Eni swings to loss despite ‘record production’

Italian oil and gas company Eni booked a loss in the fourth quarter of 2019 compared to a profit in the same period of 2018 despite record production driven by project ramp-ups and start-ups.

Source: Eni/Flickr - under the
Source: Eni/Flickr – under the CC BY-NC 2.0 license

According to its quarterly report on Friday, Eni’s adjusted operating profit was €1.8 billion in the fourth quarter, down by 40% q-o-q when the adjusted profit totaled €2.99 billion.

Excluding the impact of the loss of control over Eni Norge occurred at the end of 2018 to allow a-like-for-like comparison, and net of scenario effects, a lower time value of the money and IFRS 16 accounting, the company’s adjusted operating profit increased by 9% q-o-q.

Adjusted net profit was €0.55 billion for the fourth quarter, down by 62% q-o-q and adjusted net profit of €1.45 billion.

Eni recorded a net loss of €1.89 billion in the fourth quarter of 2019 compared to a profit of €399 million in 4Q 2018.

In the fourth quarter of 2019, Eni’s average production was 1.92 million boe/d, a 3% increase compared to 1.87 million boe/d in 4Q 2018.

Eni’s FY 2019 average production was 1.87 million boe/d versus 1.85 million boe/d in 2018.

Eni’s production performance was driven by the ramp-up of the Zohr field and of other fields started in 2018, mainly in Libya, Ghana and Angola, and by the 2019 new project start-ups in Mexico, Norway, Egypt, and Algeria, with an overall contribution of approximately 250 kboe/d.

Commenting on the results, Claudio Descalzi, CEO of Eni, remarked: “Eni is pleased to have reported excellent results in 2019, despite a tough period characterized by geopolitical tensions and much less favourable commodity prices than in 2018.

“The results today reflect the successful strategy we have pursued in recent years, which has seen Eni become more resilient and growing business. In the Upstream in particular, we achieved record production of 1.87 million barrels a day with a reserve replacement ratio of 117%.”