Mark. We're going to move now to Massimo Bonosi at Equita. Massimo.

Thank you, John, and good afternoon. Two questions. One on the capex budget over the plan period. Gross capex is guided at 5.8 billion average per year, more than 2 billion lower than the previous plan, driven by FX, changing perimeter, and efficiencies. Can you detail the key drivers of the structural efficiency measures in capex? The second question is on Venezuela. What is the realistic pathway on monetizing gas resources there, like Perla, and can you provide more detail on the timing and magnitude of potential cash recovery from Venezuela?

On Venezuela. Recently we have signed an agreement to continue production of gas in a sustainable manner in the country, which includes the opportunity to export a consistent part of this gas. We should always remember that Perla is a giant reservoir and we are just producing a little portion of it. There is big room to improve. Equally on the oil component, both the last general license 50 and the new hydrocarbon law provide opportunity and room to increase oil activity in Venezuela. We have a positive view of the country. The mood has changed and more will come for sure.

Thank you, Massimo. We're going to move now to Chris Cupp at Bank of America. Chris.

Thank you very much for taking my questions. One more follow-up on the satellite venture. What's still pending from here to closing in terms of equity participation? Are you still potentially including a cash component before closing? And then a more generic question. Looking at your commodity price deck underlying your 2030 outlook, 85 Brent, $9 European gas prices, what do you think will prove to be most bearish? Anyone who would like to take that.

I will take the easy part, which is on the satellite venture. First of all, no money transaction here. What is outstanding? We've just obtained the antitrust clearance and we are waiting for the customary approvals, which essentially are the approvals of the two governments of Malaysia and Indonesia. We are progressing the financing plan to self-fund the joint venture, which we expect, because of the resource base, the strength of the two shareholders, and the quality of the asset, to be investment grade.

I think he's going to try the macro.

Thank you very much, Francesco. I appreciate the answer and I'll call you up separately to hear what price forecasts you might give us in certain scenarios. Thank you.

Thanks, Chris. I think just methodologically, I'll speak for us all here. Clearly we are in a very volatile environment. So the message we wanted to get across was the strategic direction of travel is unchanged. The downside is protected by a resilient financial framework, and as Francesco has talked about, the upside is captured and then delivered back to our shareholders. That would be the way we would think about it.

Great.

I appreciate that.

Thanks, Chris. We're going to move on to the last two questions. The second to last question is Alessandro Vigil at Santander. Alex, if you could ask the question.

Thank you very much for taking my questions and congratulations for the targets. The first question will be about the Eni Live 2026 target of 1.1 billion EBITDA, which looks like a conservative number looking at the strength we are seeing in renewable products margins. And the second question will be about Plenitude and the 15 gigawatts capacity target by 2030. What kind of returns and competitive environment are you finding in this market, just to see the value creation potential of these capex?

On biofuels, that's the target considering the current scenario on the budget. The current situation is providing extra room to overtake it, given that it is supportive for the biofuel scenario as well. Even the relative price towards high fossil prices is supportive. Second point, we are this month in a turnaround phase on the Venice biorefinery, where we are upgrading current settings. So nowadays results are driven by the Gela biorefinery and the US one. Among the three key pillars, one is going to be partially under transformation in order to bring extra performance after the end of this transformation.

Thank you, Alessandro, for your question. First of all, the Plenitude model integrates renewables with retail activity, and 70% of our projects lie in countries where we can exploit this model, like Spain, Italy, France, and Greece. The remaining 30% is in countries where we can employ technical advantage, knowledge, and market advantages. If you look at the projects, we foresee in the medium to long term an internal rate of return between 7% and 8% on the project itself, that can be uplifted by the integration model with retail activity and also by applying the leverage model, so leverage return increases by another 1.2%.

Thanks, Stephano. We're going to go to our final question now, which is Bertrand Rudy at Kepler. Bertrand, please.

Good afternoon. Thank you for taking my question. I was looking at your new sensitivities disclosed for 2026, both for oil and gas. Maybe you can explain why, because you're still growing, that both sensitivities are going down both for oil and for gas. For a $10 move in oil price, the sensitivity goes down from 1.4 billion to 1.1. And in gas, sensitivity goes down for a $10 per MMBTU move from 1 billion to 0.8. Can you give us a clue as to whether it is the satellite model, the dividend frame, or other portfolio mix? And then I will have a second question on Mozambique.

First of all on this question, which is technical but quite effective. We design sensitivity on a broader range of variation of prices. It is reported per dollar but it is calculated assuming $10, $20, or a range. Sensitivity generally works for a limited variation of prices because in contract mechanisms, particularly PSA, there are natural regressive effects. If the price spikes, cost recovery is absorbed faster and therefore there is less contribution. So you have to consider this assuming more than $10 or up to $20 of change. The second element, as you correctly spot, is that satellites protect you with their balance sheet through distribution policy, but they decide their distribution policy on the basis of their own boards and decisions. There is some kind of inertia in evolution. It is not a direct impact of prices towards dividend automatically as it could be in a normal free cash flow element. There is also a third element, a partial difference in terms of foreign exchange impacting comparison versus last year. Sensitivity will change every year by definition. In this case, we would like to give you the most appropriate factor to calculate the effect of a scenario with a larger volatility factor embedded.

Just a remark, the footnote on slide 28 is pointing that the variation is based on $10 and changed from 2025. And then on Mozambique, on Rovuma, Eni said it was targeting an FID this year. There's been some change in stakeholders on Coral Nord, with Coral owning now 50% and Exxon not participating. Should we still assume that on Rovuma, if it is FID'd, you will have a 25% stake?

I think at that point, thanks Bertrand. We are going to close the Q&A session. Thank you everybody for your attention and for your interesting questions. I think the team will look forward to seeing many of you in person over the coming weeks and discuss the strategy in more detail. Any questions or follow-ups, please don't hesitate to call me or any one of the team. With that, thank you very much and good afternoon.