Italian oil and natural gas company Eni is counting on its low-cost exploration successes in recent years to drive output growth of over 3pc/yr in 2016-19. The company is confident that it can hit the production target despite plans to rein in capital expenditure (capex) and dilute stakes in some of its giant discoveries as part of a ?7bn ($8bn) asset sales programme. Eni expects total capex of ?37bn in 2016-19, 21pc lower than its previous four-year plan. Upstream spending will account for 90pc of the budget. And uncommitted capex represents about 40pc of total spending in 2017-19, giving Eni the flexibility to react if lower oil prices persist beyond this year. The capex reductions will be achieved by rescheduling projects, revising the scope of projects and renegotiating contracts with suppliers.
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