Italy's Eni aims for oil industry first with carbon neutral goal

MILAN (Reuters) - Italian oil major Eni ENI.MI will make a binding commitment to becoming carbon neutral, its chief executive Claudio Descalzi said on Monday.

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Descalzi said Eni’s “epochal” announcement on how it planned to reach its goal would be made by the end of the year, adding that no oil company as yet had laid out binding plans for a net zero carbon footprint.

BP BP.L has said it will maintain total CO2 emissions in 2025 at 2015 levels and that it will reduce them by 3.5 million tonnes, thereby offsetting higher production, while Shell RDSa.L has "ambitions" to halve its emissions by 2050.

Eni was assessing the costs and expected to release targets in terms of timing and volumes before the end of the year, Descalzi said on the sidelines of a conference.

“A new and strategic cycle has begun for Eni; from being an oil company it has become an energy company and is now betting on the circular economy to become carbon neutral,” he said.

Descalzi said the targets would include not only atmospheric emissions but the soil too.

“The aim is to optimise the production of waste,” he said, without giving further details.

Some global investors have started to raise ethical issues about the kind of companies they invest into.

Norway’s sovereign wealth fund, the biggest in the world, wants the companies it holds stakes in to submit data on issues such as water use and climate effects to London-based non-profit group CDP, formerly the Carbon Disclosure Project.

On Monday Eni increased its Norwegian presence with a view to extracting more offshore oil by merging its subsidiary there with privately-owned Point Resources.

The move is part of Eni’s aim of cutting its exposure to geographical risk. Eni is the biggest foreign oil and gas producer in Africa.

Asked about media speculation the group was set to announce a new bumper discovery in Egypt following its recent Zohr find, Descalzi said there were prospects and new geological structures in Egypt “but we still haven’t discovered anything”.

Reporting by Andrea Mandala, additional reporting by Ron Bousso, writing by Stephen Jewkes, editing by Alexander Smith