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					Taking actions
for sustainable development

Eni and Sustainability 2006
                                                                                                                   5   Letter from the Chief Executive Officer

                                                                                       The Eni “identity card”    6
                                                                                                                   7   Added value distribution to stakeholders
                                                                                                                   8   History and keywords
                                                                                                                  10   Eni today

                                                                    Commitment to sustainable development         12
                                                                                                                  13   The Sustainability Project
                                                                                                                  14   Challenges, Commitments, Results


                                                                     Governance and stakeholder engagement        16
                                                                                                                  18   The governance structure
                                                                                                                  20   Stakeholder engagement


                                                                                                   Our people     22
                                                                                                                  24   Health and safety
MISSION
                                                                                                                  26   Management and development of human resources
We are a major integrated energy company,                                                                         27   Internationalization
committed to growth in the activities of finding,                                                                 27   Industrial relations and human rights
                                                                                                                  28   Equal opportunity and Diversity
producing, transporting, transforming and marketing
oil and gas.                                                          Energy and environmental responsibility     29

Eni men and women have a passion for challenges,                                                                  31   The development of natural gas and its use in the production
                                                                                                                       of electricity
continuous improvement, excellence and particularly
                                                                                                                  33   The Kyoto Protocol: Emission Trading and Flexible Mechanisms
value people, the environment and integrity.                                                                      34   A sustainable energy system
                                                                                                                  34   Development of fuels with a lower environmental impact
                                                                                                                  35   Reducing of the ecological footprint and protecting biodiversity
                                                                                                                  36   Investments and expenditure for environmental protection


                                                                      Innovation for sustainable development      37


                                                      Relations with the territory and community development      41
                                                                                                                  42   Dialogue with local stakeholders
                                                                                                                  43   Social Impact Assessment
                                                                                                                  44   Areas of intervention

                                                                                Sustainability indicators table   46
                                                           E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / L E T T E R F R O M T H E C H I E F E X E C U T I V E O F F I C E R




                                   Letter
                          from the Chief
                        Executive Officer
                                                                                Paolo Scaroni




In 2005, Eni achieved the best operating and financial results                  social and cultural diversities, the human rights of the local
in its history. During the first part of 2006, we improved                      populations, their territories and the environment. Our
them even further, laying the foundations for a new year of                     commitment is aimed at improving the quality of life and
growth and the creation of value.                                               the development of the communities we interact with.
We believe that this is the best scenario for redefining the                    Eni believes that on the basis of current knowledge, the mas-
framework of our commitments and initiatives, so as to                          sive use of fossil fuels is contributing to planetary climate
ensure the sustainability of our results over time and to con-                  change, and we are committed not only to meeting energy
tribute to sustainable development. For this reason, in Febru-                  needs, but also to promoting energy efficiency and conser-
ary of this year, we initiated a project that further strengthens               vation for the protection of the environment.
and integrates our sustainability objectives into our business                  In support of our growth model, we have reaffirmed our
model.                                                                          commitment to technological innovation which aims, on
While pursuing this path, we are following the principles of                    the one hand, at providing our core business with the tech-
our corporate culture, drawing on our history, on the values                    nologies needed to acquire competitive and long-lasting
we have consolidated over time, on the responsibility,                          sustainable advantages, and on the other hand, at develop-
expertise, and passion of all the Eni men and women. In                         ing innovative processes and products capable of determin-
doing so, however, we wish to map out our route in innova-                      ing mid- to long-term technological discontinuity factors in
tive directions in order to respond to the challenges that                      the industry.
stand before us.                                                                We are constantly involved in updating our models for coop-
In this document, serving as an introduction to the Sustain-                    eration with hydrocarbon producing countries, in order to
ability Report that will be published starting from next year,                  overcome the critical state of the current global energy sys-
we have brought together our vision, strategies, and com-                       tem. We will be working ever more closely with our partners
mitments vis-à-vis governance, our people, environmental                        on contractual schemes and integrated projects.
responsibility, technological innovation, and relations with                    The search for sustainability which runs throughout Eni’s
the territory and the communities. We have reported on                          organizations, uniting them in a common purpose and
specific examples of how Eni operates and has operated, in                      strengthening relations with stakeholders, combined with
the awareness that proper management of these issues is a                       the cutting-edge approach that has always distinguished
key factor for success.                                                         our company, is destined to give an increasing contribution
As regards the values that stand at the base of our behaviours,                 to our success.
we recognize the central importance of safeguarding and
empowering our people, of developing the capabilities and
skills of each employee, so that the energy and creativity of
individuals can find expression to fulfil their potential, of main-
taining a work environment that offers everybody the same
opportunities based on a universally applied merit system.
Operating in over 70 countries has taught us to respect


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E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / T H E E N I “ I D E N T I T Y C A R D ”                                                                     E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / T H E E N I “ I D E N T I T Y C A R D ”




                                                                                          Added value distribution
                                                                                          to the stakeholders
The Eni “identity card”
                                                                                          The creation of value for stakeholders is one of Eni’s pri-
                                                                                          mary objectives and has been confirmed by the econo-
                                                                                          mic and financial results of the year 2005. The following
                                                                                          charts show the added value distribution, that is to say,
                                                                                          the wealth created by Eni for its main stakeholders.


                                                                                          Added value for 2005 (million euro)

                                                                                          Value of production                                  74,526
                                                                                          Other income (financial and equity investments)         851
                                                                                                                                                              16% Human resources
                                                                                          Purchase of goods and services                      - 48,567
                                                                                                                                                              39% State and Public Administrations
                                                                                          Amortization                                         -5,509
                                                                                                                                                               1% Financial backers
                                                                                          Write downs                                            -272
                                                                                                                                                              19% Shareholders
                                                                                          Net added value                                     21,029
                                                                                                                                                              24% Company System



                                                                                                                                                         Net profit for Eni in 2005 reached the record level of
                                                                                                                                                         euro 8,788 million. Total shareholder return was 35.3%.
                                                                                          Added value distribution for 2005 (million euro)               The dividends paid amounted to euro 5,070 million. Eni
                                                                                                                                                         continued its share buy-back program for a total
                                                                                          Human resources                                       3,351    amount of euro 1,034 million (7.04% of share capital).
                                                                                          State and Public Administrations                      8,128    Capital expenditure was euro 7,414 million, 35% greater
                                                                                          Financial backers                                       303    than amortization and depreciation.
                                                                                          Shareholders                                          4,096
                                                                                          Company System                                        5,151
                                                                                          (portion of net profit reinvested in the company)




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E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / T H E E N I “ I D E N T I T Y C A R D ”                                                                                                                                                                                                                                                     E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / T H E E N I “ I D E N T I T Y C A R D ”




                                                                                                                    The macro-economic context
    The Eni History                                                                                                 and development phases

    1950 - 1969                                                                                                        1970 - 1989                                                                                         1990 - 2006
    The years during which oil replaced coal as the main energy                                                        Two major energy crises follow each other in the 1970s                                              Oil consumption grows as a result of globalization
    source. The market is dominated by the “Seven Sisters”                                                             (1973 and 1979). Oil concessions in the Middle East                                                 and economic development. In 1991 the First Gulf War breaks
    (Exxon, Shell, BP, Gulf, Texaco, Chevron, Mobil).                                                                  are nationalized. The high prices push the West toward energy                                       out. During the 1980s, oil prices stay low (down to a minimum
    In 1960 OPEC - the Organization of the Petroleum Producing                                                         saving. During the 1980s, the war between Iran and Iraq                                             of $10 USD per barrel in 1999). In 2001, the attack on the Twin
    Countries - is founded, representing two-thirds of the world’s                                                     is fought. New producer frontiers are opened up in non-OPEC                                         Towers in New York and a new phase of international instability,
    oil production at the start of the 1970s.                                                                          territories. Italy adopts a National Energy Plan with regulated                                     leading to the outbreak of the Second Gulf War in 2003.
    These are the “economic boom” years in Italy, also leading                                                         prices for energy supply.                                                                           The sustained demand and international tensions drive oil
    to the growth of energy consumption needs.                                                                         Italy reduces its dependence on oil products for energy                                             prices to over $70 USD per barrel. During the 1990s Italy
                                                                                                                       consumption.                                                                                        initiates privatization and market liberalization processes.
                                                                                                                                                                                                                           The Euro is born.

     Eni Hydrocarbon Production                                                                                                                                                                                                                                   #                   Eni S.p.A. stock exchange
     (Thousands of boe/day)                                                                                                                                                                                                     #                                 1999
                                                                                                                                                                                                                                                        Agreement with Gazprom                     capitalization
                                                                                                                                                                                                                                 1992
                                                                                                                                                                                                                                                            for Blue Stream
                                                                                                                                                                                                                          Transformation into                                                  (Billions of euro)
                                                                                                 #                                                 #                                 #                        #               joint-stock

                                   #                                                             1963                                            1971
                                                                                                                                                                                    1983                      1988             company                                           #
                                                                                                                                                                              The Transmed gas          Discovery of oil in                                                       2000
                                   1953                                                     Discovery of oil                                 LNG from Libya                  pipeline enters into           Basilicata                  #                                     Acquisition
                            The founding of Eni                                          in Tunisia (El Borma)                                                                   production                                              1993                              of British Borneo                                               Keywords
    2,000                                                                                                                                                                                                                          Agreements with

                                                                                                             #
                                                                                                                                                                                                                                  Kazakhstan, China
                                                                                                                                                                                                                                                                                                                                           E.N.I.
                                                  #                                                           1965                                            #                           #
                                                                                                                                                                                                                                      and Russia
                                                                                                                                                                                                                                                                                  #                                                        On 10 February 1953, the Parliament ratifies the establishment of the Ente




                                                                                                                                                                                                                                                                                                         Total
                                                                                                                                                                                                                                                                                  2001
    1,800                                    1955                                                      Agreement with                                         1973                       1984
                                                                                                                                                                                                                                                                          Acquisition of Lasmo                                             Nazionale Idrocarburi. Enrico Mattei, born in Acqualagna (Pesaro),




                                                                                                                                                                                                                                                                                                                    Capitalization
                                      Agreement with Egypt                                             Libya for natural                                   Agreement                  Agreement
                                                                                                     gas, discovery of an
                                                                                                      oil field in Nigeria
                                                                                                                                                          with Algeria
                                                                                                                                                         for natural gas
                                                                                                                                                                                   with Libya (Bouri)                                          #                                  #                                                        is the founder and first chairman. On 27 October 1962 the airplane
                                                                                                                                                                                                                                               1995                        Eni sole operator                                               bringing him back to Milan crashes near Pavia. Mattei is 56 years old.
    1,600                                                                                                                                                                                                                              Listed on the Italian
                                                          #
                                                                                                                                                                                                                                                                             in Kashagan
                                                                                                                                                                                                                                          stock exchange                                                                                   SIX-LEGGED DOG
                                                                                                                                                                                                                                                                                                                                     100
                                                          1957
                                                  Agreement with Iran,                                                       #                                                                                                             and the NYSE
                                                                                                                                                                                                                                                                                                                                           Has always been Eni’s logo. It was created by Luigi Broggini, although
    1,400                                         the “Mattei formula”                                                   1967
                                                                                                                                                                                                                                                                                                                                           the sketch was submitted to the competition in 1952 by Giuseppe Guzzi,
                                                       is applied                                                The TAL, Transalpine
                                                                                                                     Oil Pipeline,
                                                                                                                                                                                                                                                            #                                                                              who for years was believed to be the author. Its true creator only came to
                                                                                                                                                                                                                                                             1997
                                                                                                                 between Trieste and
                                                                                                                  Ingolstadt enters
                                                                                                                                                                                                                                                        Start-up of the                                                                    light many years later, after Broggini passed away. The six-legged dog
    1,200                                                                                                          into operation
                                                                                                                                                                                                                                                      Karachaganak and                                                               80    has undergone two restylings over time, both by Bob Noorda, a top
                                                                                                                                                                                                                                                       Caspian projects
                                                                     #




                                                                                                                                                                                                                                                                                                                 Oil
                                                                                                                                                                                                                                                                                                                                           graphic artist in the world.
                                                                     1959                                                               #
    1,000                                                     First offshore well
                                                                   in Europe
                                                                                                                                      1969
                                                                                                                                 Agreement with
                                                                                                                                                                                                                                                                                                                                           BARELL
                                                                                                                             the URSS for natural gas                                                                                                                                                                                60    Unit of measurement used by the oil industry along with tonnes. It is
                                                                                                                                                                                                                                                                                                                                           equivalent to approximately 159 litres. A tonne of crude oil is equivalent
      800




                                                                                                                                                                                                                                                                                                                 Natural gas
                                                                                                                                                                                                                                                                                                                                           to 7.2 barrels. It derives from the old practice of storing crude oil
                                                                            #                                                               #                                                                                                                                                                                              in wooden barrels to be sold. In 1949, Agip finds oil in Cortemaggiore;
                                                                         1960
                                                                                                                                            1970
                                                                 Agreement with the URSS
                                                                                                                                      Agreement with                                                                                                                                                                                       in 2005, Eni production exceeds 1.1 million barrels per day.
      600                                                                                                                             the Netherlands                                                                                                                                                                                40
                                                                                                                                       for natural gas                                                                                                                                                                                     NATURAL GAS
                                                                                           #                                                                                                                                                                                                                                               In 1944, Agip discovers the first Italian reservoir at Caviaga, near Lodi,
      400                                                                                 1962
                                                                                    Enrico Mattei dies                                                                                                                                                                                           #                                         which turns out to the largest in Western Europe. Its reserves are
                                                                                                                                                                                                                                                                                                  2004                                     estimated at 12 billion cubic metres (1,400 metres of depth, 140
                                                                                                                                                                                                                                                                                           Production starts                         20    atmospheres of pressure, capacity of 9,000 cubic metres per hour).
                                                                                                                                                                                                                                                                                          in Libya, Australia,
      200                                                                                                                                                                                                                                                                                   Iran and Angola
                                                                                                                                                                                                                                                                                                                                           AGIP SERVICE STATIONS
                                                                                                                                                                                                                                                                                                                                           The first station, inaugurated by Mattei, opens in 1953 at Anagni.
          0                                                                                                                                                                                                                                                                                                                                As of 31 December 2005, there are 4,349 stations, also located abroad.
                                                                                                                                                                                                                                                                                                                                           LAYING OFFSHORE PIPELINES
                                                                                                                                                                                                                                                                                                                                           Eni has achieved major records: in 1980, the Transmed gas pipeline
                                                                                                                                                                                                                                                                                                                                           reached 608 metres of depth in the Mediterranean; in 2002 a new record
                                                                                                                                                                                                                                                                                                                                           was established with Blue Stream, at 2,150 metres in the Black Sea;
    Establishment of Eni and development of operations in Italy                                                        Natural gas emerges as a solution for oil crises                                                    Transformation into a joint-stock company                                                                       the record for the longest gas pipeline in the Mediterranean belongs
    and abroad                                                                                                         Eni identifies natural gas as an alternative energy source.                                         and privatization. The years of intense development                                                             to Greenstream (520 km), laid in 2004 to connect Libya to Italy
                                                                                                                                                                                                                                                                                                                                           (1,227 metres of depth).
    Eni was founded in 1953 with the objective of ensuring energy                                                      Eni reorganizes its strategy and concentrates its investments                                       Eni becomes a joint-stock company. Between 1995 and 1998,
    supply to Italy and supporting industrial development.                                                             in its core energy business. Major infrastructures                                                  roughly 75% of the company is placed on the stock exchange,                                                     Eni S.p.A.
    Eni develops one of the most extensive natural gas transport                                                       are constructed connecting the national network with                                                with the State raising approximately 24 billion euro. Eni                                                       On 7 August 1992, Eni becomes a joint-stock company. Three years later in
    networks in the world in Italy, contributing to the postwar                                                        North-Central Europe and with North Africa (the Transmed                                            integrates its operational companies and develops international                                                 1995, the company is listed on the Italian and American financial markets.
    economic “miracle”. Eni exports the “Mattei formula”                                                               gas pipeline from Algeria). The first liquefied natural gas                                         activities. Agreements in Kazakhstan, where it becomes the                                                      STAKEHOLDER
    to the world, ensuring producer countries greater participation                                                    (LNG) arrives from Libya. An agreement with Libya                                                   operator of the important Kashagan oil field (with reserves up                                                  Entities that have an interest in the company’s activities, such as
    in managing the concessions. Eni pursues its                                                                       for the exploitation of Bouri, the largest oil field in                                             to 13 billion barrels), Azerbaijan, Nigeria and Angola, and                                                     employees, shareholders, customers, suppliers, commercial and financial
    internationalization process and concentrates on natural gas                                                       the Mediterranean, is signed. A large oil field is discovered                                       acquisition of the British Borneo and Lasmo companies.                                                          partners, institutions, Non Governmental Organizations, local
    as a response to the crisis caused by the first oil embargo.                                                       in Basilicata.                                                                                      Eni constructs the Blue Stream gas pipeline connecting Russia                                                   communities it interacts with, and future generations.
    The El Borma oil field, one of the largest in Africa, is discovered                                                                                                                                                    to Turkey. Importation of natural gas from Libya through                                                        SUSTAINABLE DEVELOPMENT
    in Tunisia.                                                                                                                                                                                                            the Greenstream gas pipeline. Production of hydrocarbons rises                                                  Eni’s commitment to combining economic development with protecting
                                                                                                                                                                                                                           from 0.8 million barrels/day in 1990 to over 1.7 million in 2005.                                               the environment and stakeholder interests.



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           E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / T H E E N I “ I D E N T I T Y C A R D ”                                                                                                                                                                                     E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / T H E E N I “ I D E N T I T Y C A R D ”




                                                                                                                                                                                                                                                 Construction                                                                                       Corporate
                 Eni                                     Main economic data                          Exploration & Production                              Gas & Power                             Refining & Marketing                                                                     Petrochemicals
                                                                                                                                                                                                                                                and Engineering                                                                                 and other activities

       73,728 million euro                         Third-party revenue (million euro)                     7,716    million euro                    22,397     million euro                        32,640     million euro                     4,808     million euro                     5,572       million euro                                  595      million euro

      16,827 million euro                          Operating income (million euro)                      12,574     million euro                     3,321     million euro                          1,857    million euro                        307    million euro                        202      million euro                              -1,436       million euro

       7,414 million euro                          Capital expenditure (million euro)                     4,964    million euro                     1,152     million euro                             656   million euro                        349    million euro                        112      million euro                                  181      million euro

72,258no. as of 31 December 2005                   Employees as of 31 December 2005                       7,491    no. as of 31 December 2005      12,324     no. as of 31 December 2005            8,894    no. as of 31 December 2005      28,684    no. as of 31 December 2005        6,462       no. as of 31 December 2005                 8,403       no. as of 31 December 2005

                                                   Employees Production                                   1,737    Thousands of boe per day         91,15     Billions of m3 natural gas sold                                                 9,964    million euro                      7,282       Thousands of tonnes
                                                                                                                                                                                                                                                       (order portfolio)

Eni is an integrated energy company                Description of activities                          Eni explores and produces                 Eni operates in the supply, transport,          Eni operates in the refining              Through Saipem (Eni share 43%),           Through Polimeri Europa,                             Through its subsidiaries, Eni also has
that boasts competencies                                                                              hydrocarbons in Italy, North Africa,      distribution and sale of natural gas.           and marketing of refined products         Eni is a leader in the construction       Eni manages the production and                       a presence in other industrial sectors,
of excellence and strong market                                                                       West Africa, the North Sea,               In 2005 sales of natural gas including          primarily in Italy and the rest           of large offshore projects for the oil    marketing of a vast portfolio                        including: rehabilitation
positions at an international level                                                                   the Gulf of Mexico and Australia,         own consumption were 91.15 billion              of Europe. In the distribution            industry (laying of undersea pipelines    of products, being able to rely on                   of contaminated areas, supply
in the oil, natural gas, electricity                                                                  and in high-potential areas such          m3, 58 billion m3 of which were in              business the Eni network is the leader    and production platforms).                a range of proprietary technologies,                 of integrated services for offshore
generation, petrochemicals,                                                                           as the Caspian Sea, the Middle and        Italy. The high- and medium-pressure            in Italy with the Agip brand and          Ownership of avant-garde ships able       avant-garde installations, and                       engineering, Facility Management.
construction and engineering                                                                          Far East. In 2005, daily production       gas pipeline network owned by Eni               a market share of 30%.                    to drill wells up to over 9 thousand      an efficient, widespread distribution
sectors.                                                                                              was 1.74 million boe, representing        in Italy is approximately 30 thousand           In 2005, sales of refined products        metres and lay pipelines up               network. The strategic businesses
In 2005, Eni registered a turnover                                                                    a growth of 7% compared to 2004;          kilometers; Eni has transport rights            came to 51.63 million tonnes,             to 3 thousand metres of depth.            for the petrochemicals complex
of 73.8 billion euro, with a net                                                                      known reserves as of 31 December          abroad on a network of over 5                   30.3 million of which were in Italy.      Through Snamprogetti                      include: key chemicals, plastics, and
operating profit of 16.8 billion                                                                      have reached 6.84 billion boe with        thousand kilometers.                                                                      (Saipem 100%), Eni is one of the world    synthetic rubbers. As of 31 December
(17.6 billion adjusted operating                                                                      a residual useful life of 10.8 years.     Through EniPower, Eni operates                                                            leaders in the construction               2005, the commercial network
result) and a net profit of 8.8 billion                                                                                                         in the generation and marketing                                                           of installations for the oil and          covers 17 countries with sales
(9.3 billion adjusted net profit).                                                                                                              of electricity with a functioning                                                         petrochemicals industry.                  of petrochemical products
Eni operates in more than 70                                                                                                                    installed capacity of approximately                                                       It has developed avant-garde              amounting to 5.38 million tonnes.
countries, where it employs 72,258                                                                                                              4.5 gigawatt at the end of 2005.                                                          competencies and technologies             Total production in 2005 was
people (as of 31 December 2005);                                                                                                                                                                                                          in the production, treatment,             7.28 million tonnes.
Daily hydrocarbon production was                                                                                                                                                                                                          and transport of hydrocarbons and
approximately 1,74 million barrels                                                                                                                                                                                                        in the exploitation of natural gas
of oil equivalent (boe); the total                                                                                                                                                                                                        and heavy crude oils.
volume of natural gas sold was over
91 billion cubic metres.
Known hydrocarbon reserves
as of 31 December 2005
are 6.84 billion boe.
Eni is listed on the Milan Stock                   Strategies                                        • Development of oil fields with long      • Maximization of gas equity                    • Increase in the refining system         • Strengthening of Saipem presence        • Consolidation of the industrial
Exchange and the New York Stock                                                                        production lives in West Africa,           portfolio value in Italy, Libya, Egypt,         complexity index.                         in strategic areas of West Africa         structure.
Exchange (NYSE); as of 31 December                                                                     North Africa, and in Kazakhstan,           the North Sea, and long-term                  • Strengthening of vertical                 and the Caspian Sea.                    • Improvement in industrial
2005, the stock exchange                                                                               and exploration in Africa, in the          supply contracts with major                     integration with the upstream           • Maintenance and upgrading of the          performance and plant reliability
capitalization was 87.3 (billion euro),                                                                Barents Sea, in the Middle East, and       producers - Gazprom, Sonatrach,                 business (refining).                      fleet and making ready of vehicles        in areas of excellence (styrenes
up 26% compared to the previous                                                                        in the Gulf of Mexico.                     Gasunie and Statoil                           • Selective growth in neighbouring          and equipment for particularly            and elastomers) as well as
year. In 2005 the Total Shareholder                                                                  • Exploitation of gas equity               • Development of infrastructures for              European regions (marketing).             challenging projects.                     in the most competitive cracking
Return for Eni was 35.3%.                                                                              availability (primarily in Nigeria,        importing natural gas into Italy:             • Strengthening of the premium            • Start-up of executive projects for        plants.
Eni ranks as the sixth largest group                                                                   Egypt, Australia and Indonesia) for          - expansion of the TAG gas                    products and innovative initiatives       better integration of Saipem and
in the world for daily production                                                                      supplying European and American               pipeline from Russia and the                 in non oil (marketing).                   Snamprogetti competencies.
of hydrocarbons and for stock                                                                          markets through the growth of LNG             TTPC pipeline from Algeria;
exchange capitalization after Exxon                                                                    in production areas with the                 - increase in volumes of natural
Mobil, BP Amoco, Royal Dutch Shell,                                                                    highest potential and limited                 gas transported from Libya
Chevron Texaco, and Total.                                                                             mining costs.                                 (Greenstream gas pipeline);
                                                                                                     • Assessment of new expansion                  - adaptation of the national
                                                                                                       opportunities                                 transport network.
                                                                                                       for “non conventional oil”.              • Completion of the construction of
                                                                                                                                                  efficient and profitable combined
                                                                                                                                                  cycle gas turbine cogeneration
                                                                                                                                                  plants (CCGT)




                                                   Objectives                                        • Average annual production growth         • Average annual growth of 8% in                • Investments for upgrading refining      • Strengthening of leadership in          • Constant research in
                                                                                                       rate of 4% for internal lines,             the European natural gas sector,                systems that will enable                  the construction and engineering          the operational efficiency and
                                                   2006 - 2009                                         exceeding 2 million boe/day in 2009.       reaching 50 billion m3 in 2009.                 a conversion index of 58% by 2009,        sector by integrating                     optimization of operational
                                                                                                     • Growth in reserves replacement rate      • Expansion of natural gas                        well beyond the European average,         the competencies and portfolio            performance with the aim
                                                                                                       until it tops 100%.                        importation capacity into Italy to              as well as maximizing earning             of Snamprogetti, acquired at              of delivering positive operating
                                                                                                     • Portfolio expansion and renewal of         an additional 21 billion m3 by                  performance.                              the end of February 2006.                 results (economic-financial) even
                                                                                                       mining securities, with strengthening      2009.                                         • Processing increase up                                                              in difficult scenarios.
                                                                                                       of presence in core areas                • Increase in the installed capacity              to 42 million tonnes per year
                                                                                                       (Africa, North Sea) and entrance into      of the sector up to 5.5 gigawatt in             in 2009.
                                                                                                       new areas.                                 2009, equal to amount used for
                                                                                                     • Increase in LNG sales up to 13 billion     own consumption of gas of around
                                                                                                       m3 in 2009.                                6-7 billion m3.




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E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / C O M M I T M E N T TO S U S TA I N A B L E D E V E LO P M E N T                                                  E N I A N D S US TA I N A B I L I T Y 2 0 0 6 / C O M M I T M E N T TO S U S TA I N A B L E D E V E LO P M E N T




Commitment to sustainable
development




                                                                                                                   The Sustainability Project
                                                                                                                   For Eni, sustainability is the driving force behind con-               Today Eni is committed to giving even greater impetus
                                                                                                                   tinuous improvement, capable of positively influenc-                   to its efforts towards sustainability. In February 2006 it
                                                                                                                   ing the management of the company and its stakehold-                   initiated its “Sustainability Project” with the aim of
                                                                                                                   er relations. Eni was one of the first major European                  strengthening its integrated management and com-
                                                                                                                   companies to adopt a Code of Practice, drawn up in                     munications system for environmental, social, and
                                                                                                                   1994 and updated a number of times since then. In                      economic-financial affairs, and defining specific com-
                                                                                                                   2002, it initiated an integrated management process                    mitments and objectives. One of the results of the
                                                                                                                   for HSE operations and founded the Corporate Social                    project will be the publication of the Sustainability
                                                                                                                   Responsibility organizational unit within the Institu-                 Report 2007 that will incorporate the HSE Report.
                                                                                                                   tional Relations and Communications management.




A strong commitment to sustainable development, involving each aspect of the business
ranging from empowering people, to caring for the environment, developing communities,
and technological innovation, has always stood at the heart of Eni’s strategies.
This is a priority for all companies, but even more so for a major international corporation
operating in a sector where proper management of resources and social and environmental
issues is a key factor for success. The local and global contexts in which the company
operates present increasingly complex scenarios that are continuously evolving, offering
companies new and ambitious objectives. Following its tradition, based on values
consolidated over time and the skills and passion of its people, Eni is ready to pursue
these objectives and create value for all its stakeholders.




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Challenges, Commitments, Results

                                                      THE CHALLENGES                                                       SOME OF OUR COMMITMENTS                                                                              SOME ACTIVITIES AND RESULTS

 Governance                    The oil & gas industry, with its international presence                             1. To maintain and strengthen a governance system        1. Eni has adopted a governance system that complies with the regulations and directives issued by regulatory bodies and the financial
 and                           and influence on local and global political and economic                            that represents the best international practices,        markets it is listed in, and periodically verifies that it is in compliance.
 stakeholder                   conditions, is subject to increasing attention                                      capable of managing the complexity of existing           2. Eni was one of the first major companies in Europe to adopt a Code of Practice (1994) defining the principles and main guidelines
                               on the transparency of its governance processes,                                    scenarios in numerous countries around the world         to be followed in carrying out its activities.
 engagement
                               on relations with governments of the countries where                                in which Eni operates, along with the challenges
                               it operates, and on commitments for the development                                 to be tackled for sustainable development.               3. Eni uses a specific support methodology for identification, analysis, and consultation with relevant stakeholders, offering concrete
                                                                                                                                                                            implementations of the most important initiatives and international agreements related to its activities.
                               of a sustainable growth model.
                                                                                                                   2. To adopt systematic forms of stakeholder
                                                                                                                                                                            4. Eni promotes a model of sustainable development and is committed to giving even greater impetus to its efforts through
                                                                                                                   engagement, extending the dialogue to issues             its “Sustainability Project”, started in February 2006.
                                                                                                                   of sustainability and corporate responsibility
                                                                                                                   with those who have legitimate interests.

                                                                                                                   3. To attract the best human resources at national       5. Eni has developed a close relationship with international universities and research centers for the hiring and training of the best
 People                        The availability of qualified personnel has quickly become
                                                                                                                                                                            resources. In 2005, it increased its employment levels, primarily thanks to the rise in personnel working abroad, hiring around
                               a critical factor for the oil and gas sector, which embarks                         and international levels.
                                                                                                                                                                            2,100 employees, 800 of which are final year students (64% engineers) and 530 high-school graduates.
                               on increasingly complex projects.
                                                                                                                   4. To manage human resources at an international         6. Eni employs around 44% of its personnel abroad and aims at creating value from the social and cultural differences. Eni has conducted
                               Operational management, largely dependent on the
                                                                                                                   level using standard instruments, valuing diversity.     comparative analyses on regulations and provisions in the more than 70 countries where it operates, and has developed a series of training
                               motivation and professionalism of the human resources
                               employed, is an important key to success. Hence,                                    5. To promote its human resources health                 projects directed at new employees abroad.
                               the competition for recruiting and maintaining qualified                            and guarantee the safety of its employees,               7. Eni safeguards the health of its employees through general improvement of working conditions, protection of physical wellbeing,
                               human resources, the need to promote hiring                                         contractors, and the communities.                        prevention of work-related injuries and occupational diseases, the promotion of increasingly healthy behaviors and lifestyles. In 2005 Eni
                               and development of local employees, empowering their                                                                                         registered the lowest injury rate index in its history for its employees and a strong improvement compared to 2004 in the injury severity rate.
                               potential and professionalism, promoting health
                                                                                                                   6. To empower the potential and professionalism
                                                                                                                   of its human resources.                                  8. Eni considers training and development of its human resources to be strategic. In 2005 the total training hours in Italy added up to
                               protection and guaranteeing high safety standards.                                                                                           1,178,943, for an average training per employee of 3.7 days. Training expenses in Italy in 2005 came to 22 million euro.


                               Eni believes that on the basis of current knowledge,                                7. To give priority to the development of low carbon     9. Thanks to its activities in the natural gas sector, Eni is in the position to offer the market a range of sources with reduced greenhouse gas
 Environmental                                                                                                                                                              emissions. The average emissions factor is 2.65 tCO2/toe, one of the lowest values in the world among the major oil & gas companies.
 responsibility                the massive use of fossil fuels is contributing to planetary                        intensity fossil fuels, in particular natural gas.
                                                                                                                                                                            The current investment program for the development of natural gas (value enhancement of the gas equity, strengthening of the transport
                               climate change. Active management of environmental
                                                                                                                   8. To actively participate in Emission Trading Systems   infrastructures, construction of combined cycle cogeneration plants) aims at strengthening its leadership in the European market.
                               issues, both local and global, is ever more important
                                                                                                                   (ETS) and complete projects for emissions reduction      10. Eni has introduced an ETS management model involving more than 200 internal experts and is developing a portfolio of projects
                               to stakeholders who depend on the development
                                                                                                                   based on the Flexible Mechanisms provided for by         for emissions reduction based on the Flexible Mechanisms provided for by the Kyoto Protocol.
                               of the projects, and it is a key factor for success
                                                                                                                   the Kyoto Protocol.
                               in the industry.                                                                                                                             11. Eni has developed a complex HSE management system to ensure that operations in all its spheres of activity are carried out minimizing
                               The satisfaction of the energy demand growth while                                  9. To reduce the ecological footprint through            environments impacts while also safeguarding biodiversity.
                               lowering the atmospheric emissions is one of the main                               environmental decontamination and rehabilitation
                               themes in the oil & gas agenda.                                                     activities and to safeguard biodiversity.


                               Efforts toward increasing the availability of hydrocarbons                          10. To develop technologies to increase hydrocarbon      12. Eni is assessing a number of proprietary technologies that can have a significant impact on the oil & gas industry, making more efficient
 Innovation
                                                                                                                   availability, making the use of existing reserves more   use of existing reserves, from exploitation of “non conventional oil” (EST technology for exploitation of the “bottom of the barrel”)
                               makes it necessary to make the use of existing reserves
                                                                                                                                                                            to greater efficiency in the transport of natural gas (the TAP technology for high pressure transport).
                               more efficient. Improved efficiency in the exploitation                             efficient and safeguarding the environment and safety.
                               of existing reserves should be accompanied by
                               a concomitant increase in investments to access
                               and develop reserves whose exploitation is more complex
                               from a technical and environmental point of view.
                               Exploitation of the reserves requires continued
                               technological innovations to increase efficiency
                               and safeguard the environment and safety.



 Territory                     Most reserves currently available are located in countries                          11. To promote dialogue with local communities           13. Eni uses a specific support methodology for identification, analysis, and consultation with relevant stakeholders in the countries
 and                           characterized by complex socio-economic scenarios.                                  on industrial choices through participatory tools,       and local communities where it operates, in addition to Social Impact Assessment methods to evaluate the impact of the projects
 community                     Local stakeholder involvement and commitment                                        with the objective of enhancing the value                on the territory. This approach also makes it possible to plan integrated investment programs in various countries, targeted and
                               to the development of the communities represent                                     of the socio-economic system of the countries            responding to the needs of the local communities, in the field of healthcare, social development, education and training, environment,
                               efficient instruments for managing risk, as well as offering                        and local communities where it operates.                 and culture.
                               competitive advantages.




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                                                                                                                   The governance system is founded on the sharing of values
                                                                                                                   and rules sanctioned by the Code of Practice; on an organi-                   Compliance with International
                                                                                                                   zational structure laid out according to the best principles                  Principles and Agreements
                                                                                                                   demanded by the market and recommended by its regula-
                                                                                                                   ting bodies, such as the Stock Exchange and Consob in Italy,                  Eni is an international company operating in over
                                                                                                                   and the New York Stock Exchange (NYSE) and the Security                       70 countries, often in highly complex scenarios,
Governance and stakeholder                                                                                         and Exchange Commission (SEC) in the United States; and                       and it is aware of the importance of establishing
                                                                                                                                                                                                 relationships with its stakeholders based on
engagement                                                                                                         on internal audit systems and management models in line
                                                                                                                   with national and international legislation, such as Law                      respect, transparency, and mutual trust.
                                                                                                                   231/2001 in Italy and the Sarbanes - Oxley Act in the United                  The reference framework for Eni’s activities is defi-
                                                                                                                   States. In order to strengthen the protective power of the                    ned by complying with international principles
                                                                                                                   governance system and ensure that it promptly adheres to                      and agreements, including:
                                                                                                                   ever new and stricter requirements demanded by stakehol-
                                                                                                                   ders, in 2006 Eni created the new Company Affairs and                         G   The United Nations Universal Declaration of
                                                                                                                   Governance Management, directly responsible to the Chief                          Human Rights, also referred to in the Eni Code
                                                                                                                   Executive Officer.                                                                of Practice;
                                                                                                                                                                                                 G   Fundamental Conventions of the International
                                                                                                                                                                                                     Labour Organization (ILO) and OCSE
                                                                                                                                                                                                     Guidelines for Multinational Enterprises also
                                                                                                                                        The Eni Code of Practice                                     referred to in the Eni Code of Practice;
                                                                                                                                                                                                 G   Global Compact, the United Nations initiative
                                                                                                                                        Eni was one of the first, among the                          directed toward promoting
                                                                                                                                        major companies in Europe, to give                           sustainability-oriented policies and practices;
                                                                                                                                        itself norms of self-regulation which                    G   Extractive Industries Transparency Initiative
                                                                                                                                        define principles and guidelines to                          (EITI), which unites governments, international
                                                                                                                                        adhere to in conducting activities.                          financial institutions, energy companies and
                                                                                                                                        The Code of Practice has the function                        Non Governmental Organizations with the aim
                                                                                                                   of directing the Company’s conduct in a series of key                             of making revenue flows from extractive
                                                                                                                   areas such as business ethics, transparency and correct-                          industries transparent.
                                                                                                                   ness in accounting, industrial relations, health, safety and
                                                                                                                   environmental protection, community relations. Eni’s
                                                                                                                   Board of Directors evaluates the compliance with the
                                                                                                                   Code of Practice, and two internal units, “the Guarantor”                 contains a large section dedicated to governance and
                                                                                                                   and the “Committee” guarantee the diffusion and cor-                      sustainability. Information and documents include:
                                                                                                                   rect adherence to the Code, also through inspections and
                                                                                                                   sanctions.                                                                G   Report on Corporate Governance
                                                                                                                                                                                             G   Shareholders Structure
                                                                                                                                                                                             G   By-laws
                                                                                                                                                                                             G   Board of Directors
The Eni governance system was created with the primary aim of creating value                                                                                                                 G   Code of Practice
for its shareholders and for all other stakeholders, in full awareness of the complexity                                                                                                     G   Control bodies
of existing scenarios in numerous countries around the world in which Eni operates,                                                                                                          G   Shareholders’ meeting regulations
along with the challenges to be tackled for sustainable development.                                                                                                                         G   Compensation of Top Management
                                                                                                                                                                                             G   Shareholders’ meeting resolutions
                                                                                                                                                                                             G   Annual, Interim and Quarterly reports
                                                                                                                                                                                             G   Register of Persons Holding Inside Information
                                                                                                                   Eni commitment to information                                             G   Form 20-F
                                                                                                                   transparency and completeness                                             G   Internal Dealing
                                                                                                                                                                                             G   Fact Book
                                                                                                                   Eni considers accessibility to information for its various                G   Procedure for Advising the Market
                                                                                                                   stakeholders to be a top priority and demonstrates this                   G   HSE Report
                                                                                                                   commitment by constant updates and continuous imple-                      G   Principles of Model 231
                                                                                                                   mentation of its company web site www.eni.it which also                   G   Presentations to the market and publications



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                                                                                                                                                         which monitors the general performance of corporate
                                                                                                                                                         management; the Compensation Committee, whose
                                                                                                                                                         function is to propose remuneration packages for the
                                                                                                                                                         remuneration of executives and top management as
                                                                                                                                                         well as incentive schemes; the International Oil Com-
                                                                                                                                                         mittee, responsible for the monitoring of trends in the
                                                                                                                                                         oil markets. In order to allow representatives nominat-
                                                                                                                                                         ed by minority interest shareholders to the Board of
                                                                                                                                                         Directors, appointment of board members takes place
                                                                                                                                                         via a voting list. Shareholders who singly or jointly with
                                                                                                                                                         others represent at least 1% the share capital have the
                                                                                                                                                         right to present lists, as does the Board of Directors.
                                                                                                                                                         The Eni by-laws establish that the Italian State has spe-
                                                                                                                                                         cific powers with regard to share allocation conse-
                                                                                                                                                         quent to shareholders’ pacts or agreements and with
                                                                                                                                                         regard to relevant amendments to company by-laws.
                                                                                                                                                         Specifically, it has the power to prevent a single share-
                                                                                                                                                         holder from acquiring more than 3% of the share capi-
                                                                                                                                                         tal and to block associated voting rights (“golden
                                                                                                                                                         share”). A recent Italian law (no. 266/2005, 2006 Finan-                 of Accounts, a body that acts as financial controller for
The governance structure                                                                                                                                 cial Act) has introduced the right to include anti-raid                  the Italian State.
                                                                                                                                                         regulations in the statutes, subject to EC approval that,                The functions, composition, operation, and compensa-
The Eni organizational model entrusts the Board of Direc-                                        Annual Report, has assigned the Chairman the power      if adopted, would annul the “golden share” provision.                    tion of all Eni executive bodies are reported in the 2005
tors with exclusive control over company management,                                             to define and promote integrated projects and inter-    In regard once again to public participation, Eni’s finan-               Annual Report Financial Statements and on the com-
while regulatory functions are assigned to the Board of                                          national agreements of strategic importance, giving     cial management is also subject to control by the Court                  pany web site.
Statutory Auditors, and auditing of the company’s books                                          the Chief Executive Officer ample managerial powers.
to an auditing company appointed at the shareholders’                                            The Board of Directors has created three committees
meeting. The Board of Directors, in office until the Ordi-                                       with consulting and proposal-making functions from
                                                                                                                                                           Eni: best international practice in governance
nary Shareholders’ Meeting that will approve the 2007                                            within its members: the Internal Control Committee,

                                                                                                                                                           Eni has been listed on the Italian stock exchange                          executive, 4 independent) and
                                                                                                                                                           and on the New York Stock Exchange, through                                the Compensation Committee (4 directors,
   Eni and its shareholders
                                                                                                                                                           an American Depositary Receipts (ADR) Program,                             none of whom are executive, 3 independent);
                                                                                                                                                           since 1995. The Eni governance system, today                           G   the adoption of the Procedure for advising
   From the time Eni was listed on the Italian stock                                              by investors from other parts of the world.
                                                                                                                                                           constituting a best international practice,                                the market, the Register of person holding inside
   exchange and the New York Stock Exchange in 1995,                                              From a geographic point of view, over two thirds
                                                                                                                                                           has conformed over time to the regulations and                             information, and the Code on Internal Dealing;
   it has created high value for its shareholders, more                                           of Eni share capital is distributed amongst Italian
                                                                                                                                                           recommendations issued by regulating bodies                            G   the accounting and publication of relations
   than quadrupling the 1995 capitalization of 21                                                 shareholders. Privatization has taken place thus far
                                                                                                                                                           and stock exchanges.                                                       between associated parties.
   billion euro to approximately 98 billion euro at the                                           in 4 public placements: the first in 1995 generated
   close of April 2006. The growth in share value has                                             one of the best considerations, approximately
                                                                                                                                                           In 2000, Eni adopted the “Self-Discipline Code of                      Eni’s corporate governance system complies with
   kept pace with strategic and operational successes                                             6,5 billion euro, ever to be realized in the world
                                                                                                                                                           listed companies” and annually verifies that it is in                  the “Listing Requirements” issued by the New York
   marked by the increase in production (from less                                                for an Initial Public Offering (IPO).
                                                                                                                                                           keeping with established guidelines. In particular,                    Stock Exchange in November 2004 (Section 303A)
   than 1 million barrels in 1995 to 1,7 in 2005) and                                             The Italian State raised a total of approximately 30
                                                                                                                                                           in addition to instructions on the proxy system, on                    concerning sections applicable to “Foreign Private
   reserves (from 4,3 billion barrels in 1995 to 6,8                                              billion euro from the privatization of Eni, to which
                                                                                                                                                           procedures for appointing directors and statutory                      Issuers”. In particular, it has to be noted:
   billion in 2005). The total shareholder return from                                            6 billion euro in dividends and 15 billion in Eni
                                                                                                                                                           auditors, on shareholders’ meetings, on internal                       G the identification of the Board of Statutory
   1995 to today has been more than 20% per year; in                                              corporate taxes must be added. More than two
                                                                                                                                                           control, and on investor relations, the following                        Auditors as the body that is performing the
   2005 the return was 35.3%. This performance has                                                million small savers have underwritten the various
                                                                                                                                                           has to be noted:                                                         functions required by the SEC rules and the
   benefited all the shareholders. In June 2005                                                   placement quotas. Financial performance results
                                                                                                                                                           G a large number of independent directors                                Sarbanes-Oxley Act to be performed by the audit
   (dividend payment date) included 20.3% of the share                                            are also the fruit of constant constructive dialogue
                                                                                                                                                              on the Board of Directors (7 out of 9);                               committees of US issuers;
   capital was held by the Italian State, 9.9% by the                                             between Eni and market operators,
                                                                                                                                                           G and a single executive director                                      G the publication of the main differences between
   “Cassa Depositi e Prestiti” (Deposits and Loans                                                and an organizational model capable of ensuring
                                                                                                                                                              (the Chief Executive Officer);                                        Eni’s governance system and the one established
   Fund), 6.1% by Eni, 33.3% by individual shareholders                                           management reliability in the interest
                                                                                                                                                           G the institution of the Internal Control                                for American companies listed on the New York
   and Italian institutions, 14.7% by European investors,                                         of shareholders and the other stakeholders.
                                                                                                                                                              Committee (5 administrators, none of whom are                         Stock Exchange.
   4.8% by North American investors and 10.9%



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                                                                                                                                                            Stakeholders and involvement procedures


                                                                                                                                                            G   Human resources                 Continuous dialogue in order to share values and principles for sustainable
                                                                                                                                                                and Trade Unions                development and on issues relevant to the goals of individual well-being
                                                                                                                                                                                                and development. To this purpose, the “Agreement on international indus-
                                                                                                                                                                                                trial relations and corporate social responsibility”, signed with the Interna-
                                                                                                                                                                                                tional Federation of Chemical, Energy Mine and General Workers’ Union
                                                                                                                                                                                                (ICEM) and the Italian trade unions

                                                                                                                                                            G   International institutions      Participation in developing policies directed toward ensuring the compa-
                                                                                                                                                                                                ny’s compliance with the highest international standards in the field of sus-
                                                                                                                                                                                                tainable development and corporate responsibility. In addition to joining
                                                                                                                                                                                                the Global Compact promoted by the United Nations, Eni seeks out continu-
                                                                                                                                                                                                ous dialogue with primary international institutions.

                                                                                                                                                            G   Non Governmental                Continuous dialogue and comparison on issues of sustainable development
                                                                                                                                                                Organizations (NGOs)            globally and locally to identify, assess and overcome problems relating to the
                                                                                                                                                                and representatives             sustainability of specific projects. Ongoing relations with Italian and interna-
Stakeholder engagement                                                                                                                                          of the public at large          tional NGOs, including Amnesty International, Flora and Fauna International,
                                                                                                                                                                                                Legambiente, CittadinanzAttiva, are to be viewed in this framework.
Eni is aware that the creation of value and sustainability                                       methodology (identification, analysis, and consultation)
over time depends on the quality of relations with its                                           which provides its business units with the resources                                           Sharing of objectives and evaluation criteria for managing problems connect-
stakeholders. Eni’s strategy includes a deep commitment                                          needed to acknowledge their requests and thereby           G   Financial stakeholders active   ed to sustainable development as a prerequisite for investment or financing.
to fostering an open and constructive dialogue with all                                          increase the level of consensus regarding the various          in promoting sustainable        Comparison is performed primarily with multilateral financial institutions,
the organizations who are legitimately involved with its                                         projects. The documents that constitute the support            development                     socially responsible investors and sustainability rating agencies.
activities and with respecting their needs. This approach                                        structure for the company’s methodology, in line with
is fundamental for a major international corporation                                             the most advanced international standards in the field,                                        Constructive comparison on contractual conditions, including local devel-
operating in particularly complex scenarios, in which the                                        are subject to periodic revisions through a continual      G   Development Authorities         opment needs, through the creation of infrastructure programs and the
proper management of the legitimate interests and                                                process of internal and external consultation, based as        and Agencies in countries       provision of services to local communities, taking on of voluntary commit-
expectations of stakeholders is a key factor for success.                                        well on the results of their application and concrete          where Eni operates              ments and adherence to standards and regulations for activities undertaken
Eni has accordingly adopted a stakeholder engagement                                             experience.                                                                                    in that country. Ministers of the Environment and Energy in the hosting
                                                                                                                                                                                                countries, as well as national and local development agencies, act as coun-
                                                                                                                                                                                                terparts during the initial phase.

                                                                                                                                                                                                Dialogue sought out through local consultation. This activity often leads to
                                                                                                                                                            G   Local communities               the signing of further voluntary agreements both with the communities and
                                                                                                                                                                                                the authorities.

                                                                                                                                                                                                Comparison with competitors and development of methodologies and
                                                                                                                                                            G   Business associations           standards in line with best international practices (International Petroleum
                                                                                                                                                                and partners in carrying        Industry Environment Conservation Association - IPIECA - and Oil and Gas
                                                                                                                                                                out industrial operations       Producers - OGP - work groups and task forces). Compliance with the high-
                                                                                                                                                                                                est standards of excellence through the use of management committees
                                                                                                                                                                                                and technicians from the operational associations

                                                                                                                                                                                                Suppliers and contractors are required to upgrade their standards to
                                                                                                                                                            G   Contractors and suppliers       achieve the levels of excellence promoted and adopted by Eni

                                                                                                                                                                                                Sharing of standards to which Eni must conform. Consolidation of relations
                                                                                                                                                            G   Customers                       thanks to active management of customer relations. Dialogue with con-
                                                                                                                                                                                                sumer associations in the countries where Eni operates



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                                                                                                                                                              Numbers of Eni People

                                                                                                                                                              Employment as of 31 December 2005 consists
                                                                                                                                                              of 72,258 units, 56% of whom are Italian.
                                                                                                                                                              The breakdown of human resources testifies to
Our people                                                                                                                                                    a strong international presence, corresponding
                                                                                                                                                              to approximately 44% of the employees.
                                                                                                                                                              The gender breakdown indicates that women
                                                                                                                                                              represent overall approximately 15% of the total,
                                                                                                                                                              5% of the executive staff (executives and senior
                                                                                                                                                              managers) and approximately 12% of middle
                                                                                                                                                              management (lower-level managers and
                                                                                                                                                              managers). The process of attracting qualified
                                                                                                                                                              resources was pursued in 2005 with the hiring
                                                                                                                                                              of 2,099 people, 65% into permanent jobs, with
                                                                                                                                                              a 58% share of university graduates.



                                                                                              Eni is aware that the management of human resources is a        2005 - Breakdown of people by business sector
                                                                                              key factor for success for an international corporation that                                  Hired and      Hired in Italy           Hired
                                                                                              employs over 72,000 men and women in roughly 70 coun-                                          working       and working        and working
                                                                                                                                                                                               in Italy         abroad             abroad
                                                                                              tries, with 44% of total staff working abroad. The length of
                                                                                                                                                              Exploration & Production       3,492                1,020              2,981
                                                                                              the business investment cycles, the operations carried out      Gas & Power                    9,722                   83              2,591
                                                                                              internationally and, at times, under extreme environmen-        Refining & Marketing           6,634                   34              2,214
                                                                                              tal conditions, the long periods of time needed to develop      Engineering & Construction     4,584                1,263             22,885
                                                                                              mature professional skills and managerial abilities, and the    Petrochemicals                 5,162                   12              1,289
                                                                                              need to know the business from a technical point of view        Corporate and other activities 8,118                   68                106
                                                                                              as well make it crucial for the company to not only attract     Total                         37,712                2,480             32,066
                                                                                              but also maintain the best people possible.
                                                                                              Eni’s main objectives regarding management and                  2005 - Breakdown of people by employment and gender,
                                                                                                                                                              in Italy and abroad
                                                                                              empowerment of human resources are:
                                                                                                                                                                       Senior manager    Managers          Office     Workers        Total
                                                                                              G   to promote health and ensure safety of its own                                                          Workers
                                                                                                  people and contractors;                                     Italy       1,522            8,612          20,394       9,664 40,192
                                                                                              G   to plan human resources management and                                  (3.8%)          (21.4%)         (50.8%)      (24%)
                                                                                                                                                              women         74             1,283           5,565         55    6,977
                                                                                                  development initiatives with a medium- and
                                                                                                                                                                          (4.9%)          (14.9%)         (27.3%)      (0.6%) (17.4%)
                                                                                                  long-term outlook that is consistent with
                                                                                                                                                                       Senior manager    Managers          Office     Workers        Total
                                                                                                  the characteristics of the business and suitable                                                        Workers
Putting people first and protecting their interests, developing the capabilities and skills       for sustaining individual growth paths;                     Abroad       226             2,173          13,962       15,705 32,066
of each employee so that their energy and creativity can express their full potential,                                                                                    (0.7%)           (6.7%)         (43.6%)       (49%)
                                                                                              G   to attract the best resources domestically
creating a work environment that offers everybody the same opportunities based                                                                                women         15              142            3,086         335   3,578
                                                                                                  and internationally through close relations
                                                                                                                                                                          (6.6%)           (6.5%)         (22.1%)      (2.1%) (11.2%)
on a universally-applied, discrimination-free merit system are all essential components           with universities and research centres, actively
of the Eni heritage.                                                                              contributing to the training of new generations;            2005 - Employees working abroad by geographical area

                                                                                              G   to manage human resources internationally using
                                                                                                  standardized instruments, while respecting
                                                                                                                                                                                                                   26.60% Africa
                                                                                                  the various local laws and cultures;                                                                              1.50% North America
                                                                                                                                                                                                                    0.01% Central America
                                                                                              G   to achieve significant results in the field of industrial
                                                                                                                                                                                                                    8.20% South America
                                                                                                  relations both in the domestic and international                                                                 21.80% Asia
                                                                                                  spheres;                                                                                                         40.50% Europe
                                                                                                                                                                                                                    0.20% Oceania
                                                                                              G   to obtain maximum effectiveness from internal
                                                                                                                                                                                                                    1.10% Other
                                                                                                  training and communication activities.


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Health and safety                                                                                                           particularly serious events. These units are composed
                                                                                                                            of experts and make use of operating emergency
                                                                                                                                                                                           safety (57% in investments).
                                                                                                                                                                                           Against these health and safety investments and activi-
                                                                    E-medicine project
                                                                                                                            rooms in Rome and Milan that are equipped with                 ties, in 2005 Eni registered the lowest injury frequency
Eni is strongly committed to safeguarding the health of             In 2005, Eni kicked off its E-medicine Project to       sophisticated coordination systems (of people, vehi-           rate in its history for its employees (ratio between the
its employees by improving working conditions, safe-                improve the quality of healthcare service to its        cles, and equipment, both internal and external) and           number of injuries causing more than one day lost and
guarding physical well-being, preventing workplace acci-            employees and to healthcare professionals in Italy      decision-making support systems in the event of an             millions of worked hours) and a strong improvement
dents and occupational illnesses, promoting healthy                 and abroad. The project integrates information          emergency.                                                     compared to 2004 in the injury severity rate (ratio
behaviours and lifestyles. Eni has an organization made             and telecommunications technologies and is              In order to maintain a high level of emergency                 between days lost due to injuries and thousands of
up of 339 company healthcare units, 241 of which are                divided into three initiatives:                         response preparation, Eni periodically carries out drills.     worked hours).
abroad, run by 559 doctors and 455 paramedics, and has                                                                      In October 2005 Eni took part in the “EUROSOT” safety          In order to ensure equal protection of workers rights and
                                                                    G   the Health Card Project, which makes it
entered into a set of domestic and international agree-                                                                     drill, which all the Italian business units participated in.   those of contractor companies, Eni has made it possible
                                                                        possible to have access to individual health data
ments with the best healthcare providers in order to                                                                        Activated by the Italian Civil Defence in collaboration        to extend the principles contained in the Transnational
                                                                        via the Web, based on an electronic health card
ensure a state-of-the-art medical service and rapid                                                                         with the European Union, the drill involved the simula-        Agreement on Industrial Relations and Corporate
                                                                        accessible on-line;
responses to emergencies. In 2005 Eni spent approxi-                                                                        tion of a seismic event affecting the population and           Responsibility to suppliers and contractors. In 2005 Eni
mately 40 million euro on health protection with a pro              G   the Telemedicine Project, making it possible to     industrial plants in Western Sicily.                           registered a similar reduction in the injury frequency rate
capita average of approximately 553 euro.                               make real-time requests for opinions,               In 2005, Eni spent approximately 391 million euro on           and in the injury severity rate for contractors.
Eni is also committed to adopting a preventive                          diagnoses, therapeutic indications in every
approach to safety in order to reduce the risk of acci-                 branch of medicine, to specialists working in
dents and their associated effects, safeguarding the                    outstanding hospital and university complexes,
safety of its employees, contractors, and communities.                  both in Italy and around the world. Every year
Work safety, prevention, and hygiene require advanced                   new stations are set up and new connections                                                                        Safety Indexes 2005

methodologies and technologies for identifying dan-                     are activated for teleconsulting with the                                                                                          Eni Employees                        Contractors
gers and assessing and mitigating risks. Activities relat-              coordination centre at the University of Milan                                                                                     Injury        Injury               Injury          Injury
                                                                                                                                                                                                   frequency rate severity rate       frequency rate   severity rate
ed to health and safety are carried out through con-                    and with various participating international
                                                                                                                                                                                                            3.17             0.10                 2.59               0.07
stant dialogue with trade union organizations.                          healthcare structures. Centres that are currently
As part of its safety activities, Eni has codified internal             using the telemedicine service are located in
site emergency plans specifying all the actions that                    Libya, the Congo, Nigeria, and Italy;
must be taken to reduce the negative consequences of                    connections are soon to be established with
related events. The emergency plans are conveyed to                     centres in Pakistan, Kazakhstan and Angola;
the local public administration, with whom Eni devel-               G   the E-learning Project, providing Eni healthcare
ops a close collaboration both in laying out the area                   professionals in Italy and abroad with access to
emergency plans and in training and organizing joint                    continuous learning programs in medical and
simulations. Integrated Eni departments are actively                    health-related fields.
involved through special crisis units only in the case of


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                                                                                                                                      Relations with Foreign Universities

                                                                                                                                                           Imperial College - London                     Universidad Politecnica
                                                                                                                                             GREAT         Cranfield School                      SPAIN   de Catalunya - Barcelona      KAZAKHSTAN University “Al Farabi” - Almati
                                                                                                                                             BRETAIN       of Management                                 University of Malaga
                                                                                                                                                           Heriot Watt University - Edinburgh

                                                                                                                                                                                                                                                 University of Illinois - Chicago
                                                                                                                                                                                                                                                 University of Texas - Austin
                                                                                                                                             FRANCE        IFP Ecole du Pétrol          NORWAY      Norwegian Institute of Science     USA       Drexel University - Philadelphia
                                                                                                                                                           e des Moteurs - Paris                    and Technology - Trondheim                   University of Minnesota - Minneapolis
                                                                                                                                                                                                                                                 University of California - Berkley

                                                                                                                                             HOLLAND       Delft University                         Royal Institute
                                                                                                                                                                                        SWEDEN      of Technology - Stockholm


                                                                                                                                             BELGIUM       Louvain University
                                                                                                                                                                                                                                       CANADA Ecole Polytechnique - Montreal
                                                                                                                                                                                        POLAND      Polytechnic of Warsaw

                                                                                                                                                           University of Monaco
                                                                                                                                             GERMANY       Unversity of Aachen                                                         ARGENTINE          University of Buenos Aires
                                                                                                                                                           University of Amburgo        RUSSIA      University “Mendeleev” - Moscow


                                                                                                                                                                                                                                       BRAZIL        University of São Paulo
                                                                                                                                                                                                      Denmark Technical
                                                                                                                                                                                        DENMARK       University - Copenhagen
                                                                                                                                             HUNGARY       University of Miskolc




Management
and development                                                                                                                      Internationalization
of human resources                                                                                                                   In the light of the strengthening of Eni’s presence around                   cies for foreign human resources that are localized
Eni is committed to enhancing the potential and profes-             knowledge management, aimed at identifying and dis-              the world with over 32,000 employees, Eni has intensi-                       according to each country’s needs in order to increasing-
sionalism of its employees, with the aim of anticipating            seminating the best practices, as well as initiatives for the    fied its efforts at promoting and coordinating its man-                      ly facilitate integration. With this aim in mind, it has
possible needs related to the development of the business.          dissemination of a shared language, developing and               agement and development program for human                                    developed a series of training projects for new employ-
Considering the strategic importance of human resources             enhancing the MyEni intranet for institutional internal          resources abroad. Eni is aware that knowing, respecting,                     ees abroad, including “Introduction to Eni” and “Special
management and development activities, it has formulat-             communication, the development of technical and scien-           and valuing social and cultural differences as a source of                   training project for Agip KCO”. “Introduction to Eni
ed a system inspired by planning principles (orienting              tific knowledge, and operational activities that support         wealth is an important key to success. Eni has conducted                     group” is a company training course dedicated to young
recruitment and training activities in accordance with              the business. New employees have had an integration              comparative analyses on regulations and provisions in                        graduates employed by associated companies whose
defined objectives), decentralization (allocating opera-            plan created for them based on tutorship, training, com-         more than 70 countries where it operates, focusing on                        purpose is to facilitate integration into Eni’s international
tional and employee management responsibilities accord-             munication, verification and feedback, structured over           salaries and wages, social insurance, and pension                            sphere and to deepen knowledge and awareness of the
ing to guidelines and methodologies shared across the Eni           three years and aimed at fostering development of knowl-         schemes. By also assessing social and cultural aspects, Eni                  company’s history, culture, values, strategies, organiza-
group), monitoring (verifying the effectiveness and effi-           edge and potential in a way that is consistent with the Eni      has implemented management and development poli-                             tion and multicultural dimension.
ciency of the human resources management and develop-               culture and the objectives of the new employees’ busi-
ment system), and marketing (aimed at attracting and                ness area. As part of the company, the Eni Corporate Uni-
keeping talent, increasing motivation and performance).             versity is active in the recruitment process, in training, and
                                                                                                                                       Special Training Project for Agip KCO
                                                                                                                                                                                                                  Industrial relations
Eni believes that training is one of the strengths of human
resources management. In 2005 the total training hours in
                                                                    in knowledge management, acting as an institutional liai-
                                                                    son between Eni and the academic world in Italy and inter-
                                                                                                                                       The project, offered by Agip KCO at its Atyrau                             and human rights
                                                                                                                                       training centre, is dedicated to roughly 300 young
Italy added up to 1,178,943, for an average training per            nationally to develop and disseminate the corporate cul-
                                                                                                                                       graduates from Kazakhstan who have no previous
employee of 3.7 days. Training expenses in Italy in 2005            ture. To this end, agreements have been entered into with                                                                                     Industrial relations are an effective and consistent instru-
                                                                                                                                       work experience. The aim of the initiative is to
came to 22 million euro. In addition to traditional class-          68 Italian campuses and foreign universities in 17 coun-                                                                                      ment for realizing company strategies.
                                                                                                                                       train employees who are capable of taking on
room and on-the-job training, new remote learning meth-             tries. Working within the Eni Corporate University, the                                                                                       In Italy, in 2001 Eni signed an “Industrial Relations Proto-
                                                                                                                                       important production and managerial positions
ods (e-learning) were also employed. Training dedicated             Scuola Enrico Mattei annually offers the Master MEDEA                                                                                         col” with Trade Unions that is based on preventive infor-
                                                                                                                                       in local operations. The Atyrau centre was
to Health, Safety, Environment and Quality represent 24%            (Master’s in Management and Economics of Energy and                                                                                           mation-sharing, consultation, and the use of new partici-
                                                                                                                                       completed by Eni in 2004 and is furnished with
of the total hours and involves 56% of the participants.            the Environment). The Scuola Enrico Mattei has been pro-                                                                                      patory instruments. The participatory process consists of
                                                                                                                                       all the equipment needed to acquire expertise on
In addition to training activities, the HSE.net portal repre-       viding post-graduate research and training since it was                                                                                       three annual milestones: presentation of balance sheets
                                                                                                                                       exploration and production processes. The
sents an important information resource for employees               founded in 1957. The integration of energy and the envi-                                                                                      and investment plans, analysis of the economic, energy,
                                                                                                                                       training course lasts 36 months, 11 of which are
and is aimed at providing data and updates to anyone in             ronment in an international context are the distinguishing                                                                                    and regulatory scenarios, explanation of the multi-year
                                                                                                                                       devoted to intense field work in order to allow the
the company who is interested in HSE topics. In 2005, a             characteristics of the Scuola Enrico Mattei which has                                                                                         strategic plans. In 2005, as part of the company’s collec-
                                                                                                                                       participants to consolidate their learning and
new section on Climate Change was added to the HSE.net.             trained almost 2,500 young people, of whom 55% are for-                                                                                       tive bargaining negotiations, four-year agreements were
                                                                                                                                       acquire full operational autonomy.
Other initiatives closely integrated with training include          eigners from 100 different countries.                                                                                                         established on pay for participation (2004-2007 term) in


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                                                                    Equal opportunity
                                                                    and Diversity
                                                                    In compliance with Italian law and in harmony with the
                                                                    European Union recommendation on the protection of
                                                                    human dignity, Eni is committed to pursuing initiatives                                                                    Energy
                                                                    aimed at identifying and eliminating any obstacles to
                                                                    effective equal opportunity in gaining access to employ-
                                                                                                                                                                       and environmental responsibility
                                                                    ment and in career paths. In the scope of an appropriate
                                                                    equal opportunity policy, Eni protects its differently able
                                                                    and other socially disadvantaged employees and pro-
                                                                    motes initiatives to facilitate their targeted access into
                                                                    the company.
                                                                    In the countries where it operates, Eni promotes the
                                                                    development of skills of its local human resources and
                                                                    the construction of a common culture shared through
                                                                    numerous training initiatives.

the three sectors in which Eni operates (Energy-Oil,
Chemicals, and Natural Gas-Water).                                    Eni Multicultural Training Project:
Internationally, the dialogue between Eni and union                   a joint initiative with
organizations provides for annual meetings with the                   the European Works Council
European Works Council (EWC) and with the Interna-
tional Federation of Chemical, Energy, Mine and General               The idea of a European training project on the
Workers’ Unions (ICEM). The meetings with the EWC,                    topic of diversity was formed in July 2002 in
started in 1995, offer information-sharing and consulta-              Munich during the annual EWC meeting.
tion on a European scale regarding topics including the               The project was started on an experimental basis
economic situation, operations and investment plans,                  in Central and Western Europe for a
the employment situation and prospects, training, intro-              representative sample of Eni human resources
duction of new work methods and new production                        coming from 9 countries, subsequently extended
processes, health and safety issues. On a global scale, by            to France, involving around 300 Italian
signing the Industrial Relations Agreement at an interna-             and French employees (managers, office workers,
tional level and the Corporate Social Responsibility                  and workers). The objective of the project is to
Agreement with the ICEM and the Italian trade unions,                 increase the sense of belonging to Eni, to promote
Eni has reaffirmed its commitment to complying with the               intercultural communication, to foster cohesion
principles of the United Nations Universal Declaration of             in a multicultural working environment.
Human Rights, the International Labour Organization’s
Fundamental Conventions, and the OCSE Guidelines for                                                                              Eni believes that, on the basis of current knowledge, the massive use of fossil fuels is
Multinational Enterprises. In particular, Eni has commit-
                                                                                                                                  contributing to planetary climate change. As a corporation operating in the oil & gas sector,
ted itself to being actively engaged in ensuring the right
to the freedom of union association and to collective bar-                                                                        Eni is committed not only to satisfying energy demands, but also to conserving energy and
gaining, the ban on forced labour, the ban on child labour,                                                                       protecting the environment. The model for growth and value enhancement chosen by Eni
non-discrimination in the workplace, non-discrimination                                                                           is that of sustainable development. In particular, Eni is committed to mitigating the risks
against workers’ representatives, and constant research                                                                           of climate change caused by the emission of greenhouse gases.
in improving health and safety conditions in the work-
place, also providing for monitoring and intervention
measures in the event of violations.




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Eni initiatives in response to the risk of climate change                                                  available technologies at the highest efficiency levels;   The development of natural
have the following main objectives:
G   preferential development of low carbon intensity
                                                                                                       G   the capture and permanent geological storage of
                                                                                                           CO2;
                                                                                                                                                                      gas and its use in
    fossil fuels, in particular natural gas;                                                           G   the gradual reduction of gas flaring associated with       the production of electricity
G   natural gas-electricity integration, which makes it                                                    the production of oil, developing local or
    possible to exploit the high energy efficiency of                                                      international market outlets.                              The development of natural gas is one of the most effec-                                     approximately 26% lower than oil and approximately 41%
    natural gas in electricity generation and                                                                                                                         tive responses to the risks of climate change. New trans-                                    lower than coal. The share of natural gas used globally to
    cogeneration;                                                                                      Furthermore, Eni’s most long-term strategy is to develop
                                                                                                       lower environmental impact fuels and more efficient            port technologies, the enormous reserves that have                                           generate electricity is expected to go from today's figure
G   active participation in Emission Trading systems,                                                  technologies for the production of hydrogen. This invol-       been located, its overall lower cost, and sustainable                                        of 36% to around 50% over the next 25 years, accompa-
    promoting the reduction of emissions in its own                                                    ves designing and developing a sustainable energy              development all point to natural gas as a primary energy                                     nied by a decline in all other primary sources. The reasons
    industrial plants;                                                                                 system based on multiple high-efficiency sources, pro-         source over the coming decades.                                                              for this development are attributable to the superiority
G   the realization of reduction projects based on Flexible                                            ducts and technologies.                                        Natural gas is, in fact, more efficient and less polluting                                   of natural gas in conjunction with combined cycle elec-
    Mechanisms provided for by the Kyoto Protocol                                                      Eni is also committed to reducing its own energy and           than oil and coal. Considering the same amount of pri-                                       tricity production in terms of greater efficiency (for
    (Clean Development Mechanism - CDM - and Joint                                                     water consumption, “local” air, water, and soil pollution,     mary energy, the CO2 emission factor (2.35 tCO2/toe) is                                      example, almost a third higher compared to coal), with
    Implementation - JI), which permit the development                                                 its waste production, as well as rehabilitating and resto-
    in hosting countries of energy systems using the best                                              ring disused industrial areas and sites.                       The Eni international gas transport network                                                                                           The Eni gas transport network in Italy
                                                                                                                                                                                                                                                                                                                                                         Operating in 2004
                                                                                                                                                                          LNG shipping                   North Sea
                                                                                                                                                                                                                                                                                                                         NETHERLANDS and NORWAY
                                                                                                                                                                                                          system                                         GAS TRANSMISSION INFRASTRUCTURE
    Eni and the mitigation of Climate Change                                                                                                                              Tanker ships:
                                                                                                                                                                                                                                                                                                                                                        RUSSIA
                                                                                                                                                                             Nigerian LNG (10+4)                                                         LNG       Pipeline
                                                                                                                                                                             Eni’s share 10.4%
                                                                                                                                                                                                                                                                              Existing
                                                                                                                                                                                           INTERCONNECTOR                                                                     Projects underway
     Carbon emissions
                                                                                                                                                                                                                      TENP
                                                                                                                                                                                                       TRANSITGAS
                                                                                                                                                                                                                                 TAG
                                                                                                                                                                                         EL FERROL
                                                                                                                                                                                                       PANIGAGLIA                SRG                                                                                             LNG
                                                                                                                                                                                                                      Storage
                                                                                               Emission trading,          Capture                                                                                     system
                                                                                               CDM and JI                 and permanent                                                              SAGUNTO                                                    BLUE STREAM
                                                                       Use                                                storage of CO2            “CO2 – free”                         SINES                    TMPC

                                                                       of most efficient                                                            energy sources                                                              GREENSTREAM
                                                                       technologies                                                                                         BONNY NIGERIA TRANSMAGHREB
                                      Use of natural gas                                                                                                                                                       TTPC
                                                                                                                                                                                                                                                                                                                      COMPRESSION
                                      in the production                                                                                                                                                                                          EGYPT                                                                STATIONS

                                      of electricity                                                                                                                                                                                                                                                                  STORAGE
                                                                                                                                                                                                                                                                                                                      STATIONS
                                                                                                                                                                                                                                                                                                                                              ALGERIA
        The development                                                                                                                                                                                                                                                                                               STORAGE and/or                    LIBYA
        of natural gas                                                                                                                                                                                                                                                                                                COMPRESSION
                                                                                                                                                                                                                                                                                                                      STATIONS




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                                                                                                                                                                           The Kyoto Protocol:
                                                                                                                                                                           Emission Trading
                                                                                                                                                                           and Flexible Mechanisms
                                                                                                                                                                           Climate change connected with greenhouse gas emis-
                                                                                                                                                                           sions (GHG) represents a global environmental issue
                                                                                                                                                                           having an impact on economic systems, populations,
                                                                                                                                                                           and future generations. Its importance on the interna-
                                                                                                                                                                           tional agenda does not depend on energy trends and on
                                                                                                                                                                           the different positions of the individual countries. With
                                                                                                                                                                           the coming into force of the Kyoto Protocol in 2005 and
                                                                                                                                                                           the subsequent Conference of the Parties in Montreal
                                                                                                                                                                           (COP 11), climate change has become the most impor-
                                                                                                                                                                           tant environmental issue affecting the evolution of the
                                                                                                                                                                           energy sector.
                                                                                                                                                                           The European Emission Trading Scheme (ETS) for the miti-
                                                                                                                                                                           gation of risks of climate change in Europe started on 1
lower investment in production facilities, much shorter                                                able to third-party operators.                                      January 2005, and it involves industrial installations with
construction times, and lower emission factors, a very                                                 Thanks to its activities in the natural gas sector, Eni is in the   the greatest CO2 emissions. Eni is one of the largest in this                   Gas flaring
important factor in the current energy scenario which is                                               position to offer the market a range of sources with                category in Europe and in Italy it ranks as the biggest
highly attentive to environmental sustainability.                                                      reduced greenhouse gas emissions. The average emission              industrial group in terms of number of plants involved (61                      The elimination of GHG emissions from flaring
The history of Eni is distinguished by its preferential                                                factor is 2.65 tCO2/toe, one of the lowest in the world             plants making up 7% of the total installations) and second                      in the world would account for at least 10% of
development of natural gas, from the discovery of the                                                  among the group of major oil and gas corporations.                  in terms of allowances (EUA) allocated by the National                          total emissions reductions - 2,300 Mt of CO2
first natural gas field in Italy in 1944 (No. 1 gas field at                                           Eni is also active in Italy in producing and supplying elec-        Allocation Plan (22.4 MtCO2 in 2005, making up 10% of                           eq - which Annex I countries in the Kyoto Protocol
Caviaga) to the construction of the great transport infra-                                             trical energy to businesses. The electricity is produced in         total assigned EUA). In order to participate in the ETS, Eni                    must achieve during the 2008-2012 period.
structures built starting in the 1970s to import from Rus-                                             combined cycle cogeneration power plants that use nat-              has introduced organizational processes involving, albeit                       Flaring and venting of associated gas constitutes
sia, the Netherlands, Algeria and more recently, from                                                  ural gas as fuel. The technology and fuel used render the           part-time, more than 200 experts to monitor and account                         a significant source of GHG emissions, but also
Libya. Eighty percent of the natural gas imported into                                                 highest efficiency in energy production (electricity and            for emissions in all its plants operated around the world,                      a usable energy source for sustainable
Italy arrives through a network of high-pressure gas                                                   steam) and a low environmental impact: in the produc-               to plan projects and investments for reducing emissions,                        development initiatives in the producer country.
pipelines more than 4,300 km long, over which Eni holds                                                tion of 30 TWh, the technology used allows CO2 emis-                to disseminate best practices throughout the organiza-                          It is estimated that the volumes of gas burned
the transport rights. Moreover, Eni owns a fleet of 4                                                  sions to be reduced by approximately 11 Mt compared to              tion, to implement an internal emissions balancing plan,                        in flares around the world are 102-135 Gm3/year.
methane-tankers for the transport of Liquefied Natural                                                 conventional thermoelectric plants. The average emis-               and to exploit the surplus generated.                                           If turned to electricity generation in high
Gas (LNG), which unload the gas into the domestic grid                                                 sion factor for Eni power plants, approximately 0.34                In addition to participating in the ETS, Eni is developing a                    efficiency power plants, the amount of gas sent
through the only existing regasification plant in Italy,                                               tCO2/MWh, represents an international record in ther-               portfolio of emission reduction projects based on the                           to flaring in Africa, 37 Gm3/year, would produce
located in Panigaglia, in northern Italy. Ninety-five per-                                             moelectric generation. Eni is also completing the realiza-          Kyoto Protocol Flexible Mechanisms (CDM - Clean                                 200 TWh, roughly 50% of the electricity consumed
cent of the 32,190 km of gas pipelines in Italy are owned                                              tion of an investment program in Italy planned to replace           Development Mechanism and JI - Joint Implementation).                           on the African continent.
by Eni. With 96 billions of m3 of natural gas sold in 2005,                                            old cogeneration plants powered by fuel oil with new                The project for electricity generation at Kwale in Nigeria                      With the aim of supporting petroleum
Eni is the number one operator in Europe. Eni’s strategic                                              combined cycle cogeneration plants. This program will               that uses the associated previously flared gas and gener-                       companies and countries involved in the efforts
goal is to strengthen its European leadership, maximizing                                              bring Eni’s installed capacity up from 4.5 gigawatt to 5.5          ates reductions in emissions of 1.5 MtCO2/year was                              directed at removing obstacles to the reduction
the value of its gas equity holdings in Italy, Libya, Egypt,                                           gigawatt in 2009, using roughly 6 billion m3 of natural gas         brought before the CDM Executive Board. The Kwale                               of flaring-venting practices, the World Bank has
and the North Sea, as well as long-term supply contracts                                               and covering approximately 9% of domestic electricity               installation contributes to sustainable development in                          put forward the Global Gas Flaring Reduction
with major producers like Gazprom, Sonatrach, Gasunie                                                  needs.                                                              Nigeria, increasing the electricity generation capacity by                      Initiative, which Eni has joined.
and Statoil. Over the next few years, new investments will                                                                                                                 approximately 13% and reducing greenhouse gas emis-                             The Kwale project in Nigeria constructed by Eni
be made to develop infrastructures for importing natural                                                                                                                   sions (GHG). This project comes under the scope of a Vol-                       is the first major electricity generation plant
gas into Italy through a widespread integrated transport                                                                                                                   untary Agreement, signed in 2003, between Eni and the                           powered by associated gas previously flared.
network, with multiple receiving and storage points. In                                                                                                                    Italian Minister of the Environment with the goal of
particular, Eni is evaluating the possibility of building new                                                                                                              reducing GHG emissions assigned by the Kyoto Protocol.
regasification plants, partly with the aim of reducing                                                                                                                     Parallel to the development of CDM initiatives, Eni has
strategic dependency on the current supply system,                                                                                                                         begun to study opportunities for JI projects in the most
based predominantly on gas pipelines. By 2009 Eni will                                                                                                                     promising countries.
make an additional import capacity of 21 billion m3 avail-


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                                                                                                       Eni emissions
A sustainable                                                                                          5
                                                                                                                                                                        diesel and low-benzene gasoline in the 1990s. Given the
                                                                                                                                                                        positive market response, the introduction of the “blu” line
                                                                                                                                                                                                                                                    number of methane vehicles in Europe and third in the
                                                                                                                                                                                                                                                    world, after Argentina and Brazil). Methane offers excel-
energy system                                                                                          Direct emissions of GHG
                                                                                                       Acidification potential
                                                                                                                                       (MtCO2 eq)
                                                                                                                                       (kt SO2 eq)
                                                                                                                                                            61.84
                                                                                                                                                          142.39
                                                                                                                                                                        has also proven to be a farsighted commercial venture. In                   lent engine performance, lower consumption, and
                                                                                                                                                                        2005 the share of BluDiesel sold by the Agip network rep-                   reduced emissions of particulates, carbon monoxide,
                                                                                                                                                                        resented 15% of the total diesel sold; the share of BluSuper                nitrogen oxides, and unburned hydrocarbons. Over 500
                                                                                                       Direct emissions
Technological innovation plays a decisive role in the                                                                                                                   represented 2.5% of gasoline sold.                                          service stations are located throughout the domestic terri-
                                                                                                       of GHG/toe consumed             (t CO2 eq/tep)        2.56
development of a more sustainable energy system that                                                                                                                    Eni also markets methane for automotive fuel. This fuel is                  tory, 400 of which are supplied by Eni.
                                                                                                       Acidification
is compatible with the objective of stabilizing concen-                                                potential/toe consumed          (t SO2 eq/tep)        0.01       used in Italy by over 400,000 motor vehicles (the largest
trations of GHG in the atmosphere. Eni is committed to
the study of solutions that enable the capture and per-
manent storage of CO 2 in geological formations and
                                                                                                                                                                          Agip “multiEnergy” stations
the use of biomass for electricity generation and for
the production of fuel (biofuel) in transportation.                                                    Development of fuels                                               In collaboration with several Italian regional
                                                                                                                                                                                                                                                    Reducing the ecological
The technology of geological sequestration of CO2 is
considered essential for stabilizing CO2 in the atmos-
                                                                                                       with a lower                                                       authorities, Eni is creating next-generation                              footprint and protecting
phere. Eni participates, along with other oil & gas com-                                               environmental impact                                               “multiEnergy” service stations to satisfy
                                                                                                                                                                          the increasing demand for alternative fuels
                                                                                                                                                                                                                                                    biodiversity
panies, in the CO2 Capture Project (CCP), which plans
                                                                                                                                                                          targeting fuel-cell mini-fleets for passenger
for the development of innovative technologies for
                                                                                                                                                                          and freight transport. In 2003, the first Agip
capturing CO2 and the analysis of risks associated with                                                The environmental impact worldwide caused by the trans-                                                                                      Eni continues to pursue its goal of meeting energy
                                                                                                                                                                          “multiEnergy” solar station was inaugurated
long-term sequestration of CO2 in geological struc-                                                    portation of people and goods is becoming increasingly                                                                                       demands while at the same time protecting the envi-
                                                                                                                                                                          in Milan, featuring structurally integrated
tures. In addition to participating in the CCP, Eni has                                                significant, involving both the passenger and freight sec-                                                                                   ronment and conserving biodiversity.
                                                                                                                                                                          photovoltaic panels located on the forecourt
begun a strategic project aimed at field demonstration                                                 tors. Eni contributes to the mitigation of these impacts by                                                                                  In order to ensure that operations in all its spheres of
                                                                                                                                                                          roofing and the building, providing an installed
of the sequestration of CO2, using already separated                                                   producing and distributing innovative and eco-friendly                                                                                       activity are carried out minimizing environmental
                                                                                                                                                                          capacity of approximately 19 kW.
CO2 available in Italy and abroad.                                                                     fuels and products. Through its “blu” fuel product line                                                                                      impacts, Eni has developed a complex HSE manage-
                                                                                                                                                                          The first multifuel service area to produce
As far as the use of biomass is concerned, Eni has con-                                                (BluDiesel in 2002 and BluSuper in 2004), Eni was the first                                                                                  ment system certified by internationally accredited
                                                                                                                                                                          hydrogen exclusively from renewable sources
ducted feasibility studies for the production of elec-                                                 oil company to introduce gasoline on the market whose                                                                                        inspection bodies. Before starting up new operations,
                                                                                                                                                                          is in its completion phase near Livorno. The new
tricity and biofuels to replace diesel from vegetable                                                  environmental properties anticipated the limits imposed                                                                                      in any part of the world, an environmental impact
                                                                                                                                                                          service station will have a self-generating energy
oils, obtainable through the hydrotreatment of veg-                                                    by European fuel laws regulating the amount of benzenes.                                                                                     assessment is conducted. While in operation, the pro-
                                                                                                                                                                          system from renewable sources provided by
etable oils.                                                                                           These are innovative fuels offering high performance and                                                                                     duction unit is monitored using methods that make it
                                                                                                                                                                          photovoltaic and wind units, and cogeneration
                                                                                                       low environmental impact that guarantee better engine                                                                                        possible to receive early warning signals regarding
                                                                                                                                                                          modules using natural gas and LPG to produce
                                                                                                       efficiency and a longer life, with lower consumption. The                                                                                    potential impacts on the environment. Once the work
                                                                                                                                                                          electrical and thermal energy, making the service
                                                                                                       “blu” line testifies to the constant attention Eni pays to the                                                                               is completed, the area is restored to its original state or,
                                                                                                                                                                          station energy self-sufficient, reducing costs
                                                                                                       quality of its fuels, continuing the tradition begun in the                                                                                  if this is not possible, Eni undertakes to recover and
                                                                                                                                                                          and containing CO2 emissions.
                                                                                                       1980s with lead-free gasoline and followed by low-sulphur                                                                                    rehabilitate the environment. Eni has gained particular-


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                                                                                                                                                                                                                                          Innovation
                                                                                                                                                                                                                        for sustainable development




ly extensive experience in the laying of gas pipelines.
The route is chosen from various alternatives based on
                                                                                                       Investments and
considerations relating to environmental impact, trans-                                                expenditure for
port security, and technical-economic feasibility. Dur-
ing the construction phase, trenches are dug for laying                                                environmental protection
the pipes using technologies that interfere as little as
possible with the surrounding environment. Once the                                                    Eni’s growing commitment to environmental sustain-
laying has been completed, the land is restored to its                                                 ability is testified to by the investments and expenditure
original state through careful restoration operations.                                                 made in 2005, amounting to 1,5 billion euro, up 33%
Eni is committed to safeguarding biodiversity in all the                                               compared to the previous year.
spheres it operates in.
Operations are carried out with the objective of reduc-
ing impact on species of plants and animals (from bac-                                                 Breakdown of environmental expenditure
teria to superior organisms), their genetic patrimony,
the habitats they live in, the ecosystems, and the func-
tions these ecosystems fulfil. One example of the
approach taken in this field is the AgriBioDiversity proj-
ect that Eni is conducting, along with a partner, in the
south of Italy. The first phase of the project for identify-
ing and monitoring biodiversity has been completed in                                                                                                               In order to support its growth process and to promptly respond to new scenarios
the Val d’Agri industrial zone.
                                                                                                              5.8%       Air                                        in the industry, Eni has reaffirmed its commitment to technological innovation, aimed
The study has made it possible to classify the various                                                       15.6%       Waste
types of environments and to define exploration meth-                                                         0.4%       Noise
                                                                                                                                                                    at providing its core business with the “key” technologies needed to acquire competitive
ods according to the areas.                                                                                   1.2%       R&D                                        and long-lasting sustainable advantages. Our commitment to these issues is associated
                                                                                                              0.1%       Communication
The territory has been differentiated into three main
                                                                                                             18.9%       Other                                      with research and development of innovative processes and products capable of determining
segments: natural, quasi-natural, and rural. Biological                                                                                                             mid to long term technological discontinuity factors in the industry. Technological research
components that have the greatest role in maintaining
the stability of the ecosystem are identified for each                                                       13.5%       Water                                      and innovation activities will be developed in the framework of a new technology plan
                                                                                                             31.2%       Soil and reclamation
segment in order to define biological indicators (bio-                                                        5.6%       Environmental cleanup
                                                                                                                                                                    for 2007-2010 that Eni is committed to approve within 2006.
markers) of environmental stress. The ecotoxological                                                          7.6%       Environmental management
monitoring of extraction areas, based on the use of bio-                                                      0.1%       Training

markers, has demonstrated that the environmental
impact is modest and limited to the area within the pro-
duction site.


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Eni is aware that oil & gas companies are called upon to                                          risk. The technology consists in reducing the clearance     3D Common Reflection Surface Stack:                                       “H2S and Sulphur Management in E&P
intensify their efforts to increase hydrocarbon availabili-                                       between the diameter of the well and the casing
                                                                                                                                                              a new technology for investigating                                        Operations”: a research program for
ty, making more efficient use of existing reserves and dis-                                       columns, keeping the same production casing size.
covering new ones under increasingly difficult condi-                                                                                                         the subsoil                                                               increasing the production of natural
tions, with maximum attention placed on environmen-                                                                                                                                                                                     gas while respecting the environment
tal protection and safety.                                                                                                                                    The development of new subsoil investigation instru-
The main lines of research under development pertain                                                                                                          ments for reconstructing the geometry, properties, and
                                                                                                  EST Project: conversion of heavy crude
primarily to reducing the costs of finding and recovering                                                                                                     evolution over time as closely as possible to reality has                 In 2006 the Integrated Research Program “Sulphur and H2S
hydrocarbons, optimizing treatment and transport of
                                                                                                  oil and “fractions” into light products                     the purpose of reducing exploration risk and enabling                     Management in E&P Operations”, focused on intensifying
natural gas, and environmental protection.                                                                                                                    optimal management of the oil field. Eni has developed                    investigation into technological issues related to the treat-
Some of the main initiatives in the field of technological                                        The development of EST technology is one of the inno-       the “3D Common Reflection Surface Stack” technology                       ment of natural gas at an extremely high acidity level, is
innovation for sustainable development include:                                                   vations that can have a significant impact on the oil &     which has had numerous industrial applications, provid-                   planned to be completed. Some the most important
                                                                                                  gas industry. EST is a catalytic hydroconversion process    ing far superior results compared with conventional                       results include a new technology of H2S “bulk removal” and
                                                                                                  in the slurry phase that can completely convert             technologies and making it possible to produce an accu-                   an innovative system for massive sulphur storage.
                                                                                                  asphaltenes (the “hard” part of heavy oils), thereby        rate estimate of the available reserves.
                                                                                                  bringing production of both liquid and solid residues
Lean Profile:                                                                                     close to zero, especially those deriving from the refine-
a new drilling technology                                                                         ment of “non conventional oils”. This is a flexible tech-
                                                                                                  nology that combines upstream and downstream                GTL: the use of natural gas                                               Clean Diesel Fuel Project:
Development of new drilling technologies for deviated                                             requirements, potentially adaptable to extremely            for the production of fuels                                               a new development in Agip “blu” fuels
or horizontal wells is aimed at improving drilling capaci-                                        diverse contexts and products, including naphtha,
ty to reach greater depths, with ever greater reduction of                                        kerosene and diesel. The technology is the fruit of         GTL (evolution of a technology already used in the past for               As part of the strategy to improve the quality of auto-
drilled rock, thereby reducing operation times and envi-                                          research begun in the late 1980s, which reached the         the coal gasification and liquefaction) enables the large-                motive fuels, by 2002 Eni had already begun marketing
ronmental impact. Eni has a long tradition in this field. In                                      pilot scale phase in 2001, the year Eni began construc-     scale use of natural gas for the production of automotive                 of products (first “BluDiesel” and then “BluSuper”)
1993 it obtained a record with the drilling of the first hor-                                     tion of a pilot plant at the Taranto refinery. Completed    fuels, in particular diesel. It has strategic importance not              responding to specific EU requirements that will take
izontal well in deep waters (Aquila 2,820 meters of                                               in June 2005, the plant is now operational and the tech-    only for Eni but for all major oil & gas companies, since it              force starting in 2009, and which provide for the use of
depth) and in 1994 the deepest onshore well in the                                                nology is currently undergoing validation. Once the EST     makes it possible to lower fuel production costs while                    extremely low sulphur content fuels. The “Clean Diesel
world (Trecate 14, 5,783 meters of depth). The Lean Pro-                                          technology has been fully demonstrated, it will provide     reducing the environmental impact of the production                       Fuel” Project looks to longer term objectives and aims
file technology was introduced in 1997, developed and                                             an important competitive tool for the exploitation of       process at the same time. Research activity culminated in                 at identifying the formulation of optimal diesel fuels
patented by Eni, and has been constantly improved since                                           non-conventional resources and for the best use of the      2005 with the preparation of the first BDP (basic design                  that can improve engine performance and significantly
then. This technology is used for drilling deep wells, verti-                                     “bottom of the barrel” in refining operations, in envi-     package) for an industrial unit. The 2006 program plans to                reduce particulate emissions, using the new GTL gas as
cal and deviated, under difficult operating conditions                                            ronmental terms as well.                                    continue research activities on a pilot plant, to define the              a term of comparison.
(high pressure and high temperature). The well obtained                                                                                                       optimal size of the Eni GTL module, and to prepare the BDP
using EST technology is of high quality with lower mining                                                                                                     for the unit.


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                                                                                                                                                                                                                              Relations with the territory
                                                                                                                                                                                                                            and community development




TAP: a new technology
for the transport of natural gas
Eni innovations in the natural gas sector evolve in line                                          long distances from 7.5% to around 3% of the quantity
with its history and have contributed to reach a leader-                                          transported. The current project, begun in 2002,
ship position in Europe. In the wake of its tradition, Eni                                        includes a set of experimental-, engineering-, and con-
is developing a new technology for pipeline transport                                             struction-related activities that have led to the cre-
of large quantities of natural gas (in the order of 20-30                                         ation in 2005 of two infrastructures for the purposes of
billion cubic metres/year) from production sites to                                               technology validation (one demonstration segment
consumer markets (distances farther than 3 thousand                                               and one pilot segment). Subsequent development of
kilometres) using pressures equal or greater than 15                                              the project may involve the construction and opera-
Mpa and making use of extremely high grade steel. The                                             tion of a commercial line having a length of several
TAP technology will be able to reduce consumption of                                              dozen of kilometres.
gas used in compression stations for transport over




                                                                                                                                                             Eni operates in over 70 countries, respecting the human rights of the local populations,
                                                                                                                                                             their territories and the environment, contributing to improvement of their quality of life
                                                                                                                                                             and to the socio-economic development of their communities.
                                                                                                                                                             This commitment constitutes the basis of entrepreneurial behaviours founded on respect
                                                                                                                                                             for the ethnic, social, and cultural diversity of the many communities with
                                                                                                                                                             which Eni interacts.




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To aid in fostering integration, Eni:                                                             ing to the principles and the types of intervention
G   collaborates with local and national authorities and                                          described, Eni relies on methods of intervention that are in
                                                                                                                                                                 Social Impact                                                                          Eni in Kazakhstan: the Kashagan Program

    with international NGOs                                                                       line with the best international practices and the highest     Assessment                                                                             Eni has committed itself to developing the
                                                                                                  standards. Among those used, three of the main opera-
G   supports initiatives that can develop autonomously                                            tional tools include:                                                                                                                                 Kashagan project in the Northern Caspian Sea,
    within the social, cultural, and environmental fabric of                                                                                                     Social Impact Assessment (SIA) is an instrument used by Eni                            one of the most important oil finds in recent
    the various local contexts                                                                    G   dialogue with local stakeholders                                                                                                                  years, in order to generate maximum benefits
                                                                                                                                                                 to manage social and territorial consequences deriving
G   promotes dialogue with local communities on                                                   G   social impact assessment                                   from its activities in host countries. The “strategic” issues                          for the territory and the local community. A
    industrial choices through participatory tools                                                G   definition and revision of guidelines for community        analyzed concern all aspects involving the life of the popu-                           strategic impact assessment has been
                                                                                                      investment programmes                                      lations that may be affected by the presence of the industri-                          accordingly initiated, evaluating not only social
G   fosters improvement of the socio-economic system in                                                                                                                                                                                                 but also environmental and economic impacts
                                                                                                                                                                 al operator: local development, social dynamics, economic
    which it operates, where possible, in accordance with                                                                                                                                                                                               considered to be strategic for the success of the
                                                                                                                                                                 prospects of the region, the institutional context, human
    the specific needs for business, goods, works, and local                                      Eni’s commitment is testified to by expenditure on initia-                                                                                            project. The results of the study have made it
                                                                                                                                                                 rights. Through the use of this methodology, Eni has set up
    services, with the aim of maximizing local content                                            tives for the local beneficiary communities amounting to                                                                                              possible to identify optimal alternatives for
                                                                                                                                                                 targeted investment programs in response to the needs of
G   extends initiatives dedicated to its employees and their                                      roughly 49 million euro in 2005, divided into the fields of                                                                                           initiatives aimed at ensuring respect and
                                                                                                                                                                 the local communities.
    families to the local communities where it operates,                                          healthcare, social development, education and training,                                                                                               generation of value for the stakeholders. In
    particularly in the field of healthcare.                                                      environment and culture.                                                                                                                              Kazakhstan Eni is also committed to numerous
                                                                                                                                                                                                                                                        initiatives for the beneficiary community which
In order to make consistent progress with its policy on terri-                                                                                                     Eni in Norway: the Goliat Project                                                    primarily consist in the realization of
torial relations and fulfil stakeholder expectations accord-                                                                                                                                                                                            infrastructures and projects in the healthcare
                                                                                                  Dialogue                                                         For the development of the Goliat oil field                                          sector as well as the construction of schools and
                                                                                                  with local stakeholders                                          in the Barents Sea in Norway, Eni is studying
                                                                                                                                                                   alternative ways to carry out the project, placing
                                                                                                                                                                                                                                                        social structures. Particularly noteworthy
                                                                                                                                                                                                                                                        projects include the creation of a widespread
Community development expenditure in 2005
by type of initiative                                                                                                                                              attention not only on the environment,                                               network for the supply of natural gas to urban
                                                                                                  Involvement with local stakeholders is an important fac-         but also on the social implications for the Saami                                    and rural areas, and a water supply system in
                                                                                                  tor for success in the industry: it reduces technical and        people who are recognized as an “Indigenous                                          the Bautino area through a desalinization plant
                                                                                                  economic-financial risks, enhances the reputation and            People” by the International Labour                                                  on the Caspian Sea. Initiatives in the field of
                                                              9.6% Health                         assists in identifying optimal solutions to implement,           Organization (ILO) and by Norwegian law.                                             healthcare include the construction of new
                                                              4.5% Training                       thereby increasing the overall value of the project. Eni         Eni has begun consultation with the Saami                                            hospitals, restoration and enhancement of
                                                             24.5% Culture                        therefore uses a specific support methodology for identi-        Parliament with the aim of ensuring respect                                          existing healthcare facilities, as well as the
                                                             36.5% Environment                    fication, analysis, and consultation with stakeholders.          for their rights, responding to their                                                provision of medical instrumentation and
                                                             24.8% Social                                                                                          requirements, and identifying possible local                                         ambulances. Building projects include the
                                                                                                                                                                   development opportunities in the management                                          construction of new schools, social structures,
                                                                                                                                                                   of the project.                                                                      and road networks.


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                                                                                                                                                               Eni in Italia                                                                           At a national level, Eni takes part in large initiatives for
Areas of intervention                                                                                                                                                                                                                                  the promotion of Italy’s cultural heritage. It suffices
                                                                                                                                                               Eni’s multinational vocation and its attention to the                                   to mention the restoration of the façade of St. Peter’s
                                                                                                                                                               communities around the world is a trait that has                                        Basilica, completed in 2000 for the Jubilee. In these sorts
Eni periodically defines priority intervention areas for the                                      education and training, environment, and culture. The        distinguished the company ever since its formation.                                     of cases, the company’s support is not limited to simple
local beneficiary communities on the basis of the consul-                                         intervention strategies are directed toward the realiza-     Eni has always nurtured a special relationship with                                     financial backing. Eni makes available its technical and
tation with stakeholders and social and environmental                                             tion of integrated projects, giving relatively more impor-   its country of origin, something that is not entirely                                   scientific knowledge, placing its know-how at the service
impact assessments. In 2005 Eni committed itself to five                                          tance to the various areas according to the context and      attributable to its former status as a public sector                                    of the projects to be completed.
areas of intervention: healthcare, social development,                                            local needs.                                                 corporation. Rather, it expresses a choice and an                                       Eni’s cultural initiatives also include music and theatre.
                                                                                                                                                               assumption of responsibility that it continues to reaffirm                              The company supports various Italian musical
   Eni in Nigeria                                                                                                                                              over the years. Eni has played and continues to play a role                             institutions, including Milan’s La Scala Theatre and
                                                                                                                                                               in Italy that is not only economically, but also socially and                           the Fenice Theatre in Venice, as well as sponsoring
   Eni’s presence in Nigeria dates back to the early                                                 women and young people to work in production              culturally important, expressed through various types                                   a number of different events such as the Festivals
   1960s. Its commitment in the healthcare area has                                                  activities. Moreover, it has promoted primary             of initiatives that benefit both local communities where                                of Ravenna and Spoleto and concerts for the Italian Fund
   focused on initiatives directed toward prevention                                                 education within government programs, through             the company operates as well as the national community                                  for the Environment (FAI).
   and control of pandemic diseases like malaria and                                                 the construction and renovation of schools and            as a whole. Initiatives undertaken at the local level                                   Eni is also directly involved in producing culture and
   AIDS. As far as socio-economic development                                                        by providing teaching materials. Its commitment           have always been aimed at fostering complete sustainable                                environmental, economic, and social research through
   projects are concerned, the Green River Project, a                                                to the environment has been expressed through             development of the territory, minimizing negative                                       the Eni Enrico Mattei Foundation (FEEM). Created
   modular integrated agricultural program started                                                   initiatives targeted at reducing environmental            impacts caused by operations and creating projects in                                   in 1989 and with branches in five Italian cities (Milan,
   in 1987 and directed toward rural communities in                                                  risks for the local communities, such as an               collaboration with regional public authorities in order                                 Venice, Genoa, Turin and Rome). FEEM conducts research
   the oil areas of the Rivers, Bayelsa, Delta and Imo                                               integrated solid urban waste management plan              to support development.                                                                 programs but also offers cultural and scientific events
   states is particularly worthy of note. The project                                                for the city of Port Harcourt, a coastal erosion          In Val d’Agri, for example, as part of an agreement with                                that are open to the public, especially to young people,
   has promoted the introduction of appropriate                                                      control program for the city of Brass, and                the Region of Basilicata, Eni has created a wide-ranging                                to whom book and multimedia libraries have also been
   technologies for farming and the transformation                                                   programs on water systems management and                  support program including projects aimed at conserving                                  dedicated. FEEM offers itself as a place of encounter
   of agricultural products and the use of the                                                       land conservation practices.                              and enhancing the natural resources of the territory                                    and reflection between the worlds of culture, business,
   territory, enabling over 28,000 farmers to double                                                 The “Zero Gas Flaring” project, accomplished              involved in exploration and extraction activities, and at                               and public institutions and performs its role
   their crops and their income. A micro-credit                                                      through the construction of the Kwale power               starting development initiatives to boost local                                         as a laboratory for ideas and solutions for sustainable
   program called the “Green Card Scheme” has been                                                   plant in the Niger Delta, is of particular                employment and improve the quality of life of the people                                development, promoting dialogue at local, national,
   set up in the Bayelsa State, with the aim of                                                      importance. The plant increases the electricity           who live in the area.                                                                   and international levels. Finally, FEEM supports Eni
   supporting development projects by individual                                                     generation capacity of the country by                     Another example regards the collaboration between Eni                                   in the “Eni Scuola” Project, a portal that offers teaching
   farmers or agricultural cooperatives. Eni has                                                     approximately 13% and reduces the                         and the Municipality of Ravenna for the development                                     materials to explore the world of energy and natural
   provided education and training, integrated with                                                  environmental impact of Eni’s operational                 of the “Ravenna, city of methane” project, aimed                                        resources, sponsored by the Ministries for Education,
   scholarships, and specific programs called                                                        activities.                                               at promoting methane as the most sustainable energy                                     Universities and Scientific Research, the Environment
   “Adaptive Skill Acquisition” courses, to assist                                                                                                             resource in all end-use sectors.                                                        and Protection of the Territory.



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Sustainability
indicators table
Eni believes that sustainability is an integral part of its                                             ronment Report 2005 (HSE), on the Internet site
corporate strategies and provides information on this                                                   (Web), and in this document Eni and Sustainability
topic in all the company communication instruments.                                                     2006 (ES).
The following table identifies the key sustainability                                                   The complete table showing correspondences with the
indicators used by Eni, and provides references for                                                     Global Reporting Initiative (GRI) is available on the
locating them in the 2005 Financial Statements (AR),                                                    www.eni.it site.
in the 2005 Fact Book (FB), in the Health, Safety, Envi-


                                                                                             ES               AR           FB          HSE          Web                                                                      ES                  AR                    FB                   HSE                   Web

The Eni “identity card”                                                                                                                                         Programs for health protection and management
                                                                                                                                                                of health emergencies                                        √                                                                √                      √
Description of Eni activities and strategies
and areas of activity                                                                                         √            √            √            √          Indexes on training activities                               √                    √                                           √                      √

Key economic, asset, financial, and operational                                                                                                                 Description of equal opportunity and diversity policies      √                    √                                                                  √
indicators of Eni and areas of activity                                                      √                √            √            √            √
                                                                                                                                                                Description of policies and programs
Countries in which the activities are located                                                                 √            √            √            √          for preventing all types of discrimination                   √                    √                                                                  √

Added value distribution to stakeholders                                                      √                                                      √

Vision and strategy statement                                                                                                                                   Energy and environmental responsibility
on Sustainable Development                                                                   √                √                         √            √
                                                                                                                                                                Commitments, responses, and objectives
Eni challenges, commitments and results                                                      √                                                       √          for environmental protection                                 √                                                                √                      √

                                                                                                                                                                Direct and indirect use of energy,
                                                                                                                                                                segmented by primary source                                                                                                   √                      √
Governance and stakeholder engagement
                                                                                                                                                                Use of raw materials, including water                                                                                         √                      √
Mission and reference to codes of conduct                                                    √                √                         √            √
                                                                                                                                                                Greenhouse gas emissions                                     √                    √                                           √                      √
Adhesion to agreements, principles, or other
national/international initiatives                                                           √                √                         √            √          Other significant emissions, discharge,
                                                                                                                                                                and waste by type and destination                                                                                             √                      √
Governance structure                                                                         √                √                                      √
                                                                                                                                                                Decontamination and rehabilitation of soil and water                                                                          √                      √
Percentage of independent members
on the Board of Directors                                                                    √                √                                      √          Initiatives for the use of renewable energy
                                                                                                                                                                sources and for increasing energy efficiency                 √                    √                     √                     √                      √
Working procedures of the Board of Directors
and its Committees                                                                                            √                                      √

Identity and relations with stakeholders                                                     √                                                       √          Innovation for sustainable development

Composition and rights of Shareholders                                                                        √                                      √          Policies and strategies for innovation                       √                    √                                                                  √

Organization chart, management processes,                                                                                                                       Initiatives for the development of technologies
and certifications                                                                                                                      √            √          and products with low environmental impact                   √                                                                √                      √



Our people                                                                                                                                                      Relations with the territory and communities development

Breakdown by workforce, geographic segment,                                                                                                                     Description of corporate commitment
title, and work contract                                                                     √                √            √                         √          to respecting human rights                                   √                    √                                                                  √

Net job creation                                                                             √                √            √                         √          Policies for managing impacts and responding
                                                                                                                                                                responding to community needs                                                     √                                                                  √
Indexes on workplace injury rates and numbers,
for employees and contractors                                                                √                √                         √            √          Expenditure on initiatives for the beneficiary communities   √                    √                                                                  √

Initiatives for increasing safety                                                                                                       √            √          Description of rehabilitation procedures jointly
                                                                                                                                                                managed with the communities                                 √                                                                                       √
Agreements with workers’ representatives
on health and safety protection                                                              √                √                                      √



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Description: Sustainability Iran Gas Industry document sample