ENI S.p.A 6-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 6-K

REPORT OF FOREIGN ISSUER

Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934

For the month of April, 2004

Eni S.p.A.

(Exact name of Registrant as specified in its charter)

Piazzale Enrico Mattei 1 — 00144 Rome, Italy
(Address of principal executive offices)

(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

Form 20-F [X] Form 40-F

(Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2b under the Securities Exchange Act of 1934.)

Yes [ ] No [X]

(If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): )

PRESS RELEASE

Eni will focus its activities in Portugal on the gas sector, increasing its participation in Gas de Portugal to 49%.

Eni: agreement for the reorganisation of the gas sector signed with the Portuguese Government, EDP and REN

Eni, representatives of the Portuguese government, Electricidade de Portugal (EDP), Galpenergia, Parpublica and Red Electrica National (REN) signed in Lisbon the final agreements for the reorganisation of the company Galpenergia as part of the process underway to reorganise the Portuguese energy sector. The signing follows the preliminary agreement signed on 6 February 2004 by the Minister of the Economy, Carlos Tavares, the Minister of Finance, Manuela Ferreira Leite, and Eni’s Chief Executive Officer, Vittorio Mincato.

Under these agreements Eni will focus its activities in Portugal in the gas sector through a 49% shareholding in Gas de Portugal (currently owned indirectly through Galpenergia, in which Eni has a shareholding of 33.34%), and will exit from the refining and marketing sector of oil products.

Gas de Portugal will be owned jointly by Eni, EDP and REN, for an initial maximum period of 18 months; that is, from the date of transfer of the shares of Gas de Portugal and the separation and transfer to REN of the natural gas transport network in Portugal.

Gas de Portugal will subsequently be owned by Eni with a 49% shareholding and EDP with 51% with agreements that will ensure the joint management of GDP and the cooperation among partners.

The entire transaction involves a balance in cash which will be collected by Eni of 667 million euro.

The execution of the agreement is subject to the approval of the competent competition Authorities.

The agreements signed confirm Eni’s commitment for the cooperation of Eni in Portugal and reinforce the growth strategy in the gas sector abroad. Gas de Portugal has regasification capacity (around 5 billion cubic metres per year) at its Sines terminal in Portugal, the nearest entry point for the liquefied gas arriving from Nigeria and transport capacity (currently 3 billion euro per year) through the Trans-Maghreb gasline from Algeria. Eni’s petroleum products will continue to be distributed throughout the Iberian peninsula through Agip Espaňa.

San Donato Milanese (Milan), April 1, 2004

PRESS RELEASE

Eni: the Board designates the candidates of the majority list for the office of director and Statutory Auditor of Snam Rete Gas; Domenico Dispenza is appointed candidate for the chairmanship. Angelo Mario Taraborrelli has been appointed Chief Operating Officer of Eni Refining & Marketing Division.

Eni communicates that the Board of Directors has approved its list of candidates for the office of Director and Statutory Auditor of Snam Rete Gas.

The candidates for the office of director are Mr Domenico Dispenza (Chairman), Mr Carlo Grande, Mr Roberto Jaquinto, Mr Marco Mangiagalli and Mr Renato Roffi; the candidates for the office of effective Statutory Auditor are Mr Riccardo Perotta and Mr Sergio Galimberti.

Mr Domenico Dispenza has worked in the Eni Group for over 30 years, holding relevant positions both in Snam, where he became Chief Executive Officer and the Gas & Power Division of Eni, where he held the position of Deputy General Director.

Eni also communicates that Mr Angelo Mario Taraborrelli has been appointed Chief Operating Officer of Eni Refining & Marketing Division.

Mr Taraborrelli has been in the Eni Group for more than 30 years, holding important positions in major subsidiaries such as Snamprogetti, where he was Vice Chairman, AgipPetroli, where he was Chief Executive Officer and in the Refining & Marketing Division of Eni, where he was Deputy General Director.

The Board of Directors thanks Mr Salvatore Russo, who has been Chairman of Snam Rete Gas since its incorporation and previously Saipem, and Mr Gilberto Callera, who managed Eni Refining & Marketing Division during the important phase of integration of activities following the merger of AgipPetroli (of this company he was appointed Chief Executive Officer and Chairman) with Eni , for their work over their many years with Eni. Both leave the Group having reached the retirement age.

San Donato Milanese (Milan), april 14, 2004

NOTICE OF SHAREHOLDERS’ MEETING

Eni S.p.A.
Registered Office: Piazzale Enrico Mattei, No. 1, Rome - Italy
Company Share capital euro 4,002,923,076.00 fully paid up
Rome Companies Register Tax Identification Number 00484960588
VAT Number 00905811006 R.E.A. Rome No. 756453

NOTICE OF SHAREHOLDERS’ MEETING

Shareholders of Eni S.p.A. are hereby invited to attend the Ordinary Shareholders’ Meeting, which will be held in Rome, at the Company’s registered Office Piazzale Enrico Mattei, 1, on May 25, 2004 at 10:00 a.m. (CET) on first call and, if necessary, on May 28, 2004, on second call, at the same time and location and the Extraordinary Shareholders’ Meeting, which will be held in Rome, at the Company’s registered Office Piazzale Enrico Mattei, 1, on May 25, 2004 at 10:00 a.m. (CET) on first call and, if necessary, on May 26 and May 28, 2004, at the same time and location, on second and third call, respectively.

AGENDA

Ordinary part

1. Eni S.p.A. Financial Statements at December 31, 2003, Eni Consolidated Financial Statements at December 31, 2003, Report of the Directors on the course of the business, Report of the Board of Statutory Auditors and Report of the Independent Auditors.

2. Allocation of net income.

3. Purchase of Eni shares.

4. Appointment of the Independent Auditors for the three-year period 2004-2006.

5. Amendment to Article 2.1 of Eni S.p.A.’s Shareholders’ Meeting Regulation.

6. Determination of the remuneration of the Directors.

Extraordinary part

1. Amendments to Articles 2.1, 11.2, 12.2, 13, 16.1, 17.2, 17.3, 19.3 and 23 of Eni by-laws pursuant to the Legislative Decree No. 6 dated January 17, 2003.

2. Amendments to Articles 17.3, 19.1 and 28.1 of Eni by-laws.

Admission to the Shareholders’ Meeting will be granted to the Shareholders who have requested the certification. In order to take part in the Shareholders’ Meeting, Shareholders holding shares not yet in uncertificated form shall previously deliver said shares to a financial intermediary to be deposited with Monte Titoli S.p.A. (the Italian Securities Register Centre) and subsequently transformed into uncertificated form,

pursuant to Article 51 of Consob Deliberation No. 11768 dated December 23, 1998, and ask the above-mentioned certification of attendance.

The report on the proposals of resolutions of the Board of Directors to the Shareholders on each item of the Agenda and the related documentation will be deposited at the Company’s Registered Office and with the Borsa Italiana S.p.A. (the Italian Stock Exchange) at the Shareholders disposal from April 23, 2004 until the date of the Meeting.

Votes may be exercised also by mail pursuant to current legislation. Shareholders willing to exercise their vote by mail are entitled to request the Vote by Mail Card and a return envelope to the Company or the following Depositaries: Banca IntesaBci S.p.A., Banca Nazionale del Lavoro S.p.A., Banca Monte dei Paschi di Siena S.p.A., Banca di Roma S.p.A., Banca Fideuram S.p.A., Sofid Sim S.p.A., Citibank N. A. and JPMorgan Chase Bank.

In order to consider the votes by mail valid, envelopes containing the Vote by Mail Card, duly filled in and signed, and the Admission Ticket Card shall be received by Eni S.p.A. - Segreteria societaria, Piazzale Enrico Mattei, 1 - 00144 ROME, Italy not later than May 24, 2003, 10:00 a. m. (CET). The vote by mail must be exercised personally by the person entitled to vote.

Beneficial Owners of ADRs, listed on the New York Stock Exchange, each ADR representing five ordinary shares issued by Eni S.p.A., who have deposited their ADRs with the JPMorgan Chase Bank by April 28, 2004 will be entitled to participate in the Meeting or to exercise votes by mail, after having complied with the deposit and registration requirements. Beneficial Owners who have taken advantage of Proxy Vote or Vote by Mail options are entitled to assist at the Meeting upon written request to be made to the JPMorgan Chase Bank.

In order to simplify controls of powers entitling the participation in the Shareholders’ Meeting, people who intend to participate to the Meeting as legal or voluntary representatives of Shareholders or other people entitled to take part in it are requested to deliver to Eni S.p.A.’s Corporate Secretary the deeds entitling them to said participation, by mail, also in copy, or by fax, at least two days before the date of the Meeting.

Experts, financial analysts and journalists wishing to attend the Shareholders’ Meeting shall deliver, by mail or fax, a specific request to Eni S.p.A.’s Corporate Secretary at least two days before the date of the Meeting.

Eni S.p.A.’s Corporate Secretary is available for any further information Shareholders may need at the toll-free number 800 940 924 and fax number ++ 39 6 59822233.

The documentation regarding the Shareholders’ Meeting is available on www.eni.it and may be requested by e-mail at segreteriasocietaria.azionisti@eni.it or by calling the above-mentioned toll-free number.

REPORT ON THE PROPOSALS OF THE BOARD OF DIRECTORS ON THE ITEMS IN THE SHAREHOLDERS’ MEETING AGENDA

Eni S.p.A.

Ordinary Shareholders’ Meeting to be held on May 25 and May 28, 2004 on first and
second call, respectively
Extraordinary Shareholders’ Meeting to be held on May 25, May 26 and May 28,2004
on first, second and third call, respectively

Report on the proposals of the Board of Directors on the items
in the Shareholders’ Meeting Agenda

ORDINARY PART

ITEM 1
ENI FINANCIAL STATEMENTS AT DECEMBER 31, 2003, CONSOLIDATED FINANCIAL
STATEMENTS AT DECEMBER 31, 2003, REPORT OF THE DIRECTORS ON THE COURSE
OF THE BUSINESS, REPORT OF THE BOARD OF STATUTORY AUDITORS AND REPORT OF
THE INDEPENDENT AUDITORS

To the Shareholders:

for the illustration of Eni Financial Statements please refer to Eni Annual Report 2003 deposited at the Company’s Registered Office and with the Borsa Italiana S.p.A. (the Italian Stock Exchange).

To the Shareholders:

You are invited to approve Eni S.p.A. Financial Statements at December 31, 2003, which disclose a net income of euro 2,849,767,834.03.

ITEM 2
ALLOCATION OF NET INCOME

To the Shareholders:

in consideration of Eni 2003 results and of the treasury shares owned, the Board of Directors proposes to:

– allot the net income of euro 2,849,767,834.03 as follows:

• to the Legal Reserve the amount necessary so that it totals one fifth of Eni share capital outstanding at the Shareholders’ Meeting date;

• euro 355,414.40 to the Reserve pursuant to Article 13 of the Legislative Decree 124/93; the amount corresponds to 3% of the allocation for the Financial Year 2003 of the employees termination indemnity to the staff social security fund;

• to pay a dividend of 0.75 euro for each share outstanding on the ex dividend date, Eni treasury shares excluded. As a consequence of the tax legislation in force in

Italy as of January 1, 2004, notwithstanding the exceptions indicated below, dividends no longer entitle to a tax credit. Depending on the beneficiary, the dividend is either subject to a withholding tax or partially taxed. Dividends entitle to an ordinary tax credit, corresponding to 51.51% of 0.70 euro and a limited tax credit corresponding to 51.51% of 0.05 euro if paid to commercial entities resident of Italy, in particular to share capital companies during the financial year 2003;

• allocate the amount left after the previous allotments to the Distributable Reserve;

– pay dividends as from June 24, 2004, being the ex-dividend date June 21, 2004;

– transfer from the “Disposable Reserve” to the “Reserve for anticipated amortisation pursuant to Article 67 of D.P.R. No. 917/86” euro 280,919,796.29, corresponding to the anticipated amortisation charged to the 2003 Financial Year.

To the Shareholders:

You are invited to approve the proposals of:

- allocating the net income of euro 2,849,767,834.03 as follows:

• to the Legal Reserve the amount necessary so that it totals one fifth of Eni share capital outstanding at the Shareholders’ Meeting date;

• euro 355,414.40 to the Reserve pursuant to Article 13 of the Legislative Decree 124/93 corresponding to 3% of the allocation for the Financial Year 2003 of the employees termination indemnity to the staff social security fund;

• to pay a dividend of 0.75 euro for each share outstanding on the ex dividend date, Eni treasury shares excluded;

• allocate the amount left after the previous allotments to the Distributable Reserve;

- transferring from the “Disposable Reserve” to the “Reserve for anticipated amortisation pursuant to Article 67 of D.P.R. No. 917/86 euro 280,919,796.29, corresponding to the anticipated amortisation charged to the 2003 Financial Year;

- paying dividends as from June 24, 2004, being the ex-dividend date June 21, 2004.

ITEM 3
PURCHASE OF ENI SHARES

To the Shareholders:

the Shareholders’ Meeting held on May 30, 2003 approved a new authorisation to purchase up to 400 million Eni ordinary shares, nominal value euro 1, within eighteen months as of the shareholders’ meeting date, or within November 30, 2004. The total amount wouldn’t have exceeded 5.4 billion euro and the purchase price wouldn’t have been lower than Eni share nominal value and not higher than the reference price recorded on the day preceding each purchase increased of 5% of its amount.

The Board intends to continue the buy-back programme initiated in 2000 and therefore proposes to be authorised to continue it until November 30, 2005.

To the Shareholders:

You are invited to:

authorise the Board of Directors, pursuant to Article 2357, second Paragraph, of the Civil Code, to continue the purchase of Eni shares in compliance with the

limits, terms and conditions resolved by the shareholders’ meeting on May 30, 2003;

- resolve the use of the Reserve for the purchase of Eni shares implemented pursuant to Article 2357-ter, last Paragraph, of the Civil Code;

- delegate any and all powers to the Managing Director to execute, directly or through attorneys-in-fact, any and all acts necessary to enforce such resolution.

ITEM 4
APPOINTMENT OF THE INDEPENDENT AUDITORS FOR THE THREE-YEAR
PERIOD 2004-2006

To the Shareholders:

the appointment of PricewaterhouseCoopers S.p.A. as Independent Auditors approved by the shareholders’ meeting held on June 1, 2001 will expire on the date of the shareholders’ meeting called to approve Eni S.p.A. Financial Statements at December 31, 2003.

The Board, on the basis of the selection of the offers presented by four different audit firms and in compliance with the current legislation, as the Board of Statutory Auditors has issued a positive evaluation on the proposal, proposes to the approval of the shareholders’ meeting the appointment of PricewaterhouseCoopers S.p.A. as Independent Auditors for the audit of Eni S.p.A. and Eni consolidated Financial Statements, the audit of the regularity of the accounting procedures applied by the Company and for the limited review of Eni half-year Report for the years 2004, 2005 and 2006. Further, as Eni shares are listed also on the New York Stock Exchange (NYSE), the Board proposes to commit to PricewaterhouseCoopers S.p.A., for the same period, the audit of the accounting data released in the U.S.A. to comply with SEC Regulations (“Form 20-F”) and of the accounting adjustments consequent to the application of U.S GAAP and the release of the audit report in English set forth in compliance with US GAAS.

The Board has selected the offer of PricewaterhouseCoopers S.p.A. on a qualitative and economic basis because of the specific technical experience of the firm in the audit of oil & gas international companies financial statements.

PriceWaterhouseCoopers’ offer includes other 262 Eni subsidiaries and total fees of euro 6.7 million (corresponding to 120,243 hours).

The Board of Directors of the following listed companies: Saipem, Snam Rete Gas and Società Azionaria per la Condotta di Acque Potabili will also propose to the respective Shareholders’ Meeting the offers presented by PriceWaterhouseCoopers approved autonomously by those Boards. Consequently it will be appointed Independent Auditor for these companies and their subsidiaries.

With the above mentioned appointments, PricewaterhouseCoopers audits companies whose consolidated activities and revenues represent about 98% of total activities and revenues of Eni Group.

PriceWaterhouseCoopers will also execute supplemental audit activities according to the terms and conditions set forth by Document no. 600 of the Italian Audit Principles; therefore PriceWaterhouseCoopers will assume the full responsibility of the audit executed by the minor audit firms appointed by Eni subsidiaries (representing about 2% of

total activities and revenues of Eni Group). Consequently, PriceWaterhouseCoopers will assume in Eni Consolidated Financial Statements Audit, the role and responsibility of Sole Independent Auditor of Eni Group.

To the Shareholders:

You are invited to approve the proposal of the Board of Directors to appoint PricewaterhouseCoopers S.p.A. as Independent Auditors for the three-year period 2004-2006 for:

- the audit of Eni S.p.A. and Eni consolidated Financial Statements, pursuant to Article 159 of Legislative Decree dated February 24, 1998 No. 58;

- the audit, to be executed in the course of the financial year, of the regularity of the accounting procedures applied by the Company and of the correct accounting representation of the business activities, pursuant to Article 155 of Legislative Decree dated February 24, 1998 No. 58;

- the limited review of Eni half-year Report, pursuant to Consob Communication No. 97001574 dated February 20, 1997;

- the audit of the accounting data released in the U.S.A. to comply with SEC Regulations (“Form 20-F”) and of the accounting adjustments consequent to the application of U.S GAAP and the release of the audit report in English set forth in compliance with US GAAS as Eni shares are listed on the NYSE.

The annual fee asked by PricewaterhouseCoopers S.p.A. for said activities totals euro 1.363.290,00. The tables below set forth a breakdown for activity (values are expressed in euro):

Eni S.p.A. Financial Statements Audit


							Fee
			Working
Professional Qualification	Units		Hours		Working Hours in %		Per Hour		Total
Partner		4		1,091		7		195		212,745.00
Manager		6		2,926		18		128		374,528.00
Senior		11		4,790		30		78		373,620.00
Staff		16		7,043		45		50		352,150.00
										1,313,043.00
Discount										-590,053.00

Total				15,850		100				722,990.00

Eni Consolidated Financial Statements Audit


							Fee
			Working
Professional Qualification	Units		Hours		Working Hours in %		Per Hour		Total
Partner		4		201		6		195		39,195.00
Manager		6		602		18		128		77,056.00
Senior		8		1,208		37		78		94,224.00
Staff		6		1,289		39		50		64,450.00
										274,925.00
Discount										-161,195.00

Total				3,300		100				113,730.00

Summary


	Working		Fee
Activity	Hours		Per Hour		Total
Eni S.p.A. Financial Statements Audit		15,850		46		722,990.00
Eni Consolidated Financial Statements Audit		3,300		34		113,730.00
Audit of the regularity of the accounting procedures		3,220		45		144,490.00
Limited review of Eni half-year Report		3,680		44		160,300.00
Audit for the correct use of US GAAP and other activities in compliance with SEC Regulations		3,890		57		221,780.00

Total		29,940		46		1,363,290.00

The aforementioned fees refer only to services supplied by PricewaterhouseCoopers S.p.A. and have been determined pursuant to Consob Communication No. 96003556 dated April 18, 1996. Further, said fees are subject to an annual revision up to 80% of the increase exceeding 5% of ISTAT consumer-price index (“Index”), basis 100 the Index value on July 2003. The adjustment will be calculated with reference to the cumulated increase of the Index and applied to the contractual amounts.

Travel and living expenses shall be reimbursed separately on an arm length basis and limited to those activities performed at company locations where offices of the Independent Auditors are not present (at this end, San Donato Milanese is not considered a different location with respect to PriceWaterhouseCoopers office in Milan). Supervision contribution, owed by PricewaterhouseCoopers S.p.A. to Consob, will be reimbursed at cost and for an amount calculated on the basis of the fees paid for the Eni S.p.A. Financial Statements and Eni Consolidated Financial Statements audit.

The above mentioned fees may be adjusted only when exceptional or unforeseen circumstances arisen after the presentation of the offer require additional time and/or a different mix of professional profiles to be used. In the event actual cost accrued on the basis of hours and fees of personnel actually utilised should result lower than forecast, fees hereon will be reduced accordingly.

ITEM 5
AMENDMENT TO ARTICLE 2.1 OF ENI S.P.A.’S SHAREHOLDERS’ MEETING
REGULATION

To the Shareholders:

the Board of Directors proposes to amend Article 2.1 of Eni S.p.A.’s Shareholders’ Meeting Regulation regulating the intervention to the shareholders’ meetings, also in order to adequate its text to the amendment to the by-laws proposed in the Extraordinary part of this Report.

To the Shareholders:

You are invited to approve the amendment to Article 2.1 of Eni S.p.A.’s Shareholders’ Meeting Regulation in the text herein below together with the current text:


CURRENT TEXT		PROPOSED TEXT
1. Pursuant to Article 13 of Eni by-laws (the “by-laws”), attendance to the Meetings requires that all shares, including registred shares, be deposited at least five days prior to the date of the Meeting according to the provisions of the Notice of the shareholders’ meeting (the “Notice”).		1. Attendance to the meetings is disciplined by the provisions of the current legislation, Eni by-laws and the Notice of the shareholders’ meeting (the “Notice”).

ITEM 6
DETERMINATION OF THE REMUNERATION OF THE DIRECTORS

To the Shareholders:

the Shareholders’ Meeting held on May, 30 2002 set the Chairman’s and each Director’s annual remuneration. In particular it resolved that the fixed part of each Director’s annual remuneration comprised a fixed part of 68,000.00 euro and a variable part of 20,000.00 or 10,000.00 euro, being the amount to be paid determined in consideration of the ranking of Eni in respect of the other first seven international oil companies for market capitalisation. The above mentioned Shareholders’ Meeting resolved also the payment of 1,000.00 euro for the participation of the Board members to each meeting of the company bodies established in the by-laws and the reimbursement of the expenses incurred because of the office.

The Board, in consideration of the increased activity of the Board Members consequent to the merger of Agip Petroli S.p.A. with Eni and as Board Committees - Audit Committee, Compensation Committee and Oil & Gas Committee - members, in coherence with the provisions of the Code of Discipline for the Italian Listed Companies, proposes to the shareholders’ meeting: (i) increase the fixed part of the remuneration of each non executive Director from 68,000.00 to 100,000.00 euro, pursuant to the by-laws; (ii) pay euro 1,000.00 also for the participation of each Director to each meeting of the Committees made of Directors established by the Board of Directors and the reimbursement of the expenses incurred because of the office.

To the Shareholders:

You are invited to set the fixed part of the annual remuneration of each non executive Director to 100,000.00 euro, pursuant to the by-laws and pay euro 1,000.00 also for the participation of each Director to each meeting of the Committees made of

Directors established by the Board of Directors and the reimbursement of the expenses incurred because of the office.

EXTRAORDINARY PART

ITEM 1
AMENDMENTS TO ARTICLES 2.1, 11.2, 12.2, 13, 16.1, 17.2, 17.3, 19.3 AND 23 OF ENI
BY-LAWS PURSUANT TO THE LEGISLATIVE DECREE NO. 6
DATED JANUARY 17, 2003

To the Shareholders:

on January 1, 2004 the Legislative Decree No. 6, dated January 17, 2003, better known as “Vietti Reform” of the Italian companies law, as amended by the Legislative Decree No. 37 dated February 6, 2004, entered into force.

Therefore Eni By-laws is to be amended in order to take account of the above mentioned Reform.

The Board proposes to the shareholders’ meeting to amend Eni by-laws as follows:

- to qualify the registered office according to the new wording of Article 2328, first Paragraph, number 2, of the Italian Civil Code and indicate in the by-laws only the town where the head office and the branches are located (article 2, first Paragraph);

- to cancel the delegation of authority to the Board to issue bonds, having this matter become a competence of the board itself (Article 11, second Paragraph). By availing of this delegation, Eni Board of Directors has approved two bond issues totalling 2 billion euro;

- to express in days the term within which the annual shareholders’ meeting is called (Article 12, second Paragraph);

- to discipline the ways of announcing the calling of shareholders’ meetings (Article 13, first Paragraph);

- to discipline the ways of intervention to the shareholders’ meetings (Article 13, new second Paragraph);

- to specify that the shareholders’ meeting no longer resolves but authorises the transfer of the business, pursuant to Article 2364, first Paragraph, no. 5, of the Civil Code (Article 16, first Paragraph);

- to express the duration in office of the board members in financial years and no more in years and to insert the indication that they lapse at the shareholders’ meeting when the financial statements of the last financial year of their office is approved (Articles 17, second Paragraph);

- to make reference to the certification issued by an authorised financial intermediary in order to demonstrate the title of the number of shares necessary to present a list of candidates (Article 17, third Paragraph);

- to cancel the reference to the faculty of two Directors of calling the shareholders’ meeting (Article 19, third Paragraph, second period);

- to insert the duty of information of the Board members with respect to the operations in which they have an interest (Article 23, third Paragraph).

In order to enhance the efficiency of the operational activities of the Company, the Board of Directors proposes to the shareholders’ meeting to confer to the Board itself (Article 23, new second Paragraph) the faculty to resolve upon the following matters:

- the merger and the proportional demerger of at least 90% directly owned subsidiaries;

- the establishment and winding up of branches.

To the Shareholders:

- you are invited to approve the amendments to Articles 2.1, 11.2, 12.2, 13, 16.1, 17.2, 17.3, 19.3 and 23 of Eni by-laws proposed by the Board of Directors in the text herein below together with the current text:


CURRENT TEXT		PROPOSED TEXT
ARTICLE 2		ARTICLE 2

2.1 The registered head office of the company is located at Piazzale Enrico Mattei 1, Rome, Italy. Eni S.p.A. branches are located in:		2.1 The registered head office of the company is located in Rome, Italy. Eni S.p.A. branches are located: two in San Donato Milanese (MI) and one in Gela (CL).

-	San Donato Milanese (MI) - Via Emilia, 1;

-	San Donato Milanese (MI) - Piazza Ezio Vanoni, 1;

-	Gela (CL) - Strada Provinciale, 82.

ARTICLE 11		ARTICLE 11

11.1 The company may issue bonds, including convertibles and warrant bonds in compliance with the law.		11.1 The company may issue bonds, including convertibles and warrant bonds in compliance with the law.

11.2 Pursuant to Article 2420-ter of the Civil Code, the Board of Directors may issue bonds, in one or more times and in one or more tranches, including bonds convertible into shares issued by Eni S.p.A. controlled subsidiaries and/or warrant bonds to purchase or subscribe shares of Eni S.p.A. controlled subsidiaries, up to the amount corresponding to the counter-value of euro 4,000,000,000 (four billion). Bonds may be issued for a period of five years commencing as of May 30, 2002. The Board of Directors is empowered to adopt any act, included but not limited to the fixing of yield, duration and the regulation of the issues.		11.2 *Cancelled*


CURRENT TEXT				PROPOSED TEXT
ARTICLE 13 13.1 Attendance to the Meeting requires that all shares, including registered shares, be deposited in advance in compliance with the law and as set forth in the notice of the Meeting, that must be published also in compliance with the rules in force regulating the exercise of the vote by mail.				ARTICLE 13 13.1 Shareholders’ meetings are convened through a notice to be published on the Italian Official Gazette, according to the current legislation and in compliance with the rules in force regulating the exercise of the vote by mail. 13.2 Admission to the shareholders’ meeting is subject to the delivery, also for registered shares, of the certification issued by financial intermediaries at least two days before the date of the shareholders’ meeting on first call.

ARTICLE 16 16.1 The ordinary shareholders’ meeting decides on all the matters for which it is legally entitled and on the transfer of the business.				ARTICLE 16 16.1 The ordinary shareholders’ meeting decides on all the matters for which it is legally entitled and authorises the transfer of the business.

ARTICLE 17				ARTICLE 17

17.2 The Board of Directors is appointed for a period of up to three years and may be reappointed pursuant to Article 2383 of the Civil Code.				17.2 The Board of Directors is appointed for a period of up to three financial years; this term lapses on the date of the shareholders’ meeting convened to approve the financial statements of the last year of their office. They may be reappointed.

17.3				17.3

Omission				Omission

In order to demonstrate the title on the number of shares necessary to present candidate lists, the Shareholders must present and/or deliver to the company registered office a copy of the admission tickets issued by the depositaries of their shares at least five days prior to the date set for the first call of the shareholders’ meeting.				In order to demonstrate the title on the number of shares necessary to present candidate lists, the Shareholders must present and/or deliver to the company registered office a copy of the certification issued by the authorised financial intermediaries that are depositaries of their shares at least five days prior to the date set for the first call of the shareholders’ meeting.

Omission				Omission

ARTICLE 19 19.3 The Board of Directors must likewise be convened when so requested by at least two Board members or by one member if the Board consists of three members to decide on a specific matter considered of particular importance, pertaining to management, matter to be indicated in the request. In this case, if the Board of Directors’ meeting is not called within 15 days, or if no resolution can be taken because there is not a quorum or the Meeting				ARTICLE 19 19.3 The Board of Directors must likewise be convened when so requested by at least two Board members or by one member if the Board consists of three members to decide on a specific matter considered of particular importance, pertaining to management, matter to be indicated in the request.


CURRENT TEXT				PROPOSED TEXT
is not held within thirty days, such decision must be put to the shareholders’ meeting, should such request be made by at least two Board members or by one if the Board consists of three members. The shareholders’ meeting will be called promptly by the Board of Directors or, failing that, by the Board of Statutory Auditors.

ARTICLE 23				ARTICLE 23

				23.2 The Board of Directors is allowed to resolve on the following matters:

				• the merger and the demerger of at least 90% directly owned subsidiaries;

				• the establishment and winding up of branches.

23.2 The Board of Directors and the Managing Director report timely, at least every three months and however in the Board of Directors meetings, to the Board of Statutory Auditors on the activities and on the most relevant operations regarding the operational, economic and financial management of the company and its subsidiaries; in particular the Board of Directors and the Managing Director report to the Board of Statutory Auditors on operations entailing potential conflicts of interest.				23.3 The Board of Directors and the Managing Director report timely, at least every three months and however in the Board of Directors meetings, to the Board of Statutory Auditors on the activities and on the most relevant operations regarding the operational, economic and financial management of the company and its subsidiaries; in particular the Board of Directors and the Managing Director report to the Board of Statutory Auditors on operations entailing an interest on their behalf or on behalf of third parties.

- delegate any and all powers to the Chairman and the Managing Director, each of them severally acting, to execute, directly or through attorneys-in-fact, said resolution and provide, if necessary and possible pursuant to the current legislation, those formal amendments to the resolution under this item as determined by competent Authorities in order to deposit it with the Companies Register.

ITEM 2
AMENDMENTS TO ARTICLES 17.3, 19.1 AND 28.1 OF ENI BY-LAWS

To the Shareholders:

the Board proposes to the shareholders’ meeting the following further amendments to the by-laws:

- the impossibility for subsidiaries or controlling companies of the Shareholder who presents a list of candidates to the office of Board members to present a different list, in order to assure an effective presence of the minority shareholders in the Company’s bodies (Article 17, third Paragraph);

- the possibility of holding the Board meetings in teleconference other than videoconference (Article 19, first Paragraph);

- the inclusion of the offices of supervisory board member, as set forth in the dualistic model, and of audit committee member, as set forth in the monistic model, in the calculation of the maximum number of offices in control bodies of other companies that Eni board of statutory auditors members may hold not to be dismissed (Article 28, first Paragraph, last period).

To the Shareholders:

you are invited to:

- approve the amendments to Articles 17.3, 19.1 and 28.1 of Eni by-laws proposed by the Board of Directors in the text herein below together with the current text:


CURRENT TEXT		PROPOSED TEXT
ARTICLE 17.3		ARTICLE 17.3

Omission		Omission

Each Shareholder may present or take part in the presenting of only one candidate list and each candidate may appear in one list only or he will be ineligible.		Each Shareholder may present or take part in the presenting of only one candidate list and each candidate may appear in one list only or he will be ineligible. Companies that are controlling entities or are under common control, as defined by Article 2359, first Paragraph, of the Civil Code, by the same entity of the company presenting a list shall not present nor take part in the presentation of another candidate list. Each candidate may appear in one list only or he will be ineligible.

ARTICLE 19.1		ARTICLE 19.1

The Board of Directors’ meetings may be held by videoconference if each of the participants to the meetings may be identified and if each is allowed to follow the discussion and take part to it in real time. If said conditions are met, the Meeting is considered duly held in the place where the Chairman and the Secretary are present.		The Board of Directors’ meetings may be held by video or teleconference if each of the participants to the meetings may be identified and if each is allowed to follow the discussion and take part to it in real time. If said conditions are met, the Meeting is considered duly held in the place where the Chairman and the Secretary are present.

Eni

With a market capitalization amounting to over euro 65 billion as of April 20, 2004, Eni is one of the most important integrated energy companies in the world which operates in the oil and gas industry, power generation and oilfield services, construction and engineering. In these businesses it has a strong edge and leading international market positions.

STRATEGIES

n Develop core business activities; in particular: maintain strong hydrocarbon production growth by internal lines while continuing portfolio rationalization and focusing on reserve replacement

Expand sales on European markets and maintain sale levels in Italy, leveraging on the increase in demand and the expansion of power generation capacity; complete the restructuring of the Italian fuel distribution network and develop in selected areas in Europe; increase the efficiency and flexibility of the refining system

n Pursue the integration of core activities in order to support Eni’s international growth and improve its competitive position

n Continue to focus on core business

n Intensify efficiency and efficacy improvement programs

n Maximize return for shareholders by selecting capital expenditure and maintaining strict financial discipline

Eni intends to maintain strong hydrocarbon production growth by developing on internal lines and continuing its program of rationalisation of its asset portfolio aimed at increasing its value by focusing on strategic areas with sound growth potential and leaving marginal ones. Special attention will be paid to reserve replacement in order to support long-term growth.

In gas activities Eni intends to expand sales on European markets and to maintain sale levels in Italy leveraging on expected natural gas demand growth, the development of integrated gas-electricity supply and the completion in time of the plan of expansion of power generation capacity in its industrial sites. Key growth targets set for 2007 are the following: (i) daily hydrocarbon production of about 1.9 million boe corresponding to a 5% average annual increase in the 2003-2007 period (net of the effects of portfolio rationalization); (ii) the sale of 44 billion cubic meters of gas in European markets; (iii) the reaching of an installed power generation capacity of about 5.3 gigawatts by 2006.

In downstream oil Eni intends to complete the upgrading of its distribution network in Italy and develop/consolidate its presence in selected areas in Europe where it can leverage on operating synergies and a well established brand. In refining Eni will continue to pursue high levels of efficiency and flexibility and the development of high quality fuels anticipating the environmental requirements of new European regulations. In oilfield services, construction and engineering activities Eni intends to concentrate its presence in the strategic segment of large projects for the development of offshore hydrocarbon reserves and construction of industrial plants and infrastructure based on the application of technologies for hydrocarbon production, treatment and transmission and natural gas and heavy crudes upgrading.

Eni intends to reduce capital employed in non core businesses and to pursue the integration among its core activities in order to support international growth by means of integrated projects and to improve its competitive positioning. Eni will continue to improve operational efficiency and efficacy targeting cost savings of about euro 3.4 billion at 2006 (over 65% of which already achieved in the 1999-2003 period).

Strong attention will be devoted to R&D, the key factor for the future development of the oil industry. Financial resources dedicated to this activity will be increased significantly; in addition, expenditure will be more and more focused on those strategic projects through which Eni can achieve competitive advantages in the medium to long-term, in particular in the areas of exploration and recovery of hydrocarbons and of upgrading of heavy crudes and natural gas.

Eni intends to pursue its growth strategy by implementing a four year capital expenditure plan of euro 25.5 billion, about 90% of which will be concentrated in the Exploration & Production, Gas & Power and Refining & Marketing segments. Cash flow from operations will allow to satisfy financial requirements related to new capital expenditure and the payment of dividends, assuming an average Brent price of 16 dollars/barrel in the 2004-2007 period in real terms (base year 2000) and a dollar/euro exchange rate at parity.


		4

ENI FACT BOOK 2003
		ENI

activities

exploration & production

Eni is engaged in exploration and production of hydrocarbons in Italy, North Africa, West Africa, the North Sea, the Gulf of Mexico and Australia. It is also engaged in areas with great development potential such as the Caspian Sea, the Middle and Far East and Latin America. In 2003, Eni produced 1,562,000 boe per day and, at December 31, 2003, it reached estimated proved reserves of 7.272 billion boe with a life index of 12.7 years.

gas & power

Eni is engaged in natural gas supply, transmission, distribution and sale. In 2003, sales of natural gas (including volumes consumed in operations) totaled 71.5 billion cubic meters. Eni’s gas pipeline network is about 30,000-kilometer long in Italy, while outside Italy Eni holds transmission rights on about 3,800 kilometers of pipelines. In 2003, Eni transported 76.4 billion cubic meters of natural gas on the Italian network, of which 25 billion on behalf of third parties. Through EniPower, Eni operates in electricity generation and sale with a total installed capacity of about 1.9 gigawatts. In 2003 Eni sold about 8.7 terawatthours of electricity (of which about 5.6 of produced electricity), corresponding to about 3% of the Italian domestic market, and 9.3 million tonnes of steam.

refining & marketing

Eni is engaged in the refining and marketing of refined products mainly in Italy, the rest of Europe and Latin America. Through its Agip and IP brands, Eni is leader in the retail market in Italy, with a 36.6% market share. In 2003, sales of refined products totaled 49.9 million tonnes, of which 30.6 millions in Italy. At December 31, 2003 the balanced refining capacity of Eni’s wholly-owned refineries amounted to 504,000 barrels per day.

oilfield services construction and engineering

Eni through Saipem (Eni’s interest 43%) is one of the world leaders in the construction of large offshore projects for the oil industry and in subsea pipelaying and construction of production platforms. Eni owns and operates a fleet of world class marine service vessels, able to drill wells 10,000 meters deep in water depths of up to 3,000 meters and to lay pipelines in water depths up to over 3,000 meters. Eni through Snamprogetti (Eni’s interest 100%) is one of the world’s largest operators in the construction of plants for the oil and petrochemical industries based on advanced operating and technological knowhow in particular in hydrocarbon production, treatment and transmission as well as natural gas and heavy crudes upgrading.


5

		ENI FACT BOOK 2003
ACTIVITIES

main data


Key financial data		(million €)

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

Net sales from operations

27,310

25,740

29,381

29,790

31,359

28,341

31,008

47,938

49,272

47,922

51,487

Operating income ⁽¹⁾

2,950

3,839

5,316

4,960

5,345

3,810

5,480

10,772

10,313

8,502

9,517

Exploration & Production

1,536

1,924

2,094

2,612

2,590

594

2,834

6,603

5,984

5,175

5,746

Gas & Power

1,605

1,606

1,073

2,024

2,012

2,513

2,580

3,178

3,672

3,244

3,627

Refining & Marketing

553

316

456

214

578

730

478

986

985

321

583

Petrochemicals

(406

)

187

1,042

101

187

—

(362

)

(415

)

(126

)

(176

)

Oilfield Services Construction and Engineering

161

129

144

159

169

198

149

144

255

298

311

Other activities

(201

)

(279

)

Corporate and financial companies

(315

)

(136

)

(118

)

(98

)

(138

)

(168

)

(199

)

(143

)

(168

)

(209

)

(295

)

Activities to be divested

(184

)

(187

)

(52

)

(53

)

(57

)

Net income

125

1,659

2,235

2,299

2,643

2,328

2,857

5,771

7,751

4,593

5,585

Net cash flow provided by operating activities

4,164

4,454

6,595

5,029

6,515

6,864

8,248

10,583

8,084

10,578

10,827

Capital expenditure and investments

5,251

3,773

3,977

4,362

5,589

5,565

5,597

9,815

11,270

9,414

13,057

Capital expenditure

5,064

3,523

3,680

3,792

4,169

5,152

5,483

5,431

6,606

8,048

8,802

Investments

187

250

297

167

193

437

114

4,384

4,664

1,366

4,255

Shareholders’ equity including minority interests

9,170

10,939

12,779

13,969

16,244

17,390

19,749

24,073

29,189

28,351

28,318

Net borrowings

16,605

14,062

10,789

9,559

8,050

7,070

6,267

7,742

10,104

11,141

13,543

Net capital employed

25,775

25,001

23,568

23,528

24,294

24,460

26,016

31,815

39,293

39,492

41,861

Exploration & Production

6,157

5,504

4,903

5,554

6,469

6,862

9,279

12,646

18,252

17,318

17,340

Gas & Power

7,372

7,996

8,191

8,121

8,518

8,289

8,481

10,721

12,777

12,488

15,617

Refining & Marketing

3,857

4,682

4,705

4,249

4,071

4,186

4,028

4,563

4,476

5,093

5,089

Petrochemicals

5,645

4,963

4,150

3,504

3,099

2,956

2,604

2,581

1,075

2,130

1,821

Oilfield Services Construction and Engineering

200

(57

)

(246

)

(63

)

195

392

1,103

1,395

1,635

2,335

2,119

Other activities

2,544

1,913

1,865

2,163

1,942

1,775

521

(91

)

1,078

128

(125

)

Return On Average Capital Employed (ROACE)

(

3.7

8.8

11.5

11.4

12.2

10.7

12.5

21.5

23.9

13.7

15.6

Debt to equity ratio

1.81

1.29

0.84

0.68

0.5

0.41

0.32

0.35

0.39

0.48

(1) For the segment breakdown see note to the table “Net sales from operations” on page 85.

Key market indicators


			1993		1994		1995		1996		1997		1998		1999		2000		2001		2002		2003
Average price of Brent dated crude oil ⁽¹⁾				17.00		15.82		17.04		20.67		19.10		12.74		17.87		28.39		24.46		24.98		28.84
Average EUR/USD exchange rate				1.232		1.201		1.189		1.255		1.137		1.115		1.067		0.924		0.896		0.946		1.131
Average price in euro of Brent dated crude oil ⁽²⁾				13.89		13.17		14.33		16.47		16.80		11.43		16.75		30.73		27.30		26.41		25.50
Average European refining margin ⁽³⁾				2.58		1.74		1.18		1.52		1.86		1.99		1.21		3.99		1.97		0.80		2.65
Euribor — three-month euro rate	(	%)		10.3		8.6		10.3		8.8		6.9		5.0		3.0		4.4		4.3		3.3		2.3

(1) In US dollars per barrel. Source: Platt’s Oilgram.

(2) Eni calculation.

(3) In US dollars per barrel FOB Mediterranean Brent dated crude oil. Source: Eni calculations based on Platt’s Oilgram data.


7

		ENI FACT BOOK 2003
MAIN DATA

Key operating data


				1993		1994		1995		1996		1997		1998		1999		2000		2001		2002		2003
Exploration & Production
Proved reserves of hydrocarbons at period end	(mn boe)				4,175		4,224		4,318		4,675		5,073		5,255		5,534		6,008		6,929		7,030		7,272
Reserve life index			(y)		12.8		12.4		11.9		13.1		13.6		13.4		14.0		14.0		13.7		13.2		12.7
Daily production of hydrocarbons	(th boe/d)				901		941		982		984		1,021		1,038		1,064		1,187		1,369		1,472		1,562
Gas & Power
Sales of natural gas to third parties in primary distribution	(bn cm)				48.65		47.43		52.55		53.23		53.14		55.69		60.24		61.25		61.96		60.44		65.12
Natural gas consumed by Eni	(bn cm)																						2.02		1.90
Sales of natural gas in secondary distribution outside Italy	(bn cm)										2.80		2.79		2.73		2.67		3.48		3.91		3.79		4.44
Sales of natural gas to third parties and natural gas consumed by Eni	(bn cm)				48.65		47.43		52.55		56.03		55.93		58.42		62.91		64.73		65.87		66.25		71.46
Natural gas transported on behalf of third parties in Italy	(bn cm)				1.28		1.32		1.48		2.42		4.35		6.07		6.90		9.45		11.41		19.84		24.63
Electricity production sold	(TWh)																		4.77		4.99		5.0		5.55
Refining & Marketing
Products available from processing	(mn ton)				33.70		40.50		38.10		37.80		36.40		40.10		38.31		38.89		37.78		35.55		33.52
Balanced capacity of wholly-owned refineries at period end	(th bbl/d)				824		824		824		664		664		664		664		664		664		504		504
Utilization rate of balanced capacity of wholly-owned refineries		(	%)		90		89		86		87		94		103		96		99		97		99		100
Sales of refined products	(mn ton)				53.10		52.30		51.90		51.36		51.60		54.19		51.82		53.46		53.24		52.02		49.91
Service stations at period end (in Italy and outside Italy)	(units)				13,705		13,699		13,574		13,150		12,756		12,984		12,489		12,085		11,707		10,762		10,647
Average throughput per service station (in Italy and outside Italy)	(th liters/y)				1,399		1,402		1,431		1,448		1,463		1,512		1,543		1,555		1,621		1,674		1,771
Oilfield Services Construction and Engineering
Orders acquired	(mn euro)				1,586		2,710		2,616		2,965		3,865		3,248		2,600		4,726		3,716		7,852		5,876
Order backlog at period end	(mn euro)				2,598		3,471		4,035		4,374		5,180		4,934		4,439		6,638		6,937		10,065		9,405
Employees at period end	(units)				108,556		91,544		86,422		83,424		80,178		78,906		72,023		69,969		72,405		80,655		76,521

Share data


				1993		1994		1995		1996		1997		1998		1999		2000		2001		2002		2003
Net income ⁽¹⁾	(euro)				0.03		0.41		0.56		0.57		0.66		0.58		0.71		1.44		1.98		1.20		1.48
Dividend	(euro)						0.121		0.222		0.248		0.289		0.310		0.362		0.424		0.750		0.750		0.750
Dividends paid ⁽²⁾	(mn euro)						483		890		992		1,157		1,239		1,446		1,664		2,876		2,833		2,829
Cash flow	(euro)				1.04		1.11		1.65		1.26		1.63		1.72		2.06		2.65		2.07		2.76		2.87
Dividend yield ⁽³⁾		(	%)						4.0		3.1		2.8		2.9		3.4		3.2		5.6		5.2		5.1
Net income per ADS ⁽⁴⁾	(US dollar)				0.18		2.48		3.41		3.65		3.60		3.40		3.61		6.79		8.82		6.29		9.31
Dividend per ADS ⁽⁴⁾	(US dollar)						0.71		1.40		1.43		1.58		1.61		1.70		1.81		3.71		4.29		4.72
Cash flow per ADS ⁽⁴⁾	(US dollar)				5.87		6.65		10.06		7.98		8.88		10.04		10.41		12.45		9.20		14.49		18.05
Dividend yield per ADS ⁽³⁾		(	%)						4.2		2.8		2.8		2.6		3.2		3.0		6.2		5.8		5.2
Pay-out		(	%)				29.1		39.8		43.1		43.8		53.2		50.6		28.8		37.0		62.0		51.0
Number of shares at December 31 representing share capital		(1	0⁶)		3,999.6		3,999.6		3,999.6		3,999.6		3,999.6		4,000.1		4,001.1		4,001.1		4,001.3		4,001.8		4,002.9
Average number of shares outstanding in the year ⁽⁵⁾		(1	0⁶)		3,999.6		3,999.6		3,999.6		3,999.6		3,999.6		4,000.1		4,001.3		3,995.1		3,911.9		3,826.9		3,778.4

(1) Calculated on the average number of Eni SpA shares outstanding during the year.

(2) Per fiscal year. 2003 data are estimated.

(3) Ratio between dividend of the year and average share price in December.

(4) One ADS represents 5 shares. Net income, dividend and cash flow were converted at the Noon Buying Rate of December 31. Dividends of 1994-2002 were converted at the Noon Buying Rate of the pay-out date.

(5) Calculated by excluding own shares in portfolio.


		8

ENI FACT BOOK 2003
		MAIN DATA

Share information


		1995⁽¹⁾		1996		1997		1998		1999		2000		2001		2002		2003
Share price - Milan Stock Exchange
High	(euro)		5.78		8.33		11.36		13.80		12.60		14.50		15.60		17.15		15.75
Low	(euro)		5.09		5.67		8.06		9.19		10.18		9.54		11.56		12.94		11.88
Average	(euro)		5.47		7.05		9.79		11.28		11.40		11.78		14.10		15.29		13.64
End of period	(euro)		5.72		8.06		10.43		11.21		10.88		13.64		14.05		15.15		14.96
ADS price ⁽²⁾ - New York Stock Exchange
High	(US dollar)		34.38		53.00		63.13		73.50		69.00		64.88		69.70		82.11		94.98
Low	(US dollar)		30.88		34.38		48.13		50.50		52.38		46.56		52.50		60.90		66.15
Average	(US dollar)		32.85		44.16		55.62		63.04		60.94		54.18		63.22		72.20		77.44
End of period	(US dollar)		34.25		51.63		57.06		67.75		55.13		64.31		61.96		78.49		94.98
Average daily exchanged shares	(mn share)		6.9		5.9		7.9		11.1		12.3		17.3		17.4		19.4		22.0
Value	(mn euro)		38.3		42.7		78.8		126.0		141.0		203.9		245.0		295.4		298.5

(1) From November 28 to December 31.

(2) Each ADS represents 5 shares.

Data on Eni share placements


			1995		1996		1997		1998		2001
Offer price	(euro/share)			5.42		7.40		9.90		11.80		13.60
Number of shares placed		(10⁶)		601.9		647.5		728.4		608.1		200.1
of which through bonus shares		(10⁶)				1.9		15.0		24.4		39.6
Percentage of share capital ⁽¹⁾		(%)		15.04		16.18		18.20		15.19		5.00
Proceeds	(mn euro)			3,254		4,596		6,869		6,714		2,721

(1) Refers to share capital at December 31, 2003.

Methodological note: On June 1, 2001 Eni Shareholders’ Meeting resolved to convert the nominal value of Eni shares into euro and to group two shares of nominal value 0.5 euro into one share with nominal value one euro. In order to make an homogeneous comparison possible, data presented in the “Share data”, “Share Information” and “Data on Eni Share Placements” tables were calculated assuming that the above mentioned grouping occurred starting from the first year of each table.

(LINE GRAPH)


9

		ENI FACT BOOK 2003
MAIN DATA

exploration & production

STRATEGIES

n Maintain strong production growth

n Focus on reserve replacement

n Develop frontier areas pursuing long-term value creation

n Rationalize asset portfolio

n Select exploration expenditure

n Continue to pursue efficiency improvement

(BAR CHART)

Eni operates in the exploration and production of hydrocarbons in Italy, North Africa, West Africa, the North Sea and the Gulf of Mexico. It also operates in areas with great exploration and production potential such as the Caspian Sea, Australia, the Middle and Far East and Latin America. In 2003, Eni produced 1,562,000 boe per day and, at December 31, 2003, it reached estimated proved reserves of 7,272 million boe. Eni is pursuing an aggressive production growth strategy aimed at achieving a daily production target of about 1.9 million boe by 2007, which corresponds to an average annual growth rate of 5% over the next four years. Production growth will be pursued by developing in areas where Eni has a consolidated presence and through the start-up of important projects in Libya, Angola, Nigeria, Iran and Kazakhstan. Eni intends to continue the rationalization of its asset portfolio, started after the purchase of British-Borneo and Lasmo, in order to increase its value by focusing on strategic areas with the highest growth potential and leaving marginal areas with limited development prospects. Exploration efforts will be selected by concentrating in areas with high mineral potential. In 2003, beside the successful continuation of exploration activities in the northern Caspian Sea, Eni made interesting discoveries in Italy, Angola, Nigeria, the North Sea, Indonesia, Algeria, Tunisia, Pakistan and the Gulf of Mexico.

Eni will continue to improve its performance by searching for operating solutions with lower operating costs and synergies.

(WORLD MAP)


		10

ENI FACT BOOK 2003
EXPLORATION & PRODUCTION

MAIN RESULTS

In 2003 hydrocarbon production reached the record level of 1.56 million boe/day with a 6.1% increase. Eni intends to maintain a strong production growth in the near future leveraging on the development of assets in portfolio and targeting about 1.9 million boe/day in 2007, equal to an annual average growth rate of 5%

Eni’s proved hydrocarbon reserves reached 7,272 million boe with a replacement rate of 142% (118% excluding the effects of purchase and sale of property). In the medium term production growth and reserve replacement will be supported by the relevant mineral potential of Eni’s assets located in core areas of North and West Africa with the contribution of new fields in Australasia and higher oil production in Italy. The average reserve life index was 12.7 years

Among the major start-ups of 2003 are: the Abo oil field (Eni operator with a 50.19% interest) offshore Nigeria; the Balal (Eni’s interest 38.25%) and Darquain (Eni operator with a 60% interest) oil fields in Iran; the Woollybutt oil field (Eni operator with a 65% interest) offshore Australia; the Bhit (Eni operator with a 40% interest) and Sawan (Eni’s interest 23.68%) gas fields in Pakistan; the Ourhoud (Eni’s interest 4.59%) and ROM Est (Eni operator with a 50% interest) oil fields in Algeria; the gas and condensate Mikkel field (Eni’s interest 14.9%) offshore Norway; the Medusa gas field (Eni’s interest 25%) in the Gulf of Mexico; the Xikomba oil field (Eni’s interest 20%) offshore Angola

Within the North Caspian Sea PSA (Eni is single operator with a 16.67% interest) the importance of the Kashagan oil field discovery in the Kazakh offshore of the Caspian Sea was confirmed by the appraisal activities performed in the area. The field’s recoverable reserves, estimated at 13 billion barrels by employing gas reinjection techniques, make Kashagan the world’s most relevant oil discovery of the past thirty years. Production is expected to start in 2008. Appraisal activities of the field and the survey of the area under contract continued successfully in 2003 with the drilling of the fourth and fifth commitment wells out of six wells planned. At the beginning of the winter work on the sixth and last commitment well, which already reached its final depth, was suspended and is going to be completed in the first half of 2004

In Saudi Arabia, an exploration licence for the extraction of natural gas in the so called C area covering about 52,000 square kilometers in the Rub al Khali basin at the border with Qatar and the United Arab Emirates was awarded to a consortium formed by Eni with an international oil company and Saudi Aramco (Eni operator with a 50% interest). The project marks Eni’s return to upstream activities in this country where it had operated in the early 1970s

In Kazakhstan, within the development of the Karachaganak field (Eni co-operator with a 32.5% interest), a condensate treatment plant (Karachaganak Processing Complex - KPC) with a 150,000 barrels/day capacity and transmission infrastructure for the export of liquids produced to western markets were started-up. The latter consist mainly of a 635-kilometer long pipeline with a 24 inch diameter linking the Karachaganak field to Atyrau, point of connection with the Caspian Pipeline Consortium pipeline in which Eni holds transportation rights up to 65,000 barrels/day. In 2004, these new production facilities and transmission infrastructure will lead to an increase in Eni’s share of daily production of liquids to about 65,000 boe

In Libya, the joint development (Eni’s interest 50%) of the natural gas, oil and condensate fields of


11

		ENI FACT BOOK 2003
EXPLORATION & PRODUCTION MAIN RESULTS

Wafa, located in onshore permit NC-169 A and Bahr Essalam, located in the NC-41 offshore permit, with recoverable reserves amounting to approximately 950 million boe net to Eni, is underway. Within the onshore development, over 80% of the planned development wells were drilled: within the offshore development, the Sabratha platform and its infrastructure as well as the Mellitah treatment plant are under construction. The Wafa field is expected to start production in the fourth quarter of 2004 at an initial level of 65,000 boe/day net to Eni. The Bahr Essalam field is expected to start production in June 2005 at an initial level of 61,000 boe/day net to Eni

In Angola in Block 15 (Eni’s interest 20%) development activities of the A and B phases continued in the Kizomba area. Phase A is finalized to starting production at the Hungo and Chocalho fields with recoverable reserves of 1 billion barrels (145 million net to Eni). Production is expected to start in the second half of 2004. Peak production of 39,000 boe/day net to Eni is expected in 2006. In phase B, concerning the development and start-up of production of the Kissanje and Dikanza fields, with recoverable reserves of 910 million barrels (141 million barrels net to Eni), four EPC contracts were awarded for the completion of the project. Production start-up is scheduled for 2006

Eni was awarded five exploration licences: (i)two in Egypt as operator, Ras el Ush and South Ferain located in the Gulf of Suez (Eni’s interests 75 and 70%, respectively); (ii) two in Norway in Blocks 34/12 and 35/10 (Eni’s interest 60%) and in Block 31/4 East of Brage (Eni’s interest 12.26%); (iii) one in Pakistan as operator (Eni’s interest 92.5%) in Block 2667-6 located in the provinces of Dadu and Balochistan. Eni is waiting for the Egyptian Parliament to confirm the conferral of licences in Blocks 24 and 26 Offshore Mediterranean and Block 10 Western Desert

A total of 105 new exploratory wells were drilled (43 of which represented Eni’s share). Overall success rate was 46.7% (45.7% representing Eni’s share)

Streamlining measures and synergies obtained through the integration of purchased companies allowed for cost reductions amounting to about euro 240 million


Main financial data		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Net sales from operations		5,664		6,578		6,897		5,206		6,840		12,308		13,960		12,877		12,746
Operating income		2,094		2,612		2,590		594		2,834		6,603		5,984		5,175		5,746
Exploration expenditure		396		555		677		755		636		811		757		902		635
Acquisition of proved and unproved properties		5		292		95		103		752		416		67		317		31
Development costs and capital goods		1,184		816		1,550		2,024		1,880		2,312		3,452		4,396		5,015
Investments		24		0		0		0		10		2,511		4,149		31		1,076

Main operating data


		1995		1996		1997		1998		1999		2000		2001		2002		2003
Proved hydrocarbon reserves	(mn boe)		4,318		4,675		5,073		5,255		5,534		6,008		6,929		7,030		7,272
oil and condensates	(mn bbls)		2,402		2,484		2,844		2,881		3,137		3,422		3,948		3,783		4,138
natural gas	(mn boe)		1,916		2,191		2,229		2,374		2,397		2,586		2,981		3,247		3,134
Daily hydrocarbon production	(th boe/d)		982		984		1,021		1,038		1,064		1,187		1,369		1,472		1,562
oil and condensates	(th bbls/d)		612		614		646		653		674		748		857		921		981
natural gas	(th boe/d)		370		370		375		385		390		439		512		551		581
Reserve life index	(years)		11.9		13.1		13.6		13.4		14.0		14.0		13.7		13.2		12.7


		12

ENI FACT BOOK 2003
EXPLORATION & PRODUCTION MAIN RESULTS

production

Italy

(ITALY MAP)

In 2003, Eni’s hydrocarbon production in Italy totaled 300,000 boe/day and represented 19% of Eni’s total production. Eni’s exploration and development interests in Italy are concentrated in the Po Valley, the Adriatic Sea, the Central Southern Apennines, Sicily and the Sicilian offshore. Natural gas production totaled 216,000 boe/day and represented approximately 72% of Eni’s hydrocarbon production in Italy. Eni’s principal natural gas fields are located in the Adriatic Sea (Barbara, Porto Garibaldi/Agostino, Angela/Angelina, Cervia/Arianna and Porto Corsini Mare Ovest which collectively accounted for 43.5% of Eni’s natural gas production in Italy in 2003) and in the Ionian Sea (Luna, which accounted for 8.2%). In early 2005 the Tea, Arnica and Lavanda gas wells, located 60 kilometers off the Adriatic coast are expected to start production at the final level of 0.73 million cubic meters/day (about 5,000 boe/day) net to Eni.

Daily production of oil in Italy totaled 84,000 barrels. Eni’s three major fields, Val d’Agri in Southern Italy, Villafortuna in the Po Valley and Aquila in the southern Adriatic offshore, represented 73.6% of Eni’s total oil production in Italy in 2003. Other oil fields are Rospo in the Adriatic Sea, Vega offshore southern Sicily, Gela and Ragusa in Sicily.

In Val d’Agri development activities continued (see “Development Projects” below).

Within its portfolio rationalization process Eni defined the sale of the entire capital of Stargas SpA (Eni’s interest 100%), the company to which the assets in exploration and production of natural gas of Società Petrolifera Italiana pA (Eni’s interest 99%) were transferred. In 2003 Stargas production amounted to about 5,000 boe/day, consisting mainly of natural gas.

In the medium term, the achievement of full production of the Val d’Agri fields and the development initiatives in natural gas will partly offset declines of mature fields.


13

		ENI FACT BOOK 2003
EXPLORATION & PRODUCTION PRODUCTION

North Africa

(GRAPHICS) Egypt

Eni has been present in Egypt since 1954 and is the leading international operator. In 2003, fields operated by Eni with a production of 480,000 boe/day accounted for 37% of Egypt’s total annual hydrocarbon production.

In 2003 oil and condensate production amounted to 92,000 barrels/day net to Eni and came mainly from the Eni operated Belayim and Ashrafi fields in the Gulf of Suez and from the Melehia field located in the Western Desert.

In 2003, natural gas daily production amounted to 95,000 boe net to Eni. The main natural gas producing interests operated by Eni are concentrated in the Nile Delta, onshore the Abu Madi and el Qar’a fields and in the Mediterranean offshore, the el Temsah, North Port Said (the former Port Fouad), Darfeel and Baltim fields. In early 2004 the Nouras field in the North Port Said concession was started up with initial production of 7,000 boe/day net to Eni. Development activities are ongoing for the North Port Said, Baltim and el Temsah reserves.

In the medium term the increase in gas production, while offsetting the natural decline of mature oil producing fields, will allow to increase production over the present 187,000 boe/day net to Eni.

(EGYPT MAP)

(GRAPHICS) Libya

Eni started operations in Libya in 1959 and is one of the leading international operators, with oil fields operated by Eni accounting for approximately 12% of Libya’s annual oil production. Eni’s principal producing interests are located in two areas: onshore in the central-eastern desert in the Bu-Attifel field, where Eni is operator with a 50% interest, and offshore Tripoli in the Bouri field, where Eni is operator with a 30% interest.

With a 50% interest Eni is partner of the joint development of the natural gas, oil and condensate Wafa field, in onshore permit NC-169 A, and of the Bahr Essalam field, in the NC-41 permit in the Mediterranean offshore (see “Development Projects” below).

Early production was started in January 2004 at the Elephant oil field in the NC-174 onshore permit (Eni’s interest 33.33%). In the first half of 2004 initial production is expected to amount to 40,000 barrels/day (9,000 net to Eni). Full production will be provided by 29 wells. Peak production is expected to be reached in early 2007 with 150,000 barrels/day (32,000 net to Eni).

In the medium term the start-up of fields under development will lead to a significant increase in daily hydrocarbon production from the present level of 84,000 boe.


		14

ENI FACT BOOK 2003
EXPLORATION & PRODUCTION PRODUCTION

(GRAPHICS) Algeria

Eni has been present in Algeria since 1981. In 2003, Eni’s production (66,000 barrels/day net to Eni) accounted for approximately 5.3% of Algeria’s annual production. Eni’s principal oil producing fields are located in the Bir Rebaa area (Eni’s interest 49%) in the south-eastern desert. In 2003 oil production started at: (i) the ROM Est field (Eni operator with a 50% interest) west of Bir Rebaa with daily production amounting to 1,500 barrels net to Eni; (ii) the second and third treatment train of the three planned at the unitized Ourhoud field (Eni’s interest 4.59%) south-west of Bir Rebaa. In 2003 this field produced 7,000 barrels/day net to Eni. The Rod and satellites field (Eni operator with a 63.96% interest) is under development near Bir Rebaa with production expected in the third quarter of 2004 (see “Development Projects” below).

In the medium term development initiatives will generate an increase in daily oil production net to Eni from the present level of 65,000 barrels/day.

(GRAPHICS) Tunisia

Eni has been present in Tunisia since 1961; its main producing interests are in the el Borma oil field and in the oil and gas Hammouda and Oued Zar fields, operated by Eni with a 50% interest. In 2003 the Adam field (Eni operator with a 35% interest) started production and allowed to exceed the level of 14,000 boe/day net to Eni. In the medium term production is expected to remain stable.

(TUNISIA MAP)


15

		ENI FACT BOOK 2003
EXPLORATION & PRODUCTION PRODUCTION

West Africa

(GRAPHICS) Nigeria

Eni has been present in Nigeria since 1962. In 2003, the fields operated by Eni accounted for approximately 10% of Nigeria’s oil production. Eni’s principal producing interests in Nigeria are in four onshore blocks (OML 60, 61, 62 and 63) in the Niger Delta (Eni’s interest 20%), and in the offshore OML 125 block (Eni’s interest 50.19%), OML 116 block (former OPL 472 Agbara) and OML 119 block (former OPL 91), where it holds a 100% interest operated through service contracts. In 2003 oil production started at the first level of the Abo field, located in the OML 125 production concession reaching 12,000/day barrels net to Eni; peak production is targeted at 19,000 barrels/day net to Eni in 2006 following development of further production levels. In Block OML 119 oil production continued at the Okono oil field while the Okpoho oil field is under development, with start-up expected in the first half of 2004; production of the two fields is expected to peak at about 28,000 barrels/day net to Eni in 2004.

The Bonga oil field located in block OML 118, where Eni holds a 12.5% interest, is under development (see “Development Projects” below).

Eni also holds a 5% interest in NASE, the largest oil joint venture in the country relating to 43 onshore blocks. The major development projects underway are the Cawthorne Channel fields with expected start-up in the first half of 2004 and the revamping of the Forcados/Yokri fields. Development initiatives are ongoing for guaranteeing natural gas supplies to Bonny’s liquefaction plant (Eni’s interest 10.4%, see “Gas & Power - Development Initiatives” below). Gas reserves net to Eni committed to the liquefaction plant (five trains) amount to 44 billion cubic meters (corresponding to 268 million boe or 3.7% of Eni’s proved reserves at December 31, 2003).

The Okpai power station (Eni’s interest 20%) is expected to start-up in the second half of 2004, with a generation capacity of 480 megawatt on two turbogenerators. The power station will be fired with gas from the Kwale fields in Block OML 60 which will provide 2 million cubic meters/day.

In the medium term, the reaching of full production at the Abo and Bonga fields, the increase in liquefied natural gas volumes treated at Bonny’s liquefaction plant and the contribution of the NASE projects will lead to a significant increase in Eni’s production from the present level of 132,000 boe/day.

(NIGERIA MAP)


		16

ENI FACT BOOK 2003
EXPLORATION & PRODUCTION PRODUCTION

(GRAPHICS) Congo

Eni has been present in Congo since 1968 and is the second largest international oil producer, with oil fields operated by Eni accounting for approximately 35% of Congo’s total oil production in 2003. Eni’s principal oil producing interests operated in Congo are located in the deep offshore facing Pointe Noire: the Kitina (Eni’s interest 35.75%), Foukanda, Mwafi, Zatchi and Djambala (Eni’s interest 65% each) and Loango (Eni’s interest 50%) fields. Other fields are the Pointe Noire Grand Fond (Eni’s interest 35%). In the medium term Eni’s daily production is expected to decline slightly from the present level of 68,000 boe.

(CONGO MAP)

(GRAPHICS) Angola

Eni has been present in Angola since 1980. Eni’s main oil producing interests are located in Block 0, former Cabinda (Eni’s interest 9.8%), Block 14 (Eni’s interest 20%) and Block 15 (Eni’s interest 20%). The main oil fields in Block 0 are the Takula, Nemba and Malongo fields. In area B of this Block an FPSO and its facilities are under construction for developing the oil, condensate and LPG Sanha and Bomboco fields, that are expected to start production between the autumn of 2004 and the beginning of 2005.

In the deep waters of Block 14 the Kuito oil field is producing, while engineering and construction works are underway for the development of the of Benguela/Belize and Lobito/Tomboco fields expected to start-up in 2006. These fields hold recoverable reserves of 441 million barrels (76 million net to Eni); peak production is targeted at 40,000 barrels/day net to Eni in 2007.

In Block 15 development activities are underway for the oil fields discovered in the Kizomba area (see “Development Projects” below). In November 2003 in Block 15 the Xikomba oil field was started-up at an initial production level of 15,000 barrels/day net to Eni during the production period. Recoverable reserves net to Eni amount to 16 million barrels.

The start-up of fields under development will allow to increase significantly daily production net to Eni from the present 58,000 barrels/day.

(ANGOLA MAP)


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		ENI FACT BOOK 2003
EXPLORATION & PRODUCTION PRODUCTION

(GRAPHICS) Norway

Eni has been operating in Norway since 1964. Eni’s principal producing interests are the Ekofisk field (12.39% interest) in the North Sea and the Aasgard (14.9%), Norne (6.9%) and Heidrun (5.12%) fields in the Norwegian Sea. In 2003, production of the Ekofisk and Aasgard fields accounted for 38 and 43% respectively of Eni’s production in Norway (57 and 43% in 2002). In March 2003 Eni concluded the purchase of Fortum Petroleum with proved and probable reserves of approximately 200 million boe at December 31, 2002. In 2003 its daily production amounted to 44,000 boe and allowed to increase Eni’s hydrocarbon production in Norway by 40%. Within its portfolio rationalization strategy Eni sold its interests in certain exploration permits and purchased a 7.9% interest in the Tyrihans field in the Norwegian section of the North Sea.

In 2003 the Mikkel field (Eni’s interest 14.9%) started production at 2,000 boe/day net to Eni, its production peak with approximately 8,000 boe net to Eni is expected in 2004. Development is underway at the Kristin gas and oil field (see “Development Projects” below).

In the medium term, the increase in production of active fields and start-ups of fields under development will increase production from the present level of 142,000 boe/day.

(NORWAY MAP)


19

		ENI FACT BOOK 2003
EXPLORATION & PRODUCTION PRODUCTION

(GULF OF MEXICO MAP)

Rest of the World

(GRAPHICS) United States

Eni has been present in the United States since 1966 and holds various mineral interests in the Gulf of Mexico. Eni’s main producing fields (Eni’s interest 100%) are located in the Grand Isle 102, Green Canyon 254-297 (where the Allegheny field is located) and Ewing Bank 921/964-5 (where the Morpeth field is located) concessions; other fields in which Eni holds interests are located in the Garden Banks 602/646 (Eni’s interest 34%), Mississippi Canyon 890-1/934-5 (Eni’s interest 32%) and Mississippi Canyon 194-5/150-1 (Eni’s interest 16.5%) concessions.

In November 2003 production started at the oil and gas Medusa field (Eni’s interest 25%) at an initial level of 2,000 boe/day. Production is expected to peak at 9,000 boe/day in 2004. Eni is operator in the development of the K2 oil field in the Green Canyon 562-3 concession (Eni’s interest 18.17%) with start-up expected in early 2005. A peak production of 5,000 boe/day net to Eni is expected in 2007.

In the medium term the contribution of fields under development will allow to compensate the decline in mature fields, maintaining daily hydrocarbon production at the present level of 48,000 boe.

(GRAPHICS) Kazakhstan

Eni has been present in Kazakhstan since 1992. Eni is co-operator with British Gas with a 32.5% interest of the Karachaganak oil, gas and condensate field with recoverable reserves net to Eni of about 1 billion boe. In 2003, production of liquids and natural gas from this field amounted to 69,000 barrels/day (net to Eni). The second development phase of this field has been completed with the start-up in the second half of 2003 of an oil treatment plant (Karachaganak Processing Complex - KPC) with a 150,000 barrels/day capacity and of transmission infrastructure for the export of liquids to Western markets, including a


		20
ENI FACT BOOK 2003
EXPLORATION & PRODUCTION
PRODUCTION

(KAZAKHSTAN MAP)

(KARACHAGANAK CAMP MAP)

635-kilometer long pipeline with a 24 inch diameter linking the Karachaganak field to Atyrau, point of connection with the Caspian Pipeline Consortium pipeline. Following the completion of this phase in 2004 daily production of liquids will be 65,000 barrels/day net to Eni (100,000 boe/day including natural gas). The third development phase of this field envisages an increase in hydrocarbon production by means of the construction of a natural gas treatment plant. The fourth development phase envisages activities aimed at maintaining the field production plateau reached in the third phase.

Eni has been present in Indonesia since 2000. Eni’s producing interests are located in the onshore area in east Kalimantan regulated by the Sanga Sanga PSA (Eni’s interest 37.81%) operated by Virginia Indonesia Company (VICO) in which Eni holds a 50% interest. This area produces mainly natural gas (about 80%). This gas is treated at the Bontang liquefaction plant, the largest in the world, and is exported to the Japanese, South Korean and Taiwanese markets.

(GRAPHICS) Indonesia

In the medium term daily hydrocarbon production net to Eni is expected to decline slightly from the present level of 41,000 boe.

(GRAPHICS) Venezuela

Eni has been present in Venezuela since 1998 and is operator with a 100% interest of the Dación oil field regulated by a service contract with a 20 year term. In 2003 daily production from this field amounted to 54,000 barrels net to Eni and in 2004 it is expected to reach 74,000 barrels net to Eni. In addition Eni holds a 26% interest in the Corocoro oil field located in the West Paria Gulf at the mouth of the Orinoco river. The field’s development project approved in April 2002 will proceed by phases and expects to reach a daily production of 15,000 barrels/day net to Eni in the first phase. Daily oil production net to Eni is expected to increase in the medium term.


21
		ENI FACT BOOK 2003
EXPLORATION & PRODUCTION

Rest of the World

(GRAPHICS) Trinidad & Tobago

Eni holds a 17.31% interest in the development of the offshore Chaconia, Hibiscus and Poinsettia gas fields in Block NCMA. The development of these fields will allow to maintain Eni’s production at 10,000 boe/day in the medium term.

(GRAPHICS) Ecuador

Production is concentrated in the Villano oil field, operated by Eni with a 100% interest. In 2003, this field produced 30,000 barrels/day (21,000 net to Eni). This production level is expected to increase in the medium term, following the field’s revamping plan that provides for the drilling of new producing wells and an increase in the capacity of the oil treatment center. Production is expected to peak at about 25,000 barrels/day net to Eni in 2006.

(PAKISTAN MAP)

(GRAPHICS) Pakistan

Eni has been present in Pakistan since 2000. Eni’s main natural gas producing fields are Bhit (operated by Eni with a 40% interest), Kadanwari (Eni’s interest 18.42%), Zamzama (17.75%), Sawan (23.68%) and Miano (15.16%). In 2003 the Bhit field was started up with an initial production of 18,000 boe/day net to Eni. In the Sawan Block a gas treatment plant was started up and the first development phase of the Zamzama field was completed.

In the medium term further developments and the start-up of recently discovered fields will allow to increase daily production from the present level of 28,000 boe net to Eni.

(GRAPHICS) Croatia

Eni through a 50/50 joint venture with Ina, the national Croatian company, operates the Ivana natural gas field, located 40 kilometers west of Pola in the Adriatic offshore in approximately 40 meter deep waters. The field is operated through a main production platform, called Ivana A and three satellite platforms, Ivana B, D and E. Two more satellites (C and K) are going to be developed by installing two production platforms. The development of other fields discovered in the area – Ika, Ida, Annamaria and Marica –


		22
ENI FACT BOOK 2003
EXPLORATION & PRODUCTION
PRODUCTION

with recoverable reserves of 66 million boe is underway. Start-up of these fields is expected in early 2005.

The development of these fields will allow to increase production net to Eni by 7,000 boe/day by 2007.

(GRAPHICS) Iran

(IRAN MAP)

Eni has been present in Iran since 1957. Its main producing oil fields are Darquain (Eni is operator with a 60% interest), Balal (38.25%) and Dorood (45%). In 2003 Eni’s oil production amounted to 9,000 barrels/day.

Darquain started production in the second half of 2003 at a level of 10,000 barrels/day net to Eni in this period. Production is sent to an oil treatment center with a capacity of 60,000 barrels/day, that is undergoing upgrading. Production is expected to peak in 2007 at 22,000 barrels/day net to Eni. Balal was started up in 2003 with a production of 29,000 barrels/day (5,000 net to Eni) and is expected to peak in 2005 at 6,000 barrels/day net to Eni.

In 2003 the development of the Dorood field continued. Production (about 4,000 barrels/day in 2003) is expected to peak at 10,000 barrels/day net to Eni in 2005.

Eni is operator with a 60% interest of phases 4 and 5 of the development of the natural gas and condensate South Pars field (see “Development Project” below).

In the medium term oil production net to Eni is expected to increase.


23
		ENI FACT BOOK 2003
EXPLORATION & PRODUCTION
PRODUCTION

exploration areas

Eni is among the best positioned companies in the new and most promising mining areas. In the future such areas will give a substantial contribution to the growth in Eni’s reserves and production.

Deep offshore

(GRAPHICS) West Africa

In ANGOLA, in offshore Block 14 (Eni’s interest 20%) the Negage-2 appraisal well was drilled 10 kilometers from the Negage-1 discovery well and identified an oil and gas bearing column. In Block 15 (Eni’s interest 20%) four new oil discoveries were made: Bavuca-1, Kakocha-1, Tchihumba-1, Clochas-1. Three successful appraisal wells were drilled on preceding oil discoveries: Saxi-2, Batuque-2 and Mondo 3/A.

In CONGO Eni owns significant interests in two deep water exploration blocks, Mer Très Profonde Nord, where Eni is operator with a 100% interest, and Mer Très Profonde Sud (Eni’s interest 30%).

In NIGERIA Eni is operator in three blocks, OPL 244 (Eni’s interest 90%), OPL 211 and OPL 316 (Eni’s interest in both is 50.19%). In addition Eni holds a 12.5% interest in two deep water blocks, OPL 219 and OPL 212.

(GRAPHICS) Gulf of Mexico

Eni holds various exploration licences, in particular is operator with interests varying from 30 to 100% in 4 exploration licences in the East Breaks concession, 5 in the Garden Banks concession, 20 in the Green Canyon concession and 18 in the Mississippi Canyon concession. A wide exploration campaign is ongoing. In 2003 a new oil discovery was made with the St. Malo well in Block WR 678 (Eni’s interest 1.25%). In the Green Canyon 562-3 Block (Eni’s interest 18.17%), the first and second appraisal wells (K2-2 and K2-3) of field K2 were drilled and confirmed the initial estimate of the recoverable reserves of the field.

(GRAPHICS) Brazil

Eni holds interests in 4 exploration licenses (with shares from 20 to 100%), in two of these the second exploration phase started.

(GRAPHICS) Norway

Eni is operator with interests ranging from 20 to 100% in 4 licences in the Norwegian section of the North Sea and holds interests varying from 11 to 50% in 11 licences. In the Barents Sea Eni is operator of the PL 201 and PL 229 licences (with interests of 67 and 65% respectively). In the latter licence the Goliath field was discovered in 2001.

In the Norwegian Sea Eni is operator of Block PL 256 (Eni’s interest 55%) where in 2003 the Skilinna gas and condensate discovery was made. Other discoveries were made in the PL 264 permit (Eni’s interest 20%) with the Hvitveis well, with reserves still to be defined and in the PL 128 permit (Eni’s interest 11.5%) with the Lerke well containing oil.

(GRAPHICS) United Kingdom

Eni holds interests in various exploration licences in the deep offshore, in particular, Eni is operator in 7 licences off the coast of Scotland with interests varying from 17 to 100%.

(GRAPHICS) Ireland

Eni holds 3 exploration permits in the Atlantic offshore of Ireland at water depths ranging from 1,000 to 2,000 meters: permits 7/97 and 1/99 operated by Eni with a 100% interest and permit 2/94 (Eni’s interest 40%) where the 12/2-17(Dooish re-entry) well confirmed the Dooish discovery of 2002.


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EXPLORATION & PRODUCTION
EXPLORATION AREAS

exploration areas

(GRAPHICS) FarÆe Islands

Eni is operator in 2 exploration permits off the coast with a 75% interest.

(GRAPHICS) Indonesia

Eni’s exploration activities in Indonesia focus on the deep offshore of East Kalimantan. Eni holds interests in 7 exploration permits (Ganal, Rapak, Popodi, Papalang, Muara Bakau, Ambalat and Bukat), in three of these as operator (Muara Bakau, Ambalat and Bukat) located in the Kutei and Tarakan oil basins.

In the Ganal permit about 70 kilometers from the east coast of the Kalimantan island, the Gehem-2 discovery was made, that confirmed the extension of the gas and condensates bearing strata already identified by the previous well Gehem-1 and identified a new oil bearing area. Further discoveries were made with the Ranggas S-1 and Bangau-1 wells. Development plans are being studied for the Ganal and Rapak discoveries.

Exploration onshore and in conventional waters

(GRAPHICS) Saudi Arabia

Eni was awarded an exploration licence for exploration, development and production of natural gas in the so called C area covering approximately 52,000 square kilometers in the Rub al Khali basin at the border with Qatar and the United Arab Emirates (Eni operator with a 50% interest).

(GRAPHICS) Caspian Sea

Geologically the Caspian Sea is one of the most promising areas in the world for hydrocarbon exploration.

In KAZAKHSTAN Eni is single operator with a 16.67% interest of the North Caspian Sea PSA in the Kazakh offshore where in 2000 the Kashagan field was discovered. Appraisal activities and exploration of the area under contract continued in 2003. In March testing of the third and the fourth appraisal wells (KE-4 and KE-5) started in 2002 was completed, while the fifth appraisal well (KE-6) was drilled in April. The completion of this well and production tests continued in 2003 and will be completed in 2004. Two nearby commitment exploration wells (Kashagan South West-1 and Aktote-1) were successfully drilled. The first one was drilled to the total depth of 5,875 meters and yielded over 2,000 barrels/day in test production. Aktote-1, drilled at a total depth of 4,267 meters yielded about 1,500 barrels/day in test production. Work on the sixth and last commitment well Kairan-1 reached the final depth, was suspended in the winter and is due to restart after thawing.

In May 2003, the Kazakh authorities approved the appraisal plan of the Kalamkas structure, where in 2002 oil was discovered with the Kalamkas-1 exploration well. 3D seismic surveys were completed at the end of October 2003.

(GRAPHICS) Australia

Eni holds interests in 11 exploration licenses in the north-western offshore, in three of these is operator. Two of the latter are located north of Perth (WA-326-P, Eni’s interest 100% and WA-328-P, Eni’s interest 67%), the third licence (WA-25-L) includes the Woollybutt field (Eni’s interest 65%).


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EXPLORATION AREAS

(GRAPHICS) Algeria

Three new oil discoveries were made in Block 404 (Eni’s interest 25%) in the south-eastern desert with the HBNE-1, SFSW-1 and Bkne-Aac-A wells. In the Zamoul el Kbar permit (Eni operator with a 100% interest) the REC 2-H appraisal well showed the presence of hydrocarbons and yielded over 8,000 barrels/day of oil. In October 2003 the saleability of this field’s production was declared.

(GRAPHICS) Egypt

In Egypt exploration activity takes place in 10 exploration permits in 35 production concessions. The major exploration areas in geomineral terms are: (i) gas and condensates in the North Sinai, the Nile Delta and the Mediterranean offshore; (ii) oil in the Suez Gulf and the Western Desert. Gas areas in the Mediterranean offshore show the most promising potential.

In 2003 Eni was assigned as operator two exploration permits: Ras el Ush (244 square kilometers) and South Ferain (349 square kilometers) located in the Gulf of Suez (Eni’s interests 75 and 70%, respectively). Exploration plans provide for the drilling of three wells in both permits.

As a consequence of the Bid Round 2002, Blocks 24 and 26 Offshore Mediterranean were assigned while Block 10 Western Desert was assigned following the Bid Round 2003. The latter bid needs to be approved by the Egyptian Parliament which will confirm the conferral of licences to Eni.

(GRAPHICS) Nigeria

Three discoveries were made in onshore production areas: (i) in the OML 63 permit (Eni operator with a 20% interest) with the Sengana River 1 Dir well; (ii) in the OML 11 permit (Eni’s interest 5%) with the Bonny North 2 well; (iii) in the OML 41 permit (Eni’s interest 5%) with the Ovhor 1 Dir DNFW well. The three discovery wells have been prepared for the connection with existing production facilities.

(GRAPHICS) Italy

Exploration activities in Italy yielded positive results with the natural gas wells Annamaria 2 (Eni’s interest 90%) and Elettra 2 (Eni’s interest 100%) in the Adriatic offshore; Panda W-1 in the offshore of Sicily (Eni operator with a 37.5% interest); Capparuccia 1 (Eni’s interest 100%) onshore in Central Italy.

(GRAPHICS) Pakistan

Eni is present in the Kirthar Foldbelt area and in the Middle Indus Basin. In Kirthar Foldbelt Eni is operator in the Manchar and Gorakh permits (the latter obtained in April 2003). In 2003 in the Kirthar Foldbelt the new Hallel-1 gas discovery was made (Eni’s interest 47%); the ZZ-North-1 and ZZ-East-1 wells in the Zamzama block (Eni’s interest 17.75%) containing natural gas are going to be linked to existing production facilities. In the Middle Indus Basin Eni is present in the Mubarak (Eni’s interest 38%), Gambat (31.58%), South West Miano 2 (33.3%) and Latif (33.3%) blocks obtained in October 2003. In 2003 in this area two gas discoveries were made: Kadanwari-14 in the Kadanwari production block (Eni’s interest 18.42%) and Rehmat-2 in the Mubarak block (Eni’s interest 38%).


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		ENI FACT BOOK 2003
EXPLORATION & PRODUCTION
EXPLORATION AREAS

exploration areas

(GRAPHICS) Norway

Eni holds interests in various exploration licences in the conventional offshore of Norway and in particular is operator of 7 permits with interests ranging from 30 to 65%, while in other 32 exploration permits it holds interests ranging from 5 to 30%. In the PL0443 permit (Eni’s interest 9.13%) in the North Sea the Tommeliten Alpha oil and gas field was discovered.

(GRAPHICS) United Kingdom

Eni holds various exploration licences with interests ranging from 5 to 35%. In the Gas Basin, in Block 48/10a (Eni’s interest 11.11%) the gas and condensate Annabella field was discovered. In the North Sea, in Block 211/12a&7a (Eni’s interest 5%) the Ritchie Channel oil field was discovered and was linked to the Magnus field. In the Central Graben area, in Block 29/5B (Eni’s interest 21.87%) the West Franklin gas and condensate field was discovered. This field will be linked to the production facilities of the nearby Franklin field. In Block 30/2C (Eni’s interest 7%) the Jade NE gas field was discovered. In the Viking Graben area in Block 16/28 (Eni operator with a 50% interest) the Farragon field was discovered near the Andrew producing field (Eni’s interest 16.2%).

(GRAPHICS) Venezuela

Eni holds interests in two exploration licences: Gulf of Paria East (GOPE, Eni’s interest 30%) and Gulf of Paria West (GOPW, Eni’s interest 40%) both in conventional waters. In the first one the Delfin well was drilled and found heavy oil. In the second one the Tiburon well is being drilled.


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EXPLORATION AREAS

(DEVELOPMENT PROJECTS MAP)

development projects

Eni is involved in the completion ofa number of development projects that will contribute to the medium and long-term growth in its hydrocarbon production. What follows is an utline of the most important development projects.

(VAL D'AGRI PROJECT MAP)

(GRAPHICS) Italy - The Val d’Agri Project

The three fields of Monte Alpi, Monte Enoc and Cerro Falcone, located in the Grumento Nova and Volturino concessions, are currently under development. With regard to the development plan for the area, eight out of eleven implementation agreements have been defined. Such agreements were included in the protocol of intents signed in 1998 with the Basilicata Region, that commits Eni to joint action aimed at protecting the environment. At December 31, 2003 development activities performed concerned: (i) the drilling of 27 development wells, 15 of which already producing; (ii) the construction of the Viggiano oil center with the start-up of three treatment lines, with a capacity of around 66,000 barrels/day of oil and 2.1 million cubic meters/day of natural gas (about 13,000 boe/day); (iii) construction and start-up in October 2001 of the Monte Alpi oil pipeline, 136-kilometer long with a 20-inch diameter, connecting the oil center with Eni’s Taranto refinery with a transport capacity of 150,000 barrels/day. The pipeline has been built to the highest safety, environmental protection and anti-seismic standards. In 2003, in relation with the advancement stage of infrastructure and development wells, production in Val d’Agri flowed at 47,000 barrels/day of oil and 8,000 boe/day of natural gas net to Eni.

Val d’Agri Project - Summary data


				Project		Eni share
Peak production	(th boe/d)				117		79
Expenditure	(mn €)				1,983		1,358
Recoverable reserves	(mn boe)				539		354
Eni interest		(	%)				71


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		ENI FACT BOOK 2003
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DEVELOPMENT PROJECTS

(ALGERIA-THE ROD AND SATELLITES PROJECT MAP)

The further development phases of the Val d’Agri Project foresee:

n the drilling of 11 production wells;

n the continuation of the expansion of the treatment capacity of the oil center with the installation of a fourth train, up to a capacity of 104,000 barrels/day for oil and 3.2 million cubic meters/day of natural gas (about 20,000 boe/day);

n the expansion of the marine terminal in the Gulf of Taranto.

Recoverable reserves of the Val d’Agri fields net to Eni amount to 354 million boe (85% of which is oil). Eni’s share of daily production is set to rise from the current level of approximately 55,000 boe to a peak of 79,000 boe in 2005. Eni’s overall development expenditure amounts to about euro 1,358 million (100 million of which relate to the agreement between Eni and the Basilicata Region).

(GRAPHICS) Algeria - The ROD and Satellites Project

Following the unitization of the ROD field (Eni operator with a 63.96% interest) in blocks 401a/402a and 403a a development project for the field and its satellites (SFNE, BSF, RDB, RERN and RAR) was started. The project foresees the construction of a treatment train with a capacity of 80,000 barrels/day and facilities in the area of the Bir Rebaa oil center. All the development wells have been drilled and completed, while the plant and its facilities are under construction. Recoverable reserves net to Eni amount to 89 million barrels. When production begins in the third quarter of 2004, Eni’s share of daily production will be 23,000 barrels. A production peak of 24,000 barrels/day is scheduled in 2004. Eni’s overall capital expenditure is about dollar 324 million.

(GRAPHICS) Libya - Wafa and Bahr Essalam

Joint development of the gas, oil and condensates fields of Wafa, located in NC-169 A permit, about 520 kilometers south west of Tripoli, and Bahr Essalam in the NC-41 permit, located in the Mediterranean offshore, 110 kilometers north of Tripoli is underway. These fields (where Eni is partner of the development with a 50% interest) hold recoverable reserves net to Eni of about 950 million boe. The Wafa field is expected to start production in the fourth quarter of 2004 at an initial level of 65,000 boe/day net to Eni. The Bahr Essalam field is expected to start

Wafa and Bahr Essalam - Summary data


				Project		Eni share
Peak production	(th boe/d)				240		128
Expenditure	(mn €)				6,100		3,100
Recoverable reserves	(mn boe)				1,743		950
Eni interest		(	%)				50
Expected start-up							2004


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DEVELOPMENT PROJECTS

(WAFA AND BAHR ESSALAM PROJECT MAP)

production in June 2005 at an initial level of 61,000 boe/day net to Eni. Peak production from the two fields (128,000 boe/day net to Eni) is expected in 2006. Capital expenditure for the upstream phase of the project is expected to amount to euro 6.1 billion (Eni’s share 3.1 billion) for the construction of hydrocarbon treatment plants at Wafa and at Mellitah on the Libyan coast, the installation of the Sabratha offshore production platform, the construction of onshore and offshore infrastructure including an underwater production facility and the laying of pipelines for the transport of natural gas and condensates to the Mellitah plant. The downstream phase of the project provides for the laying of the underwater Greenstream pipeline linking Mellitah to Sicily for exporting to Italy natural gas produced in the two fields. The pipeline will be 520-kilometer long, with a 32-inch diameter and a maximum laying depth of 1,130 meters. It will have a transport capacity of 8 billion cubic meters/year and will start operating in the second half of 2004. See “Gas & Power - Transmission, dispatching and regasification” below.

(GRAPHICS) Angola - Block 15 - Kizomba phase A and B

Eni is engaged in the development of oil fields discovered in the Kizomba area situated in Block 15 (Eni’s interest 20%) in the deep offshore of Angola, the most important in the West

(ANGOLA - BLOCK 15 MAP)


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		ENI FACT BOOK 2003
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DEVELOPMENT PROJECTS

Block 15 - Kizomba A (Hungo/Chocalho) - Summary data


		Project		Eni share
Peak production	(th bbls/d)		243		39
Expenditure	(mn USD)		3,680		720
Recoverable reserves	(mn bbls)		1,000		145
Eni interest	(%)				20
Expected start-up					2004

African deep offshore. The project foresees three phases, A, B and C. Phase A concerns the development and start-up of production of the Hungo and Chocalho fields, containing recoverable reserves of about 1 billion barrels (145 million net to Eni), with the drilling of 59 wells (33 production and 26 injection) and the use of a Tension Leg Platform connected to an FPSO that will be the largest in the world, with a treatment capacity of 250,000 barrels/day and storage capacity of 2.2 million barrels. The TLP has been installed and the FPSO is travelling and is expected to reach Angola in May 2004. A total of 11 development wells have been drilled. Production is scheduled to begin in the second half of 2004. Eni’s share of capital expenditure amounts to about dollar 720 million.

Phase B concerns the development and start-up of production of the Kissanje and Dikanza fields, with recoverable reserves of about 910 million barrels (141 million net to Eni). The project provides for the drilling of 58 wells (34 producing and 24 injection) on Kissanje and 17 wells (10 producing and 7 injection) on Dikanza, the use of a Tension Leg Platform for Kissanje and an underwater production system for Dikanza. Production will be transported to an FPSO common to both fields. In January 2003 the contract for the construction of an FPSO with similar characteristics to that of phase A was awarded. Production start-up is scheduled for 2006 with production peaking at 43,000 boe/day net to Eni in 2007. Eni’s share of the capital expenditure amounts to approximately dollar 600 million.

Phase C concerns the development of the Mondo, Saxi and Batuque fields for which feasibility studies are underway. Production is expected to start in 2007.

(LOGO) Nigeria - The Bonga Project

The Bonga oil field (Eni’s interest 12.5%) is situated in OML 118 permit offshore Nigeria in waters of a depth between 950 and 1,150 meters. The development plan for the field foresees the drilling of 34 underwater wells (of which 17 production wells and 17 water injection wells) touching 20 production levels. Oil will be transferred to an FPSO with a treatment capacity of 225,000 barrels/day and a storage capacity of 2 million barrels. Associated gas will be

(PICTURE)


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ENI FACT BOOK 2003
EXPLORATION & PRODUCTION DEVELOPMENT PROJECTS

deviated to a collection platform in the EA field from which it will be sent to the Offshore Gas Gathering System (OGGS) pipeline that in turn will carry it to the Bonny liquefaction plant. 16 development wells have been drilled and completed, which confirmed the results of the forecast model. The construction of the FPSO and relevant topsides is underway. Recoverable reserves net to Eni amount to about 75 million barrels. Production is scheduled to begin in 2005 at a peak flow of about 20,000 barrels/day net to Eni. Eni’s share of the development expenditure amounts to over dollar 350 million.

(GRAPHICS) Kazakhstan – North Caspian Sea

Eni is operator of the North Caspian Sea PSA (Eni’s interest 16.67%) in joint venture with seven international oil companies. In May the partners in the project, except for one, exercised their pre-emptive rights and purchased in proportional shares the interest of British Gas that left the project. A Sale and Purchase Agreement with effect from January 1, 2003 was agreed among the partners, subject to authorization by the Kazakh authorities. Under the agreement, Eni’s share in the project will go from 16.67% to 20.372%.

The area under contract is made up of 11 blocks covering a total of over 5,500 square kilometers at a water depth of 2 to 10 meters. This project, due to the mineral potential of existing structures and to the operating and technological challenges it poses, resulting from the shallow waters which are frozen for about six months a year, represents an extremely important industrial feat in the oil industry. Eni intends to apply the most advanced technologies and methods in order to provide maximum environmental protection to the North Caspian area. In this area in July 2000 the Kashagan field was discovered and subsequent appraisal allowed to define the amount of recoverable reserves of oil in the 7 to 9 billion barrels range, that could reach 13 billion barrels with gas reinjection techniques, thus making this field the most important discovery in the world in the past thirty years. On June 30, 2002 the Eni led consortium and the Kazakh authorities declared the saleability of the Kashagan field. At the end of 2002 the consortium presented a development plan for the field. At the end of June 2003 the front end engineering of the first development phase was completed. After the signing of a Supplemental Agreement and related deeds, on February 25, 2004 the development plan for Kashagan was approved. The plan, which will be implemented in multiple phases, aims at the production of the recoverable reserves up to 13 billion barrels through partial reinjection of gas and a total expenditure of 29 billion dollars (5 billion being Eni’s share). Production is expected to start in 2008 at a level of 75,000 barrels/day and to increase to 450,000 barrels/day at the end of the first development phase. Target production plateau is expected at 1.2 million barrels/day.

(PICTURE)


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				ENI FACT BOOK 2003
		EXPLORATION & PRODUCTION DEVELOPMENT PROJECTS

(GRAPHICS) Iran – The South Pars Project phases 4 and 5

In 2000 Eni entered a buy-back contract with the National Iranian Oil Company (NIOC) for the development of Phases 4 and 5 of the South Pars gas and condensate field, an eastern extension of the North Field (Qatar), the largest natural gas field in the world in the offshore of the Persian Gulf. The project, in which Eni is operator with a 60% interest, involves the construction of two offshore platforms in waters of a depth of around 70 meters, the drilling of 24 production wells and the construction of two gas pipelines, each approximately 105-kilometer long, to connect the platforms to the onshore gas center to be built at Assaluyeh. The gas center will have a treatment capacity of 20 billion cubic meters/year and will be able to produce 47.6 million cubic meters/day of natural gas, one million tonnes/year of LPG and 80,000 barrels/day of condensates. Construction work is underway for completing the platforms and building the treatment plant, as well as drilling of development wells. Capital expenditure for the development of the project is estimated at about dollar 2 billion (Eni’s share dollar 1.4 billion) and will be incurred in the 2000-2005 period. Eni will act as operator for the development phase and will supply technologies, know-how and resources. The contract foresees that the production of liquids from the field over a period of 8 years will repay costs incurred and ensure return on capital employed. Recoverable reserves amount to 170 million boe net to Eni. Production is scheduled to begin in the last quarter of 2004 at an initial level of 8,000 boe/day net to Eni.

(GRAPHICS) Australia – The Bayu Undan Integrated Project

The offshore Bayu Undan field (Eni’s interest 12.04%) is located in Block Zoca 91/12-13 in the international cooperation area between Australia and East Timor, about 500 kilometers north west of Darwin at a water depth of 80 meters.

(PICTURE)


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(PICTURE)

The project includes two phases. The first one for the development of liquids(Propane butane and condensates) and the second one for the development of LNG. Phase 1, aimed at producing liquids by means of three drilling, production and treatment platforms, relevant facilities and an FPSO for the storage of liquids, has been completed. Production started in February 2004. The second phase entails the construction of a 26-inch diameter 500-kilometer long sealine that will link the field to Darwin where an onshore LNG plant with a 3.5 million tonnes/year capacity is under construction. The first LNG shipment is scheduled for the first quarter of 2006.

Under a 17-year long contract, gas produced will be sold to two Japanese companies, Tokyo Electric and Tokyo Gas, that bought a 10.08% interest in the integrated project.

Recoverable reserves amount to 434 million barrels of liquids and 79 billion cubic meters of natural gas (Eni’s total share is 88 million boe). Production is scheduled to peak at about 160,000 boe/day (18,000 net to Eni) in 2009. The total investment will be dollar 3.5 billion, of which 396 million is Eni’s share, of these 206 for the upstream portion.

(GRAPHICS) Norway – Kristin Project

In the offshore oil and gas Kristin field (Eni’s interest 9%) located in the Haltenbanken area in the Norwegian Sea, the Norne and Aasgard fields are in production. The development plan foresees the drilling of 12 underwater wells, the installation of a semi-submersible platform with treatment facilities and the laying of a gas pipeline connecting it with the Aasgard Transport Pipeline, 10-kilometer off Kristin, and of a 20-kilometer long oil pipeline to carry condensates to the Aasgard C storage vessel. Recoverable reserves of this field amount to 527 million boe (48 million net to Eni). Production is scheduled to start in October 2005 with a production peak of 20,000 boe/day net to Eni expected in 2006. Eni’s expenditure in this project amounts to dollar 240 million.


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				ENI FACT BOOK 2003
		EXPLORATION & PRODUCTION DEVELOPMENT PROJECTS

(PIE CHART)


Proved oil and condensate reserves by geographic area		(million barrels)


(at December 31)	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		318		316		360		329		328		296		309		255		252
North Africa		869		953		985		1,024		1,071		1,039		1,171		1,072		1,080
West Africa		749		720		728		790		900		934		976		1,022		1,038
North Sea		375		416		428		433		417		455		552		498		529
Rest of World		91		79		343		305		421		698		940		936		1,239

Total outside Italy		2,084		2,168		2,484		2,552		2,809		3,126		3,639		3,528		3,886

		2,402		2,484		2,844		2,881		3,137		3,422		3,948		3,783		4,138

(PIE CHART)


Proved natural gas reserves by geographic area ⁽¹⁾		(million boe)


(at December 31)	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		1,418		1,321		1,286		1,245		1,149		1,093		1,006		944		744
North Africa		111		467		544		662		778		890		951		961		944
West Africa		121		127		125		120		167		159		160		265		286
North Sea		209		227		226		233		229		245		327		327		383
Rest of World		57		49		48		114		74		199		537		750		777

Total outside Italy		498		870		943		1,129		1,248		1,493		1,975		2,303		2,390

		1,916		2,191		2,229		2,374		2,397		2,586		2,981		3,247		3,134

(1) Natural gas was converted to boe using a coefficient of 0.0061 for each cubic meter of gas produced outside Italy and 0.0063 for each cubic meter of gas produced in Italy due to the different heat value.

(PIE CHART)


Proved hydrocarbon reserves by geographic area		(million boe)


(at December 31)	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		1,736		1,637		1,646		1,574		1,477		1,389		1,315		1,199		996
North Africa		980		1,420		1,530		1,686		1,849		1,929		2,122		2,033		2,024
West Africa		870		847		852		910		1,067		1,093		1,136		1,287		1,324
North Sea		584		643		655		666		646		700		879		825		912
Rest of World		148		128		390		419		495		897		1,477		1,686		2,016

Total outside Italy		2,582		3,038		3,427		3,681		4,057		4,619		5,614		5,831		6,276

		4,318		4,675		5,073		5,255		5,534		6,008		6,929		7,030		7,272


Oil and condensate production by country		(thousand barrels/day)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		93		96		105		100		88		76		69		86		84
North Africa		214		218		212		213		221		227		228		252		250
Egypt		76		68		75		88		109		112		97		97		92
Libya		113		112		103		92		80		82		84		79		82
Algeria		7		22		20		19		18		21		35		65		65
Tunisia		18		16		14		14		14		12		12		11		11
West Africa		199		182		177		194		202		213		219		222		236
Nigeria		78		82		77		68		65		75		84		83		108
Congo		68		45		45		67		75		72		69		75		68
Angola		53		55		55		58		59		63		64		62		58
Gabon								1		3		3		2		2		2
North Sea		80		83		114		112		116		124		204		213		235
United Kingdom		38		41		69		65		64		59		134		139		130
Norway		42		42		45		47		52		65		70		74		105
Rest of World		26		35		38		34		47		108		137		148		176
Venezuela														39		42		54
Kazakhstan		7		14		16		12		19		27		23		32		41
United States		10		7		6		4		5		38		26		29		25
Ecuador										2		22		25		22		21
Australia																		14
China		9		14		13		12		14		14		12		10		7
Indonesia														6		5		5
Qatar						3		6		7		7		6		5
Iran																3		9

Total outside Italy		519		518		541		553		586		672		788		835		897

		612		614		646		653		674		748		857		921		981


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(PIE CHART)


Natural gas production by country		(thousand boe/day)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		320		309		299		294		270		257		239		230		216
North Africa		4		10		17		23		48		79		89		102		101
Egypt		4		10		17		23		48		77		83		95		95
Tunisia												2		3		3		3
Libya														3		4		2
Algeria																		1
West Africa		3		3		3		2		4		11		14		15		24
Nigeria		3		3		3		2		4		11		14		15		24
North Sea		28		31		40		44		38		44		84		95		110
United Kingdom		9		13		22		32		31		34		68		73		72
Norway		18		18		18		12		7		10		14		20		37
Netherlands														2		2		1
Rest of World		15		17		16		22		30		48		86		109		130
Indonesia														41		39		36
Kazakhstan								11		18		23		19		26		28
Pakistan														2		7		28
United States		15		17		16		11		12		23		20		30		23
Trinidad & Tobago																2		10
Croatia												2		4		5		5

Total outside Italy		50		61		76		91		120		182		273		321		365

		370		370		375		385		390		439		512		551		581

(PIE CHART)


Hydrocarbon production by country⁽¹⁾		(thousand boe/day)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		413		406		403		394		358		333		308		316		300
North Africa		218		228		229		236		269		306		317		354		351
Egypt		80		78		92		111		157		189		180		192		187
Libya		113		112		103		92		80		82		87		83		84
Algeria		7		22		20		19		18		21		35		65		66
Tunisia		18		16		14		14		14		14		15		14		14
West Africa		202		184		180		196		206		224		233		237		260
Nigeria		81		84		80		70		69		86		98		98		132
Congo		68		45		45		67		75		72		69		75		68
Angola		53		55		55		58		59		63		64		62		58
Gabon								1		3		3		2		2		2
North Sea		108		114		155		156		154		168		288		308		345
United Kingdom		47		54		92		97		95		93		202		212		202
Norway		61		60		63		59		59		75		84		94		142
Netherlands														2		2		1
Rest of World		41		52		54		56		77		156		223		257		306
Kazakhstan		7		14		16		23		37		50		42		58		69
Venezuela														39		42		54
United States		25		24		22		15		17		61		46		59		48
Indonesia														47		44		41
Pakistan														4		7		28
Ecuador										2		22		25		22		21
Australia																		14
Trinidad & Tobago																2		10
Iran																3		9
China		9		14		13		12		14		14		12		10		7
Croatia												2		2		5		5
Qatar						3		6		7		7		6		5

Total outside Italy		569		578		618		644		706		854		1,061		1,156		1,262

		982		984		1,021		1,038		1,064		1,187		1,369		1,472		1,562

(1) Includes natural gas consumed in operations (23,000 and 26,000 boe/day in 2002 and 2003 respectively).


		37
				ENI FACT BOOK 2003
		EXPLORATION & PRODUCTION


Hydrocarbon production sold		(million boe)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Hydrocarbon production		358.4			360.3			372.5			378.8			388.4			434.5			499.7			537.3			570.0
Change in oil and condensate inventories		0.2			0.1			(0.4	)		(1.0	)		0.4			0.0			(0.7	)		(0.2	)
Royalties in kind and over/under lifting of oil and condensates		(5.1	)		0.8			(1.0	)		(2.3	)		(1.9	)		(1.9	)		(2.4	)		(3.8	)		(4.3	)
Withdrawals from (input to) natural gas storage		(0.6	)		(4.0	)		(1.0	)		6.9			6.7			(4.6	)		9.1			(1.8	)
Own consumption of gas																				(6.0	)		(8.4	)		(9.5	)

Hydrocarbon production sold		352.9			357.2			370.1			382.4			393.6			428.0			499.7			523.1			556.2

Principal oil and natural gas interests


					Net exploration⁽¹⁾		Net			Number		Number
	Commencement		Number		and development		development		Type	of producing		of other
	of operations		of interests		acreage		acreage		of fields	fields		fields
Italy		1926		261		40,210		15,118	Onshore/Offshore		94		82
North Africa
Algeria		1981		29		3,226		760	Onshore		14		14
Egypt		1954		38		12,849		1,969	Onshore/Offshore		34		24
Libya		1959		7		21,268		8,053	Onshore/Offshore		9		9
Tunisia		1961		11		3,784		1,888	Onshore/Offshore		8		5
				85		41,127		12,670			65		52
West Africa
Angola		1980		38		2,223		432	Offshore		32		39
Congo		1968		17		7,507		741	Offshore		16		8
Gabon		1981		4		20,344		43	Offshore		1		0
Nigeria		1962		55		7,770		4,878	Onshore/Offshore		115		130
				114		37,844		6,094			164		177
North Sea
Norway		1965		44		4,239		316	Offshore		12		13
Netherlands		2001		1		47		47	Offshore		2		0
United Kingdom		1964		61		2,379		1,076	Offshore		40		19
				106		6,665		1,439			54		32
Rest of World
Australia		2001		13		19,275		1,643	Offshore		1		2
China		1983		3		241		85	Offshore		6		6
Croatia		1996		2		3,018		878	Offshore		1		7
Ecuador		1988		1		2,000		2,000	Onshore		1		1
Indonesia		2001		10		12,360		984	Onshore/Offshore		8		8
Iran		1957		4		423		423	Onshore/Offshore		3		1
Kazakhstan		1995		2		1,030		106	Onshore/Offshore		1		1
Pakistan		2000		12		8,089		598	Onshore		5		2
Trinidad & Tobago		1970		1		66		66	Offshore		3		2
United States		1968		408		2,502		489	Onshore/Offshore		15		4
Venezuela		1998		3		713		131	Onshore/Offshore		5		2
				458		49,717		7,403			49		36
Other						1,156		1,156					2
Other countries with only exploration activity				28		65,916
Outside Italy				792		202,425		28,762					5

Total				1,053		242,635		43,880			426		382

(1) Square kilometers.


		38
ENI FACT BOOK 2003
EXPLORATION & PRODUCTION


Exploration wells		(units)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Wells drilled		95		113		127		121		60		95		110		120		105
Outside Italy		67		81		98		82		43		75		99		111		97
Italy		28		32		29		39		17		20		11		9		8
Wells drilled (net to Eni)		49		66		74		66		29		47		47		52		43
Outside Italy		28		41		52		35		16		30		37		45		36
Italy		21		25		22		31		13		17		10		7		7


Reserve life index		(years)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		11.4		11.2		11.5		10.2		10.7		11.7		10.9		10.8		9.0
North Africa		12.3		16.7		18.0		19.3		18.6		17.5		18.4		15.8		15.9
West Africa		11.6		12.8		12.8		12.4		14.6		13.3		13.4		14.8		13.9
North Sea		14.6		15.4		11.0		11.7		12.0		11.4		8.4		7.4		7.2
Rest of World		9.1		6.7		19.7		20.9		16.8		15.6		18.0		17.1		18.1
		11.9		13.1		13.6		13.4		14.0		14.0		13.7		13.2		12.7


Reserve replacement ratio			(	%)


	1995		1996			1997		1998		1999		2000		2001		2002		2003
Italy		67		32			106		53		30		26		39				..
North Africa		93		618			229		277		265		172		267		30		93
West Africa		176		65			107		179		312		132		151		273		138
North Sea		246		244			120		119		113		185		271		53		168
Rest of World		311		(5	)		1,410		245		196		825		818		324		396
		126		200			207		147		171		210		282		119		142


Economic indicators per boe ⁽¹⁾		(USD/boe)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Revenues		17.30		20.66		19.02		13.68		16.95		24.67		21.52		22.07		24.82
Lifting cost⁽²⁾		3.72		3.97		3.98		3.56		3.64		3.75		4.02		3.87		4.09
Income		4.12		4.95		3.86		0.13		4.11		7.86		5.48		5.08		5.95
Exploration cost (three-year average) – discovery cost⁽³⁾		1.31		1.56		1.67		1.78		1.77		1.70		1.55		1.38		1.21
Finding and development cost (three-year average)⁽⁴⁾		4.27		4.33		4.72		5.16		5.43		5.35		5.33		5.67		6.53

(1) Calculated according to SEC standards.

(2) Ratio of production costs (incurred for well and facilities maintenance and royalties) and volumes produced.

(3) Exploration cost for each boe of new reserves discovered or proved represented by the ratio of costs incurred with respect to exploration activity and purchase of unproved property and increases in proved reserves related to improved recovery, extensions and new discoveries and revisions of previous estimates. 2001, 2002 and 2003 averages were calculated excluding purchase costs of unproved property of Lasmo in 2001 and of Fortum Petroleum in 2003.

(4) For each boe of new proved reserves, represented by the ratio of the sum of costs incurred with respect to exploration and development activities and purchase of unproved property and increases in proved reserves related to improved recovery, extensions and new discoveries and revisions of previous estimates. 2001, 2002 and 2003 averages were calculated excluding purchase costs of unproved property of Lasmo in 2001 and of Fortum Petroleum in 2003. Data for 2002 and 2003 also exclude buyback contracts in Iran.


Capital expenditure		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Exploration		396		555		677		755		636		811		757		902		635
Italy		143		192		178		191		132		156		80		66		59
Outside Italy		253		363		499		564		504		655		677		836		576
Acquisition of proved and unproved properties		5		292		95		103		752		416		67		317		30
Italy				55		48				54				13
Outside Italy		5		237		47		103		698		416		54		317		30
Development and capital goods		1,184		816		1,550		2,024		1,880		2,312		3,452		4,396		5,016
Italy		440		383		581		507		435		543		600		442		469
Outside Italy		744		433		969		1,517		1,445		1,769		2,852		3,954		4,547
		1,585		1,663		2,322		2,882		3,268		3,539		4,276		5,615		5,681


		39
				ENI FACT BOOK 2003
		EXPLORATION & PRODUCTION

gas & power

STRATEGIES

n Develop natural gas sales in target markets

n Maintain volumes sold in Italy within regulatory limits leveraging on the integration of natural gas and electricity generation and on the expected increase in demand

n Implement effective marketing actions developing an integrated commercial supply of gas and electricity

n Develop the LNG segment in order to give value to available natural gas production volumes

(ROACE BAR CHART)

natural gas

Eni operates in the supply, transmission, distribution and sale of natural gas. In 2003, Eni sold 71.5 billion cubic meters of natural gas (including volumes consumed in operations). Eni’s transmission network in Italy through medium and high pressure pipelines is about 30,000-kilometer long. Outside Italy Eni owns transportation rights on approximately 3,800 kilometers of pipelines.

Eni is pursuing the development of sales on European markets in order to compensate the lower growth opportunities on the domestic market, due to the limits imposed to operators by the sector regulations. In Italy, Eni intends to maintain sales volumes within the regulatory limits through the optimal allocation of supplies between direct sales in Italy and in the rest of Europe and by using natural gas at its own electricity generation plants and, at the same time, leveraging on the expected consumption growth, in particular for electricity generation. Eni’s marketing policy will tend to customer satisfaction by means of market segmentation, the development of commercial offers based on the gas-electricity integration and the expansion and customization of services offered to customers.

Outside Italy development will be focused on the European gas market, in particular in countries with interesting growth and profitability prospects (Iberian Peninsula, Turkey, Germany and Northern Europe) where Eni can make optimal use of its diversified portfolio of supply contracts and its extensive gas pipeline network which allows the supply of natural gas from several sources. Eni completed its entry into those markets by means of acquisitions and construction of infrastructure and, in 2003, it started the operational and commercial phase of this plan. Eni also intends to expand its presence in LNG in order to increase the value of the natural gas it produces in West and North Africa and the Far East. Based on contracts signed and actions defined, Eni expects to sell about 44 billion cubic meters of natural gas on European markets in 2007. Eni will also intensify its cost reduction actions especially in transmission activities in Italy and in secondary distribution.

(MAP)


		40
ENI FACT BOOK 2003
GAS & POWER

MAIN RESULTS

In August the laying of the Greenstream underwater gasline, a new route for natural gas import into Italy, started. This infrastructure will link Mellitah on the Libyan coast to Gela in Sicily covering about 520 kilometers at a maximum depth of about 1,130 meters and when fully operational will carry 8 billion cubic meters/year (of which 4 billion net to Eni) of natural gas from the Libyan fields of Wafa and Bahr Essalam. Volumes available have been already booked under long term contracts and will allow a further opening of the Italian natural gas market. Laying is expected to be completed on September 30, 2004

Within its strategy of international expansion in natural gas in the Iberian Peninsula, Eni purchased 50% of Spanish company Unión Fenosa Gas with an expenditure of euro 442 million. Operating in all segments of the natural gas business and LNG, Unión Fenosa Gas is a relevant partner that can contribute to Eni’s reaching its objective of developing its presence on the Spanish natural gas market which shows interesting growth prospects. In Portugal Eni signed an agreement with the Portuguese Government for the reorganization of Galp Energia within the restructuring process of the Portuguese energy sector. Eni will concentrate in the natural gas sector through a 49% interest in Gas de Portugal and by exiting the segment of refining and marketing of refined products in Portugal where Eni operated through Galp Energia. This transaction entails cash proceeds of euro 667 million

In February supplies of natural gas from Russia to the Turkish national company Botas started via the Blue Stream underwater gasline across the Black Sea. In 2003 Botas withdrew 1.3 billion cubic meters (of which 0.6 billion were Eni’s share). Volumes transported and marketed will progressively increase in future years and are targeted to about 16 billion cubic meters per year (8 billion net to Eni) in 2010

Eni continued its program for developing its electricity generation capacity targeted at about 5.3 gigawatts of installed power by 2006 with total capital expenditure amounting to approximately euro 2.3 billion (of which 1.2 were already expensed). In 2003 the construction of combined cycle power stations fired with natural gas with installed capacity of 3.8 gigawatts at Eni’s sites in Brindisi, Ferrera Erbognone, Mantova and Ravenna started. The commercial start-up of other units under construction is expected by stages between 2004 and early 2006. When fully operational, volumes of natural gas destined to electricity generation will reach 6-7 billion cubic meters per year

Rationalizations and efficiency improvement actions generated cost savings of approximately euro 50 million


Main financial data		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Net sales from operations		8,400		9,352		9,985		9,625		9,900		14,427		16,098		15,297		16,068
Operating income		1,703		2,024		2,012		2,513		2,580		3,178		3,672		3,244		3,627
Capital expenditure		1,232		1,207		881		921		906		794		1,065		1,315		1,760
Investments		146		5		17		34		17		1,180		128		158		3,156

Main operating data


		1995		1996		1997		1998		1999		2000		2001		2002		2003
Sales of natural gas to third parties in primary distribution	(bn cm)		52.55		53.23		53.14		55.69		60.24		61.25		61.96		60.44		65.12
Natural gas consumed by Eni	(bn cm)																2.02		1.90
Sales of natural gas in secondary distribution outside Italy	(bn cm)				2.80		2.79		2.73		2.67		3.48		3.91		3.79		4.44
Sales of natural gas to third parties and natural gas consumed by Eni	(bn cm)		52.55		56.03		55.93		58.42		62.91		64.73		65.87		66.25		71.46
Natural gas transported on behalf of third parties in Italy	(bn cm)		1.48		2.42		4.35		6.07		6.90		9.45		11.41		19.84		24.63
Electricity production sold	(TWh)												4.77		4.99		5.00		5.55


		41
				ENI FACT BOOK 2003
		GAS & POWER MAIN RESULTS

the Italian natural gas system

In the next decade world consumption of natural gas is expected to increase, due to the continuous improvement in technologies applicable to all phases of natural gas production, the higher environmental compatibility of natural gas as compared to other hydrocarbons, the expected demographic, economic and social developments and the steady increase in natural gas reserves. Europe represents one of the areas with the highest development rate, where the average increase in consumption is expected to be about 3% per year.

Given the recent regulatory and organizational developments, the Italian national natural gas system takes part in the structural change ongoing in Europe with the prospect of a single market for energy. In this context Italy will be able to make good use of its geographical position and its double integration with the European internal market and the Mediterranean area. Eni has the know-how and experience necessary for becoming a leader in this process of European development.

One of the new features of the development process ongoing in Europe is the importance acquired by international hubs, whose development can be attributed to the new regulations on third party access to transmission networks, to increased gas availability in markets and to the progressive cancellation of the territorial destination clause in supply contracts (see specific paragraph below). Hubs represent the major interconnection points in international transmission networks where volumes of natural gas are traded on spot markets and not under long term contracts. The development of European hubs, located in Great Britain, Belgium and Germany, represents an opportunity for Eni for selling increasing gas volumes, as Eni can take advantage from its diversified supply portfolio and the flexibility provided by long term contracts.

The demand for natural gas in Italy

With consumption amounting to about 77 billion cubic meters in 2003 (increasing by 9.4% over 2002) Italy is the third European market for natural gas after Great Britain and Germany. In 2003, about 20% of natural gas requirements were met through domestic production (including natural gas volumes withdrawn from storage), while imports covered 80%.

Eni expects natural gas consumption in Italy to reach about 90 billion cubic meters in 2010, corresponding to an annual average increase of about 2.5%. The share of natural gas on total domestic energy requirements is expected to reach nearly 37% as compared to the present 33%.

Most of this increase will concern natural gas used in electricity generation, because of the significant advantages of the use of natural gas in combined cycle plants, thanks to its lower investment cost, higher yields and reduced polluting emissions as compared to other fuels. Demand is expected to increase also from residential and commercial users, due to the further expansion of the natural gas distribution network in Southern Italy and the increased use of natural gas in residential space heating in households and services, in large tertiary firms and as vehicle fuel.

(BAR CHART)


		42
ENI FACT BOOK 2003
GAS & POWER THE ITALIAN NATURAL GAS SYSTEM

Transmission, dispatching and regasification

Transmission, dispatching and regasification activities in Italy are carried out by Snam Rete Gas, a company listed on the Italian Stock Exchange (in which Eni holds a 50.07% interest). Eni’s primary transmission network was conferred to Snam Rete Gas in July 2001 in implementation of Legislative Decree No. 164/2000 concerning the Italian natural gas market, which provides for the separation of transmission, dispatching and regasification activities from all other activities in the natural gas segment.

The Italian natural gas transmission system is made up of a national pipeline network and a regional pipeline network for a total length of 31,220 kilometers, of which 30,120 owned by Eni.

The Italian national transmission network is made up of high pressure trunklines, mainly with a large diameter, which carry natural gas from the entry points to the system – import lines, storage sites and main Italian natural gas fields – to the linking points with the regional transmission network. The national network includes also some interregional lines reaching important markets.

The regional transmission network is made up of the remaining lines and allows the transmission of natural gas to industries, power stations and local distribution companies of the various local areas served.

At December 31, 2003 the national pipeline network owned by Eni extended for 7,993 kilometers. Underground pipelines have a maximum diameter¹ of 48 inches and carry natural gas at pressures of 24 to 75 bars. The underwater pipeline crossing the Messina Strait has a diameter of 20 to 26 inches and carries natural gas at a pressure equal to or higher than 115 bars.

The major pipelines interconnected with import trunklines that are part of Eni’s national network are:

for natural gas imported from Algeria:

• two lines with a 48/42-inch diameter, each approximately 1,500-kilometer long, including the smaller pipes that cross underwater the Messina strait, which link Mazara del Vallo (on the Southern coast of Sicily) to Minerbio (near Bologna). These lines are linked to the import pipelines that carry natural gas from Algeria through the Sicily Channel. The pipeline transmission capacity amounts to 87 million cubic meters/day;

for natural gas imported from Russia:

• two lines with 48/42/36/34-inch diameters extending for a total length of approximately 900 kilometers that are linked to the Austrian network in Tarvisio and cross the Po Valley reaching Sergnano (near Cremona) and Minerbio. The pipeline transmission capacity amounts to 84.4 million cubic meters/day;

for natural gas imported from the Netherlands and Norway:

• two lines, with a 48-inch diameter, 177-kilometer long extending from the Italian border at Passo Gries (Verbania), point of connection with the Swiss network, to the node of Mortara, in the Po Valley. The pipeline transmission capacity amounts to 60.7 million cubic meters/day.

In 2003 Eni’s national network increased by 50 kilometers due to the entry into service of lines: (i) from Istrana to Camisano (37 kilometers); (ii) from Bernalda to Brindisi (7 kilometers); (iii) from Malborghetto to Bordano (6 kilometers).

The national transmission network will be upgraded by means of:

• the laying of a third line with a 48-inch diameter over 264 kilometers (124 of which already operational as of December 2002) from Tarvisio to Zimella (Verona) on the pipeline carrying natural gas imported from Russia and the upgrade of the Malborghetto compression station. Works are expected to be completed by 2007;

(1) The diameter of lines varies according to the route’s carrying requirements or according to their different construction or upgrading date.


		43
				ENI FACT BOOK 2003
		GAS & POWER THE ITALIAN NATURAL GAS SYSTEM

n the laying of a pipeline (66-kilometer long with a 36-inch diameter, 24 million cubic meters/day transmission capacity) from Gela (point of connection with the Greenstream pipeline importing gas from Libya. See international gaslines below) to Enna (point of interconnection with the national network). This pipeline is expected to start operations in 2004;

n the laying a 70-kilometer long pipeline with a 30-inch diameter (39 already operating in 2003 and 31 from 2004) from Pontremoli to Parma for upgrading the connection of the Panigaglia LNG terminal with the national network and local markets.

Eni’s regional transmission network is made up of pipes with smaller diameter than the national lines for a total length 22,127 kilometers. These pipes carry natural gas at pressures lower than 5 bars, between 5 and 24 bars and between 24 and 75 bars. In 2003, Eni’s regional network increased by 275 kilometers due to the entry into service of the Sannicola-Ugento-Tricase pipeline in Southern Italy, of the connection with the EniPower Ferrera-Erbognone power station and of various connections to end users.

Eni’s system is completed by: (i) 11 compressor stations with a total power of about 620 megawatts; (ii) 4 marine terminals linking underwater pipelines with the on-land network at Mazara del Vallo and Messina in Sicily and Favazzina and Palmi in Calabria.

The control room of the dispatching system is located in San Donato Milanese and oversees and monitors the whole transmission network in cooperation with local units. In 2003 this system obtained the ISO 9000 certification. Peripheral units are represented by 8 districts that monitor the transmission network through 69 centers that guarantee operation, maintenance and control of the whole system. Each unit is responsible for operations in accordance with technical specifications and applicable laws and regulations. With the aim of rationalizing maintenance activities in 2003 various interventions were performed: (i) extension of remote control/remote monitoring by installing 74 new remote control units (valves, reduction plants and network terminals) which allow to reduce the time necessary for interventions aimed at restoring normal functioning and at increasing safety and reliability of operations; (ii) rationalization of local units and reduction of their number from 74 to 69; (iii) the entry into service on 90% of all maintenance units of a new IT system for the optimization of monitoring and periodic supervision; (iv) extension of new remote diagnostic systems of gas compressor units that allow for a constant monitoring of the system’s efficiency and for the optimization of costs and intervention times.

In addition to the international pipeline transmission system, natural gas enters Eni’s system also through the Panigaglia (Liguria) LNG terminal, which receives liquefied natural gas (LNG) carried by tanker ships. This terminal is the only one in Italy, at its maximum it can input approximately 3.5 billion cubic meters/year into the transmission network. LNG is downloaded from tanker ships and stored, then vaporized in a regasification plant made up of cryogenic pumps and submerged flame vaporizers. When it has recovered the gaseous state, natural gas is input in the transmission network. This terminal also regasifies LNG

(MAP)


		44
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GAS & POWER THE ITALIAN NATURAL GAS SYSTEM

bought by Enel. In 2003, volumes of LNG regasified amounted to the equivalent of approximately 3.5 billion cubic meters of natural gas. Upgrading of this terminal is underway by means of an enhancement of the boil-off gas recovery system.

In 2003 approximately 76.4 billion cubic meters of natural gas were input in the national network, of these approximately 33% were owned by third parties.

The Italian natural gas system is supplied for about 80% with imported gas, transmitted to Italy through a network of international high pressure pipelines for a total of about 3,800 kilometers; in which Eni owns transportation rights, in particular:

n the TENP PIPELINE, 968-kilometer long (a 500-kilometer long single line and a 468-kilometer long doubling line) with transit capacity of 44 million cubic meters/day and four compression stations, transports natural gas from the Netherlands through Germany, from the German-Dutch border of Bocholtz to Wallbach at the German-Swiss border. In 2003 the upgrading of this pipeline was completed with the entry into service of 44 kilometers of doubling line and a 3.7 million cubic meters/day increase in transit capacity;

n the TRANSITGAS PIPELINE, 291-kilometer long, with one compression station, which transports natural gas from the Netherlands and from Norway crossing Switzerland with its 165-kilometer long main line and a 71-kilometer long doubling line, from Wallbach where it joins the TENP pipeline to Passo Gries at the Italian border. It has a transit capacity of 61 million cubic meters/day. A new 55-kilometer long line from Rodersdorf at the French-Swiss border to Lostorf, an interconnection point with the line coming from Wallbach was built for the transport of Norwegian gas;

n the TAG PIPELINE, 1,018-kilometer long, made up of two lines, each about 380-kilometer long and a third line 258-kilometer long, with a transit capacity of 81 million cubic meters/day and three compression stations, which transports natural gas from Russia across Austria from Baumgarten, the delivery point at the border of Austria and Slovakia, to Tarvisio, point of entry in Italy. This pipeline is being upgraded with the laying of a third 380-kilometer long line (258 already operating);

n the TTPC PIPELINE, 742-kilometer long, made up of two lines each 371-kilometer long with a transit capacity of 78 million cubic meters/day and three compression stations, which

(MAP)


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				ENI FACT BOOK 2003
		GAS & POWER THE ITALIAN NATURAL GAS SYSTEM

transports natural gas from Algeria across Tunisia from Oued Saf Saf at the Algerian border to Cap Bon on the Mediterranean coast where it links with the TMPC pipeline;

n the TMPC PIPELINE for the import of Algerian gas, 775-kilometer long, made up of five lines each 155-kilometer long with a transit capacity of 101 million cubic meters/day which crosses underwater the Sicily Channel from Cap Bon to Mazara del Vallo in Sicily, the point of entry into Italy.

In August 2003 works started for the laying of the Greenstream pipeline, an underwater 520-kilometer long pipeline with a 32-inch diameter for the transport of natural gas from Mellitah in Libya to Gela in Sicily for the transmission of natural gas from Libyan fields (targeted at 8 billion cubic meters/year, of which 4 billion is Eni’s share, with a transmission capacity of 24.4 million cubic meters/day, and laid at a maximum depth of 1,130 meters by the Saipem Castoro 6 vessel. This project is scheduled to be completed by September 30, 2004 with an expenditure of dollar 953 million, corresponding to euro 0.8 billion (dollar 715 million corresponding to euro 0.6 billion is Eni’s share) including the link to the national network.

At the end of 2002 the Blue Stream underwater pipeline started operating. This 774-kilometer long (on two 24-inch diameter lines) pipeline with a transmission capacity of 49 million cubic meters/day, linking the Russian and Turkish coast of the Black Sea, will transport approximately 16 billion cubic meters (Eni’s share 8 billion) of natural gas to be sold on the Turkish market (see “Development Projects” below). Supplies to the Turkish national company Botas started in February 2003.

Sales in Italy

In 2003, Eni’s natural gas sales in primary distribution in Italy amounted to 52.8 billion cubic meters (including volumes consumed in operations). The Italian natural gas market is made up of three main segments: residential and commercial, industrial and thermoelectric. Customers can be divided into two groups: final users directly consuming natural gas and wholesalers (mainly local distribution companies) purchasing natural gas to sell it to final customers (mainly small industries and residential and commercial users). According to the types of distribution, natural gas sales are divided into: (i) large distribution (primary distribution) which includes sales to wholesalers and large customers; (ii) local distribution (secondary distribution) represented almost exclusively by sales made by local distribution companies to commercial and residential customers, the tertiary sector and small industries located in urban areas, receiving natural gas from low pressure networks. From January 1, 2003 with the complete opening of the natural gas market, as per Legislative Decree No. 164/2000, all customers are allowed to purchase natural gas at any source and to enter contracts with transmission companies on the national network and with distribution companies on local networks for the transmission to the delivery points.

In 2003 wholesalers, including local distribution companies and automotive natural gas sellers, sold over 34 billion cubic meters to final users (44% of total natural gas consumption), with an 8% increase over 2002. In 2003, Eni’s natural gas sales to wholesalers amounted to 24.1 billion cubic meters.

Natural gas consumption in the industrial segment (linked to the national and regional networks) amounted to over 16 billion cubic meters (22% of total consumption), with a 1% increase over 2002. In 2003, Eni’s sales of natural gas to industrial users amounted to about 13 billion cubic meters (including volumes consumed in operations).

Natural gas consumption in the thermoelectric segment amounted to over 26 billion cubic meters (34% of total consumption), with a 17% increase over 2002. This segment includes electricity producers and distributors (Enel and some municipal utilities) and industrial


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GAS & POWER THE ITALIAN NATURAL GAS SYSTEM

producers of electricity. In 2003, Eni’s sales of natural gas to thermoelectric users amounted to 15.7 billion cubic meters (including volumes consumed in operations).

In 2002 Eni reorganized its activities by creating six new branches in Italy in order to react promptly and efficiently to market requirements and applying the home working model to all its sales personnel. The new marketing strategy is aimed at market segmentation and customer satisfaction, through offers tailored on customers needs and the integration of gas and electricity. In particular the customized commercial offer includes a range of elements such as, for example, various price formulas and types of indexes aimed at controlling price volatility, availability of services and technical assistance. In 2003 Eni’s commercial strategy was focused on contact channels: sales persons, contact centers, technical assistance, a new customer portal, which was completed in the year.

Eni, through its 100% subsidiary Italgas, is the Italian leader in the retail sale of natural gas to residential and commercial users with 5.8 million customers in 2003 (about a third of the market). In 2003, Eni’s retail sales in Italy amounted to 8.4 billion cubic meters (approximately 25% of the retail market). Eni owns a low pressure urban network in Italy consisting of 46,780 kilometers of pipelines at December 31, 2003, and serving 1,228 municipalities, among which Rome, Naples, Venice, Florence and Turin (the latter through an affiliate).

Sales activities and customer management are performed by Italgas Più SpA, established in 2002 by Italgas SpA in implementation of the regulations contained in Legislative Decree No. 164/2000, which provided for the separation of retail sales from all other activities in secondary distribution of natural gas; the new company was conferred the relevant business and is now present on the market with a new and wider supply of services; in particular:

n a post-counter service for extraordinary and planned maintenance interventions on autonomous household heating systems, offered in two forms: (i) “Assistenza Italgas Più” concerning the planned maintenance of heaters fired with any fuel that need to be periodically monitored and subjected to combustion analysis; (ii) “Pronto Assistenza” concerning fast interventions of skilled technicians for repairing damages or checking heaters and other parts of the heating plant;

n a service of energy management addressed mainly to the public administration, condominiums, the tertiary sector and industrial enterprises supplying heat instead of just natural gas, design of heating systems and consultancy services. It provides immediate solutions to problems of management, design and upgrade of plants and frees customers from technical and organizational tasks as wells as from responsibilities and administrative tasks.

Italgas Più also improved its tools for getting in contact with customers adding to the traditional access point other specific channels:

n an integrated toll-free call center system (located in Turin, Rome, Florence, Naples, Chiavari) which customers can access for any information concerning services provided: payment of bills, information on consumption, requests for service and all technicalities related to it;

n a network of franchisors made up of 94 “shops” with flexible opening hours available to customers for any request concerning services provided. Italgas Più targets the establishment of 460 franchised shops by 2005.

The interactive web site www.italgaspiu.it represents a true online shop where customers can: (i) find all information concerning services; (ii) check their accounts; (iii) simulate consumption; (iv) change personal data; (v) organize payments through their bank account. This business will be developed by entering new areas and by promoting new services such as air conditioning and co-generation for small enterprises, in order to foster new forms of consumption.


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Sales in the rest of Europe

On European markets Eni signed seven long-term supply contracts with operators in the natural gas sector. These contracts, when fully operational, will enable Eni to supply about 15 billion cubic meters of natural gas per year, including 8 billion cubic meters (Eni’s share 4 billion) from the Libyan fields. Until the production from Libyan fields comes on stream, these supplies will be covered with gas derived from Eni’s wide and diversified portfolio of supply contracts.

In 2003 sales in Europe amounted to 25 billion cubic meters, including sales through affiliates (about 7.5 billion cubic meters); in particular: (i) about 14 billion related to sales in target markets, among which Turkey (0.6 billion to Botas), Germany and Northern Europe (a total of 6.2 billion), the Iberian Peninsula (3.2 billion, of which 1.1 billion to the Spanish electric company Iberdrola), Hungary (3.3 billion); (ii) over 9 billion related to supply contracts with operators in the natural gas sector in Italy.

Outside Italy Eni is present in natural gas secondary distribution in the rest of Europe and Latin America as follows:

n Hungary through Tigaz (controlled by Eni with a 50% interest), the largest regional gas distribution company in the country. In 2003 Tigaz consolidated its market share by purchasing a majority stake in three natural gas distribution companies: Mol-Gàz (now Tigaz 2), Zsàmbèrkgàz and Turulgàz. In 2003, natural gas sales in Hungary amounted to 3.3 billion cubic meters. In 2003 customers supplied were approximately 1.1 million in 1,120 municipalities through an about 24,000-kilometer long network;

n Argentina, through Distribuidora de Gas Cuyana SA (Eni’s interest 45.6%), which operates in the urban area of Mendoza, serving about 371,000 customers through a network of about 9,000 kilometers of pipelines. In 2003, it handled 1.8 billion cubic meters of natural gas; about 1 billion was sold to end users, while the rest was transported on behalf of third parties;

n Slovenia, through Adriaplin Doo (Eni’s interest 51%), which distributes natural gas to about 8,000 customers in 17 urban centers through a network of about 363 kilometers of pipelines. In 2003, it sold 37 million cubic meters.


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(GAS AVAILABILITY MAP)

Supply

Eni’s natural gas requirements are met for about 82% with imports (mainly from Algeria, Russia, the Netherlands and Norway) under long-term contracts, and for the remaining part by purchases of gas produced in Italy by Eni’s Exploration & Production segment. Eni is a party in import contracts with an average residual duration of about 17 years which will provide a total of approximately 67.3 billion cubic meters of natural gas per year (28.5 from Russia, 21.5 from Algeria, 9.8 from the Netherlands, 6 from Norway and 1.5 from Nigeria) from 2008. Overall natural gas volumes under contract amount to approximately 1,088 billion cubic meters.

The so called territory destination clause for gas imported from Russia was cancelled: an agreement signed by Eni and Gazexport (Gazprom) allows Eni to sell the gas it purchases from Gazexport in countries other than Italy; Gazexport in turn can sell its gas to other Italian operators. This agreement was filed for approval to the European Commission, which concluded its exam of the contract, started when Eni and Gazexport agreed on the destination clause. The Commission requested Eni to assume additional obligations favoring competition, in particular: (i) Eni should make volumes of natural gas purchased from Gazexport available outside Italy; (ii) Eni shall promote the upgrading of the TAG gasline (from Austria into Italy) with deadlines consistent with the decision of third parties to build LNG terminals in Italy.


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		ENI FACT BOOK 2003
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development projects

Eni is engaged in various development projects concerning the sale of natural gas in the rest of Europe in order to compensate the growth potential that cannot be developed in the domestic market, due to the limits set to operators. In Europe Eni can leverage on a positive competitive positioning as concerns gas availability, access to infrastructure, relations with producing countries and knowledge of markets. Based on the contracts and projects defined to date, Eni expects to sell 44 billion cubic meters of natural gas outside Italy by 2007.

GERMANY

Eni is present on the German natural gas market since late 2002 through GVS (Gasversorgung Süddeutschland GmbH) in which it acquired a 97.81% interest in joint venture with the German electricity operator EnBW. GVS is the fourth operator in the German gas market where it transports and markets about 7 billion cubic meters of gas per year to local distribution companies serving about 750 municipalities in the south-western areas of the country through an approximately 1,880-kilometer long gas pipeline network. Through GVS and the development of direct sales, Eni expects to sell about 4 billion cubic meters/year, of which 3.4 billion cubic meters of natural gas through GVS, corresponding to 4% of German consumption in 2007.

IBERIAN PENINSULA

(GRAPHICS) Portugal

In April 2004 Eni signed an agreement with the Portuguese Government for the reorganization of Galp Energia (Eni’s interest 33.34%) within the restructuring process of the Portuguese

(EUROPEAN TARGET AREAS MAP)


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ENI FACT BOOK 2003
GAS & POWER DEVELOPMENT PROJECTS

energy sector. Eni will concentrate in the natural gas sector through a 49% interest in Gas de Portugal (indirectly owned through Galp Energia) and will exit the segment of refining and marketing of refined products in Portugal where Eni operated through Galp Energia. Gas de Portugal will be managed jointly with Electricidade de Portugal, the other shareholder with a 51% interest; the natural gas transmission network owned by Gas de Portugal will be sold to a state-owned Portuguese company. This transaction entails cash proceeds of euro 667 million. The finalization of the agreement is subject to authorization from relevant antitrust authorities. In 2003 Galp sold about 3.8 billion cubic meters of natural gas to about 600,000 customers through a network of high, medium and low pressure pipelines about 9,000-kilometer long. Galp’s asset include interest two import infrastructures, the Transmaghreb pipeline and the Sines LNG terminal, that started operations in the fourth quarter of 2003, which provide Eni with a basis to access the Iberian market.

(GRAPHICS) Spain

After obtaining the relevant authorizations from European antitrust authorities and the Spanish Government, in July 2003 Eni finalized the purchase of a 50% interest in Unió n Fenosa Gas (the remaining 50% being held by Unión Fenosa SA) with an outlay of euro 442 million. Unión Fenosa Gas is active in natural gas supply and sale to final users and to power generation companies. It holds a 25-year supply contract, with an option for a 25 year extension, involving 4 billion cubic meters per year with the Egyptian Natural Gas Holding Company (EGAS). It is active in LNG through a liquefaction plant with a capacity of over 7 billion cubic meters per year under construction near Damietta, on the Egyptian coast and through an 8% interest in a liquefaction plant under construction in Oman, which is expected to start operations in 2006. In addition, it holds a 19% and a 50% interest in the Reganosa and Sagunto regasification plants under construction, expected to start operations in 2005.

Through Unión Fenosa Gas, Gas de Portugal and the development of direct sales, Eni targets to sell about 6.7 billion cubic meters by 2007 in the Iberian Peninsula.

(IBERIAN PENINSUAL MAP)


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		ENI FACT BOOK 2003
GAS & POWER DEVELOPMENT PROJECTS

TURKEY - BLUE STREAM

Eni and Gazprom hold equal shares in Blue Stream Pipeline Company BV, which operates the Blue Stream transport system, that links the Russian (Beregovaya) to the Turkish (Samsun) coast of the Black Sea. The gasline transports natural gas produced in Russia which is sold jointly by Eni and Gazprom in Turkey to the Turkish company Botas under a long-term contract. Supplies to Botas started in February 2003, by year-end Botas had withdrawn approximately 1.3 billion cubic meters of natural gas (of which 633 million were Eni’s share). Volumes transported and marketed will increase progressively in future years and are targeted to about 16 billion cubic meters per year (8 billion net to Eni) in 2010.

GREECE

Eni holds a 49% interest in the natural gas secondary distribution companies EPA Thessalonica and EPA Thessaly. The two companies hold a 30-year licence for natural gas distribution to residential and commercial users as well as the right to use distribution networks. The two companies, whose operations are managed by Eni, are extending the distribution network in their areas covering about 2 million inhabitants. Natural gas sales of the two companies are targeted at 800 million cubic meters of natural gas per year.

LNG

Eni is a party in various initiatives in the area of LNG. In particular Eni holds a 10.4% interest in Nigeria LNG Co that manages the Bonny liquefaction plant. The plant, made up of three treatment trains with an overall capacity of 11.4 billion cubic meters/year of liquefied natural gas is undergoing an upgrade by means of the installation of two further trains which will increase its capacity to 21.8 billion cubic meters/year and are expected to be completed by the end of 2005.

(TURKEY : BLUE STREAM PROJECT MAP)


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power generation

Eni, through EniPower, is one of the major operators in electricity generation on the Italian market. Operating since 2000, EniPower owns power stations located at Eni’s sites in Brindisi, Ferrera Erbognone, Livorno, Mantova, Ravenna and Taranto with installed capacity in operation of approximately 1.9 gigawatts at December 31, 2003.

In 2003, Eni sold 8.7 terawatthour of electricity, of which about 5.6 produced by EniPower, corresponding to approximately 3% of the Italian market, and 9.3 million tonnes of steam. Eni intends to develop its electricity generation capacity and sales by exploiting the advantages provided by the integration of natural gas and electricity, targeting in 2006 an installed capacity of 5.3 gigawatts, corresponding about 11% of electricity generation planned in Italy at that date. Planned expenditure amounts to euro 2.3 billion, of this 1.2 already expensed. This objective will be pursued by building new capacity at Eni’s industrial sites. In particular work is underway at Ferrera Erbognone, Brindisi, Ravenna, and Mantova with total installed capacity of about 3.8 gigawatts (including the units started in 2003 at Ferrera Erbognone and Ravenna each with a capacity of 0.39 gigawatt) while authorizations are awaited for the new units (0.8 gigawatt) to be installed at Ferrara. High efficiency, low environmental impact, reduced expenditure and construction times are the main features of these plants, which show interesting profitability prospects due to the expected increase in demand for electricity and the ability to operate in co-generation (combined electricity and steam generation). The co-generation mode has been acknowledged by the Authority for Electricity and Gas as a production mode that entails priority on the national dispatching network and the exemption from the purchase of “green certificates”². Eni estimates that EniPower power stations will allow to reduce total emissions of carbon dioxide by 8%, with negligible amounts of particulate and sulphur oxides as well as very low emissions of nitric oxides as compared to emissions caused by electricity generation in Italy in 2000. EniPower intends to become a cost leader in the Italian electricity industry thanks to the high technology content and optimal size the plants it is building. When fully operational, consumption of natural gas of Eni’s plants will reach about 6-7 billion cubic meters/year, supplied by Eni.

(ENIPOWER INSTALLED CAPACITY BY 2006 MAP)

(2) Article 11 of Legislative Decree No. 79/1999 concerning the opening up of the Italian electricity market obliges importers and producers of electricity from non renewable sources to input into the national electricity system a share of electricity produced from renewable sources set at 2% of electricity produced from non renewable sources exceeding 100 gigawatt. This obligation can be met also by purchasing volumes or rights from other producers employing renewable sources (the so called “green certificates”) to cover all or part of such 2% share. This obligation applies to import or production of electricity net of, among others, co-generation and volumes consumed in questions.


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		ENI FACT BOOK 2003
GAS & POWER GENERAZIONE ELETTRICA


Natural gas supplies		(billion cubic meters)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Italy		18.05			17.05			16.81			17.72			16.16			13.64			14.62			12.67			12.12
Russia		13.83			13.56			13.75			16.69			19.09			21.03			19.51			18.62			18.92
Algeria		17.43			18.55			16.02			16.83			20.40			21.56			18.39			16.35			16.53
Netherlands		3.62			4.45			5.00			3.02			2.87			6.09			7.00			7.55			7.41
Norway																				1.10			4.83			5.44
Croatia																							0.31			0.65
Purchases for trading and other																							1.48			2.65
Algeria (LNG)		0.05						1.89			1.99			2.06			2.01			1.79			1.92			1.98
Others (LNG)																							0.30			0.72
*Outside Italy*		34.93			36.56			36.66			38.53			44.42			50.69			47.79			51.36			54.30
Total purchases in primary distribution⁽¹⁾		52.98			53.61			53.47			56.25			60.58			64.33			62.41			64.03			66.42
Withdrawals from (input to) storage		52.98			53.61			53.47			56.25			60.58			(2.43	)		0.13			(1.43	)		0.84
Network losses and measurement differences		(0.43	)		(0.38	)		(0.33	)		(0.56	)		(0.34	)		(0.65	)		(0.58	)		(0.14	)		(0.24	)
Volumes available for primary distribution		52.55			53.23			53.14			55.69			60.24			61.25			61.96			62.46			67.02
Volumes available for secondary distribution outside Italy					2.80			2.79			2.73			2.67			3.48			3.91			3.79			4.44
		52.55			56.03			55.93			58.42			62.91			64.73			65.87			66.25			71.46

(1) From 2003 the Gas & Power segment manages trading activities of purchased natural gas, mainly in the North Sea, which were formerly performed by the Exploration & Production segment. In order to allow a homogeneous comparison natural gas volumes purchased and sold in 2002 were increased by 1.70 billion cubic meters.


Natural gas sales		(billion cubic meters)

1995

1996

1997

1998

1999

2000

2001

2002

2003

Italy

52.55

53.23

53.10

55.62

60.19

59.92

58.89

50.54

50.93

Wholesalers (distributing companies)

27.07

28.36

27.31

29.49

30.85

30.26

30.83

25.14

24.07

Industrial users

15.69

15.40

15.65

15.66

16.33

16.79

15.25

12.92

11.83

Thermoelectric users

9.79

9.47

10.14

10.47

13.01

12.87

12.81

12.48

15.03

Rest of Europe

0.04

0.05

1.33

3.07

9.90

14.15

Other outside Italy

0.04

Sales to third parties in primary distribution

52.55

53.23

53.14

55.69

60.24

61.25

61.96

60.44

65.12

Sales in secondary distribution outside Italy

2.80

2.79

2.73

2.67

3.48

3.91

3.79

4.44

Total sales to third parties

52.55

56.03

55.93

58.42

62.91

64.73

65.87

64.23

69.56

Volumes consumed by Eni

2.02

1.90

Sales to third parties and volumes consumed by Eni

52.55

56.03

55.93

58.42

62.91

64.73

65.87

66.25

71.46

The breakdown by customer in this table is based on the type of contract and therefore does not correspond to the breakdown of sales to wholesalers and end customers envisaged in Legislative Decree No. 164/2000.


Natural gas transported in Italy⁽¹⁾		(billion cubic meters)

1995

1996

1997

1998

1999

2000

2001

2002

2003

On behalf of Eni’s primary distribution

52.55

53.23

53.14

55.69

59.67

63.73

58.17

54.56

51.74

On behalf of third parties

1.48

2.42

4.35

6.07

6.90

9.45

11.41

19.84

24.63

Enel

0.52

2.48

4.04

4.50

6.27

6.28

8.28

9.18

Edison Gas

1.27

1.52

2.10

2.98

5.34

7.49

Other

1.48

1.90

1.87

0.76

0.88

1.08

2.15

6.22

7.96

54.03

55.65

57.49

61.76

66.57

73.18

69.58

74.40

76.37

(1) Include volumes input to domestic storage.


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Transport infrastructure


	Length				Pressure		Transport	Transit		Compressor
	of main line		Lines	Diameter	min-max		capacity	capacity		stations
Route	(km)		(units)	(inch)	(bar)		(mn cm/d)	(mn cm/d)		(units)
Italy
Mazara del Vallo-Minerbio		1,540	2	48/42		74	87.0				7
Tarvisio-Sergnano-Minerbio (under upgrading)		440	2/3	48/42/36/34		58/70	84.4				2
Passo Gries-Mortara		177	2	48/34		55/75	60.7				1
Outside Italy⁽¹⁾⁽²⁾
TENP (Bocholtz-Wallbach)		500	1+1 468 km	36/38/40			66.0		44.0		4
Transitgas (Rodersdorf-Lostorf)		165	1+1 71 km + one 55 km	36/48			76.0		61.0		1
TAG (Baumgarten-Tarvisio) (under upgrading)		380	2+1 258 km	36/38/40/42			99.0		81.0		3
TTPC (Oued Saf Saf-Cap Bon)		371	2	48			79.0		78.0		3
TMPC (Cap Bon-Mazara del Vallo)		155	5	20/26			101.0		101.0		0
Greenstream (Mellitah-Gela)⁽³⁾ (under construction)		520	1	32			24.4				1
Blue Stream (Beregovaya-Samsum)⁽³⁾		391	1+1 383 km	24			49.0				1

(1) As of January 2004.

(2) Capacity is related to standard conditions: pressure 1.01325 bar; temperature 288.15 K.

(3) Data relate to full operation of the transport system.

Transport capacity includes both transit capacity and maximum daily volumes of natural gas destined to local markets and withdrawn at various points along the pipeline. Transit capacity is the maximum daily volume of natural gas which is input at various entry points along the pipeline and transported to the next pipeline.

Power generation


		2000		2001		2002		2003
Purchases
Natural gas	(mn cm)		827		784		819		940
Other fuels	(th toe)		842		936		885		847
Sales
Electricity production sold	(TWh)		4.77		4.99		5.00		5.55
Electricity trading	(TWh)				1.56		1.74		3.10
Steam production sold	(th t)		9,535		10,025		9,302		9,303
Installed generation capacity	(GW)		1.0		1.0		1.0		1.9


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		ENI FACT BOOK 2003
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refining & marketing

STRATEGIES

n Increase the efficiency and flexibility of the refining system focusing on fuel quality

n Intensify efficiency and competitivity improvement actions through the growing integration of refining, marketing and logistics

n Continue the process of requalification and strategic repositioning of the distribution network in Italy by focusing on Agip branded service stations with high throughput and high non oil potential; in the rest of Europe by developing in selected areas

ROACE

Eni is engaged in the refining and sale of refined products mainly in Italy, the rest of Europe and Latin America. In distribution, with its Agip and IP brands, Eni is market leader in Italy. In 2003, Eni’s sales of refined products amounted to 49.9 million tonnes, of which 30.6 million tonnes in Italy. The processing capacity of Eni’s wholly-owned refineries was 25.2 million tonnes (equal to 504,000 barrels/day) at December 31, 2003.

In refining interventions are planned for rationalizing refining capacity by balancing production and demand and increasing refinery efficiency and flexibility. These actions will allow to increase conversion rates from the 60% average of the 2000-2003 period to 64% by 2007. Eni also intends to adjust the characteristics of its refined products to the evolution of fuel specifications in Europe focusing on fuels dedicated to specific market segments by leveraging on its integrated refining-logistics-distribution system.

In logistics Eni aims at increasing flexibility in order to allow the distribution of different high quality fuels and reducing costs by means of joint ventures with qualified partners. Eni intends to continue the process of requalification and strategic repositioning of the distribution network. In Italy by focusing on Agip branded service stations with high throughput and high non oil potential; in the rest of Europe by developing in selected areas. Eni’s objective in Italy is to reach European standards in terms of average throughput, services to customers and automation. In the rest of Europe Eni intends to strengthen its position in selected areas, in particular eastern Spain, southern France and Germany where it can obtain logistical and operating synergies and exploit the well-known Agip brand. Market shares will be increased by buying modern and well equipped services stations. Eni will intensify its efforts for efficiency improvements in all its business lines.

(BAR CHART)

(MAP)


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ENI FACT BOOK 2003
REFINING & MARKETING

MAIN RESULTS

In 2003 Eni substantially completed the restructuring of its distribution network in Italy, aimed at reaching European standards in terms of average throughput and services to customers. The average throughput of Agip branded service stations in Italy increased by 26% (from 1.9 to 2.4 million liters)

The BluDiesel and High Fidelity initiatives confirmed their market success. BluDiesel, a low environmental impact gasoil, reached sales of 850 million liters, corresponding to 16% of all gasoil sales in Agip branded service stations. The High Fidelity campaign, which offers discounts to customers through personal cards, distributed 3.5 million cards, increasing by 30% over 2002; approximately 25% of Agip service stations’ throughput was sold via these cards

Sales of refined products on Eni’s network in the rest of Europe exceeded 3 million tonnes, with an 18% increase over 2002 as a consequence of a selective development strategy in markets with interesting growth prospects where Eni can leverage on the well known Agip brand and on logistic and operational synergies. In 2003 Eni purchased 410 services stations in Spain, Germany and France

Within the policy of specific focus on environmental protection and product quality, the construction of a tar gasification plant was started at the Sannazzaro refinery. This plant will produce synthesis gas from heavy fractions for the supply of the nearby EniPower electricity plant

Rationalizations and efficiency improvement actions generated cost savings by approximately euro 85 million


Main financial data		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Net sales from operations		10,594		11,326		11,834		10,374		14,415		25,462		22,083		21,546		22,148
Operating income		456		214		578		730		478		986		985		321		583
Capital expenditure		520		584		495		586		524		533		496		550		730
Investments		40		48		17		282		2		570		51		54		10

Main operating data


				1995		1996		1997		1998		1999		2000		2001		2002		2003
Oil products available from processing	(mn ton)				38.10		37.80		36.40		40.10		38.31		38.89		37.78		35.55		33.52
Sales of petroleum products	(mn ton)				51.90		51.36		51.60		54.19		51.82		53.46		53.24		52.02		49.91
Italy	(mn ton)				37.62		37.56		36.15		36.00		35.45		35.54		34.99		33.07		30.58
Outside Italy	(mn ton)				14.28		13.80		15.45		18.19		16.37		17.92		18.25		18.95		19.33
Service stations at period end (in Italy and outside Italy)	(units)				13,529		13,150		12,756		12,984		12,489		12,085		11,707		10,762		10,647
Average throughput (in Italy and outside Italy)	(th liters/d)				1,431		1,448		1,463		1,512		1,543		1,555		1,621		1,674		1,771
Balanced refining capacity of wholly-owned refineries at period end	(th bbls/d)				824		664		664		664		664		664		664		504		504
Utilization rate of balanced refining capacity of wholly-owned refineries		(	%)		86		87		94		103		96		99		97		99		100


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		ENI FACT BOOK 2003
REFINING MARKETING MAIN RESULTS

refining

Eni is engaged in refining activities in Italy and owns interests in refineries in Germany and the Czech Republic with a total refining capacity (balanced with conversion capacity) of 34 million tonnes (equal to 681,000 barrels/day), at December 31, 2003, with 29.2 million tonnes capacity in Italy.

Italy

Eni’s refining system in Italy is made up of five wholly owned refineries and a 50% and 28% interest in the Milazzo and Priolo refineries in Sicily, respectively. At December 31, 2003, Eni’s wholly owned refineries in Italy had a balanced capacity of 25.2 million tonnes (equal to 504,000 barrels/day), corresponding to over a fourth of Italian capacity and a conversion capacity of over 16.3 million tonnes, with a 58.8% conversion equivalent rate, one of the highest in Europe.

In 2003 total intake processing on own account amounted to 31.8 million tonnes (of these 8.4 million tonnes on refineries belonging to third parties, in particular Milazzo, Priolo and Saras). Total intake processing on wholly owned refineries amounted to 25.1 million tonnes with a nearly 100% utilization rate.

Eni confirms its strategy aimed at reducing Fob refining capacity in order to reach a total capacity of 30 million tonnes by 2007, increasing the share of Cif capacity from 65% of total capacity in 1999 to 83% in 2007. Eni also intends to improve refinery performance by means of: (i) creating more flexible operating structures, optimizing maintenance and reducing energy consumption; (ii) increasing the conversion index from 60% in the 2000-2003 period to about 64% by 2007, in order to improve its supply system and to adjust the characteristics of its refined products to the evolution of fuel specifications in Europe. Each of Eni’s Italian refineries is specialized based on its logistical configuration, geographic location and integration with other Eni business segments.

(IMPROVING REFINING PERFORMANCE GRAPH)

SANNAZZARO, with a balanced primary refining capacity of 160,000 barrels/day is one of the most efficient refineries in Europe. Located in the south-west of the Po Valley, at the confluence of the rivers Po and Ticino, it produces mainly gasolines, gasoil and other light products for the supply of markets in north-western Italy, Switzerland and Bavaria. Besides its primary distillation plants, this refinery contains two catalytic reforming plants used to increase the octane number of gasolines, an isomerization plant and three desulfurization plants, which allow a high degree of flexibility of production related to market and environmental conditions. The conversion plants are: a fluid catalytic cracker (FCC), an HDCK middle distillate conversion, and a Visbreaking thermal conversion. This refinery processes mainly oil from Russia, Africa and the North Sea incoming at the Genoa harbor and oil from Eni’s nearby Villafortuna field. From a logistical standpoint this refinery is located along the route of the Central Europe Pipeline, which links the Genoa terminal with French speaking Switzerland and Bavaria. In 2003 expenditure was dedicated to the upgrade of diesel fuel manufacture in line with new European regulations in force from 2005 and to the construction of a new tar (heavy residue from visbreaking) gasification plant that will produce syngas from fuel oil and will be used to fire the nearby EniPower power station.


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		REFINING & MARKETING REFINING

GELA, with a balanced primary refining capacity of 100,000 barrels/day represents an upstream integrated pole with the production of heavy crudes obtained from nearby Eni fields offshore Sicily, while downstream it is integrated with Eni’s nearby petrochemical plants. Located on the southern coast of Sicily, it manufactures fuels for automotive use and residential heating purposes, as well as petrochemical feedstocks. Its high conversion level allows it to minimize the yield of fuel oil and semi-finished products. Besides its primary distillation plants, this refinery contains the following plants: an FCC reactor with advanced technology and two coking plants for the conversion of low grade feedstocks and vacuum conversion of heavy residues. All these plants are integrated in order to process heavy residues and manufacture valuable products and electricity. This refinery also contains modern residue and exhaust fume treatment plants which allow the complex to comply with the most exacting environmental standards. Oil and oil products are handled on land and by sea.

TARANTO, with a balanced primary refining capacity of 90,000 barrels/day, can process a wide range of crudes and semi-finished products with great operational flexibility. It mainly produces fuel for automotive use and residential heating purposes for the southeastern Italian markets. Besides its primary distillation plants, this refinery contains desulfurization plants and conversions plants such as: a two-stage thermal conversion plant (Visbreaking/thermal cracking) and an RHU conversion plant, one of the most advanced plants in the world with high yield of valuable products and low environmental impact. It processes most of the oil produced in Eni’s Val d’Agri fields carried to Taranto through the Monte Alpi pipeline; in 2003 a total of 2.1 million tonnes of this oil were processed. In 2003 the topping unit was upgraded in order to respond to the increasing availability of oil from the Val d’Agri fields.

LIVORNO, with a balanced primary refining capacity of 84,000 barrels/day, manufactures mainly gasolines, specialty products and lubricant bases. Besides its primary distillation plants, this refinery contains two gasoline treatment plants, an isomerization plant and an octanization plant for the manufacture of highly environmental friendly gasolines, as well an advanced solvex cycle for lubricant manufacture. Its pipeline links with the local harbor and with the Florence storage sites allow the Livorno facility to operate with great efficiency as concerns reception, handling and distribution of products. In 2003 plants were upgraded for the manufacture of higher viscosity lubricants (Group II bases) and the desulfurization of gasoil provided for by the new 2005 specifications.

PORTO MARGHERA, with a balanced primary refining capacity of 70,000 barrels/day, produces mainly gasolines and other light products for the supply of markets in north-eastern Italy, Austria, Slovenia and Croatia. Besides its primary distillation plants, this refinery contains a gasoline treatment plant, octanization plants and a two-stage thermal conversion plant (Visbreaking/thermal cracking) for increasing yields of valuable products. At year end the desulfurization plant was upgraded in order to comply with the new 2005 specifications.

Outside Italy

In Germany Eni holds an 8.3% interest in the SCHWEDT refinery and a 20% interest in BAYERNOIL, an integrated industrial pole including the Ingolstadt, Vohburg and Neustadt refineries. Eni’s refining capacity in Germany amounts to approximately 70,000 barrels/day. Eni’s share of the production of the three integrated refineries and of the Schwedt refinery is mainly used to supply Eni’s distribution network in Bavaria and Eastern Germany.

Eni holds a 16.33% interest in CESKA RAFINERSKA (CRC) which owns and manages two refineries, Kralupy and Litvinov, in the Czech Republic. In 2002 the CRC partners approved a plan under which the refinery provides a service of oil processing on account of its partners in proportion to their respective interests. This plan started up in the second half of 2003. Under this new arrangement Eni overall balanced conversion capacity increased by 27,000 barrels/day over 2002.


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		ENI FACT BOOK 2003
REFINING & MARKETING REFINING

logistics

Eni is the leading transporter of petroleum products in Italy. Its logistical integrated infrastructure consists of storage sites and a network of petroleum product pipelines.

The storage infrastructure is made up of 12 directly managed storage sites all over Italy and of interests in five companies established by the major Italian operators in Vado Ligure-Genova (Petrolig), Arquata Scrivia (Sigemi), Venice (Petroven), Ravenna (Petra) and Trieste (DCT) aimed at reducing costs, increasing efficiency and developing innovative integrated services to customers. Sigemi manages storage and handling of semi-finished and refined products by means of pipelines between Arquata and Ferrera.

For the transport of refined products on land Eni also owns storage facilities, pumping stations and a pipeline network, integrated by leased pipelines. Eni’s pipeline network in Europe extends over 3,173 kilometers, of these 1,476 are wholly owned.

Eni’s logistic system also makes use of a leased fleet of tanker ships and tanker trucks for the distribution of refined products on the retail and wholesale markets.

Eni also owns a 65% interest in Costiero Gas Livorno, a company that operates an underground storage facility in Livorno with the capacity to store 45,000 cubic meters of propane.


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		REFINING & MARKETING REFINING


		marketing

Retail sales

ITALY

(MARKETING STRATEGY IN ITALY: NETWORK REQUALIFICATION AND ENHANCEMENT MAP)

At December 31, 2003, Eni’s retail distribution network consisted of 7,290 service stations (60% of which under the Agip brand), a 420 unit decrease over December 31, 2002, due to the sale of 281 service stations, the closure of 66 marginal stations and the negative balance of acquisitions and expirations of lease contracts (104 units), whose effects were offset in part by the purchase/construction of 31 new service stations.

Eni is implementing a process of requalification and strategic repositioning of its distribution network in Italy and in the rest of Europe. In Italy Eni continues the upgrading process of its retail network by developing its core network (stations with high throughput and high non oil retail potential), while the rationalization process is in its final phase. Eni’s objective is to reach European standards in terms of throughput, services provided to customers and automation. Eni targets an Agip branded network consisting of 4,180 service stations, a 30% market share and average throughput of about 2.8 million liters by 2007.

In this context the newly established IP company (operational since May 2002) consolidated its activity. The IP network consists of mainly leased service stations devoted to satisfying local markets, with an average throughput of 900,000 liters.

In 2003 markets confirmed the success of BluDiesel, a new diesel fuel with low environmental impact, sold in Agip branded service stations from the end of 2002. This environmentally advanced product was introduced into the market earlier than the regulation imposed by the European Union and was appreciated by motorists because it increases efficiency, reduces consumption and leaves the engine cleaner than traditional diesel fuel. This initiative gives value to the potential of the refining and marketing integrated system (refining-logistics-distribution) and launched a well identified product capable of meeting the requirements of more environmentally sensitive and technically exacting customers on a market that was considered undifferentiated.

In 2003 a total of 850 million liters of BluDiesel were sold, corresponding to 16% of total diesel fuel volumes sold on the Agip branded network on ordinary roads and highways and to 5.2% of all diesel fuel sales on the Italian market. At the end of 2003 about 3,700 Agip branded service stations were selling BluDiesel (about 1,500 at December 31, 2002).

In 2003 sales of refined products on retail markets amounted to 11 million tonnes, average throughput to 1,813,000 liters and market share was 36.6% (37.5% in 2002). In particular sales of Agip branded service stations amounted to 8.99 million tonnes with an average throughput of 2,418,000 liters. Market share of Agip branded service stations increased by 0.6 percentage points (from 29.4 in 2002 to 30% in 2003) also due to the success of BluDiesel. In view of improving fuel quality and services to customers, in 2003 on IP branded service stations sales of Plus 98 started. This new high quality gasoline with better performance in terms of efficiency and engine cleanliness was sold in about 800 service stations at December 31, 2003 (see “New technologies” below).


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n Do it yourself campaign

Eni’s “Do-it-yourself” program allows motorists to obtain relevant savings by paying a price 0.021 and 0.026 euro per liter lower than the reference price, in about 3,000 Agip and IP branded service stations located on the ordinary network and highways respectively. In March 2002 Eni launched the “high fidelity” campaign in its self service stations, whereby customers provided with a special free card receive further discounts as a function of the total amount of purchased fuel with additional savings (1 cent/liter for the first 200 liters, 2 cents for the following 200 and 4 cents for volumes from 400 to 500 liters) which can be discounted at any time.

Within the process of upgrading its service station network by promoting customized services in 2003 Eni built: (i) three service stations dedicated to heavy transport, so called “Agip Truck Points”, strategically located on highways with the highest lorry traffic and provided with wide parking space, dedicated runways, personal services active 24 hours a day. In these service stations lorries can be washed and convenience stores are equipped with internet services; (ii) the first “Agip Multienergy” service station where all kinds of fuel are on sale (including also LPG and methane) which obtains part of the energy necessary for servicing from solar panels installed on its roof.

In 2003 Eni continued its “high fidelity” campaign which allows customers accessing self-service outlets provided with an electronic card to obtain price discounts as a function of the total amount of purchased fuel. The number of cards distributed exceeded 3.5 million (up 30% over 2002). The amount of fuel purchased with the card was about 25% of all fuel sold on Agip branded service stations.

The improvement in the quality of service to customers led to a further expansion of the automation process of the domestic network. At December 31, 2003 nearly all Agip branded service stations were provided with a corporate credit card system (94% in 2002). Eni continued the development of its non oil retail activities (retailing and catering) aimed at promoting the development of its network in line with European standards, such as the diffusion of self-service and innovative commercial outlets. To this end Eni owns master franchisor rights with exclusive rights for the oil sector for some international brands of the restaurant and catering sector.

In particular in 2003 the new Agip Caf# outlets were launched, and by year end 104 franchises were opened, while 8 new Pans & Co outlets were opened and convenience stores were reorganized under the new “SpazioAgip” brand name.

Eni intends to continue the development of its non oil activities and expects to provide 66% of its Agip branded network with these structures in the next four years.

In 2003 Eni continued the development of its Multicard paying card which covered 1.25 billion liters (up 7.2% over 2002), while the number of customers provided with this card increased from about 41,000 to 42,000. Multicard is used also by international fleets and is part of the international Routex consortium.

(RETAIL MARKET SHARES IN SELECTED EUROPEAN AREAS (TARGET 2007) )


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OUTSIDE ITALY

As of December 31, 2003, Eni’s retail distribution network outside Italy consisted of 3,357 service stations, of which 1,813 in the rest of Europe and 1,544 in Brazil. Retail sales in the rest of Europe amounted to 3 million tonnes with an average throughput of 2,378,000 liters. Eni intends to develop its presence in selected markets in Europe where it can leverage on logistical and operational synergies and on its well established brand name. In this context it purchased 410 service stations, of these 164 in Spain, 221 in Germany and 25 in France. In the next four years Eni intends to increase by over 30% the number of Agip branded service stations in the rest of Europe, also by means of leases, reaching sales volumes of about 7 billion tonnes and an average throughput of 2.8 million liters in 2007. Non oil activities outside Italy is performed under the “CiaoAgip” brand name on 1,025 service stations, of these 342 are in Germany and 162 in France.

Wholesale marketing and other sales

Eni sells gasoline, gasoil, fuel oil, lubricants, petroleum coke and LPG both directly to large customers and through independent distributors on various wholesale markets.

Major customers are the agricultural and manufacturing industries, public utilities and transports, as well as fishing fleets that are supplied directly at 100 Agip branded owned or leased outlets.

Eni also sells jet fuel directly at 38 airports, of which 27 in Italy, and marine fuel (bunkering) directly at 38 ports, of which 23 in Italy. In addition, it sells virgin naphtha and fuel oil to Eni’s Petrochemical segment. Enel is the single largest customer of Eni’s wholesale marketing segment, purchasing approximately 9% of its total refined products requirements from Eni.

n e-business - e-commerce

Eni continued its actions aimed at exploiting the potential of the internet in particular:

n to implement a tool for communication with all operators of its fuel distribution network in order to increase management process efficiency and service levels. About 3,000 service stations are provided with a dedicated PC linked to the “Manager’s Portal”, which will be progressively extended to all Agip branded service stations. The following applications are active: fuel orders, maintenance requests, change in suggested prices, lubricant orders, management of incentives related to sales goals, display of account movements, documents and links to other relevant sites, forum. Applications concerning non oil orders and online training are in the definition phase;

n to integrate its own corporate systems and processes with those of the major customers and suppliers through the web in order to increase efficiency. Fuel orders from the Public Administration and some major clients are already active through the web.

Applications active in the “Eni Portal” are:

- AgipTrading: supporting crudes, semi-finished and finished products trading;

- AgipMarine: provides the option to buy fuels and lubricants on line to marine shippers;

- AgipBusiness: provides information and services to professionals.


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other businesses

LPG

Eni is a leader in Italy in the production, distribution and marketing of LPG. In 2003 it sold 710,000 tonnes on retail and wholesale markets (777,000 tonnes in 2002) with a 19.4% market share in 2003. Additional 335,000 tonnes were sold to oil companies.

LPG activities in Italy derive their products from seven Italian refineries and from imports received at the three coast storage sites located in Livorno, Naples and Ravenna.

Product availability and customer requirements are met also with other 12 owned plants/storage sites in Italy and 45 contracts for bottling and storage with third parties’ facilities.

Eni’s LPG sales network is organized over seven sale areas with 19 direct sales offices, 15 agencies and 30 concessionaires. Products are sold also to 140,000 customers owning small tanks, while the sale network of LPG bottles includes over 12,000 outlets.

In the past few years LPG pipelines were developed and over 12,000 customers are served through direct links with 95 storage facilities.

In 2003 Eni sold 1,346,000 tonnes of LPG in Brazil with a 21.4% market share. There Eni owns 25 bottling facilities and 26 storage facilities. Its sales network includes over 5,000 outlets. Eni has also a significant presence in Ecuador with a 37.4% market share in 2003.

Lubricants

Eni operates 12 (owned and co-owned) blending plants, in Italy, Europe, North and South America, Africa and the Far East.

In Italy Eni is a market leader in lubricants with the manufacturing of base oils, primarily at its refinery in Livorno, and in marketing. Eni owns a 33.33% share in facilities in Italy for the reprocessing of used oils and two facilities for the production of additives and solvents. In 2003 Eni started a renewal of its lubricant lines in Italy and launched new or renewed products in a new wholly recyclable PET packaging, manufactured at the Livorno plant. The new line, the first in the world in this material, is the outcome of in-house research and of the application of proprietary technologies aimed at protecting the environment and improving product quality.

In 2003, retail and wholesale sales in Italy amounted to 150,000 tonnes with a 25.8% market share. Outside Italy sales amounted to approximately 160,000 tonnes, of these about 49% were registered in Europe (mainly Germany, Netherlands and Spain) and 51% in the Americas (Brazil, United States and Argentina).

Oxygenates

Eni, through its affiliate Ecofuel, sells about 2 million tonnes of MTBE (11% of world demand) and methanol. About 70% of products are manufactured in Eni’s plants in Ravenna, Venezuela (in joint venture with Pequiven) and Saudi Arabia (in joint venture with Sabic), the remaining 30% is bought and resold.


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		REFINING & MARKETING OTHER BUSINESSES

Refining system in 2003


	Ownership		Conversion		Primary balanced
	share		equivalent		refining capacity
	(%)		(%)		(bbls/d)
Wholly owned refineries				58.8		504,000
Sannazzaro		100		42.0		160,000
Gela		100		139.3		100,000
Taranto		100		71.6		90,000
Livorno		100		11.4		84,000
Porto Marghera		100		22.8		70,000
Partially owned refineries ⁽¹⁾				38.3		176,800
Milazzo		50		69.6		80,000
Ingolstadt/Vohburg/Neustadt (Bayernoil)		20		30.0		51,700
Schwedt		8.3		33.0		18,600
Kralupy/Litvinov (Ceska Rafinerska)		16.33		28.0		26,500
				42.1		680,800

(1) Conversion equivalent and capacity are expressed in Eni’s share.

Refining capacity


				1995		1996		1997		1998		1999		2000		2001		2002		2003
Balanced capacity at period end	(th bbls/d)				977		897		853		859		859		859		814		654		681
Balanced capacity of wholly owned refineries at period end	(th bbls/d)				824		664		664		664		664		664		664		504		504
Processing at wholly owned refineries	(th bbls/d)				712		718		621		681		640		659		645		501		502
Balanced capacity utilization of wholly owned refineries		(	%)		86		87		94		103		96		99		97		99		100


Petroleum products availability		(million tons)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Italy
Products processed in wholly owned refineries		35.60			35.90			31.10			34.05			32.00			32.93			32.24			30.09			25.09
Products processed for third parties		(3.60	)		(3.50	)		(3.50	)		(3.24	)		(2.78	)		(3.41	)		(1.45	)		(1.88	)		(1.72	)
Products processed in non owned refineries		4.80			4.80			8.00			7.90			8.08			8.41			5.92			6.27			8.43
Products consumed and lost		(2.00	)		(2.00	)		(2.00	)		(1.94	)		(2.07	)		(2.11	)		(1.95	)		(1.91	)		(1.64	)
*Products available*		34.80			35.20			33.60			36.77			35.23			35.82			34.76			32.57			30.16
Purchases of finished products and change in inventories		5.92			5.16			6.75			5.74			5.45			4.30			5.19			6.06			5.61
Finished products transferred to foreign cycle		(3.10	)		(2.80	)		(4.20	)		(6.51	)		(5.23	)		(4.58	)		(4.96	)		(5.56	)		(5.19	)
*Sales*		37.62			37.56			36.15			36.00			35.45			35.54			34.99			33.07			30.58
Outside Italy
*Products available*		3.30			2.60			2.80			3.33			3.08			3.07			3.02			2.98			3.36
Purchases and change in inventories		7.88			8.40			8.45			8.35			8.06			10.27			10.27			10.41			10.78
Finished products transferred from Italian cycle		3.10			2.80			4.20			6.51			5.23			4.58			4.96			5.56			5.19
*Sales*		14.28			13.80			15.45			18.19			16.37			17.92			18.25			18.95			19.33
*Sales in Italy and outside Italy*		51.90			51.36			51.60			54.19			51.82			53.46			53.24			52.02			49.91


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		ENI FACT BOOK 2003
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Oil products sales in Italy and outside Italy		(million tons)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Retail sales		12.60		12.38		12.09		12.02		11.85		11.57		11.64		11.14		10.99
Wholesale sales		13.30		12.10		11.30		11.73		11.42		11.10		11.24		10.64		10.35
		25.90		24.48		23.39		23.75		23.27		22.67		22.88		21.78		21.34
Petrochemicals		6.61		6.18		5.97		5.75		5.38		4.93		4.23		3.82		2.79
Other sales ⁽¹⁾		5.11		6.90		6.79		6.50		6.80		7.94		7.88		7.47		6.45
Sales in Italy		37.62		37.56		36.15		36.00		35.45		35.54		34.99		33.07		30.58
Retail sales rest of Europe						2.25		2.35		2.36		2.35		2.47		2.57		3.02
Retail sales Africa and Brazil						0.68		1.11		1.55		1.43		1.71		1.44		1.18
		3.10		3.07		2.93		3.46		3.91		3.78		4.18		4.01		4.20
Wholesale sales		6.31		6.25		6.17		6.20		6.40		5.46		5.55		5.65		6.01
		9.41		9.32		9.10		9.66		10.31		9.24		9.73		9.66		10.21
Other sales ⁽¹⁾		4.87		4.48		6.35		8.53		6.06		8.68		8.52		9.29		9.12
Sales outside Italy		14.28		13.80		15.45		18.19		16.37		17.92		18.25		18.95		19.33
		51.90		51.36		51.60		54.19		51.82		53.46		53.24		52.02		49.91

(1) Includes bunkering, consumption for power production and sales to oil companies.


Number of service stations		(units)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		11,234		10,958		10,615		9,828		9,425		9,045		8,351		7,710		7,290
of which ordinary stations		10,955		10,686		10,345		9,563		9,160		8,783		8,157		7,546		7,134
of which highway stations		279		272		270		265		265		262		194		164		156
Outside Italy		2,295		2,192		2,141		3,156		3,064		3,040		3,356		3,052		3,357
Central Europe		1,328		1,169		1,112		1,081		1,044		1,007		988		1,013		1,230
Iberian Peninsula		147		167		186		192		200		201		202		198		357
Eastern Europe		66		93		121		142		145		165		185		223		226
Africa		754		763		722		685		593		262		262		—		—
Latin America								1,056		1,082		1,405		1,719		1,618		1,544
		13,529		13,150		12,756		12,984		12,489		12,085		11,707		10,762		10,647


Average throughput		(thousand liters/number of service stations)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		1,382		1,376		1,405		1,475		1,530		1,565		1,643		1,707		1,813
Rest of Europe						2,042		2,141		2,200		2,210		2,303		2,276		2,378
Brazil								1,122		1,074		856		914		967		942
Africa						926		1,080		1,079		1,515		1,943
Average throughput outside Italy		1,665		1,824		1,753		1,661		1,586		1,524		1,563		1,585		1,671
Average throughput		1,431		1,448		1,463		1,512		1,543		1,555		1,621		1,674		1,771


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		REFINING & MARKETING

oilfield services construction and engineering

STRATEGIES

n Consolidate competitive positioning in the segment of complex EPIC/EPC offshore projects

n Develop technological and operational capabilities in the area of gas-to-market

n Intensify efficiency improvement actions and maintain a flexible structure

(ROACE BARCHART)

oilfield services and construction

Eni operates in oilfield services and construction through Saipem, a company listed on the Italian Stock Exchange (Eni’s interest 43%), a world leader in the laying of underwater pipelines and the installation of offshore platforms, thanks to exclusive state-of-the-art technology and a world-class fleet of vessels, which has been upgraded with an investment plan amounting to over euro 1 billion started in 1997.

Eni intends to increase its operating and technical know-how in the gas-to-market segment, which includes projects for the construction of offshore and onshore natural gas transmission systems, natural gas regasification and conversion plants. In particular Eni will focus on LNG floating production systems that integrate production, storage, transport and regasification of natural gas.

Offshore construction remains the key business with the highest expected growth rates. Eni intends to develop in the area of leased FPSO for which West Africa is the region with the most interesting opportunities. In the field of drilling Eni intends to focus on strategic geographical areas adopting long-term commercial policies that ensure high use of facilities also in case of economic downturn. In the onshore construction sector, Eni will focus on complex projects for the construction of hydrocarbon treatment plants and long distance natural gas transmission infrastructure.

Eni intends to intensify efficiency improvements in all its activities, by reducing supply and execution costs while maintaining a flexible structure in order to dampen the impact of possible negative cycles.

(CONTRIES MAP)


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AND ENGINEERING


Main financial data		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Net sales from operations		1,179		1,447		1,647		1,705		1,467		1,310		1,961		3,149		4,231
Operating income		115		124		138		160		108		141		256		302		304
Capital expenditure		144		132		228		334		412		231		289		211		261
Investments		2		0		0		10		0		0		69		1,052		13
Order backlog at December 31		1,803		1,919		2,346		2,463		2,588		2,630		2,853		5,158		5,225
Offshore construction		720		759		1,043		900		1,363		1,312		1,229		3,276		3,265
Offshore drilling		131		412		454		748		622		582		546		550		499
Leased FPSO														184		170		142
Onshore construction		624		428		492		434		257		609		577		656		776
Onshore drilling		44		36		72		98		66		127		317		195		179
LNG		0		0		0		0		0		0		0		250		318
Maintenance		0		0		0		0		0		0		0		61		46
Infrastructure		284		284		285		283		280		0		0		0		0

Main operating data


		1995		1996		1997		1998		1999		2000		2001		2002		2003
Offshore pipelines laid	(km)		1,067		804		1,610		2,009		979		276		781		1,798		1,409
Onshore pipelines laid	(km)		1,153		1,777		1,221		873		1,303		483		552		687		612
Offshore structures installed	(ton)		162,157		97,140		108,745		65,331		111,164		57,087		73,028		55,960		118,211
Onshore structures installed	(ton)		12,500		26,420		36,024		30,514		30,767		13,000		18,120		30,060		29,930
Offshore drilling	(km)		92		134		99		94		88		96		107		125		129
Onshore drilling	(km)		116		159		178		167		63		147		190		348		386
Offshore wells drilled	(units)		34		43		25		52		53		50		36		50		56
Onshore wells drilled	(units)		34		42		43		78		30		44		55		100		119

Business areas

OFFSHORE CONSTRUCTION

Eni intends to consolidate its competitive positioning in the segment of large EPIC/EPC projects for the development of offshore and deep offshore hydrocarbon fields by integrating its technological and operational skills with engineering and project management capabilities acquired on the market (among which Bouygues Offshore, Moss Maritime, Petromarine, Idpe). The demand for these services is expected to increase, given the objective constraints to the expansion of hydrocarbon reserves in conventional environments. The development of deep offshore fields in the future will be performed more and more frequently by means of floating hydrocarbon production systems¹, among which FPSOs are the most important due to their storage capacity which allows to develop fields remote from transmission infrastructure and to their versatility which allows to relocate vessels on nearby fields thus expanding their useful life. On the other hand the demand for fixed platforms for the development of offshore fields is slowly declining. Eni intends to increase its know-how in both floating oil production and storage systems and in LNG floating production systems that integrate production, storage, transport and regasification of natural gas.

Eni is recognized as one of the leading international companies for the design, procurement and installation of fixed platforms, in particular in the segment of ultra heavy lifting, thanks to the technical features of its vessels. It is a world leader in the laying of subsea pipelines and large diameter transmission infrastructure both in conventional

(1) Other floating production units are semisubmersible platforms, tension leg platforms and submersible pipe alignment rigs.


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AND ENGINEERING
MAIN RESULTS

(BUSINESS AREA BARCHART)

and deep offshore. Eni has a relevant competitive positioning in the area of deep offshore development, which includes platform installation, laying of flexible, umbilical lines and other subsea structures due to the lifting and laying ability of its vessels.

Its offshore construction fleet is made up of 25 vessels and 45 robotized vehicles able to perform advanced subsea operations. Among its major vessels are: (i) Saipem 7000, semisubmersible vessel with dynamic positioning system, with 14,000 tonnes of lift capacity (the highest in the world), capable to lay pipelines in ultra-deep waters using the J-lay technique to the maximum depth of 3,000 meters. This vessel has been used to lay the Blue Stream pipeline in the waters of the Black Sea at the record depth of 2,150 meters; (ii) the Castoro 6 semi-submersible vessel, capable of laying pipes in waters up to 1,000 meters deep; (iii) the Saipem 3000 multifunction vessel for the development of hydrocarbon fields, derived from the transformation of the Maxita, provided with a crane capable of lifting over 2,000 tonnes, it is capable of laying flexible and umbilical lines and mooring systems in deep waters with the “reel”, “J” and “S” laying techniques; (iv) the Semac semisubmersible vessel used for large diameter underwater pipe laying; (v) the Saibos FDS for the development of underwater fields in dynamic positioning, provided with cranes lifting up to 600 tonnes and a system for vertical pipe laying to a depth of 2,000 meters.

OFFSHORE DRILLING

Eni provides offshore drilling services to oil companies all over the world and holds relevant market shares in key areas such as West Africa, the Middle East, North Africa and South America (Peru). Its offshore drilling fleet consists of 10 advanced vessels properly equipped for its primary operations and some drilling plants installed on board of fixed

n Construction vessels

(SAIPEM 7000 FIGURE)

Semisubmersible crane and pipelaying (J-lay) DP vessel. Built in Italy (Trieste) by Fincantieri shipyards (1987).


Dimensions:
Length:		198 m
Breadth:		87 m
Depth to main deck:		45 m
Transit draft:		10.5 m
Operational draft:		27.5 m

Dynamic positioning: DP (AAA) Lloyds Register; IPD 3 R.I.Na.; Class 3 Norwegian Maritime Directorate notations. Power plant: total power plant 70,000 kW, 10,000 Volt; 12 diesel generators on heavy fuels divided in 4 fire segregated engine rooms; classified UMS. Ballast system: computer controlled system with simultaneous capabilities comprising 4 x 6,000 t/h ballast pumps, fully redundant. Lifting facilities main crane: 2 twin S 7000 model fully revolving bow mounted Amhoist cranes; main blocks tandem lift: 14,000 t; main block single lift: 7.000 t revolving at 40 m rad./41 m; tieback 6,000 t revolving at 45 m rad./50 m. Lowering capability to 450 m below sea level. Whip hook: 120 t revolving at 150 m rad. J-Lay system: pipe diameter range from 4” to 32”; main laying tension system 525 t with tensioners, up to 2,000 t with friction clamps; laying tower angle 901/4-1101/4; number of welding stations: 1; pipe storage capacity up to 6,000 t. Maximum laying depth: 3,000 m.

(CASTRO 6 FIGURE)

Semisubmersible pipelay vessel (S-lay). Built in Italy (Trieste) by San Marco shipyards (1978).


Dimensions:
Length overall:		152 m
Breadth:		65 m
Depth to main deck:		29.8 m
Operational draft:		7.8-15.5 m
Deck load capacity:		up to 3,600 t

Propulsion/positioning system: number of thrusters: 4 azimuthal variable pitch. Thruster capacity: 2,060 kW/37 t thrust. Pipe tensioning system: type of tensioners: Remacut DC electric; tensioner capacity: 3 x 110 t each; pipe diameter capacity: up 60”. Pipe abandonment/retrieval system: type of winch: Tesmec DC electric; winch capacity: 300 t constant tension. Cranes/pipe handling system: number of cranes: 2 fully revolving; crane type: deck mounted; crane capacity: 60 t with 50 m boom. Maximum laying depth: 1,000 m.


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AND ENGINEERING
OILFIELD SERVICES

offshore platforms. The technical features of its vessels allow Eni to keep significant market positions in the most complex areas of deep and ultra deep waters. One of its most important offshore drilling vessels is the Saipem 10000, designed to explore and develop hydrocarbon reservoirs down to 10,000 meters operating in excess of 3,000 meters of water depth in full dynamic positioning. The ship has a storage capacity of 140,000 barrels and can maintain a steady operating position without anchor moorings by means of 6 computerized azimuth thrusters, which offset and correct the effect of wind, waves and current in real time. Capital expenditure for building this ship amounted to about dollar 300 million. The vessel will is operating, also on account of Eni, in ultra deep waters (over 1,000 meters) in West Africa and Brazil.

Other relevant vessels are Scarabeo 5 and 7, fourth generation semi-submersible rigs able to operate at depths of 1,900 and 1,200 meters of water respectively, and to drill wells at maximum depths of 8,000 meters.

LEASED FPSO

Eni provides to oil companies services for the development of offshore hydrocarbon fields by leasing its fleet of FPSO vessels. The leasing of an FPSO represents an alternative to direct expenditure for oil companies. West Africa is the market with the highest expected growth rates due to the number of development projects announced or started-up by oil companies. Eni’s main vessels are: (i) FPSO Firenze, which, after its conversion into a floating production and storage vessel, has been installed in Eni’s Aquila field, in the Adriatic Sea, and operates at a depth of 850 meters; (ii) FPSO Jamestown, also converted to a floating production and storage vessel, that was installed in the oil fields of Okono and

(SEMACI 1 FIGURE)

Semisubmersible pipelay barge. Built by Alabama Shipbuilding, Alabama USA (1976).


Dimensions:
Length overall:		148.5 m
Breadth overall:		54.9 m
Depth to main deck:		27.8 m
Maximum deck load:		5,700 t

Pipelay equipment: 3 x 75 t tensioners, 11 work stations (welding, x-ray and field joint coating). Double jointing system with 8 work stations. Above water tie-in capability (optional). Dual lay welding line and ramp (optional). Abandonment and recovery winch: 275 t. Lifting facilities: fitted with 4 revolving pedestal cranes (1 x 318 t and 3 x 37 t) mounted at each corner of the main deck for pipe handling and general lifting. Pipe handling davits may also be mounted on the main deck to facilitate above water tie-ins. “S-lay” technique. Pipe diameter: max 58”. Maximum laying depth: 600 m.

(SAIBOS FDS FIGURE)

Multi-purpose monohull dynamically positioned crane and pipelay (J-lay) vessel. Built in Korea by Samsung (2000).


Dimensions:
Length overall:		156 m
Breadth:		30 m
Operational draft:		12.4 m
Displacement:		26,608 t at operating draft
Payload:		4,300 t at 7.40 draft

Dynamic Positioning: Dynpos Autro, Dynpos Autr, 2 DGPS, 2 Lras HIPAP – 2,500 m interfaces available for Taut Wire, Artemis, Fan Beam. Lifting capabilities: main crane AMClyde KPT600: main hook SWL: 600 t at 30 m, 300 t at 55 m; auxiliary cranes: 2 Liebherr CBO3100-50 Litronic SWL 50 t at 20 m, SWL 30 t at 38 m; 2 Liebherr RL-S 20/20 Litronic; starboard side fixed boom SWL 20 t at 20 m, portside telescopic boom SWL 15 t at 16 m. Pipelay equipment: 5 work stations + one in option; rigid pipe: 4 pipes string J-lay tower system, SWL 320 t, 2,000 m w.d., max. o.d. 18”; flexible pipe: laying through Gutter and 3 x retractable four tracks tensioners total SWL 270 t, max. i.d. 17”. Assembly station has openings to allow the passage of 4 x 3 x 6 m special items. A&R winch SWL 320 t.


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OILFIELD SERVICES

Okpoho operated by Eni with a 100% interest in the deep offshore of Nigeria; (iii) FPSO Mystras, which will substitute the Jamestown in the mentioned fields.

ONSHORE CONSTRUCTION

Eni operates in the construction of hydrocarbon treatment plants (separation, stabilization, collection of liquids and treatment of natural gas) and in the installation of large onshore transmission systems (pipelines, pumping and compression stations, terminals). Its main operation areas in the production/transmission area (upstream/midstream) are Central Asia, Africa and the Middle East. Eni intends to consolidate its competitive positioning in this segment by exploiting in particular the opportunities provided by frontier areas, characterized by the lack of infrastructure, where it can leverage on its distinctive ability to operate in difficult areas and to manage complex projects. Eni is also capable of providing onshore services complementary to offshore operations, which represents a competitive advantage for the development of projects in areas such as the Caspian Sea.

The downstream segment (refining, petrochemical, LPG plants and power stations), although providing less opportunities than the upstream segment, benefits from the expected expansion of the demand for services in the area of power generation.

Drilling vessels

(PERRO NEROS 5 FIGURE)

Self elevating drilling platform (Jack up); National 1320 UE drilling plant. Built by Levingston Shipbuilding Company Orange, Texas USA (1981).


Dimensions:
Hull length:		60.8 m
Beam:		56.5 m
Depth:		6.7 m
Length of legs (including footing):		126.1 m

Operating performance:
Drilling depth:		6,500 m
Water depth max:		90 m
Variable load:		1,500 t

(SAIPEM 10000 FIGURE)

Ultra deep water drillship, self propelled, equipped with EWT (Extended Well Testing). Wirth GH 4500 EG 4200 drilling plant. Built in Korea by Samsung (2000).


Dimensions:
Length overall:		228 m
Breadth, moulded:		42 m
Depth, moulded:		19 m
Operating draft:		12 m
Displacement:		96,455 t
Variable load:		20,000 t
Oil storage capacity:		140,000 bbl

Operating performance:
Drilling depth:		10,000 m
Water depth max:		over 3,300 m


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OILFIELD SERVICES

ONSHORE DRILLING

Eni operates in this area as main contractor for the major international oil companies. Onshore drilling is conducted through 47 facilities located in Italy, Saudi Arabia, North Africa, Nigeria, Kazakhstan, Venezuela and Russia. Some of these facilities can drill to 10,000-meter depths in high pressure and high temperature environments. Eni intends to focus its activities in areas where it has been present for a long time and to search opportunities in areas with proved development prospects such as Central Asia, the Middle East and Russia.

In onshore drilling Eni developed extremely advanced technologies with a high degree of automation, which allow it to exploit the opportunities provided by the emergence of new logistically demanding remote areas lacking infrastructure that require the ability to operate in extreme environmental conditions.

LNG

Eni operates in the LNG market following its purchase of Bouygues Offshore which contributed its excellent competence in the area of liquefaction (in particular tanks) and regasification, complementary to the onshore and offshore transmission of natural gas. The markets offering the highest potential are the United States and Europe.

(BUSINESS AREA BARCHART)

(SCARABEO 5 FIGURE)

Semisubmersible drilling platform self propelled; Emsco C3 drilling plant. Built in Italy (Genova) by Fincantieri shipyards (1990).


Dimensions:
Pontoon length:		111 m
Pontoon breadth:		14.3 m
Pontoon height:		9.5 m
Main hull length:		80.8 m
Main hull breadth:		68.8 m
Main hull depth:		7.3 m
Water depth max:		1,800 m

Operating performance:
Dynamic assisted mooring		up to 900 m w.d.
Dynamic positioned mode		up to 1,900 m w.d.
Maximum drilling depth:		8,000 m
Water depth max:		1,900 m

4,300 t variable deck load in all conditions, under the most stringent codes

(SACARABEO 7 FIGURE)

Semisubmersible drilling platform self propelled; Wirth SH 3000 EG drilling plant. Built in Turkey by Tusla shipyard, (1999) and perfected in Italy (Palermo) by Fincantieri shipyards (1999).


Dimensions:
Displacement:		38,100 t
Main deck width:		61.3 m
Main deck length:		77.5 m
Main deck depth:		4.5 m
Variable deck load:		4,000 t

Operating performance:
Drilling depth W/5” DP:		25,000 ft
Drilling depth:		8,000 m
Water depth max:		1,200 m

Positioning system: automatic thruster assisted 8 leg mooring system.


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OILFIELD SERVICES

Construction vessels

Transport/

Maximum

Pipelaying

lifting

laying

maximum

Laying

capability

depth

diameter

Name

Type

technique

(t)

(m)

(inches)

Castoro 2

Derrick/lay barge

1,000

Castoro 3

Cargo barge

5,000

Castoro 6

Semisubmersible large diameter pipelay vessel

300

1,000

Castoro 8

Crane and pipelay vessel

2,177

600

Castoro 9

Launching/cargo barge

5,000

Castoro 10

Trench/pipelay barge

300

Castoro XI

Heavy duty cargo barge

15,000

Crawler

Derrick/lay barge

540

S300

Multipurpose monohull crane and DP (J, S, reel-lay) vessel

Reel, J,S

2,200

3,000

S. 42

Launching/cargo barge

8,000

S. 44

Launching/cargo barge

30,000

S. 45

Launching/cargo barge

20,000

Saipem 7000

Semisubmersible crane and pipelaying (J-lay) DP vessel

14,000

3,000

Saipem 3000

Self propelled deep water crane vessel

J,S

2,200

Lifter 1

Lifting shear barge

1,000

Semac 1

Semisubmersible pipelay barge

318

600

BAR 331

Trench barge

BAR Protector

DP dive support vessel

Multipurpose monohull dynamically positioned crane

Saibos FDS

and pipelay (J-lay) vessel for the development

600

2,000

of hydrocarbon fields in deep water

BOS 230

Mobile crane barge for small-diameter pipelaying

BOS 931

Launching/cargo barge

4,000

BOS 103

Launching/cargo barge

BOS 600

Launching/cargo barge

30,000

JUP III

Self-elevating crane for structure lifting

180

BOS 355

Crane and pipelay vessel

600


		74
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OILFIELD SERVICES CONSTRUCTION
AND ENGINEERING

oilfield services construction and engineering

STRATEGIES

n Selective repositioning based on profitability

nContinue actions for improving efficiency and operating flexibility

n Maintain technological excellence and expand its portfolio of proprietary technologies

n Develop qualified services for large oil & gas projects and expand role of Owner’s Engineer for Eni

(ROAE BARCHART)

engineering

Eni, through its subsidiary Snamprogetti (100% Eni), is one of the major international operators in engineering and contracting in the area of plants for hydrocarbon production, refining complexes, terminals for natural gas treatment, fertilizer and petrochemical plants, power stations, pipeline transport systems and infrastructure. In over forty years of activity, Eni operated in more than 100 countries, building over 70 industrial grass-root complexes, over 1,400 plants (refineries, chemical and petrochemical plants, infrastructure, offshore rigs, marine terminals). It provided its services for the construction of gas and oil pipelines, engineering about 74,000 kilometers of onshore (for 45,000 kilometers of these it also carried out construction works) and 21,000 kilometers of offshore pipelines, also in deep waters and hostile environments.

Eni intends to consolidate its competitive positioning in the market segment of turn key complex projects requiring a wide and integrated range of services, flexible organization and a continuous development of new technologies. It will therefore stress its role of global contractor based on its distinctive operating skills, the level of services provided and advanced proprietary technologies. It will focus its activity on market segments characterized by high opportunities deriving from expected growth rates such as hydrocarbon production and transmission as well as upgrading of natural gas (treatment, conversion and liquefaction) and of heavy crudes. Projects will be selected in such a way as to guarantee a good balance of profitability and risk profiles. Eni intends to pursue a balance between turn-key contracts and special services (such as conceptual, basic, FEED and PMC). It will also intensify actions for improving efficiency and operating flexibility also through the development of low cost engineering centers, the simplification of corporate structure and the hiring of highly qualified resources.

Eni continues to enhance its proprietary portfolio of technologies by means of innovative projects, in particular in the area of natural gas upgrading (syngas, methanol, ammonia, urea) where Eni holds leading positions. It also continues to support R&D programs for the development of strategic technologies(Eni Slurry Technology, High Pressure Transmission).

(COUNTRIES MAP)


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AND ENGINEERING


Main financial data		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002			2003
Net sales from operations		1,054		1,109		1,265		1,675		1,535		847		1,166		1,422			2,093
Operating income		29		35		31		38		41		3		0		(4	)		7
Capital expenditure		7		11		9		20		13		14		15		22			17
Investments		1		0		1		0		42		22		5		3			9
Order backlog at December 31		2,232		2,455		2,834		2,471		1,851		4,008		4,084		4,907			4,180
Oil & Gas and Refining		1,272		1,161		1,638		892		803		520		697		1,950			1,487
Chemicals and fertilizers		461		861		778		1,066		454		463		465		673			503
Field upstream facilities and pipelines		478		417		363		459		554		593		610		299			597
Energy and environment		0		0		46		45		38		138		96		54			31
Railway infrastructure												2,290		2,213		1,924			1,547
Other		21		16		9		9		1		4		3		7			15

Business areas

PLANTS

Oil & Gas. Eni has the world class know-how to carry out the most complex and technologically advanced projects. Eni is especially active in the area of plants for hydrocarbon production, natural gas treatment and upgrading, in particular recovery and fractioning of natural gas liquids (NGL) and natural gas liquefaction. Based on the capital expenditure plans announced by oil companies, Eni expects a strong growth in the demand for services from the upstream industry.

Refining. In this area Eni has good competitive positioning in conventional areas such as primary distillation, reforming, fluid catalytic cracking (FCC) and is a leader in plants for the hydroconversion of residues and heavy distillates and in the construction of complex refining plants. Eni is developing a new strategically relevant technology called EST (Eni Slurry Technology) aimed at meeting the growing demand for upgrading heavy crudes and converting and using refining residues. Eni is also present in the market for the design and construction of plants for electricity generation in combined cycle from refining residues (IGCC — Integrated Gasification Combined Cycle).

Chemical Complex. Eni is active in the area of plants for the manufacture of synthetic gases (syngas, hydrogen and methanol) and gas-to-chemicals (ethylene and ethane derivatives) and holds a leading position in the design and construction of plants for the production of nitrogen-based fertilizers and oxygenated additives for gasoline, based on proprietary technologies. Eni intends to consolidate its competitive position through the continuous improvement in technologies and know-how in natural gas upgrading.


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OILFIELD SERVICES CONSTRUCTION AND ENGINEERING MAIN RESULTS

(BAR GRAPH)

Energy and the Environment. Eni is active in the design and construction of combined cycle power stations. In 2003 combined cycle units were started-up for a total capacity of 1,200 megawatts at EniPower’s Ravenna and Ferrera Erbognone power stations. In the field of waste disposal Eni built 10 facilities for the incineration of industrial, noxious and solid urban waste. In particular, Eni holds a new proprietary technology for the total abatement of noxious elements present in fumes from combustion.

FIELD UPSTREAM FACILITIES AND PIPELINES

Eni holds relevant competitive positions in the area of design and construction of pipelines for the transmission of hydrocarbons, for collection networks and upstream plants (construction of primary separation plants, gas and water injection systems, compression and pumping stations), the demand for which is expected to grow. Eni has new advanced technologies for the construction of high pressure pipelines in deep waters for long distance transmission of large volumes of natural gas and intends to strengthen its competitive positioning in this area by leveraging its know-how and expertise.

INFRASTRUCTURE

Eni is active in the field of design and construction of great infrastructure in Italy. The Italian market for great infrastructure shows interesting prospects after the approval of a 10-year plan for the construction of large infrastructure by the Italian Government. The types of works, their size, the introduction of simpler and faster authorization procedures, the modes of implementation of projects based on their critical variables (time, cost, quality) and the acknowledgement of the role of General Contractors are the elements on which Eni bases its efforts to win orders in this area.

n Project high speed/high capacity train tracks from Milan to Bologna and from Milan to Verona

In 1991, Snamprogetti, through its interest in Cepav Uno and Cepav Due consortia, signed two conventions with TAV SpA to participate in the construction of the tracks for high speed trains from Milan to Bologna and from Milan to Verona. Eni holds a majority stake in both Cepav Uno (50.36%) building the track from Milan to Bologna (under construction) and Cepav Due (52%), building the track from Milan to Verona (still in the design phase).

Within the project for the construction of the tracks for high speed/high capacity trains from Milan to Bologna, an addendum to the contract between Cepav Uno and TAV SpA was signed in June. Major changes concern the continuation of works, the division of works into five functional stages that are expected to be completed between the spring of 2006 and late 2008, a lump sum payment related to the new 30 changes.

Works completed at the end of 2003 correspond to 40% of the total.

As concerns the Milan to Verona section, on December 5, 2003 the Government approved the preliminary project; the further step is the signing of an integration deed.


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new technologies

Eni is aware of the key role innovative technologies play in the future development of the hydrocarbon industry, it therefore intends to integrate R&D expertise and its industrial application, focusing on innovative strategic projects capable of creating competitive advantages. Research projects are going to be selected according to a strict evaluation of their return; ongoing projects are going to be monitored in light of the maximization of the value of Eni’s project portfolio. In the next four years Eni intends to significantly increase the resources it deploys in R&D and will focus on lines that can respond to expected market trends in the long- to medium-term; in particular: (i) reduction of mineral risk; (ii) enhanced recovery of hydrocarbons; (iii) optimal management of reserves with high acid gas content (e.g. sulphur); (iv) upgrading of heavy and ultra heavy crudes; (v) high pressure transmission of natural gas; (vi) conversion of natural gas to liquids in order to give value to associated gas or natural gas produced in remote locations; (vii) manufacture of high quality fuels and alternative fuels with better engine and environmental performance; (viii) hydrogen as energy vector.

Eni intends to search global alliances in order to participate in research projects that have a longer horizon than the four-year plan. Follows a brief description of the main techniques applied or under development.

Hydrocarbon exploration and production

INNOVATIVE TECHNOLOGIES FOR SUBSOIL SURVEY

In order to prepare a geological model of fields as near as possible to reality and therefore to reduce exploration risks and uncertainties related to fields, Eni developed significant industrial applications of highly innovative technologies. In particular, the so called CRS Stack (Common Reflection Surface Stack) is able to process seismic imaging and to obtain information on the Òvelocity modelÓ with significantly higher results than conventional technologies. This allowed to improve the final seismic image of the Elephant field in Libya. Significant developments derived also from the development and/or application of advanced technologies for modelling and monitoring fields: innovative technologies for studying fractured fields, cross-well seismics, 4D time lapse seismics to monitor the behaviour of producing fields over time.

(ADVANCED WELLS LOGO)

DRILLING OF “ADVANCED WELLS”

Eni developed and applied at industrial level a series of technologies that allow to drill highly complex wells with greater operating efficiency. “Lean profile” drilling, developed and patented by Eni, is applied in deep vertical and deviated wells especially in high pressure and high temperature environments allowing a reduction in time and costs as wells as the final environmental impact as it reduces the volume of rock handled. Wells obtained with this technique are high quality and low risk. It basically consists in reducing to a minimum the tolerance between the diameter of wells and their lining columns while keeping the production casing unchanged. The verticality and direction of the hole are guaranteed by innovative tools such as “Vertitrack” (former SDD, straight-hole drilling device) and “Autotrack” developed and applied by Eni in cooperation with Baker-Hughes. Lean drilling was successfully applied both in Italy (Val d’Agri, Trecate) and outside Italy (Tunisia, Algeria, Egypt and Russia) and entailed significant benefits such as higher safety and higher savings of costs and time. The ultra deep HP/HT well recently drilled in Russia represents a world record for this technology with its 6,826 meters of total depth and the use of a 13”3/8 casing at 4,016 meters lowered in a 14”3/4 hole. The application


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in Val d’Agri is a record lean drilling in highly deviated wells (a 13”3/8 casing in a 14”3/4 hole with inclination up to 60º).

In deep water drilling Eni’s innovative proprietary technology is the dual casing running which allows for simultaneous drilling of the first two superficial holes of a deep water well, the simultaneous lowering of the superficial casings and the cementing. The application of this technology allows for a significant reduction in time and costs and a perfect verticality of the two casings and the well head.

INNOVATIVE TECHNOLOGIES FOR THE TREATMENT OF LIQUIDS

In the field of transmission and treatment of hydrocarbons Eni developed and applied innovative technologies with particular attention to multi-phase fluids (water, oil and/or gas) in order to optimize production and reduce its environmental impact.

In particular, Eni successfully tested at its Cavone oil center a pilot plant for the removal of oils from layer waters which allows to reduce the residual concentration of hydrocarbons in water to less than 10 ppm, starting from an initial content of 1,000 ppm. The system is based on the use of adsorbing polymers capable first to capture oil particles and then to release them favoring their coalescence and making them easier to separate. The system is currently being engineered in order to make it useable on platforms. Another ongoing project aims at optimizing new design centrifugal systems for the separation of water from oil and for the confirmation of innovative technologies for removing soluble organic compounds.

Also in the field of multiphase pumping Eni is applying innovative technologies as an alternative to traditional production systems in marginal fields, fields located in frontier areas or difficult areas such as deep waters. The multiphase technology becomes extremely useful, in terms of economic benefits, in offshore applications where the possibility to transport production from the wells over long distances allows to transfer processing activities on existing facilities and infrastructure, thus significantly reducing technical costs for the development of fields. Infield applications of multiphase pumping have been recently installed offshore and onshore in the United Kingdom and Tunisia with other partners in order to obtain a higher recovery of hydrocarbons.

MANAGEMENT OF HYDROGEN SULPHIDE AND SULPHUR

In 2003 Eni started an important R&D project for the optimal management of reserves with high content of hydrogen sulphide and sulphur. The project aimed at developing innovative technologies and/or advanced processes able to manage the disposal and possible exploitation of high amounts of acid gas and sulphur that are produced with hydrocarbons, while respecting safety and the environment. In particular the study concerns innovative processes for the separation of hydrogen sulphide and its conversion into plain sulphur and the storage and/or use of this sulphur. In parallel innovative processes are being studied for the reinjection of hydrogen sulphide into the field and its monitoring.

Eni Slurry Technology

Eni Slurry Technology (EST) is a strategically relevant technique that is being developed for meeting the growing need for the upgrading of heavy crudes and non conventional crudes (asphalt sands) and for the transformation and enhancement of refining residues. EST is a hydrogenating treatment technique which acts on heavy residues from extra-heavy crudes with high content of polluting substances (sulphur, metals, nitrogen compounds and with high Conradson Carbon Residue - CCR). The strategic interest of upgrading heavy crudes derives from the need felt by the oil industry: (i) to enhance relevant reserves of heavy crudes thus increasing proved reserves without recourse to new exploration expenditure; (ii) to requalify the productive structure of most refineries by turning refining residues into valuable products without building additional capacity; (iii) to reduce the environmental impact of refining by eliminating fuel oil which is turned into valuable products and indirectly contributing to the increase in natural gas demand and


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to the reduction of carbon dioxide emissions. At present this technology is characterized by: (i) feedstock flexibility; (ii) high quality of finished products; (iii) total conversion of processing residues; (iv) no production of fuel oil and coke. Within the development and the pre-marketing phases, a Commercial Demonstration Plant (CDP) is nearing completion at Eni’s Taranto refinery with a 1,200 barrels/day capacity and is expected to start operations at the end of 2004.

Transmission: TAP Project

The TAP Project (High Pressure Transmission) aims at developing reliable technologies for making the transmission via pipeline of relevant amounts of natural gas from production areas to the most promising markets economically viable (gas-to-market). This project was started in May 2003 and is expected to last for three years. Activity is aimed at developing the most advanced long distance, high capacity, high pressure and high grade solutions with relevant targets related to: (i) distances over 3,000 kilometers; (ii) natural gas volumes to be transported of about 20-30 billion cubic meters/year; (iii) pressure equal to or higher than 15 Mpa and (iv) use of high and very high grade steel (e.g. X100). The project phases are: (i) evaluation of the viability of alternative solutions in frontier initiatives; (ii) technological upgrading within the Eni Group and by participating in international R&D projects; (iii) technical-economic evaluation of transport along strategic routes and comparison with LNG solutions; (iv) construction of a portion of pipeline type DN 1200 10-kilometer long in X80 steel along an Italian transport route; (v) construction of a portion of pipe DN 1200 in X100 steel operated under high pressure in a testing area in order to evaluate the various design, construction and operation options over time.

Conversion of natural gas into liquids

At Eni’s Sannazzaro refinery a pilot plant for the conversion of syngas to a mixture of paraffin hydrocarbons (wax) is operating. Aim of the project is to exploit the enormous volumes of natural gas that are not extracted because too far from end markets and of volumes of natural gas associated to oil for which the only option is reinjection into wells and that could negatively affect liquid production. The conversion of gas allows to manufacture of high quality refined products such as naphtha, kerosene and diesel fuel, totally sulphur and aromatic free. This plant produces 20 barrels/day of wax by means of an advanced technology (Fischer-Tropsch) studied in cooperation with the Institut Francais du Pétrole (IFP) and EniTecnologie (100% Eni). The project was started in 1996 and allowed for the filing of 44 patents. Along with the completion of the second test phase in the pilot plant (to be completed by the autumn of 2004), which will consolidate the process book of the hydrocarbon synthesis section, the feasibility study for the commercial developments of the project is underway.

Eni and IFP are also cooperating to the development of a specific hydrocracking process for the conversion of wax into liquid hydrocarbons with maximization of yields of middle distillates (diesel fuel and kerosene).

Innovative fuels: Plus 98

In July 2003 on IP branded service stations sales of Plus 98 started. This new high quality gasoline with better performance in terms of efficiency than conventional gasoline has its major advantages in: (i) an octane number (over 98) three points higher than conventional gasoline which allows a more regular burning, optimizing the process of transformation of available energy into mechanical energy; (ii) easier vaporization, i.e the fuel’s ability to turn from liquid into vapour, which allows Plus 98 to mix faster with air and produce faster combustion, thus increasing the engine’s response; (iii) detergent power: Plus 98 contains a special additive that prevents the formation of deposits in the engine


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feeding system, in particular in valves, allowing the engine to maintain its performance over time.

With Plus 98 Eni confirms its constant attention for the quality of its fuels and the optimization of engine performance and its protection.

Hydrogen and Syngas System

The first phase of the Hydrogen and Syngas System research program was completed. The project aimed at increasing the utilization rate and the environmental sustainability of fossil energy sources and, based on the indications emerged, a new project was started for the industrial development of a new kind of multi-fuel reforming based on catalytic oxidation with low contact time (SCT-CPO) of various kinds of hydrocarbon feedstocks, in particular low value and marginal feedstocks produced in the refinery with high content of polyaromatic and sulphur compounds. If this project is successful it will be possible to meet the demand for hydrogen required for the hydrotreatment units manufacturing clean fuels at a reasonable cost. This technology will be tested in a pilot plant that will be built at the Centro Ricerche Sud in Milazzo in the spring of 2005.

Technologies for the development of hydrogen as energy vector

Eni’s interest in this field is aimed at the creation of a portfolio of technologies that may be employed in the production of hydrogen as energy vector from various primary energy sources, also in light of the reduction of emissions of greenhouse gases. Eni confirmed its strategic partnership with Haldor Topsøe, in which it holds a 50% interest. Haldor Topsøe is a Danish company operating in the provision of technologies and the manufacture and sale of catalysts for the chemical, petrochemical and refining industries and in the technologies for the manufacture of hydrogen and synthetic gas. It owns production facilities in Denmark and the United States and operates worldwide employing proprietary technologies, among which the one considered most advanced for “gas to liquids” applications in natural gas reforming plants. It operates also in fuel cells.


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financial data


Results of operations		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Net sales from operations		29,381			29,790			31,359			28,341			31,008			47,938			49,272			47,922			51,487
Other income and revenues		668			665			616			727			952			905			921			1,080			913
Total revenues		30,049			30,455			31,975			29,068			31,960			48,843			50,193			49,002			52,400
Purchases, services and other		(18,176	)		(18,679	)		(19,811	)		(18,033	)		(20,000	)		(31,442	)		(32,110	)		(31,893	)		(34,566	)
Payroll and related costs		(3,142	)		(3,081	)		(3,051	)		(2,917	)		(2,782	)		(2,786	)		(2,927	)		(3,103	)		(3,166	)
Total operating costs		(21,318	)		(21,760	)		(22,862	)		(20,950	)		(22,782	)		(34,228	)		(35,037	)		(34,996	)		(37,732	)
Depreciation, amortization and writedowns		(3,415	)		(3,735	)		(3,768	)		(4,308	)		(3,698	)		(3,843	)		(4,843	)		(5,504	)		(5,151	)
Operating income		5,316			4,960			5,345			3,810			5,480			10,772			10,313			8,502			9,517
Net financial (expense) income		(698	)		(445	)		(229	)		(41	)		10			64			(295	)		(167	)		(154	)
Net (expense) income from investments		(114	)		99			59			396			89			33			(7	)		43			(17	)
Income before extraordinary income and income taxes		4,504			4,614			5,175			4,165			5,579			10,869			10,011			8,378			9,346
Net extraordinary expense (income)		(248	)		(76	)		(198	)		(245	)		(528	)		(512	)		1,737			(29	)		49
Income before income taxes		4,256			4,538			4,977			3,920			5,051			10,357			11,748			8,349			9,395
Income taxes		(1,904	)		(2,167	)		(2,254	)		(1,450	)		(2,054	)		(4,335	)		(3,529	)		(3,127	)		(3,241	)
Income before minority interests		2,352			2,371			2,723			2,470			2,997			6,022			8,219			5,222			6,154
Minority interests		(117	)		(72	)		(80	)		(142	)		(140	)		(251	)		(468	)		(629	)		(569	)
Net income		2,235			2,299			2,643			2,328			2,857			5,771			7,751			4,593			5,585


Balance sheet		(million €)
(at December 31)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Net fixed assets		20,953			20,440			20,641			20,871			23,074			26,797			33,851			33,693			36,360
Intangible assets		1,095			1,011			1,689			1,776			2,175			2,391			2,850			3,175			3,610
Investments		1,501			1,328			1,482			1,382			1,446			4,223			2,740			2,797			3,160
Accounts receivable financing and securities related to operations		1,583			1,565			1,352			1,453			1,670			1,659			1,630			1,408			983
Net accounts payable in relation to investments		(1,033	)		(955	)		(738	)		(746	)		(717	)		(825	)		(657	)		(870	)		(1,018	)
Non current assets		24,099			23,389			24,426			24,736			27,648			34,245			40,414			40,203			43,095
Inventories		2,719			2,631			2,629			2,442			2,626			3,120			3,014			3,200			3,293
Trade accounts receivable		6,574			6,760			6,448			6,076			7,486			9,186			9,346			9,090			9,772
Trade accounts payable		(3,455	)		(3,485	)		(3,508	)		(3,517	)		(4,200	)		(4,903	)		(5,081	)		(5,579	)		(5,950	)
Tax liabilities		(4,557	)		(4,249	)		(3,704	)		(3,083	)		(4,219	)		(5,629	)		(4,173	)		(2,978	)		(2,532	)
Reserve for contingencies		(2,634	)		(2,656	)		(3,106	)		(3,246	)		(3,735	)		(5,702	)		(5,377	)		(5,522	)		(5,708	)
Other operating assets (liabilities)		1,947			1,901			1,614			1,408			821			(602	)		1,636			1,585			446
Net working capital		594			902			373			80			(1,221	)		(1,973	)		(635	)		(204	)		(679	)
Reserve for employee termination indemnities		(1,125	)		(763	)		(505	)		(356	)		(411	)		(457	)		(486	)		(507	)		(555	)
Net capital employed		23,568			23,528			24,294			24,460			26,016			31,815			39,293			39,492			41,861
Shareholders’ equity ⁽¹⁾		11,893			13,084			15,324			16,156			18,398			22,401			27,483			26,257			26,696
Minority interest		886			885			920			1,234			1,351			1,672			1,706			2,094			1,622
		12,779			13,969			16,244			17,390			19,749			24,073			29,189			28,351			28,318
Net borrowings		10,789			9,559			8,050			7,070			6,267			7,742			10,104			11,141			13,543
Total liabilities and shareholders’ equity		23,568			23,528			24,294			24,460			26,016			31,815			39,293			39,492			41,861

(1) Net of own shares in portfolio.


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Cash flow statement and change in net borrowings		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Net income before minority interest		2,352			2,371			2,723			2,470			2,997			6,022			8,220			5,222			6,154
as adjusted:
- amortization and depreciation and other non monetary items		3,610			3,514			4,056			4,468			3,869			4,307			4,841			5,682			5,493
- net gains on disposals of assets		(25	)		(139	)		(185	)		(443	)		(60	)		(82	)		(170	)		(152	)		(35	)
- dividends, interest, extraordinary income (expense) and income taxes		2,948			2,727			2,706			1,743			2,618			4,990			2,164			3,305			3,268
Cash generated from operating income before changes in working capital		8,885			8,473			9,300			8,238			9,424			15,237			15,055			14,057			14,880
Changes in working capital related to operations		(457	)		(490	)		(268	)		785			(660	)		(1,592	)		(206	)		(510	)		(465	)
Dividends received, taxes paid, interest and extraordinary income/expense (paid) received during the year		(1,833	)		(2,954	)		(2,517	)		(2,159	)		(516	)		(3,062	)		(6,765	)		(2,969	)		(3,588	)
Net cash provided by operating activities		6,595			5,029			6,515			6,864			8,248			10,583			8,084			10,578			10,827
Capital expenditure		(3,680	)		(3,792	)		(4,169	)		(5,152	)		(5,483	)		(5,431	)		(6,606	)		(8,048	)		(8,802	)
Acquisitions		(231	)		(352	)		(153	)		(407	)		(114	)		(3,483	)		(3,082	)		(1,315	)		(985	)
Disposals		850			689			363			371			295			277			2,114			935			650
Other investments and divestments		(144	)		(6	)		(9	)		(118	)		(446	)		(69	)		(40	)		(319	)		1,110
Free cash flow		3,390			1,569			2,547			1,558			2,500			1,877			470			1,831			2,800
Borrowings (repayment) of debt related to financing activities		308			(727	)		66			2,019			(433	)		111			994			(1,171	)		1,400
Changes in short and long term financial debt		(3,133	)		45			(1,121	)		(3,715	)		(294	)		121			(490	)		3,736			1,629
Dividends paid and changes in minority interests and reserves		(561	)		(833	)		(999	)		(645	)		(1,311	)		(2,118	)		(950	)		(3,846	)		(5,933	)
Change in consolidation area and exchange differences		(7	)		(14	)		67			(24	)		(29	)		41			38			(64	)		(107	)
NET CASH FLOW FOR THE PERIOD		(4	)		41			560			(807	)		433			32			62			486			(211	)
Free cash flow		3,390			1,569			2,547			1,558			2,500			1,877			470			1,831			2,800
Net borrowings of acquired companies		(64	)		(10	)		1			(6	)		0			(901	)		(1,582	)		(51	)		(692	)
Net borrowings of divested companies		641			392			174			30			3			20			185			39			1
Exchange differences on net borrowings and other changes		(133	)		112			(213	)		43			(389	)		(353	)		(312	)		990			1,422
Dividends paid and changes in minority interests and reserves		(561	)		(833	)		(999	)		(645	)		(1,311	)		(2,118	)		(950	)		(3,846	)		(5,933	)
CHANGE IN NET BORROWINGS		3,273			1,230			1,510			980			803			(1,475	)		(2,189	)		(1,037	)		(2,402	)


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Net sales from operations		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Exploration & Production		5,664			6,578			6,897			5,206			6,840			12,308			13,960			12,877			12,746
Gas & Power		8,400			9,352			9,985			9,625			9,900			14,427			16,098			15,297			16,068
Refining & Marketing		10,594			11,326			11,834			10,374			14,415			25,462			22,083			21,546			22,148
Petrochemicals		6,830			5,063			4,985			4,048			4,096			6,018			5,108			4,516			4,487
Oilfield Services Construction and Engineering		2,231			2,551			2,890			3,348			2,988			2,146			3,114			4,546			6,306
Other activities		297			290			417			552			555			608			695			1,555			1,302
Corporate and financial companies																							457			638
Activities to be divested		1,249			905			464			253			83
Consolidation adjustment		(5,884	)		(6,275	)		(6,113	)		(5,065	)		(7,869	)		(13,031	)		(11,786	)		(12,872	)		(12,208	)
		29,381			29,790			31,359			28,341			31,008			47,938			49,272			47,922			51,487

As compared to 2002, in 2003 Eni’s activities have been grouped differently:

• Syndial (former EniChem) was included in the “Other activities” segment, which includes all Eni companies not included in specific segments (such as, among others, EniData, Sieco, Tecnomare, EniTecnologie, Eni Corporate University, AGI);

• the new “Corporate and financial companies” segment was created, which includes Eni Corporate, Sofid and the financial companies formerly included in the “Other Activities” segment.

In order to allow for a homogenous comparison, data for 2002 have been reclassified accordingly.


Net sales to customers		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Exploration & Production		2,303		2,803		3,254		2,300		1,228		2,924		5,530		4,082		4,278
Gas & Power		7,834		8,776		9,563		9,272		9,532		13,714		15,430		14,674		15,617
Refining & Marketing		9,638		10,386		10,861		9,626		13,542		23,913		20,881		20,509		21,527
Petrochemicals		6,501		4,722		4,640		3,787		3,777		5,448		4,290		3,770		4,049
Oilfield Services Construction and Engineering		1,862		2,148		2,450		2,938		2,689		1,762		2,605		4,067		5,409
Other activities		88		84		129		166		157		177		89		700		449
Corporate and financial companies														100		120		158
Activities to be divested		1,155		871		462		252		83
		29,381		29,790		31,359		28,341		31,008		47,938		49,272		47,922		51,487


Net sales by geographic area of destination		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		19,255		19,288		19,914		18,059		18,813		27,184		27,591		23,797		25,491
Other European Union countries		4,654		4,051		4,182		3,339		4,191		6,944		8,226		8,450		9,995
Rest of Europe		1,393		1,662		1,785		1,737		1,551		2,711		3,136		4,712		4,093
Africa		828		1,004		1,167		1,160		1,496		2,083		2,180		2,478		5,854
Americas		2,014		2,265		2,334		2,432		3,148		6,034		6,169		5,317		2,778
Asia		1,165		1,402		1,958		1,596		1,795		2,959		1,949		3,154		3,245
Other areas		72		118		19		18		14		23		21		14		31
Total outside Italy		10,126		10,502		11,445		10,282		12,195		20,754		21,681		24,125		25,996
		29,381		29,790		31,359		28,341		31,008		47,938		49,272		47,922		51,487


85
		ENI FACT BOOK 2003
FINANCIAL DATA


Purchases, services and other		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Production costs - raw, ancillary and consumable materials and goods		12,423			12,647			13,415			11,038			13,189			23,691			23,993			22,658			24,087
Production costs - services		4,942			5,061			5,330			6,173			6,035			6,513			7,507			8,614			10,431
Lease, rental and royalty expenses		955			969			1,155			1,048			941			1,203			1,242			1,454			1,407
Other expenses		888			1,038			1,239			1,232			1,022			1,518			1,302			1,575			1,423
less:
capitalized direct costs associated with self-constructed assets		(523	)		(562	)		(716	)		(805	)		(563	)		(616	)		(745	)		(842	)		(1,277	)
services billed to joint venture partners		(509	)		(474	)		(612	)		(653	)		(624	)		(867	)		(1,189	)		(1,566	)		(1,505	)
		18,176			18,679			19,811			18,033			20,000			31,442			32,110			31,893			34,566


Payroll and related costs		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Wages and salaries		2,278			2,244			2,226			2,234			2,134			2,175			2,271			2,441			2,412
Social security contributions		705			726			725			651			621			627			602			650			693
Employee termination indemnities		189			159			128			126			121			117			114			121			126
Employee retirement and similar obligations		3			6			17			11			16			11			12			15			31
Other costs		152			153			147			85			73			57			83			119			91
less:
revenues related to personnel costs		(36	)		(47	)		(39	)		(36	)		(33	)		(40	)		(51	)		(53	)		(26	)
capitalized direct costs associated with self-constructed assets		(149	)		(160	)		(153	)		(154	)		(150	)		(161	)		(180	)		(190	)		(161	)
		3,142			3,081			3,051			2,917			2,782			2,786			2,851			3,103			3,166


Depreciation, amortization and writedowns		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Exploration & Production		1,428		1,542		1,810		1,897		1,654		2,364		3,163		3,552		3,133
Gas & Power		840		930		994		1,033		1,045		474		500		417		533
Refining & Marketing		461		434		420		459		476		502		508		490		493
Petrochemicals		339		281		259		251		284		273		323		125		125
Oilfield Services Construction and Engineering		74		81		87		107		109		144		203		267		271
Other activities		19		24		30		30		24		31		46		51		54
Corporate and financial companies																60		101
Activities to be divested		39		17		10		1
Total depreciation and amortization		3,200		3,309		3,610		3,778		3,592		3,788		4,743		4,962		4,710
Writedowns		215		426		158		530		106		55		100		542		441
		3,415		3,735		3,768		4,308		3,698		3,843		4,843		5,504		5,151


Operating income by segment		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Exploration & Production		2,094			2,612			2,590			594			2,834			6,603			5,984			5,175			5,746
Gas & Power		1,703			2,024			2,012			2,513			2,580			3,178			3,672			3,244			3,627
Refining & Marketing		456			214			578			730			478			986			985			321			583
Petrochemicals		1,042			101			187			0			(362	)		4			(415	)		(126	)		(176	)
Oilfield Services Construction and Engineering		144			159			169			198			149			144			255			298			311
Other activities																							(201	)		(279	)
Corporate and financial companies		(118	)		(98	)		(138	)		(168	)		(199	)		(143	)		(168	)		(209	)		(295	)
Activities to be divested		(5	)		(52	)		(53	)		(57	)
		5,316			4,960			5,345			3,810			5,480			10,772			10,313			8,502			9,517


		86

ENI FACT BOOK 2003
FINANCIAL DATA


Net financial expense		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Interest and other financial income		852			623			579			485			339			501			539			512			436
Securities gains		237			302			246			176			197			116			95			44			34
Interest and other financial expense		(1,878	)		(1,386	)		(1,125	)		(790	)		(556	)		(791	)		(978	)		(738	)		(710	)
Exchange gain (loss), net		32			(35	)		33			49			(27	)		165			(10	)		(30	)
less:
interest capitalized		59			51			38			39			57			73			49			43			86
		(698	)		(445	)		(229	)		(41	)		10			64			(295	)		(167	)		(154	)
of which income on receivables related to operations and tax credits		263			227			197			195			254			201			170			122			116


Income (expense on) from investments		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Gains on disposals		16			69			135			401			17			19			76			55			39
Dividends		14			23			42			67			63			44			40			32			22
Income from equity investments		143			64			68			46			61			137			151			178			180
Other revaluation of investments		4			2			23			22			47			10			7			6			9
Writedown of investments		(291	)		(59	)		(213	)		(143	)		(101	)		(178	)		(282	)		(245	)		(278	)
Other		1			4			4			3			2			1			1			17			11
		(114	)		99			59			396			89			33			(7	)		43			(17	)


Net extraordinary income (expense)		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Gains on disposals		248			245			67			57			77			86			3,473			257			290
of which gain on the public offering of 40.24% of Snam Rete Gas																				2,453
Other extraordinary income		59			100			76			351			26			146			177			112			273
Extraordinary income		307			345			143			408			103			232			3,650			369			563
Restructuring costs:
provisions for risks and contingencies		(289	)		(88	)		(207	)		(277	)		(330	)		(182	)		(885	)		(157	)		(248	)
writedowns of fixed assets and losses from investments		(46	)		(65	)		(38	)		(183	)		(169	)		(34	)		(651	)		(55	)		(66	)
cost of redundancy incentives		(76	)		(205	)		(77	)		(129	)		(110	)		(202	)		(257	)		(114	)		(116	)
		(411	)		(358	)		(322	)		(589	)		(609	)		(418	)		(1,793	)		(326	)		(430	)
Other extraordinary expense		(144	)		(63	)		(19	)		(64	)		(22	)		(326	)		(120	)		(72	)		(84	)
Extraordinary expense		(555	)		(421	)		(341	)		(653	)		(631	)		(744	)		(1,913	)		(398	)		(514	)
Net extraordinary income (expense)		(248	)		(76	)		(198	)		(245	)		(528	)		(512	)		1,737			(29	)		49


87

		ENI FACT BOOK 2003
FINANCIAL DATA


Fixed assets (at period end)		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Fixed assets, gross:
Exploration & Production		13,804		14,837		17,633		18,878		23,329		28,220		38,667		38,534		38,811
Gas & Power		13,536		14,691		14,513		14,997		15,579		16,881		15,867		16,467		18,926
Refining & Marketing		7,986		7,526		7,852		8,316		8,620		8,854		9,083		8,172		8,652
Petrochemicals		4,642		4,030		4,163		4,356		4,611		4,618		5,862		4,169		4,266
Oilfield Services Construction and Engineering		1,115		1,354		1,614		1,898		2,336		2,564		2,805		3,447		3,531
Other activities		163		167		227		239		202		224		241		2,472		2,403
Corporate and financial companies																132		149
Activities to be divested		731		581		424		340
		41,977		43,186		46,426		49,024		54,677		61,361		72,525		73,393		76,738
Fixed assets, net:
Exploration & Production		6,450		6,675		7,651		7,790		10,155		13,113		20,728		19,862		20,338
Gas & Power		7,074		7,473		6,624		6,419		6,142		7,068		6,598		7,191		9,500
Refining & Marketing		4,108		3,398		3,409		3,566		3,472		3,393		3,332		3,097		3,170
Petrochemicals		2,595		2,163		2,076		2,071		1,958		1,759		1,626		1,285		1,181
Oilfield Services Construction and Engineering		485		546		718		919		1,257		1,370		1,467		1,758		1,741
Other activities		74		76		97		104		90		94		100		418		338
Corporate and financial companies																82		92
Activities to be divested		167		109		66		2
		20,953		20,440		20,641		20,871		23,074		26,797		33,851		33,693		36,360


Capital expenditure by segment		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Exploration & Production		1,584		1,663		2,322		2,882		3,268		3,539		4,276		5,615		5,681
Gas & Power		1,232		1,207		882		921		906		794		1,065		1,315		1,760
Refining & Marketing		520		584		495		586		524		533		496		550		730
Petrochemicals		133		158		180		331		289		265		390		145		141
Oilfield Services Construction and Engineering		151		143		237		354		425		245		304		233		278
Other activities		36		27		34		61		55		55		75		119		71
Corporate and financial companies																71		141
Activities to be divested		24		10		19		17		16
		3,680		3,792		4,169		5,152		5,483		5,431		6,606		8,048		8,802


Capital expenditure by geographic area of origin		(million €)


	1995		1996		1997		1998		1999		2000		2001		2002		2003
Italy		2,336		2,365		2,246		2,535		2,238		2,206		2,436		2,396		2,708
Other European Union countries		458		300		478		439		320		439		595		546		1,035
Rest of Europe		184		242		306		465		390		283		249		305		334
Africa		583		671		904		1,103		1,159		1,186		1,405		2,497		3,026
Americas		76		86		144		261		1,095		753		923		721		369
Asia		39		127		90		345		280		562		923		1,333		795
Other areas		4		1		1		4		1		2		75		250		535
Total outside Italy		1,344		1,427		1,923		2,617		3,245		3,225		4,170		5,652		6,094
		3,680		3,792		4,169		5,152		5,483		5,431		6,606		8,048		8,802


		88

ENI FACT BOOK 2003
FINANCIAL DATA


Net borrowings (at period end)		(million €)


						Securities			Accounts receivable
						not related			financing not related
	Debt and bonds		Cash			to operations			to operations			Other, net			Total
1995
Short-term		7,360		(984	)		(1,544	)		(586	)		(5	)		4,241
Long-term		6,977					(429	)								6,548
		14,337		(984	)		(1,973	)		(586	)		(5	)		10,789
1996
Short-term		8,339		(1,026	)		(2,063	)		(897	)		42			4,395
Long-term		5,506					(351	)					9			5,164
		13,845		(1,026	)		(2,414	)		(897	)		51			9,559
1997
Short-term		7,924		(1,586	)		(2,204	)		(1,180	)		(5	)		2,949
Long-term		5,347					(156	)		(91	)		1			5,101
		13,271		(1,586	)		(2,360	)		(1,271	)		(4	)		8,050
1998
Short-term		4,948		(779	)		(1,119	)		(389	)		(6	)		2,655
Long-term		4,517					(85	)					(17	)		4,415
		9,465		(779	)		(1,204	)		(389	)		(23	)		7,070
1999
Short-term		4,764		(1,212	)		(1,645	)		(343	)		26			1,590
Long-term		4,787					(85	)					(25	)		4,677
		9,551		(1,212	)		(1,730	)		(343	)		1			6,267
2000
Short-term		5,928		(1,244	)		(1,432	)		(550	)		(50	)		2,652
Long-term		5,116					(24	)					(2	)		5,090
		11,044		(1,244	)		(1,456	)		(550	)		(52	)		7,742
2001
Short-term		6,464		(1,305	)		(940	)		(74	)		(29	)		4,116
Long-term		6,084					(312	)								5,772
		12,819		(1,360	)		(1,252	)		(74	)		(29	)		10,104
2002
Short-term		8,870		(1,791	)		(730	)		(1,465	)		(3	)		4,881
Long-term		6,550					(290	)								6,260
		15,420		(1,791	)		(1,020	)		(1,465	)		(3	)		11,141
2003
Short-term		7,918		(1,580	)		(792	)		(32	)		(65	)		5,449
Long-term		8,336					(2	)		(240	)					8,094
		16,254		(1,580	)		(794	)		(272	)		(65	)		13,543


89

		ENI FACT BOOK 2003
FINANCIAL DATA

employees


Number of employees at year-end		(units)


		1995		1996		1997		1998		1999		2000		2001		2002		2003
Exploration & Production	Italy		5,856		5,750		5,912		5,444		5,294		5,014		4,495		4,617		4,555
	Outside Italy		2,884		2,691		2,666		2,726		2,479		2,727		3,038		3,098		3,163
			8,740		8,441		8,578		8,170		7,773		7,741		7,533		7,715		7,718
Gas & Power	Italy		17,355		16,341		14,474		13,977		13,669		13,175		11,704		10,852		10,302
	Outside Italy		217		3,784		3,432		3,132		2,806		2,925		2,582		2,465		2,680
			17,572		20,125		17,906		17,109		16,475		16,100		14,286		13,317		12,982
Refining & Marketing	Italy		13,838		12,662		11,543		11,176		10,341		9,760		8,638		7,332		6,882
	Outside Italy		7,173		7,003		6,897		7,230		6,720		6,370		6,534		6,425		6,395
			21,011		19,665		18,440		18,406		17,061		16,130		15,172		13,757		13,277
Petrochemicals	Italy		18,465		14,969		14,354		12,957		12,596		11,573		10,910		5,744		5,585
	Outside Italy		2,366		1,778		1,653		1,370		1,312		1,284		1,569		1,514		1,465
			20,831		16,747		16,007		14,327		13,908		12,857		12,479		7,258		7,050
Oilfield Services Construction and Engineering Oilfield Services and Construction	Italy		3,276		3,194		2,925		2,832		2,648		2,326		2,279		2,255		2,423
	Outside Italy		5,361		6,907		8,086		9,682		7,359		7,560		12,881		22,770		18,910
			8,637		10,101		11,011		12,514		10,007		9,886		15,160		25,025		21,333
Engineering	Italy		3,422		3,402		3,376		3,328		3,102		3,001		3,055		3,433		3,544
	Outside Italy		506		405		411		393		378		330		417		633		1,580
			3,928		3,807		3,787		3,721		3,480		3,331		3,472		4,066		5,124
Other activities	Italy		1,499		1,510		2,834		3,527		3,247		3,841		4,255		6,999		6,367
	Outside Italy		96		92		94		69		72		83		48		13		13
			1,595		1,602		2,928		3,596		3,319		3,924		4,303		7,012		6,380
Corporate and financial companies	Italy																2,455		2,577
	Outside Italy																50		80
																	2,505		2,657
Activities to be divested	Italy		4,105		2,936		1,521		1,063
	Outside Italy		3		0		0		0
			4,108		2,936		1,521		1,063
	Italy		67,816		60,764		56,939		54,304		50,897		48,690		45,336		43,687		42,235
	Outside Italy		18,606		22,660		23,239		24,602		21,126		21,279		27,069		36,968		34,286
			86,422		83,424		80,178		78,906		72,023		69,969		72,405		80,655		76,521
of which senior managers			2,165		2,012		1,992		1,914		1,788		1,683		1,438		1,537		1,733


		90

ENI FACT BOOK 2002
EMPLOYEES

supplemental oil and gas information¹

Oil and natural gas reserves

Proved oil and gas reserves are the estimated quantities of crude oil, natural gas and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under technical, contractual, economic and operating conditions existing at the time. Prices include consideration of changes in existing prices provided only by contractual arrangements, but not on escalations based upon future conditions. Proved reserves exclude royalties and interests owned by others.

Proved developed reserves are proved reserves that can be estimated to be recovered through existing wells with existing equipment and operating methods.

Proved undeveloped oil and gas reserves are reserves that are expected to be recovered from new wells on undrilled acreage, or from existing wells where a relatively major expenditure is required for completion.

Additional oil and gas reserves expected to be obtained through the application of fluid injection or other improved recovery techniques for supplementing natural forces and mechanisms of primary recovery are included as proved developed reserves only after testing by a pilot project or after the operation of an installed program has confirmed through production response that increased recovery will be achieved.

The estimates of Eni’s reserve quantities have been prepared in accordance with applicable U.S. Securities and Exchange Commission regulation. The estimates of proved reserves, developed and undeveloped are based on data prepared by Eni.

Eni operates under PSAs in several of the foreign jurisdictions where it has oil and gas exploration and production activities. In countries where Eni operates under PSAs, proved reserves are shown in accordance with Eni’s economic interest (pursuant to PSA contract terms) in the oil and gas reserve quantities estimated to be recoverable in future years. Such reserves include estimated quantities allocated to Eni for recovery of costs, income taxes owed by Eni but settled by its joint venture partners (which are state-owned entities) out of Eni’s share of production, and Eni’s net equity share after cost recovery.

Proved reserves include the volume of natural gas used for own consumption and volumes of natural gas held in certain Eni storage fields in Italy. Proved reserves attributable to these fields include: (i) the residual natural gas volumes of the reservoirs; (ii) natural gas volumes from other Eni fields input into these reservoirs in subsequent periods. Proved reserves do not include volumes owned by or acquired from third parties. Gas withdrawn from storage is produced and thereby detracted from proved reserves when it is sold to third parties.

Numerous uncertainties are inherent in estimating quantities of proved reserves and in projecting future rates of production and timing of development expenditures. The accuracy of any reserve estimate is a function of the quality of available data and engineering and geological interpretation and judgement. Results of drilling, testing and production after the date of the estimate may require substantial upward and downward revision. In addition, changes in oil and natural gas prices could have an effect on the quantities of Eni’s proved reserves because the estimates of reserves are based on prices and costs at the date when such estimates are made. Reserves estimates are also subject to revision as prices fluctuate due to the cost recovery feature under certain PSAs.

The following table presents yearly changes in estimated proved reserves, developed and undeveloped, of crude oil (including condensate and natural gas liquids) and natural gas.

(1) The following information is not audited and is presented in accordance with the Statement of Financial Accounting Standard No. 69 “Disclosures about Oil and Gas Producing Activities”.


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Proved hydrocarbon reserves ⁽¹⁾		(million boe)


	Italy			North			West			North			Rest
	⁽²⁾			Africa			Africa			Sea			of World			Total
Reserves at December 31, 1995		1,736			980			870			584			148			4,318
Purchase of minerals in place		12			185			3			57						257
Revisions of previous estimates					(12	)		26			33			(2	)		45
Improved recovery								6			12						18
Extensions and discoveries		35			352			8			1			1			397
Production		(146	)		(85	)		(66	)		(41	)		(19	)		(357	)
Sales of minerals in place											(3	)					(3	)
Reserves at December 31, 1996		1,637			1,420			847			643			128			4,675
Purchase of minerals in place		37			1									254			292
Revisions of previous estimates		31			77			46			24			25			203
Improved recovery					1			2			14						17
Extensions and discoveries		83			117			24			44			5			273
Production		(142	)		(85	)		(67	)		(59	)		(20	)		(373	)
Sales of minerals in place					(1	)					(11	)		(2	)		(14	)
Reserves at December 31, 1997		1,646			1,530			852			655			390			5,073
Purchase of minerals in place
Revisions of previous estimates		13			126			65			41			(24	)		221
Improved recovery								17									17
Extensions and discoveries		68			118			49			27			73			335
Production		(153	)		(88	)		(73	)		(57	)		(20	)		(391	)
Sales of minerals in place
Reserves at December 31, 1998		1,574			1,686			910			666			419			5,255
Purchase of minerals in place		6			17						5			93			121
Revisions of previous estimates		24			208			48			28			(1	)		307
Improved recovery								3									3
Extensions and discoveries		11			37			180			1			14			243
Production		(138	)		(99	)		(74	)		(54	)		(30	)		(395	)
Sales of minerals in place
Reserves at December 31, 1999		1,477			1,849			1,067			646			495			5,534
Purchase of minerals in place		0			3			12			80			159			254
Revisions of previous estimates		15			86			56			32			231			419
Improved recovery		0			3			9			0			0			12
Extensions and discoveries		16			100			32			3			69			220
Production		(119	)		(111	)		(83	)		(62	)		(56	)		(430	)
Sales of minerals in place		(0	)		(1	)		0			0			0			(1	)
Reserves at December 31, 2000		1,389			1,929			1,093			700			897			6,008
Purchase of minerals in place		3			118						206			437			764
Revisions of previous estimates		22			171			93			63			166			515
Improved recovery					11			16			6						33
Extensions and discoveries		21			8			24			9			58			120
Production		(120	)		(115	)		(86	)		(104	)		(81	)		(506	)
Sales of minerals in place		0			0			(4	)		(1	)					(5	)
Reserves at December 31, 2001		1,315			2,122			1,136			879			1,477			6,929
Purchase of minerals in place											27			12			39
Revisions of previous estimates		5			14			113			24			181			337
Improved recovery					14			1									15
Extensions and discoveries		29			12			124			31			142			338
Production		(111	)		(129	)		(87	)		(112	)		(93	)		(532	)
Sales of minerals in place		(39	)								(24	)		(33	)		(96	)
Reserves at December 31, 2002		1,199			2,033			1,287			825			1,686			7,030


		92

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(million boe)


	Italy			North			West			North			Rest
	⁽²⁾			Africa			Africa			Sea			of World			Total
Reserves at December 31, 2002		1,199			2,033			1,287			825			1,686			7,030
Purchase of minerals in place		2									159			1			162
Revisions of previous estimates		(116	)		29			89			77			208			287
Improved recovery					15			16									31
Extensions and discoveries		22			74			27						232			355
Production		(111	)		(127	)		(95	)		(126	)		(111	)		(570	)
Sales of minerals in place											(23	)					(23	)
Reserves at December 31, 2003		996			2,024			1,324			912			2,016			7,272
Proved developed hydrocarbon reserves ⁽¹⁾
Reserves at December 31, 1995		1,174			800			495			373			64			2,906
Reserves at December 31, 1996		1,069			761			458			468			72			2,828
Reserves at December 31, 1997		1,018			734			454			423			73			2,702
Reserves at December 31, 1998		914			778			476			460			102			2,730
Reserves at December 31, 1999		921			796			586			416			202			2,921
Reserves at December 31, 2000		860			824			590			443			301			2,995
Reserves at December 31, 2001		825			875			640			773			654			3,767
Reserves at December 31, 2002		774			797			703			724			705			3,703
Reserves at December 31, 2003		702			806			710			822			1,190			4,230

(2) Data at December 31, 1995, 1996, 1997, 1998, 1999, 2000, 2001, 2002 and 2003 include 136.2, 143.7, 144.2, 139.4, 134.8, 139.8, 129.9, 139 and 133.2 million boe of natural gas in storage in Italy, respectively.


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Proved oil reserves ⁽¹⁾		(million barrels)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
Reserves at December 31, 1995		318			869			749			375			91			2,402
Purchase of minerals in place		6			84			3			45						138
Revisions of previous estimates		8			1			19			21						49
Improved recovery								6			7						13
Extensions and discoveries		19			79			8			1			1			108
Production		(35	)		(80	)		(65	)		(30	)		(13	)		(223	)
Sales of minerals in place											(3	)					(3	)
Reserves at December 31, 1996		316			953			720			416			79			2,484
Purchase of minerals in place														254			254
Revisions of previous estimates		20			76			47			23			21			187
Improved recovery					1			2			12						15
Extensions and discoveries		61			34			24			26			5			150
Production		(37	)		(78	)		(65	)		(43	)		(14	)		(237	)
Sales of minerals in place					(1	)					(6	)		(2	)		(9	)
Reserves at December 31, 1997		360			985			728			428			343			2,844
Purchase of minerals in place
Revisions of previous estimates		(20	)		86			78			38			(25	)		157
Improved recovery								17									17
Extensions and discoveries		25			31			39			9						104
Production		(36	)		(78	)		(72	)		(42	)		(13	)		(241	)
Sales of minerals in place
Reserves at December 31, 1998		329			1,024			790			433			305			2,881
Purchase of minerals in place		6			13						1			79			99
Revisions of previous estimates		20			107			52			22			44			245
Improved recovery								3									3
Extensions and discoveries		5			8			126			2			11			152
Production		(32	)		(81	)		(71	)		(41	)		(18	)		(243	)
Sales of minerals in place
Reserves at December 31, 1999		328			1,071			900			417			421			3,137
Purchase of minerals in place					3			12			46			133			194
Revisions of previous estimates		(13	)		42			59			36			166			290
Improved recovery					2			9									11
Extensions and discoveries		9			6			32			1			17			65
Production		(28	)		(84	)		(78	)		(45	)		(39	)		(274	)
Sales of minerals in place					(1	)											(1	)
Reserves at December 31, 2000		296			1,039			934			455			698			3,422
Purchase of minerals in place					118						120			248			486
Revisions of previous estimates		29			79			91			37			20			256
Improved recovery					11			16			6						33
Extensions and discoveries		9			8			21			8			24			70
Production		(25	)		(84	)		(81	)		(74	)		(50	)		(314	)
Sales of minerals in place								(5	)								(5	)
Reserves at December 31, 2001		309			1,171			976			552			940			3,948
Purchase of minerals in place											13			12			25
Revisions of previous estimates		2			(31	)		112			4			(33	)		54
Improved recovery					14			1									15
Extensions and discoveries		11			10			14			18			104			157
Production		(30	)		(92	)		(81	)		(77	)		(54	)		(334	)
Sales of minerals in place		(37	)								(12	)		(33	)		(82	)
Reserves at December 31, 2002		255			1,072			1,022			498			936			3,783


		94

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Proved natural gas reserves		(million cubic meters)


	Italy			North			West			North			Rest
	⁽¹⁾			Africa			Africa			Sea			of World			Total
Reserves at December 31, 1995		225,027			18,157			19,786			34,328			9,344			306,642
Purchase of minerals in place		765			16,516						2,039						19,320
Revisions of previous estimates		(1,204	)		(2,050	)		1,228			2,002			(334	)		(358	)
Improved recovery											822						822
Extensions and discoveries		2,585			44,740						18			122			47,465
Production		(17,567	)		(806	)		(183	)		(1,939	)		(1,033	)		(21,528	)
Sales of minerals in place
Reserves at December 31, 1996		209,606			76,557			20,831			37,270			8,099			352,363
Purchase of minerals in place		5,900			117												6,017
Revisions of previous estimates		1,796			265			(189	)		89			619			2,580
Improved recovery											399						399
Extensions and discoveries		3,590			13,525						2,931			5			20,051
Production		(16,822	)		(1,158	)		(222	)		(2,713	)		(951	)		(21,866	)
Sales of minerals in place											(836	)					(836	)
Reserves at December 31, 1997		204,070			89,306			20,420			37,140			7,772			358,708
Purchase of minerals in place		5															5
Revisions of previous estimates		5,293			6,534			(2,150	)		589			71			10,337
Improved recovery
Extensions and discoveries		6,845			14,264			1,640			2,954			12,036			37,739
Production		(18,641	)		(1,535	)		(205	)		(2,493	)		(1,225	)		(24,099	)
Sales of minerals in place
Reserves at December 31, 1998		197,572			108,569			19,705			38,190			18,654			382,690
Purchase of minerals in place		53			538						617			2,288			3,496
Revisions of previous estimates		632			16,545			(790	)		1,057			(7,393	)		10,051
Improved recovery
Extensions and discoveries		927			4,850			8,734			61			349			14,921
Production		(16,834	)		(2,974	)		(344	)		(2,231	)		(1,826	)		(24,209	)
Sales of minerals in place		(11	)														(11	)
Reserves at December 31, 1999		182,339			127,528			27,305			37,694			12,072			386,938
Purchase of minerals in place											5,531			4,249			9,780
Revisions of previous estimates		4,435			7,242			(551	)		(654	)		10,722			21,194
Improved recovery					50												50
Extensions and discoveries		1,133			15,457						218			8,489			25,297
Production		(14,450	)		(4,383	)		(641	)		(2,646	)		(2,828	)		(24,948	)
Sales of minerals in place		(6	)														(6	)
Reserves at December 31, 2000		173,451			145,894			26,113			40,143			32,704			418,305
Purchase of minerals in place		485									14,181			30,939			45,605
Revisions of previous estimates		(1,041	)		15,254			355			4,190			23,580			42,338
Improved recovery											14						14
Extensions and discoveries		1,869			18			497			121			5,730			8,235
Production ⁽²⁾		(15,048	)		(5,179	)		(755	)		(4,968	)		(5,011	)		(30,961	)
Sales of minerals in place											(114	)					(114	)
Reserves at December 31, 2001		159,716			155,987			26,210			53,567			87,942			483,422
Purchase of minerals in place											2,454						2,454
Revisions of previous estimates		604			7,281			216			3,266			35,061			46,428
Extensions and discoveries		2,946			269			18,008			2,095			6,316			29,634
Production ⁽²⁾		(12,905	)		(6,006	)		(1,020	)		(5,697	)		(6,458	)		(32,086	)
Sales of minerals in place		(432	)								(1,918	)					(2,350	)
Reserves at December 31, 2002		149,929			157,531			43,414			53,767			122,861			527,502


		96

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(million cubic meters)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
Reserves at December 31, 2002		149,929			157,531			43,414			53,767			122,861			527,502
Purchase of minerals in place		295									12,041			212			12,548
Revisions of previous estimates		(21,753	)		(3,469	)		4,873			3,923			9,197			(7,229	)
Extensions and discoveries		2,387			6,847						10			2,826			12,070
Production ⁽²⁾		(12,892	)		(6,087	)		(1,390	)		(6,490	)		(7,795	)		(34,654	)
Sales of minerals in place											(310	)
Reserves at December 31, 2003		117,966			154,822			46,897			62,941			127,301			509,927
Proved developed natural gas reserves
Reserves at December 31, 1995		146,211			7,406			4,179			20,270			3,431			181,497
Reserves at December 31, 1996		134,405			8,044			4,144			26,629			4,789			178,011
Reserves at December 31, 1997		125,776			8,848			4,083			22,359			3,737			164,803
Reserves at December 31, 1998		116,524			14,627			3,870			23,740			5,202			163,963
Reserves at December 31, 1999		118,954			18,928			18,497			22,965			8,791			188,135
Reserves at December 31, 2000		113,601			28,570			16,861			22,926			18,389			200,347
Reserves at December 31, 2001		103,789			31,217			16,543			48,737			34,568			234,854
Reserves at December 31, 2002		96,206			30,690			24,429			48,899			36,335			236,559
Reserves at December 31, 2003		83,996			27,226			24,520			58,754			95,008			289,504

(1) Including 21,630, 22,816, 22,884, 22,133, 21,399, 22,183, 20,618, 22,065 and 21.144 million cubic meters of natural gas held in storage at December 31, 1995, 1996, 1997, 1998, 1999, 2000, 2001, 2002 and 2003 respectively.

(2) Starting from 2001 include volumes consumed in operations (968, 1,333 and 1,506 million cubic meters in 2001, 2002 and 2003, respectively).


97

		ENI FACT BOOK 2003
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Results of operations from oil and gas producing activities ⁽¹⁾		(million €)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
Year ended December 31, 1995
Revenues:
sales and transfers to affiliates		2,411			744			116									3,271
sales to unaffiliated entities		27			267			864			523			185			1,866
		2,438			1,011			980			523			185			5,137
Production costs		(180	)		(396	)		(365	)		(159	)		(22	)		(1,122	)
Exploration expenses		(142	)		(64	)		(30	)		(52	)		(43	)		(331	)
Depreciation, amortization and writedowns		(456	)		(202	)		(229	)		(206	)		(79	)		(1,172	)
Other income (expense)		(65	)					100			31			(10	)		56
Pretax income from producing activities		1,595			349			456			137			31			2,568
Estimated income taxes		(855	)		(169	)		(203	)		(111	)		(8	)		(1,346	)
Results of operations from E&P activities		740			180			253			26			23			1,222
Year ended December 31, 1996
Revenues:
sales and transfers to affiliates		2,613			819			152						27			3,611
sales to unaffiliated entities		45			436			920			624			244			2,269
		2,658			1,255			1,072			624			271			5,880
Production costs		(222	)		(382	)		(324	)		(153	)		(59	)		(1,140	)
Exploration expenses		(175	)		(81	)		(35	)		(47	)		(50	)		(388	)
Depreciation, amortization and writedowns		(621	)		(198	)		(203	)		(218	)		(82	)		(1,322	)
Other income (expense)		(107	)		(17	)		(52	)		6			(20	)		(190	)
Pretax income from producing activities		1,533			577			458			212			60			2,840
Estimated income taxes		(803	)		(228	)		(269	)		(107	)		(23	)		(1,430	)
Results of operations from E&P activities		730			349			189			105			37			1,410
Year ended December 31, 1997
Revenues:
sales and transfers to affiliates		2,701			781			56						7			3,545
sales to unaffiliated entities		57			464			994			874			258			2,647
		2,758			1,245			1,050			874			265			6,192
Production costs		(306	)		(393	)		(316	)		(231	)		(58	)		(1,304	)
Exploration expenses		(151	)		(133	)		(63	)		(33	)		(97	)		(477	)
Depreciation, amortization and writedowns		(452	)		(273	)		(214	)		(422	)		(88	)		(1,449	)
Other income (expense)		(133	)		(19	)		(70	)		6			24			(192	)
Pretax income from producing activities		1,716			427			387			194			46			2,770
Estimated income taxes		(915	)		(225	)		(263	)		(99	)		(12	)		(1,514	)
Results of operations from E&P activities		801			202			124			95			34			1,256

(1) Results of operations from oil and gas producing activities including services for the modulation of gas supply due to seasonal swings in demand, represent only those revenues and expenses directly associated with Eni’s oil and gas production. These amounts do not include any allocation of interest expense or corporate overhead and, therefore, are not necessarily indicative of the contributions to consolidated net earnings of Eni. Revenues and income taxes include taxes due in PSA’s where Eni’s tax liability is paid by the State Company on behalf of Eni. Such income taxes have been calculated by applying the tax rate of the country where Eni operates to the pretax income from exploration and production activities.


		98

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SUPPLEMENTAL OIL AND GAS INFORMATION

(million €)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
Year ended December 31, 1998
Revenues:
sales and transfers to affiliates		2,216			573			20						3			2,812
sales to unaffiliated entities		57			256			711			674			185			1,883
		2,273			830			732			674			186			4,695
Production costs		(329	)		(364	)		(254	)		(211	)		(50	)		(1,208	)
Exploration expenses		(154	)		(95	)		(105	)		(35	)		(86	)		(475	)
Depreciation, amortization and writedowns		(787	)		(254	)		(512	)		(517	)		(92	)		(2,162	)
Other income (expense)		(98	)		(21	)		(102	)		(10	)		(51	)		(282	)
Pretax income from producing activities		905			95			(241	)		(99	)		(91	)		568
Estimated income taxes		(382	)		(58	)		(74	)		(7	)		(1	)		(522	)
Results of operations from E&P activities		523			37			(316	)		(106	)		(92	)		46
Year ended December 31, 1999
Revenues:
sales and transfers to affiliates		1,919			958			1,075			650			138			4,740
sales to unaffiliated entities		499			506			81			205			222			1,513
		2,418			1,464			1,156			855			360			6,253
Production costs		(352	)		(370	)		(353	)		(199	)		(52	)		(1,326	)
Exploration expenses		(120	)		(69	)		(61	)		(39	)		(83	)		(372	)
Depreciation, amortization and writedowns		(462	)		(316	)		(253	)		(336	)		(81	)		(1,448	)
Other income (expense)		(183	)		(99	)		(91	)		3			(77	)		(447	)
Pretax income from producing activities		1,301			610			398			284			67			2,660
Estimated income taxes		(542	)		(254	)		(219	)		(110	)		(19	)		(1,144	)
Results of operations from E&P activities		759			356			179			174			48			1,516
Year ended December 31, 2000
Revenues:
sales and transfers to affiliates		3,336			1,748			2,114			1,205			531			8,934
sales to unaffiliated entities		136			1,134			190			373			660			2,493
		3,472			2,882			2,304			1,578			1,191			11,427
Production costs		(399	)		(459	)		(517	)		(238	)		(125	)		(1,738	)
Exploration expenses		(192	)		(84	)		(60	)		(45	)		(180	)		(561	)
Depreciation, amortization and writedowns		(407	)		(393	)		(327	)		(358	)		(375	)		(1,860	)
Other income (expense)		(30	)		(196	)		(132	)		(55	)		(117	)		(530	)
Pretax income from producing activities		2,444			1,750			1,268			882			394			6,738
Estimated income taxes		(986	)		(877	)		(678	)		(479	)		(78	)		(3,098	)
Results of operations from E&P activities		1,458			873			590			403			316			3,640


99

		ENI FACT BOOK 2003
SUPPLEMENTAL OIL AND GAS INFORMATION

(million €)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
Year ended December 31, 2001
Revenues:
sales and transfers to affiliates		3,160			1,440			1,807			1,265			322			7,994
sales to unaffiliated entities		140			1,181			169			1,250			1,271			4,011
		3,300			2,621			1,976			2,515			1,593			12,005
Operating expenses		(327	)		(337	)		(221	)		(495	)		(270	)		(1,650	)
Production taxes		(152	)		(124	)		(256	)		(27	)		(36	)		(595	)
Exploration expenses		(77	)		(104	)		(70	)		(51	)		(326	)		(628	)
Depreciation, amortization and writedowns		(474	)		(417	)		(315	)		(704	)		(612	)		(2,522	)
Other income (expense)		(87	)		(129	)		(129	)		(79	)		(214	)		(638	)
Pretax income from producing activities		2,183			1,510			985			1,159			135			5,972
Estimated income taxes		(877	)		(605	)		(628	)		(672	)		(136	)		(2,918	)
Results of operations from E&P activities		1,306			905			357			487			(1	)		3,054
Year ended December 31, 2002
Revenues:
sales and transfers to affiliates		2,871			1,673			1,856			1,748			281			8,429
sales to unaffiliated entities		253			1,226			186			695			1,414			3,774
		3,124			2,899			2,042			2,443			1,695			12,203
Operating expenses		(218	)		(352	)		(317	)		(490	)		(237	)		(1,614	)
Production taxes		(138	)		(110	)		(210	)		(20	)		(47	)		(525	)
Exploration expenses		(80	)		(71	)		(116	)		(117	)		(294	)		(678	)
Depreciation, amortization and writedowns⁽²⁾		(528	)		(532	)		(390	)		(863	)		(758	)		(3,071	)
Other income (expense)		(258	)		(186	)		(122	)		(47	)		(183	)		(796	)
Pretax income from producing activities		1,902			1,648			887			906			176			5,519
Estimated income taxes		(751	)		(852	)		(578	)		(445	)		(83	)		(2,709	)
Results of operations from E&P activities		1,151			796			309			461			93			2,810
Year ended December 31, 2003
Revenues:
sales and transfers to affiliates		2,609			1,469			1,946			1,913			345			8,282
sales to unaffiliated entities		153			1,188			164			822			1,595			3,922
		2,762			2,657			2,110			2,735			1,940			12,204
Operating expenses		(222	)		(316	)		(283	)		(446	)		(235	)		(1,502	)
Production taxes		(136	)		(97	)		(235	)		(11	)		(79	)		(558	)
Exploration expenses		(89	)		(70	)		(113	)		(96	)		(276	)		(644	)
Depreciation, amortization and writedowns⁽²⁾		(458	)		(420	)		(377	)		(759	)		(734	)		(2,748	)
Other income (expense)		(170	)		(264	)		(121	)		14			(289	)		(830	)
Accretion of discount (SFAS 143) ⁽³⁾		(37	)		(5	)		(14	)		(42	)		(4	)		(102	)
Pretax income from producing activities		1,650			1,485			967			1,395			323			5,820
Estimated income taxes		(629	)		(788	)		(617	)		(750	)		(111	)		(2,895	)
Results of operations from E&P activities		1,021			697			350			645			212			2,925

(2) Includes assets impairments amounting to euro 227 million in 2002 and euro 210 million in 2003.

(3) Represents the financial effect of the passage of time relating to Eni’s future asset retirement obligations pursuant to SFAS 143 “Accounting for asset retirement obligations”.


		100

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SUPPLEMENTAL OIL AND GAS INFORMATION


Capitalized costs ⁽¹⁾		(million €)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
At December 31, 1995
Proved mineral interests		4,625			3,148			3,002			2,123			543			13,441
Unproved mineral interests					25			237			4			40			306
Support equipment and facilities		353			81			114			48			13			609
Incomplete wells and other		643			189			66			403			39			1,340
Gross capitalized costs		5,621			3,443			3,419			2,578			635			15,696
Accumulated depreciation, depletion and amortization		(2,642	)		(1,673	)		(1,789	)		(1,046	)		(281	)		(7,431	)
Net capitalized costs		2,979			1,770			1,629			1,531			354			8,265
At December 31, 1996
Proved mineral interests		5,006			3,388			3,066			2,760			604			14,824
Unproved mineral interests					5			167						42			214
Support equipment and facilities		387			12			113			73			14			599
Incomplete wells and other		747			169			118			343			41			1,418
Gross capitalized costs		6,140			3,574			3,464			3,176			701			17,055
Accumulated depreciation, depletion and amortization		(3,181	)		(1,743	)		(1,877	)		(1,219	)		(354	)		(8,374	)
Net capitalized costs		2,959			1,831			1,587			1,957			347			8,681
At December 31, 1997
Proved mineral interests		5,393			4,166			3,734			3,270			763			17,326
Unproved mineral interests					7			188						58			253
Support equipment and facilities		427			15			139			105			17			703
Incomplete wells and other		991			236			321			494			36			2,078
Gross capitalized costs		6,811			4,424			4,382			3,869			874			20,360
Accumulated depreciation, depletion and amortization		(3,584	)		(2,267	)		(2,357	)		(1,725	)		(475	)		(10,408	)
Net capitalized costs		3,227			2,157			2,025			2,144			399			9,952
At December 31, 1998
Proved mineral interests		5,794			4,258			3,963			3,446			794			18,255
Unproved mineral interests					14			177						127			318
Support equipment and facilities		451			23			142			95			14			725
Incomplete wells and other		1,172			342			234			651			194			2,593
Gross capitalized costs		7,417			4,637			4,516			4,192			1,129			21,891
Accumulated depreciation, depletion and amortization		(4,272	)		(2,395	)		(2,689	)		(2,078	)		(500	)		(11,934	)
Net capitalized costs		3,145			2,242			1,827			2,114			629			9,957
At December 31, 1999
Proved mineral interests		6,255			5,480			5,117			4,299			1,529			22,680
Unproved mineral interests		2			130			230						381			743
Support equipment and facilities		487			29			179			149			18			862
Incomplete wells and other		1,077			337			181			649			414			2,658
Gross capitalized costs		7,821			5,976			5,707			5,097			2,342			26,943
Accumulated depreciation, depletion and amortization		(4,609	)		(3,095	)		(3,393	)		(2,610	)		(663	)		(14,370	)
Net capitalized costs		3,212			2,881			2,314			2,487			1,679			12,573


101

		ENI FACT BOOK 2003
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(million €)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
At December 31, 2000
Proved mineral interests		6,509			6,339			5,885			5,395			3,009			27,137
Unproved mineral interests					175			281			101			646			1,203
Support equipment and facilities		241			30			170			49			28			518
Incomplete wells and other		1,195			413			316			547			688			3,159
Gross capitalized costs		7,945			6,957			6,652			6,092			4,371			32,017
Accumulated depreciation, depletion and amortization		(4,669	)		(3,718	)		(3,935	)		(2,893	)		(1,081	)		(16,296	)
Net capitalized costs		3,276			3,239			2,717			3,199			3,290			15,721
At December 31, 2001
Proved mineral interests		7,645			7,624			6,723			7,986			5,382			35,360
Unproved mineral interests					672			238			811			1,913			3,634
Support equipment and facilities		295			56			191			52			47			641
Incomplete wells and other		845			508			501			225			1,718			3,797
Gross capitalized costs		8,785			8,860			7,653			9,074			9,060			43,432
Accumulated depreciation, depletion and amortization		(5,109	)		(4,333	)		(4,378	)		(3,612	)		(1,894	)		(19,326	)
Net capitalized costs		3,676			4,527			3,275			5,462			7,166			24,106
At December 31, 2002
Proved mineral interests		8,030			6,782			6,377			8,112			5,638			34,939
Unproved mineral interests					527			130			684			1,593			2,934
Support equipment and facilities		251			43			174			49			51			568
Incomplete wells and other		773			889			795			147			1,958			4,562
Gross capitalized costs		9,054			8,241			7,476			8,992			9,240			43,003

Accumulated depreciation, depletion and amortization		(5,427	)		(4,090	)		(4,048	)		(4,192	)		(2,262	)		(20,019	)

Net capitalized costs		3,627			4,151			3,428			4,800			6,978			22,984

At December 31, 2003
Proved mineral interests		8,766			6,103			6,141			8,291			6,389			35,690
Unproved mineral interests					329			83			696			1,272			2,380
Support equipment and facilities		262			594			208			32			51			1,147
Incomplete wells and other		826			1,254			1,098			223			1,413			4,814
Gross capitalized costs		9,854			8,280			7,530			9,242			9,125			44,031
Accumulated depreciation, depletion and amortization		(6,186	)		(3,799	)		(3,785	)		(4,252	)		(2,657	)		(20,679	)
Net capitalized costs ⁽²⁾		3,668			4,481			3,745			4,990			6,468			23,352

(1) Capitalized costs represent the total expenditure for proved and unproved mineral interests and related support equipment and facilities utilized in oil and gas exploration and production activities, together with related accumulated depreciation, depletion and amortization.

(2) Include euro 385 million related to the effect of the application of SFAS 143 “Accounting for asset retirement obligations”; in particular, the item Proved mineral interest was increased by euro 1,119 and the item Accumulated depreciation, depletion and amortization was increased by euro 734 million.


		102

ENI FACT BOOK 2003
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Costs incurred ⁽¹⁾		(million €)


			North		West		North		Rest
	Italy		Africa		Africa		Sea		of World		Total
Year ended December 31, 1995
Proved property acquisitions		0.5								0.5		1
Unproved property acquisitions						4						4
Exploration		235		136		39		53		26		489
Development		430		238		118		280		60		1,126
		666		374		161		333		86		1,620
Year ended December 31, 1996
Proved property acquisitions		55		5		22		198				280
Unproved property acquisitions				7						5		12
Exploration		289		198		53		48		60		648
Development		351		163		132		254		67		967
		695		373		207		500		132		1,907
Year ended December 31, 1997
Proved property acquisitions		48		5		4				2		59
Unproved property acquisitions				5		16				15		36
Exploration		278		236		112		51		99		776
Development		558		212		288		394		66		1,518
		884		458		420		445		182		2,389
Year ended December 31, 1998
Proved property acquisitions				27		9				67		103
Unproved property acquisitions				12						82		94
Exploration		303		171		150		51		112		786
Development		488		353		367		583		197		1,988
		791		563		526		634		458		2,971
Year ended December 31, 1999
Proved property acquisitions		54		102		9				380		545
Unproved property acquisitions		2		102		34				234		372
Exploration		194		92		87		44		121		538
Development		433		356		357		400		318		1,864
		683		652		487		444		1,053		3,319
Year ended December 31, 2000
Proved property acquisitions				8		32		443		880		1,363
Unproved property acquisitions				30		11		67		149		257
Exploration		155		151		174		86		326		892
Development		567		415		372		346		617		2,317
		722		604		589		942		1,972		4,829
Year ended December 31, 2001 ⁽²⁾
Proved property acquisitions		14		503				1,411		1,254		3,182
Unproved property acquisitions				438				495		704		1,637
Exploration		89		139		97		166		598		1,089
Development		600		498		698		328		1,337		3,461
		703		1,578		795		2,400		3,893		9,369


103

		ENI FACT BOOK 2003
SUPPLEMENTAL OIL AND GAS INFORMATION

(million €)


			North		West		North		Rest
	Italy		Africa		Africa		Sea		of World		Total
Year ended December 31, 2002
Proved property acquisitions								104		24		128
Unproved property acquisitions								22		167		189
Exploration		69		116		203		84		430		902
Development		440		724		986		316		1,622		4,088
		509		840		1,189		526		2,243		5,307
Year ended December 31, 2003 ⁽³⁾
Proved property acquisitions								308		8		316
Unproved property acquisitions								125		6		131
Exploration		67		80		138		125		243		653
Development ⁽⁴⁾		449		1,106		1,268		286		1,454		4,563
Totale costi sostenuti		516		1,186		1,406		844		1,711		5,663

(1) Costs incurred represent amounts both capitalized and expensed as incurred in connection with oil and gas producing activities.

(2) Includes costs for the acquisition of Lasmo Plc of euro 5,084 million, net of the related gross-up for deferred taxes (SFAS 109 “Accounting for Income taxes”) of euro 974 million. The amount has been allocated to the following items: (i) Proved property acquisitions euro 3,115 million, (ii) Unproved property acquisitions euro 1,637 million, (iii) Exploration euro 332 million.

(3) Includes costs for the acquisition of Fortum AS of euro 434 million, net of the related gross-up for deferred taxes (SFAS 109 “Accounting for Income taxes”) of euro 514 million. The amount has been allocated to the North Sea area as follows: (i) Proved property acquisitions euro 308 million, (ii) Unproved property acquisitions euro 109 million, (iii) Exploration euro 17 million.

(4) Includes euro 84 million of costs capitalized during 2003 for assets retirement obligations pursuant to SFAS 143 “Accounting for asset retirement obligations”.


		104

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SUPPLEMENTAL OIL AND GAS INFORMATION

Standardized measure of discounted future net cash flows

Estimated future cash inflows represent the revenues that would be received from production and are determined by applying year-end prices of oil and gas to the estimated future production of proved reserves. Future price changes are considered only to extent provided by contractual arrangements. Estimated future development and production costs are determined by estimating the expenditures to be incurred in developing and producing the proved reserves at the end of the year. Neither the effects of price and cost escalations nor expected future changes in technology and operating practices have been considered.

The standardized measure is calculated as the excess of future cash inflows from proved reserves less future costs of producing and developing the reserves, future income taxes and a yearly 10% discount factor.

Future cash flows as of December 31, 2001, 2002 and 2003 include annual revenue payments from Eni’s Gas & Power segment and other transport and distribution gas companies which represent payments for modulation services to support demand delivery capability. Such capability is provided through utilization of gas withdrawn from producing fields and injected into depleted gas fields as storage.

Future production costs include the estimated expenditures related to the production of proved reserves plus any production taxes without consideration of future inflation. Future development costs include the estimated costs of drilling development wells and installation of production facilities, plus the net costs associated with dismantlement and abandonment of wells and facilities, under the assumption that year-end costs continue without considering future inflation. Future income taxes were calculated in accordance with the tax laws of the countries in which Eni operates. The standardized measure of discounted future net cash flows, related to the preceding proved oil and gas reserves, is calculated in accordance with the requirements of Statement of Financial Accounting Standard No. 69. The standardized measure does not purport to reflect realizable values or fair market value of Eni’s proved reserves. An estimate of fair value would also take into account, among other things, the expected recovery of reserves in excess of proved reserves, anticipated changes in future prices and costs and a discount factor representative of the risks inherent in producing oil and gas.


105

		ENI FACT BOOK 2003
SUPPLEMENTAL OIL AND GAS INFORMATION

(million €)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
At December 31, 1995
Future cash inflows		26,338			12,578			10,600			7,863			1,758			59,137
Future production costs		(2,516	)		(5,726	)		(3,599	)		(2,341	)		(437	)		(14,619	)
Future development and abandonment costs		(2,068	)		(1,389	)		(968	)		(1,184	)		(289	)		(5,898	)
Future net inflows before income taxes		21,754			5,463			6,033			4,338			1,032			38,620
Future income taxes		(10,925	)		(1,825	)		(3,770	)		(1,765	)		(119	)		(18,404	)
Future net cash flows		10,829			3,638			2,263			2,573			913			20,216
10% discount		(4,144	)		(1,280	)		(881	)		(914	)		(325	)		(7,544	)
Standardized measure of discounted future net cash flows		6,685			2,358			1,382			1,659			588			12,672
At December 31, 1996
Future cash inflows		29,780			20,463			12,222			10,094			1,846			74,405
Future production costs		(3,062	)		(6,650	)		(3,537	)		(2,737	)		(347	)		(16,333	)
Future development and abandonment costs		(2,205	)		(3,260	)		(1,095	)		(1,037	)		(237	)		(7,834	)
Future net inflows before income taxes		24,513			10,553			7,590			6,320			1,262			50,238
Future income taxes		(12,451	)		(3,411	)		(4,827	)		(2,811	)		(182	)		(23,682	)
Future net cash flows		12,062			7,142			2,763			3,509			1,080			26,556
10% discount		(4,649	)		(3,830	)		(1,058	)		(1,225	)		(359	)		(11,121	)
Standardized measure of discounted future net cash flows		7,413			3,312			1,705			2,284			721			15,435
At December 31, 1997
Future cash inflows		27,586			20,370			10,989			9,407			4,895			73,247
Future production costs		(3,585	)		(6,994	)		(3,440	)		(2,674	)		(1,257	)		(17,950	)
Future development and abandonment costs		(2,489	)		(3,742	)		(1,318	)		(1,237	)		(1,183	)		(9,969	)
Future net inflows before income taxes		21,512			9,634			6,231			5,496			2,455			45,328
Future income taxes		(7,998	)		(2,615	)		(3,526	)		(2,290	)		(625	)		(17,054	)
Future net cash flows		13,514			7,019			2,705			3,206			1,830			28,274
10% discount		(5,024	)		(3,979	)		(1,009	)		(1,028	)		(1,116	)		(12,156	)
Standardized measure of discounted future net cash flows		8,490			3,040			1,696			2,178			714			16,118
At December 31, 1998
Future cash inflows		18,312			13,676			7,111			6,792			2,600			48,491
Future production costs		(3,134	)		(6,196	)		(2,978	)		(2,700	)		(836	)		(15,844	)
Future development and abandonment costs		(2,544	)		(3,704	)		(1,207	)		(895	)		(972	)		(9,322	)
Future net inflows before income taxes		12,634			3,776			2,926			3,197			792			23,325
Future income taxes		(4,489	)		(749	)		(1,198	)		(1,062	)		(192	)		(7,690	)
Future net cash flows		8,145			3,027			1,728			2,135			600			15,635
10% discount		(2,858	)		(2,027	)		(650	)		(608	)		(433	)		(6,576	)
Standardized measure of discounted future net cash flows		5,287			1,000			1,078			1,527			167			9,059
At December 31, 1999
Future cash inflows		29,900			34,457			21,177			12,831			9,181			107,546
Future production costs		(3,972	)		(7,782	)		(5,212	)		(3,528	)		(1,375	)		(21,869	)
Future development and abandonment costs		(2,264	)		(4,584	)		(2,711	)		(893	)		(1,731	)		(12,183	)
Future net inflows before income taxes		23,664			22,091			13,254			8,410			6,075			73,494
Future income taxes		(9,168	)		(10,662	)		(8,012	)		(4,006	)		(1,594	)		(33,442	)
Future net cash flows		14,496			11,429			5,242			4,404			4,481			40,052
10% discount		(5,618	)		(5,886	)		(2,238	)		(1,269	)		(2,288	)		(17,299	)
Standardized measure of discounted future net cash flows		8,878			5,543			3,004			3,135			2,193			22,753


		106
ENI FACT BOOK 2003
SUPPLEMENTAL OIL AND GAS INFORMATION

(million €)


				North			West			North			Rest
	Italy			Africa			Africa			Sea			of World			Total
At December 31, 2000
Future cash inflows		50,505			39,551			22,057			16,761			17,778			146,652
Future production costs		(6,310	)		(9,770	)		(5,875	)		(3,349	)		(2,999	)		(28,303	)
Future development and abandonment costs		(2,310	)		(4,981	)		(2,708	)		(860	)		(2,504	)		(13,363	)
Future net inflows before income taxes		41,885			24,800			13,474			12,552			12,275			104,986
Future income taxes		(15,627	)		(11,524	)		(7,938	)		(6,365	)		(2,835	)		(44,289	)
Future net cash flows		26,258			13,276			5,536			6,187			9,440			60,697
10% discount		(12,203	)		(7,146	)		(2,370	)		(1,867	)		(4,410	)		(27,996	)
Standardized measure of discounted future net cash flows		14,055			6,130			3,166			4,320			5,030			32,701
At December 31, 2001
Future cash inflows		32,310			37,780			20,154			17,444			20,715			128,403
Future production costs		(5,344	)		(10,941	)		(5,779	)		(4,466	)		(5,073	)		(31,603	)
Future development and abandonment costs		(2,577	)		(5,284	)		(3,194	)		(1,593	)		(2,607	)		(15,255	)
Future net inflows before income taxes		24,389			21,555			11,181			11,385			13,035			81,545
Future income taxes		(8,918	)		(9,258	)		(6,374	)		(5,584	)		(3,119	)		(33,253	)
Future net cash flows		15,471			12,297			4,807			5,801			9,916			48,292
10% discount		(6,925	)		(6,612	)		(1,992	)		(1,611	)		(4,381	)		(21,521	)
Standardized measure of discounted future net cash flows		8,546			5,685			2,815			4,190			5,535			26,771
At December 31, 2002
Future cash inflows		32,809			41,797			29,242			19,645			26,500			149,993
Future production costs		(4,367	)		(10,354	)		(6,795	)		(4,748	)		(4,310	)		(30,574	)
Future development and abandonment costs		(2,755	)		(3,880	)		(2,706	)		(1,523	)		(2,459	)		(13,323	)
Future net inflows before income taxes		25,687			27,563			19,741			13,374			19,731			106,096
Future income taxes		(8,885	)		(12,164	)		(11,320	)		(7,598	)		(5,593	)		(45,560	)
Future net cash flows		16,802			15,399			8,421			5,776			14,138			60,536
10% discount		(7,471	)		(7,411	)		(3,534	)		(1,577	)		(6,063	)		(26,056	)
Standardized measure of discounted future net cash flows		9,331			7,988			4,887			4,199			8,075			34,480
At December 31, 2003
Future cash inflows		24,641			36,484			25,074			19,590			28,505			134,294
Future production costs		(3,879	)		(7,868	)		(5,847	)		(5,458	)		(4,763	)		(27,815	)
Future development and abandonment costs		(2,080	)		(3,762	)		(2,005	)		(1,084	)		(2,575	)		(11,506	)
Future net inflows before income taxes		18,682			24,854			17,222			13,048			21,167			94,973
Future income taxes		(6,113	)		(10,296	)		(8,979	)		(7,614	)		(6,073	)		(39,075	)
Future net cash flows		12,569			14,558			8,243			5,434			15,094			55,898
10% discount		(5,056	)		(6,646	)		(3,130	)		(1,872	)		(7,930	)		(24,634	)
Standardized measure of discounted future net cash flows		7,513			7,912			5,113			3,562			7,164			31,264


107

		ENI FACT BOOK 2003
SUPPLEMENTAL OIL AND GAS INFORMATION


Changes in standardized measure of discounted future net cash flows		(million €)


	1995			1996			1997			1998			1999			2000			2001			2002			2003
Beginning of year		11,491			12,673			15,438			16,118			9,059			22,753			32,701			26,771			34,480
Increase (Decrease):
sales, net of production costs		(4,015	)		(4,740	)		(4,888	)		(3,486	)		(4,927	)		(9,689	)		(9,760	)		(10,064	)		(10,144	)
net changes in sales and transfer prices, net of production costs		1,933			6,507			(5,034	)		(10,384	)		23,334			11,889			(16,754	)		18,936			(1,050	)
extensions, discoveries and improved recovery, net of future production and development costs		831			1,077			1,112			666			1,144			1,623			1,027			1,810			1,855
changes in estimated future development and abandonment costs		(180	)		(588	)		(1,005	)		(642	)		(1,570	)		(1,061	)		(2,527	)		(2,697	)		(3,576	)
development costs incurred during the period that reduced future development costs		1,033			854			1,375			1,803			1,746			2,125			3,342			4,287			4,864
revisions of quantity estimates		1,264			324			1,229			688			2,054			2,736			3,397			1,715			2,348
accretion of discount		2,096			2,256			2,997			2,494			1,362			4,226			5,628			4,279			5,585
net change in income taxes		(831	)		(3,145	)		4,773			4,819			(12,702	)		(4,102	)		5,618			(9,318	)		105
purchase of reserves in place		69			535			520						1,032			3,052			4,443			387			1,488
sale of reserves in place		(12	)		(18	)		(80	)					(1	)		(7	)		(34	)		(646	)		(222	)
changes in production rates (timing) and other		(1,006	)		(297	)		(319	)		(3,017	)		2,222			(844	)		(310	)		(980	)		(4,469	)
End of year		12,673			15,438			16,118			9,059			22,753			32,701			26,771			34,480			31,264


		108

ENI FACT BOOK 2003
SUPPLEMENTAL OIL AND GAS INFORMATION

energy conversion table


Oil		(average reference density 32.35 ºAPI, relative density 0.8636)

1 barrel

(bbl)

158.987 l oil ⁽²⁾

0.159 m³ oil

164.238 m³ gas

5,800 ft³ gas

1.462x10⁶ kcal

5.8x10⁶ btu

1.7x10³ kWh

0.006 TJ

0.137 toe

0.1 tLNG

1 barrel/d

(bbl/d)

~50 t/year

1 cubic meter

(m³

)

1,000 l oil

6.29 bbl

1,033 m³ gas

36,481 ft³ gas

9.193x10⁶ kcal

36.481x10⁶ btu

10,691.5 kWh

0.0385 TJ

0.862 toe

1 tonne oil equivalent

(toe)

1,160.49 l oil

7.299 bbl

1.161 m³ oil

1,199 m³ gas

42,335.7 ft³ gas

10.668x10⁶ kcal

42.336x10⁶ btu

12,407.4 kWh

0.045 TJ

0.8 tLNG

Gas

1 cubic meter ⁽¹⁾

(m³

)

0.968 l oil

0.0061 bbl

0.00071 tLNG

35.315 ft³ gas

0.0008 toe

8,899.15 kcal

35,314.67 btu

10.35 kWh

0.000037 TJ

10³ cubic feet

(ft³)

27.412 l oil

0.1724 bbl

27.317 m³ gas

0.0236 toe

252x10³ kcal

10⁶ btu

293.07 kWh

0.00106 TJ

10⁶ british thermal unit

(btu)

27.4 l oil

0.17 bbl

0.027 m³ oil

28.3 m³ gas

1,000 ft³ gas

0.024 toe

251,986 kcal

293.1 kWh

0.0011 TJ

1 tonne LNG

(tLNG)

1.2 toe

8.9 bbl

520x10⁵ btu

1.5x10⁴ kWh

52x10³ ft³ gas

1.3x10⁷ kcal

1,400 m³ gas

Electricity

1 megawatthour=10³ kWh

(MWh)

93.532 l oil

0.5883 bbl

0.0955 m³ oil

96.621 m³ gas

3,412.14 ft³ gas

0.0806 toe

0.86x10⁶ kcal

3.412x10⁶ btu

0.00036 TJ

1 teraJoule

(TJ)

25,981.45 l oil

163.42 bbl

25.9814 m³ oil

26,839.46 m³ gas

947,826.7 ft³ gas

22.388 toe

238.85x10⁶ kcal

947.83x10⁶ btu

277,780.6 kWh

10⁶ kilocalory

(kcal)

108.8 l oil

0.68 bbl

0.109 m³ oil

112.4 m³ gas

3,968.3 ft³ gas

0.094 toe

3.968x10⁶ btu

1,163 kWh

0.0042 TJ

(1) A cubic meter of natural gas produced in Italy is equivalent to 0.0063 barrels of oil in turn equivalent to 5,600 cubic feet of natural gas.

(2) l oil: liters of oil.

Conversion of mass


	kilo		pound		metric ton
	(kg)		(lb)		(t)
kg		1		2.2046		0.001
lb		0.4536		1		0.0004536
t		1,000		22,046		1

Conversion of length


	meter		inch		feet		yard
	(m)		(in)		(ft)		(yd)
m		1		39.37		3.281		1.093
in		0.0254		1		0.0833		0.0278
ft		0.3048		12		1		0.3333
yd		0.9144		36		3		1

Conversion of volumes


	cubic feet		barrel		liter		cubic meter
	(ft³)		(bbl)		(l)		(m³)
ft³		1		0.1781		28.32		0.02832
bbl		5.615		1		159		0.158984
l		0.035311		0.0063		1		0.001
m³		35.3107		6.2898		10³		1


109

		ENI FACT BOOK 2003
ENERGY CONVERSION TABLE

quarterly information

Main financial data ⁽¹⁾


	1999														2000
	I quarter			II quarter			III quarter			IV quarter					I quarter			II quarter			III quarter			IV quarter
Net sales from operations		7,601			6,502			7,257			9,648		31,008			11,814			10,759			10,730			14,635		47,938
Operating income:		1,843			513			818			2,306		5,480			3,514			1,818			2,017			3,423		10,772
Exploration & Production		411			342			649			1,432		*2,834*			2,047			1,081			1,283			2,192		*6,603*
Gas & Power		1,356			177			97			950		*2,580*			1,434			504			357			883		*3,178*
Refining & Marketing		99			116			150			113		478			99			188			381			318		*986*
Petrochemicals		(35	)		(100	)		(76	)		(151	)	*(362*	)		(39	)		71			8			(36	)	4
Oilfield Services Construction and Engineering		38			49			24			38		*149*			15			19			37			73		*144*
Other activities Corporate and financial companies		(26	)		(71	)		(26	)		(76	)	*(199*	)		(42	)		(45	)		(49	)		(7	)	*(143*	)
Net income
Capital expenditure		1,013			1,123			1,631			1,716		5,483			1,189			1,232			1,047			1,963		5,431
Investments ⁽²⁾					27						87		114						683						3,701		4,384
Net borrowings at period end		4,849			6,166			6,265			6,267		6,267			4,703			5,820			7,060			7,742		7,742

[Additional columns below]

[Continued from above table, first column(s) repeated]


	2001														2002
	I quarter			II quarter			III quarter			IV quarter					I quarter			II quarter			III quarter			IV quarter
Net sales from operations		13,882			12,136			10,682			12,572		49,272			12,705			11,199			10,795			13,223		47,922
Operating income:		3,706			2,413			1,644			2,550		10,313			2,700			1,875			1,854			2,073		8,502
Exploration & Production		1,975			1,510			1,144			1,355		*5,984*			1,287			1,228			1,327			1,333		*5,175*
Gas & Power		1,466			596			339			1,271		*3,672*			1,426			577			375			866		*3,244*
Refining & Marketing		294			372			266			53		*985*			62			60			122			77		*321*
Petrochemicals		(25	)		(71	)		(124	)		(195	)	*(415*	)		(68	)		31			50			(139	)	*(126*	)
Oilfield Services Construction and Engineering		42			48			52			113		*255*			86			73			73			66		*298*
Other activities																(43	)		(55	)		(69	)		(34	)	*(201*	)
Corporate and financial companies		(46	)		(42	)		(33	)		(47	)	*(168*	)		(50	)		(39	)		(24	)		(96	)	*(209*	)
Net income																1,382			879			921			1,411		4,593
Capital expenditure		1,182			1,795			1,616			2,013		6,606			1,541			1,919			2,824			2,912		9,196
Investments ⁽²⁾		4,160			233			142			129		4,664			196			22			952			196		1,366
Net borrowings at period end		9,188			9,105			10,809			10,104		10,104			6,713			8,486			9,272			11,141		11,141

[Additional columns below]

[Continued from above table, first column(s) repeated]


	2003
	I quarter			II quarter			III quarter			IV quarter
Net sales from operations		14,359			11,578			11,916			13,634		51,487
Operating income:		3,333			1,779			1,897			2,508		9,517
Exploration & Production		1,735			1,175			1,457			1,379		*5,746*
Gas & Power		1,529			539			390			1,169		*3,627*
Refining & Marketing		117			208			151			107		*583*
Petrochemicals		(17	)		(34	)		(63	)		(62	)	*(176*	)
Oilfield Services Construction and Engineering		60			79			81			91		*311*
Other activities		(31	)		(128	)		(54	)		(66	)	*(279*	)
Corporate and financial companies		(60	)		(60	)		(65	)		(110	)	*(295*	)
Net income		2,006			1,084			955			1,540		5,585
Capital expenditure		1,735			2,235			2,145			2,687		8,802
Investments ⁽²⁾		3,512			54			537			152		4,255
Net borrowings at period end		11,708			12,795			13,044			13,543		13,543

(1) Quarterly data are unaudited.

(2) Data for years 1999 and 2000 refer to investments made in the first and second half respectively.

Key market indicators


	1999									2000
	I quarter		II quarter		III quarter		IV quarter			I quarter		II quarter		III quarter		IV quarter
Average price of Brent dated crude oil ⁽¹⁾		11.28		15.48		20.61		24.09	17.87		26.90		26.69		30.44		29.54	28.39
Average EUR/USD exchange rate		1.123		1.057		1.049		1.038	1.067		0.987		0.934		0.904		0.870	0.924
Average price in euro of Brent dated crude oil ⁽²⁾		10.04		14.65		19.65		23.21	16.75		27.25		28.58		33.67		33.95	30.73
Average European refining margins ⁽³⁾		1.24		0.64		1.12		1.83	1.21		2.11		4.78		4.33		4.72	3.99
Euribor %		3.10		2.70		2.70		3.50	3.0		3.6		4.3		4.8		5.0	4.4

[Additional columns below]

[Continued from above table, first column(s) repeated]


	2001									2002
	I quarter		II quarter		III quarter		IV quarter			I quarter		II quarter		III quarter		IV quarter
Average price of Brent dated crude oil ⁽¹⁾		25.84		27.33		25.30		19.38	24.46		21.14		25.04		26.95		26.78	24.98
Average EUR/USD exchange rate		0.923		0.873		0.891		0.896	0.896		0.876		0.919		0.984		1.000	0.946
Average price in euro of Brent dated crude oil ⁽²⁾		28.00		31.31		28.40		21.63	27.30		24.13		27.25		27.39		26.78	26.41
Average European refining margins ⁽³⁾		2.16		2.31		1.52		1.87	1.97		0.21		0.73		0.75		1.49	0.80
Euribor %		4.7		4.6		4.3		3.4	4.3		3.4		3.4		3.4		3.1	3.3

[Additional columns below]

[Continued from above table, first column(s) repeated]


	2003
	I quarter		II quarter		III quarter		IV quarter
Average price of Brent dated crude oil ⁽¹⁾		31.51		26.03		28.41		29.42	28.84
Average EUR/USD exchange rate		1.073		1.136		1.124		1.189	1.131
Average price in euro of Brent dated crude oil ⁽²⁾		29.37		22.91		25.28		24.74	25.50
Average European refining margins ⁽³⁾		3.81		2.17		2.28		2.34	2.65
Euribor %		2.7		2.4		2.1		2.2	2.3

(1) In USD/barrel. Source: Platt’s Oilgram.

(2) Eni calculation.

(3) In US dollars per barrel FOB Mediterranean Brent crude. From 1995 lead-free gasoline. Eni elaborations on Platt’s Oilgram data.

		108

ENI FACT BOOK 2003
SUPPLEMENTAL OIL AND GAS INFORMATION

Main operating data

1999

2000

I quarter

II quarter

III quarter

IV quarter

I quarter

II quarter

III quarter

IV quarter

Daily production of oil (th bbls/d)

689

659

671

677

674

741

761

745

748

748

Daily production of natural gas (th boe/d)

392

385

375

408

390

441

427

459

439

Daily production of hydrocarbons (th boe/d)

1,081

1,044

1,046

1,085

1,064

1,182

1,188

1,172

1,207

1,187

Italy

371

359

355

349

358

357

337

324

315

333

North Africa

264

263

273

272

269

289

307

304

324

306

West Africa

220

206

194

202

206

217

234

230

224

North Sea

154

138

154

170

154

179

165

155

173

168

Rest of World

140

162

155

165

156

Production sold (mn boe)

120.1

75.7

79.2

118.6

393.6

132.8

89.8

85.4

120.0

428.0

Sales of natural gas to third parties in primary distribution in Italy (bn cm)

20.97

10.61

9.80

18.81

60.19

22.09

11.41

9.93

16.49

59.92

Sales of natural gas to third parties in primary distribution in rest of Europe (bn cm)

0.05

0.05

0.29

0.37

0.40

0.27

1.33

Other sales of natural gas to third parties in primary distribution outside Italy (bn cm)

Sales of natural gas to third parties in primary distribution (bn cm)

20.97

10.61

9.80

18.86

60.24

22.38

11.78

10.33

16.76

61.25

Sales of natural gas in secondary distribution outside Italy (bn cm)

1.17

0.30

0.20

1.00

2.67

1.23

0.73

0.53

0.99

3.48

Total sales of natural gas to third parties (bn cm)

22.14

10.91

10.00

19.86

62.91

23.61

12.51

10.86

17.75

64.73

Volumes of natural gas consumed by Eni (bn cm)

Sales to third parties and volumes of natural gas consumed by Eni (bn cm)

Volumes of natural gas transported on behalf of third parties in Italy (bn cm)

1.63

1.58

1.64

2.05

6.90

2.36

2.44

2.28

2.37

9.45

Electricity sales (TWh)

1.05

1.29

1.13

1.30

4.77

Sales of refined products (mn ton):

12.78

12.52

12.82

13.70

51.82

12.60

13.27

12.84

14.75

53.46

Retail sales in Italy

2.77

3.02

3.08

2.98

11.85

2.72

2.92

3.04

2.89

11.57

Wholesale sales in Italy

2.90

2.53

2.52

3.47

11.42

2.86

1.33

2.73

3.05

11.10

Retail sales outside Italy

0.93

0.97

1.00

1.01

3.91

0.93

5.58

1.01

0.86

3.78

- Rest of Europe - Africa and Brazil Wholesale sales outside Italy

1.55

1.57

1.63

1.65

6.40

1.35

1.33

1.49

1.29

5.46

Other sales

4.63

4.43

4.59

18.24

4.74

5.58

4.57

6.66

21.55

[Additional columns below]

[Continued from above table, first column(s) repeated]

2001

2002

I quarter

II quarter

III quarter

IV quarter

I quarter

II quarter

III quarter

IV quarter

Daily production of oil (th bbls/d)

861

847

838

883

857

910

927

908

939

921

Daily production of natural gas (th boe/d)

526

499

525

512

531

541

543

588

551

Daily production of hydrocarbons (th boe/d)

1,387

1,346

1,337

1,408

1,369

1,441

1,468

1,451

1,527

1,472

Italy

311

297

306

319

308

311

315

320

316

316

North Africa

315

312

320

322

317

330

349

360

376

354

West Africa

235

231

230

238

233

237

238

240

235

237

North Sea

278

280

284

308

288

313

271

337

308

Rest of World

248

226

197

221

223

250

253

260

263

257

Production sold (mn boe)

134.4

112.9

103.9

148.5

499.7

132.8

123.3

124.7

142.5

523.3

Sales of natural gas to third parties in primary distribution in Italy (bn cm)

20.32

11.29

9.48

17.80

58.89

18.51

9.87

8.41

13.24

50.03

Sales of natural gas to third parties in primary distribution in rest of Europe (bn cm)

0.49

0.37

0.56

1.65

3.07

2.04

2.27

2.29

2.94

9.54

Other sales of natural gas to third parties in primary distribution outside Italy (bn cm)

Sales of natural gas to third parties in primary distribution (bn cm)

20.81

11.66

10.04

19.45

61.96

20.55

12.14

10.70

16.18

59.57

Sales of natural gas in secondary distribution outside Italy (bn cm)

1.34

0.66

0.56

1.35

3.91

1.33

0.61

0.58

1.27

3.79

Total sales of natural gas to third parties (bn cm)

22.15

12.32

10.60

20.80

65.87

21.88

12.75

11.28

17.45

63.36

Volumes of natural gas consumed by Eni (bn cm)

0.51

0.50

0.51

2.02

Sales to third parties and volumes of natural gas consumed by Eni (bn cm)

22.39

13.25

11.78

17.96

65.38

Volumes of natural gas transported on behalf of third parties in Italy (bn cm)

2.43

2.44

2.61

3.93

11.41

4.55

4.79

4.94

5.56

19.84

Electricity sales (TWh)

1.32

1.34

1.02

1.31

4.99

1.37

1.24

1.06

1.34

5.01

Sales of refined products (mn ton):

12.61

13.24

13.55

13.84

53.24

12.22

13.42

13.20

13.18

52.02

Retail sales in Italy

2.78

2.98

2.90

11.64

2.67

2.81

2.87

2.79

11.14

Wholesale sales in Italy

2.69

2.62

2.82

3.11

11.24

2.66

2.54

2.55

2.89

10.64

Retail sales outside Italy

0.93

1.08

1.10

1.07

4.18

0.96

1.05

1.00

4.01

- Rest of Europe

0.58

0.64

0.69

0.66

2.57

- Africa and Brazil

0.38

0.41

0.31

0.34

1.44

Wholesale sales outside Italy

1.29

1.39

1.47

1.40

5.55

1.29

1.32

1.59

1.45

5.65

Other sales

4.92

5.17

5.18

5.36

20.63

4.64

5.70

5.19

5.05

20.58

[Additional columns below]

[Continued from above table, first column(s) repeated]

2003

I quarter

II quarter

III quarter

IV quarter

Daily production of oil (th bbls/d)

925

978

985

1,035

981

Daily production of natural gas (th boe/d)

573

578

571

602

581

Daily production of hydrocarbons (th boe/d)

1,498

1,556

1,637

1,562

Italy

310

302

295

293

300

North Africa

333

343

357

369

351

West Africa

235

262

265

278

260

North Sea

367

349

317

348

345

Rest of World

253

300

322

349

306

Production sold (mn boe)

128.6

138.7

141.2

147.7

556.2

Sales of natural gas to third parties in primary distribution in Italy (bn cm)

18.36

9.72

8.45

14.40

50.93

Sales of natural gas to third parties in primary distribution in rest of Europe (bn cm)

3.59

3.25

2.76

4.55

14.15

Other sales of natural gas to third parties in primary distribution outside Italy (bn cm)

0.03

0.01

0.04

Sales of natural gas to third parties in primary distribution (bn cm)

21.95

12.97

11.24

18.96

65.12

Sales of natural gas in secondary distribution outside Italy (bn cm)

1.66

0.77

0.60

1.41

4.44

Total sales of natural gas to third parties (bn cm)

23.61

13.74

11.84

20.37

69.56

Volumes of natural gas consumed by Eni (bn cm)

0.51

0.41

0.40

0.58

1.90

Sales to third parties and volumes of natural gas consumed by Eni (bn cm)

24.12

14.15

12.24

20.95

71.46

Volumes of natural gas transported on behalf of third parties in Italy (bn cm)

5.90

6.28

5.87

6.58

24.63

Electricity sales (TWh)

1.26

1.25

1.16

1.88

5.55

Sales of refined products (mn ton):

11.82

12.50

12.32

13.27

49.91

Retail sales in Italy

2.57

2.81

2.84

2.77

10.99

Wholesale sales in Italy

2.50

2.48

2.45

2.92

10.35

Retail sales outside Italy

0.88

1.02

1.18

1.12

4.20

- Rest of Europe

0.61

0.72

0.88

0.81

3.02

- Africa and Brazil

0.27

0.30

0.31

1.18

Wholesale sales outside Italy

1.44

1.57

1.55

1.45

6.01

Other sales

4.43

4.62

4.30

5.01

18.36


		108

ENI FACT BOOK 2003
SUPPLEMENTAL OIL AND GAS INFORMATION

(ENI LOGO)


Società per Azioni
Headquarters: Rome, Piazzale Enrico Mattei, 1
Capital Stock at December 31, 2003:
€ 4,002,922,176 fully paid
No. 6866/92 Registro delle Imprese di Roma (Tribunale di Roma)
Branches:
San Donato Milanese (MI) - Via Emilia, 1
San Donato Milanese (MI) - Piazza Ezio Vanoni, 1
Gela (CL) - Strada Provinciale, 82

		Investor Relations
		Piazza Ezio Vanoni, 1 - 20097 San Donato Milanese (MI)
		Tel. +39-0252051651 - Fax +39-0252031929
		e-mail: investor.relations@eni.it

		Publications
		Annual Report 2003 (in Italian)
		prepared in accordance with Law No. 127 of April 9, 1991
		Annual Report 2003 (in English)
		Annual Report 2003 on Form 20-F for the Securities
		and Exchange Commission (in English)
		Environmental Report 2003 (in Italian and English)
		Fact Book 2003 (in Italian and English)
		Report on the First Nine Months of 2003 (in Italian and English)
		Report on the First Half of 2003 (in Italian)
		prepared in accordance with art. 2428 of Italian Civil Code
		Report on the First Half of 2003 (in English)
		Report on the Second Quarter of 2003 (in Italian and English)
		Report on the First Quarter of 2003 (in Italian and English)

		Internet Home page: http://www.eni.it
		Rome office telephone: +39-0659821
		Toll-free number: 800940924
		e-mail: segreteriasocietaria.azionisti@eni.it

		ADRs/Depositary
		Morgan Guaranty Trust Company of New York
		ADR Department
		60 Wall Street (36^th Floor)
		New York, New York 10260
		Tel. 212-648-3164

		ADRs/Transfer agent
		Morgan ADR Service Center
		2 Heritage Drive
		North Quincy, MA 02171
		Tel. 617-575-4328

		Design: Fausta Orecchio/Orecchio acerbo
		Cover: Lorenzo Mattotti
		Layout and supervision: Studio Joly Srl - Rome
		Printing: Ugo Quintily SpA - Rome
		Printed on environment friendly paper: Fedrigoni Symbol Freelife Satin


CURRENT TEXT				PROPOSED TEXT
ARTICLE 12				ARTICLE 12

12.2 Ordinary meetings must be called at least once a year to approve the financial statements, within six months of the end of the business year, also considering the holding and financial nature of the company’s activity conducted pursuant to Article 4 of these by-laws.				12.2 Ordinary shareholders’ meetings must be called at least once a year to approve the financial statements, within 180 days of the end of the business year, as the Company approves the Group Financial Statements.


		5	Activities
		6	Integration
		7	Main data
Exploration & Production		10	Overview
		13	Production
		25	Exploration areas
		29	Development projects
		36	Main data
Gas & Power		40	Natural gas overview
		42	The Italian Natural Gas System
		50	Iniziative di sviluppo
		53	Power generation overview
		54	Main data
Refining & Marketing		56	Overview
		58	Refining
		60	Logistics
		61	Marketing
		64	Other businesses
		65	Main data
Oilfield Services Construction		68	Oilfield Services
and Engineering		76	Engineering
New technologies		79	Overview
Tables		83	Financial data
		90	Employees
		91	Supplemental oil and gas information
		109	Energy conversion table
		110	Quarterly information
Abbreviations	bbls		barrels
	bbls/d		barrels/day
	bn		billion
	boe		barrels of oil equivalent
	boe/d		barrels of oil equivalent/day
	cm		cubic meters
		d	day
	EPC		Engineering Procurement Construction
	EPIC		Engineering Procurement Installation Construction
	FEED		Front End Engineering Design
	FPSO		Floating Production Storage and Offloading System
	GWh		gigawatthour
	km		kilometers
	ktoe		thousand tons of oil equivalent
	LNG		liquefied natural gas
	mn		million
	no.		number
	PCA		Production Concession Agreement
	PMC		Project Management Consultant
	PSA		Production Sharing Agreement
	th		thousand
	ton		metric ton
	TWh		terawatthour
		y	year

1.		Eni S.p.A. Financial Statements at December 31, 2003, Eni Consolidated Financial Statements at December 31, 2003, Report of the Directors on the course of the business, Report of the Board of Statutory Auditors and Report of the Independent Auditors.

2.		Allocation of net income.

3.		Purchase of Eni shares.

4.		Appointment of the Independent Auditors for the three-year period 2004-2006.

5.		Amendment to Article 2.1 of Eni S.p.A.’s Shareholders’ Meeting Regulation.

6.		Determination of the remuneration of the Directors.

1.		Amendments to Articles 2.1, 11.2, 12.2, 13, 16.1, 17.2, 17.3, 19.3 and 23 of Eni by-laws pursuant to the Legislative Decree No. 6 dated January 17, 2003.

2.		Amendments to Articles 17.3, 19.1 and 28.1 of Eni by-laws.

	•		to the Legal Reserve the amount necessary so that it totals one fifth of Eni share capital outstanding at the Shareholders’ Meeting date;

	•		euro 355,414.40 to the Reserve pursuant to Article 13 of the Legislative Decree 124/93; the amount corresponds to 3% of the allocation for the Financial Year 2003 of the employees termination indemnity to the staff social security fund;

	•		to pay a dividend of 0.75 euro for each share outstanding on the ex dividend date, Eni treasury shares excluded. As a consequence of the tax legislation in force in

			Italy as of January 1, 2004, notwithstanding the exceptions indicated below, dividends no longer entitle to a tax credit. Depending on the beneficiary, the dividend is either subject to a withholding tax or partially taxed. Dividends entitle to an ordinary tax credit, corresponding to 51.51% of 0.70 euro and a limited tax credit corresponding to 51.51% of 0.05 euro if paid to commercial entities resident of Italy, in particular to share capital companies during the financial year 2003;

	•		allocate the amount left after the previous allotments to the Distributable Reserve;

–		pay dividends as from June 24, 2004, being the ex-dividend date June 21, 2004;

–		transfer from the “Disposable Reserve” to the “Reserve for anticipated amortisation pursuant to Article 67 of D.P.R. No. 917/86” euro 280,919,796.29, corresponding to the anticipated amortisation charged to the 2003 Financial Year.

-		transferring from the “Disposable Reserve” to the “Reserve for anticipated amortisation pursuant to Article 67 of D.P.R. No. 917/86 euro 280,919,796.29, corresponding to the anticipated amortisation charged to the 2003 Financial Year;

-		paying dividends as from June 24, 2004, being the ex-dividend date June 21, 2004.

		limits, terms and conditions resolved by the shareholders’ meeting on May 30, 2003;

-		resolve the use of the Reserve for the purchase of Eni shares implemented pursuant to Article 2357-ter, last Paragraph, of the Civil Code;

-		delegate any and all powers to the Managing Director to execute, directly or through attorneys-in-fact, any and all acts necessary to enforce such resolution.

-		the audit of Eni S.p.A. and Eni consolidated Financial Statements, pursuant to Article 159 of Legislative Decree dated February 24, 1998 No. 58;

-		the audit, to be executed in the course of the financial year, of the regularity of the accounting procedures applied by the Company and of the correct accounting representation of the business activities, pursuant to Article 155 of Legislative Decree dated February 24, 1998 No. 58;

-		the limited review of Eni half-year Report, pursuant to Consob Communication No. 97001574 dated February 20, 1997;

-		the audit of the accounting data released in the U.S.A. to comply with SEC Regulations (“Form 20-F”) and of the accounting adjustments consequent to the application of U.S GAAP and the release of the audit report in English set forth in compliance with US GAAS as Eni shares are listed on the NYSE.

-		to qualify the registered office according to the new wording of Article 2328, first Paragraph, number 2, of the Italian Civil Code and indicate in the by-laws only the town where the head office and the branches are located (article 2, first Paragraph);

-		to cancel the delegation of authority to the Board to issue bonds, having this matter become a competence of the board itself (Article 11, second Paragraph). By availing of this delegation, Eni Board of Directors has approved two bond issues totalling 2 billion euro;

-		to express in days the term within which the annual shareholders’ meeting is called (Article 12, second Paragraph);

-		to discipline the ways of announcing the calling of shareholders’ meetings (Article 13, first Paragraph);

-		to discipline the ways of intervention to the shareholders’ meetings (Article 13, new second Paragraph);

-		to specify that the shareholders’ meeting no longer resolves but authorises the transfer of the business, pursuant to Article 2364, first Paragraph, no. 5, of the Civil Code (Article 16, first Paragraph);

-		to express the duration in office of the board members in financial years and no more in years and to insert the indication that they lapse at the shareholders’ meeting when the financial statements of the last financial year of their office is approved (Articles 17, second Paragraph);

-		to make reference to the certification issued by an authorised financial intermediary in order to demonstrate the title of the number of shares necessary to present a list of candidates (Article 17, third Paragraph);

-		to cancel the reference to the faculty of two Directors of calling the shareholders’ meeting (Article 19, third Paragraph, second period);

-		the merger and the proportional demerger of at least 90% directly owned subsidiaries;

-		the establishment and winding up of branches.


		Eni S.p.A.


		Name : Fabrizio Cosco
		Title: Company Secretary

-		the possibility of holding the Board meetings in teleconference other than videoconference (Article 19, first Paragraph);

-		the inclusion of the offices of supervisory board member, as set forth in the dualistic model, and of audit committee member, as set forth in the monistic model, in the calculation of the maximum number of offices in control bodies of other companies that Eni board of statutory auditors members may hold not to be dismissed (Article 28, first Paragraph, last period).


CURRENT TEXT		PROPOSED TEXT
ARTICLE 28.1		ARTICLE 28.1

Omission		Omission
Those who are already appointed effective auditor in at least five companies with securities listed on regulated securities markets other than Eni S.p.A. subsidiaries may not be appointed Statutory Auditor; if elected, they will lapse.		Those who are already appointed effective auditor or supervisory board member or audit committee member in at least five companies with securities listed on regulated securities markets other than Eni S.p.A. subsidiaries may not be appointed Statutory Auditor; if elected, they will lapse.

(1)		In US dollars per barrel. Source: Platt’s Oilgram.

(2)		Eni calculation.

n		the drilling of 11 production wells;

n		the continuation of the expansion of the treatment capacity of the oil center with the installation of a fourth train, up to a capacity of 104,000 barrels/day for oil and 3.2 million cubic meters/day of natural gas (about 20,000 boe/day);

n		the expansion of the marine terminal in the Gulf of Taranto.

(1)		Calculated according to SEC standards.

(2)		Ratio of production costs (incurred for well and facilities maintenance and royalties) and volumes produced.

(3)		Exploration cost for each boe of new reserves discovered or proved represented by the ratio of costs incurred with respect to exploration activity and purchase of unproved property and increases in proved reserves related to improved recovery, extensions and new discoveries and revisions of previous estimates. 2001, 2002 and 2003 averages were calculated excluding purchase costs of unproved property of Lasmo in 2001 and of Fortum Petroleum in 2003.

(4)		For each boe of new proved reserves, represented by the ratio of the sum of costs incurred with respect to exploration and development activities and purchase of unproved property and increases in proved reserves related to improved recovery, extensions and new discoveries and revisions of previous estimates. 2001, 2002 and 2003 averages were calculated excluding purchase costs of unproved property of Lasmo in 2001 and of Fortum Petroleum in 2003. Data for 2002 and 2003 also exclude buyback contracts in Iran.

n		a post-counter service for extraordinary and planned maintenance interventions on autonomous household heating systems, offered in two forms: (i) “Assistenza Italgas Più” concerning the planned maintenance of heaters fired with any fuel that need to be periodically monitored and subjected to combustion analysis; (ii) “Pronto Assistenza” concerning fast interventions of skilled technicians for repairing damages or checking heaters and other parts of the heating plant;

n		a service of energy management addressed mainly to the public administration, condominiums, the tertiary sector and industrial enterprises supplying heat instead of just natural gas, design of heating systems and consultancy services. It provides immediate solutions to problems of management, design and upgrade of plants and frees customers from technical and organizational tasks as wells as from responsibilities and administrative tasks.

n		an integrated toll-free call center system (located in Turin, Rome, Florence, Naples, Chiavari) which customers can access for any information concerning services provided: payment of bills, information on consumption, requests for service and all technicalities related to it;

n		a network of franchisors made up of 94 “shops” with flexible opening hours available to customers for any request concerning services provided. Italgas Più targets the establishment of 460 franchised shops by 2005.

n		Hungary through Tigaz (controlled by Eni with a 50% interest), the largest regional gas distribution company in the country. In 2003 Tigaz consolidated its market share by purchasing a majority stake in three natural gas distribution companies: Mol-Gàz (now Tigaz 2), Zsàmbèrkgàz and Turulgàz. In 2003, natural gas sales in Hungary amounted to 3.3 billion cubic meters. In 2003 customers supplied were approximately 1.1 million in 1,120 municipalities through an about 24,000-kilometer long network;

n		Argentina, through Distribuidora de Gas Cuyana SA (Eni’s interest 45.6%), which operates in the urban area of Mendoza, serving about 371,000 customers through a network of about 9,000 kilometers of pipelines. In 2003, it handled 1.8 billion cubic meters of natural gas; about 1 billion was sold to end users, while the rest was transported on behalf of third parties;

n		Slovenia, through Adriaplin Doo (Eni’s interest 51%), which distributes natural gas to about 8,000 customers in 17 urban centers through a network of about 363 kilometers of pipelines. In 2003, it sold 37 million cubic meters.

(1)		As of January 2004.

(2)		Capacity is related to standard conditions: pressure 1.01325 bar; temperature 288.15 K.

(3)		Data relate to full operation of the transport system.

n		to implement a tool for communication with all operators of its fuel distribution network in order to increase management process efficiency and service levels. About 3,000 service stations are provided with a dedicated PC linked to the “Manager’s Portal”, which will be progressively extended to all Agip branded service stations. The following applications are active: fuel orders, maintenance requests, change in suggested prices, lubricant orders, management of incentives related to sales goals, display of account movements, documents and links to other relevant sites, forum. Applications concerning non oil orders and online training are in the definition phase;

n		to integrate its own corporate systems and processes with those of the major customers and suppliers through the web in order to increase efficiency. Fuel orders from the Public Administration and some major clients are already active through the web.

		Applications active in the “Eni Portal” are:

-		AgipTrading: supporting crudes, semi-finished and finished products trading;

-		AgipMarine: provides the option to buy fuels and lubricants on line to marine shippers;

-		AgipBusiness: provides information and services to professionals.

(2)		Includes assets impairments amounting to euro 227 million in 2002 and euro 210 million in 2003.

(3)		Represents the financial effect of the passage of time relating to Eni’s future asset retirement obligations pursuant to SFAS 143 “Accounting for asset retirement obligations”.