----

**UNITEDSTATESSECURITIES AND EXCHANGE COMMISSION**Washington, D.C. 20549***————————————————————*******Form 20-F**

| (Mark One) |
|------------|

|      |   | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)        or (g) OF THE SECURITIES EXCHANGE ACT OF 1934                                                              |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| OR   |
| **** |   | **ANNUAL REPORT        PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES        EXCHANGE ACT OF 1934         For the fiscal year ended December 31, 200****8**     |
| OR   |
|      |   | TRANSITION REPORT PURSUANT        TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF        1934        For the transition period from _____ to _____        |
| OR   |
|      |   | SHELL COMPANY REPORT        PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES        EXCHANGE ACT OF 1934        Date of event requiring this shell company report |

**Commission file number:1-14090****Eni SpA**(Exact name ofRegistrant as specified in its charter) **Republic of Italy**(Jurisdiction ofincorporation or organization) **1, piazzaleEnrico Mattei00144 RomaItaly**(Address of principal executive offices)**Alessandro BerniniEni SpA1, piazza Ezio VanoniSan Donato Milanese20097 MilanoItalyTel +39 02 52041730Fax +39 02 52041765**(Name, Telephone, Email and/or Facsimile number and Addressof Company Contact Person)***————————————————————*****Securitiesregistered or to be registered pursuant to Section 12(b) of theAct.

| Title of each class                                      |    | Name of each exchange on        which registered                                                                                                                                            |
|----------------------------------------------------------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Shares        American Depositary Shares**             |    | **New York Stock Exchange*        New York Stock Exchange**                                                                                                                                 |
| (Which represent the right to receive two        Shares) |    | * Not for        trading, but only in connection with the registration of        American Depositary Shares, pursuant to the requirements        of the Securities and Exchange Commission. |

Securities registered or to beregistered pursuant to Section 12(g) of the Act:**None**Securities for which there is a reporting obligation pursuantto Section 15(d) of the Act:**None**

Indicate the number of outstanding shares ofeach of the issuer’s classes of capital or common stock asof the close of the period covered by the annual report.                                        **Ordinary sharesof euro 1.00 each**                                                                                                                                                                **4,005,358,876**

Indicate by check mark if the registrant is awell-known seasoned issuer, as defined in Rule 405 of theSecurities Act.

| Yes  |  |     |  No  |  |
|-----------|--|--------------------|----------------|--|

If this report is an annual or transitionreport, indicate by check mark if the registrant is not requiredto file reports pursuant to Section 13 or 15(d) of the SecuritiesExchange Act of 1934.

| Yes  |  |     |  No  |  |
|-----------|--|--------------------|----------------|--|

Note - Checking the box above will not relieveany registrant required to file reports pursuant to Section 13 or15(d) of the Securities Exchange Act of 1934 from theirobligations under those Sections.Indicate by check mark whether the registrant (1) has filed allreports required to be filed by Section 13 or 15(d) of theSecurities Exchange Act of 1934 during the preceding 12 months(or for such shorter period that the registrant was required tofile such reports), and (2) has been subject to such filingrequirements for the past 90 days.

| Yes  |  |     |  No  |  |
|-----------|--|--------------------|----------------|--|

Indicate by check mark whether the registrantis a large accelerated filer, an accelerated filer, or a nonaccelerated filer. See definition of "accelerated filer andlarge accelerated filer" in Rule 12b-2 of the Exchange Act.(Check one):

| Large accelerated filer |  | Accelerated filer |  | Non-accelerated filer |  |
|-------------------------|--|-------------------|--|-----------------------|--|

Indicate by check mark which basis ofaccounting the registrant has used to prepare the financialstatements included in this filing:

| U.S. GAAP |  | International Financial        Reporting Standards as issued by the International        Accounting Standards Board |  | Other |  |
|-----------|--|---------------------------------------------------------------------------------------------------------------------|--|-------|--|

If "Other" has been checked inresponse to the previous question, indicate by check mark whichfinancial statement item the registrant has elected to follow.

| Item        17 |  |     |  Item        18 |  |
|----------------|--|--------------------|----------------------|--|

If this is an annual report, indicate by checkmark whether the registrant is a shell company (as defined inRule 12b-2 of the Exchange Act).

| Yes  |  |     |  No  |  |
|-----------|--|--------------------|----------------|--|

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##### **TABLE OF CONTENTS**

| i                                               | i | **Page** |
|-------------------------------------------------|---|----------|
| Certain Defined Terms                           | i | ii       |
| Presentation of Financial and Other Information | i | ii       |
| Statements Regarding Competitive Position       | i | ii       |
| Glossary                                        | i | iii      |
| Abbreviations and Conversion Table              | i | vi       |

| ii         | i      | i | i | i |
|------------|--------|---|---|---|
| **PART I** |   | i | i | i |

| Item 1.  | i | IDENTITY        OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS   | i | 1   |
|----------|---|----------------------------------------------------------------|---|-----|
| Item 2.  | i | OFFER        STATISTICS AND EXPECTED TIMETABLE                 | i | 1   |
| Item 3.  | i | KEY        INFORMATION                                         | i | 1   |
| i        | i | Selected        Financial Information                          | i | 1   |
| i        | i | Selected        Operating Information                          | i | 3   |
| i        | i | Exchange        Rates                                          | i | 5   |
| i        | i | Risk        Factors                                            | i | 5   |
| Item 4.  | i | INFORMATION        ON THE COMPANY                              | i | 17  |
| i        | i | History        and Development of the Company                  | i | 17  |
| i        | i | Business        Overview                                       | i | 21  |
| i        | i | Exploration        & Production                            | i | 21  |
| i        | i | Gas &        Power                                         | i | 50  |
| i        | i | Refining        & Marketing                                | i | 62  |
| i        | i | Engineering        & Construction                          | i | 69  |
| i        | i | Petrochemicals                                                 | i | 71  |
| i        | i | Corporate        and Other activities                          | i | 73  |
| i        | i | Research        and Development                                | i | 74  |
| i        | i | Insurance                                                      | i | 74  |
| i        | i | Environmental        Matters                                   | i | 74  |
| i        | i | Regulation        of Eni’s Businesses                     | i | 79  |
| i        | i | Property,        Plant and Equipment                           | i | 88  |
| i        | i | Organizational        Structure                                | i | 88  |
| Item 4A. | i | UNRESOLVED        STAFF COMMENTS                               | i | 88  |
| Item 5.  | i | OPERATING        AND FINANCIAL REVIEW AND PROSPECTS            | i | 88  |
| i        | i | Executive        Summary                                       | i | 89  |
| i        | i | Critical        Accounting Estimates                           | i | 91  |
| i        | i | 2006-2008        Group Results of Operations                   | i | 95  |
| i        | i | Liquidity        and Capital Resources                         | i | 105 |
| i        | i | Recent        Developments                                     | i | 111 |
| i        | i | Management’s        Expectations of Operations            | i | 113 |
| Item 6.  | i | DIRECTORS,        SENIOR MANAGEMENT AND EMPLOYEES              | i | 118 |
| i        | i | Directors        and Senior Management                         | i | 118 |
| i        | i | Board        Practices                                         | i | 122 |
| i        | i | Compensation                                                   | i | 130 |
| i        | i | Employees                                                      | i | 137 |
| iii      | i | Share        Ownership                                         | i | 138 |
| Item 7.  | i | MAJOR        SHAREHOLDERS AND RELATED PARTY TRANSACTIONS       | i | 139 |
| i        | i | Major        Shareholders                                      | i | 139 |
| i        | i | Related        Party Transactions                              | i | 139 |
| Item 8.  | i | FINANCIAL        INFORMATION                                   | i | 139 |
| i        | i | Consolidated        Statements and Other Financial Information | i | 139 |
| i        | i | Significant        Changes                                     | i | 148 |
| Item 9.  | i | THE OFFER        AND THE LISTING                               | i | 148 |
| i        | i | Offer and        Listing Details                               | i | 148 |
| i        | i | Markets                                                        | i | 149 |
| Item 10. | i | ADDITIONAL        INFORMATION                                  | i | 150 |
| i        | i | Memorandum        and Articles of Association                  | i | 150 |
| i        | i | Material        Contracts                                      | i | 156 |
| i        | i | Documents        on Display                                    | i | 157 |
| i        | i | Exchange        Controls                                       | i | 157 |
| i        | i | Taxation                                                       | i | 157 |

| Item 11.     | i  | QUALITATIVE        AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK                          | i | 161    |
|--------------|----|--------------------------------------------------------------------------------------------|---|--------|
| Item 12.     | i  | DESCRIPTION        OF SECURITIES OTHER THAN EQUITY SECURITIES                              | i | 161    |
| i            | i  | i                                                                                          | i | i      |
| **PART II**  | i  | i                                                                                          | i | i      |
| Item 13.     | i  | DEFAULTS,        DIVIDEND ARREARAGES AND DELINQUENCIES                                     | i | 162    |
| Item 14.     | i  | MATERIAL        MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE        OF PROCEEDS | i | 162    |
| Item 15.     | i  | CONTROLS        AND PROCEDURES                                                             | i | 162    |
| Item 16.     | i  |                                                                                       | i |   |
| 16A.         | i  | Board of        Statutory Auditors Financial Expert                                        | i | 163    |
| 16B.         | i  | Code of        Ethics                                                                      | i | 163    |
| 16C.         | i  | Principal        Accountant Fees and Services                                              | i | 163    |
| 16D.         | i  | Exemptions        from the Listing Standards for Audit Committees                          | i | 164    |
| 16E.         | i  | Purchases        of Equity Securities by the Issuer and Affiliated        Purchasers       | i | 164    |
| 16G          | i  | Corporate        Governance Practices                                                      | i | 165    |
| i            | ii | i                                                                                          | i | i      |
| **PART III** | i  | i                                                                                          | i | i      |
| Item 17.     | i  | FINANCIAL        STATEMENTS                                                                | i | 168    |
| Item 18.     | i  | FINANCIAL        STATEMENTS                                                                | i | 168    |
| Item 19.     | i  | EXHIBITS                                                                                   | i | 168    |

i

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##### Table of Contents

*Certain disclosures contained herein including, withoutlimitation, information appearing in "Item 4 –Information on the Company", and in particular "Item 4– Exploration & Production", “Item 5 –Operating and Financial Review and Prospects” and "Item11 – Qualitative and Quantitative Disclosures about MarketRisk" contain forward-looking statements regarding futureevents and the future results of Eni that are based on currentexpectations, estimates, forecasts, and projections about theindustries in which Eni operates and the beliefs and assumptionsof the management of Eni. Eni may also make forward-lookingstatements in other written materials, including other documentsfiled with or furnished to the U.S. Securities and ExchangeCommission (the "SEC"). In addition, Eni’s seniormanagement may make forward-looking statements orally toanalysts, investors, representatives of the media and others. Inparticular, among other statements, certain statements withregard to management objectives, trends in results of operations,margins, costs, return on capital, risk management andcompetition are forward looking in nature. Words such as‘expects’, ‘anticipates’,‘targets’, ‘goals’, ‘projects’,‘intends’, ‘plans’, ‘believes’,‘seeks’, ‘estimates’, variations of suchwords, and similar expressions are intended to identify suchforward-looking statements. These forward-looking statements areonly predictions and are subject to risks, uncertainties, andassumptions that are difficult to predict because they relate toevents and depend on circumstances that will occur in the future.Therefore, Eni’s actual results may differ materially andadversely from those expressed or implied in any forward-lookingstatements. Factors that might cause or contribute to suchdifferences include, but are not limited to, those discussed inthis Annual Report on Form 20-F under the section entitled"Risk Factors" and elsewhere. Any forward-lookingstatements made by or on behalf of Eni speak only as of the datethey are made. Eni does not undertake to update forward-lookingstatements to reflect any changes in Eni’s expectations withregard thereto or any changes in events, conditions orcircumstances on which any such statement is based. The readershould, however, consult any further disclosures Eni may make indocuments it files with the SEC.*

 

**CERTAIN DEFINED TERMS**

In this Form 20-F, the terms "Eni", the"Group", or the "Company" refer to the parentcompany Eni SpA and its consolidated subsidiaries and, unless thecontext otherwise requires, their respective predecessorcompanies. All references to "Italy" or the"State" are references to the Republic of Italy, allreferences to the "Government" are references to thegovernment of the Republic of Italy. For definitions of certainoil and gas terms used herein and certain conversions, see"Glossary" and "Conversion Table".

 

**PRESENTATION OF FINANCIAL AND OTHERINFORMATION**

The Consolidated Financial Statements of Eni, included in thisannual report, have been prepared in accordance with IFRS issuedby the International Accounting Standards Board (IASB). 

Unless otherwise indicated, any reference herein to"Consolidated Financial Statements" is to theConsolidated Financial Statements of Eni (including the Notesthereto) included herein.

Unless otherwise specified or the context otherwise requires,references herein to "dollars", "$","U.S. dollars" and "U.S. $" are to thecurrency of the United States, and references to "euro"and "€" are to the currency of the EuropeanMonetary Union.

 

**STATEMENTS REGARDINGCOMPETITIVE POSITION**

Statements made in "Item 4 – Information on theCompany" referring to Eni’s competitive position arebased on the Company’s belief, and in some cases rely on arange of sources, including investment analysts’ reports,independent market studies and Eni’s internal assessment ofmarket share based on publicly available information about thefinancial results and performance of market participants. Marketshare estimates contained in this document are based onmanagement estimates unless otherwise indicated.

 

 

 

 

 

ii

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##### Table of Contents

****GLOSSARY****

A glossary of oil and gas terms is available on Eni’s webpage at the address www.eni.it. Below is a selection of the mostfrequently used terms.

 

| ***Financial        terms***            |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-----------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Leverage*                              |   | A non-GAAP measure of the        Company’s financial condition, calculated as the        ratio between net borrowings and shareholders’        equity, including minority interest. For a discussion of        management’s view of the usefulness of this measure        and its reconciliation with the most directly comparable        GAAP measure which in the case of the Company refers to        IFRS, see "Item 5 – Financial Condition".                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Net borrowings*                        |   | Eni evaluates its financial        condition by reference to "net borrowings",        which is a non-GAAP measure. Eni calculates net        borrowings as total finance debt less: cash, cash        equivalents and certain very liquid investments not        related to operations, including among others        non-operating financing receivables and securities not        related to operations. Non-operating financing        receivables consist of amounts due to Eni’s        financing subsidiaries from banks and other financing        institutions and amounts due to other subsidiaries from        banks for investing purposes and deposits in escrow.        Securities not related to operations consist primarily of        government and corporate securities. For a discussion of        management’s view of the usefulness of this measure        and its reconciliation with the most directly comparable        GAAP measure which in the case of the Company refers to        IFRS, see "Item 5 – Financial Condition". |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *TSR (Total Shareholder        Return)* |   | Management uses this measure        to asses the total return of the Eni share. It is        calculated on a yearly basis, keeping account of changes        in prices (beginning and end of year) and dividends        distributed and reinvested at the ex-dividend date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| ***Business        terms***             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Associated gas*                        |   | Natural gas, occurring in        the form of a gas cap, overlying an oil zone, contained        in the reservoir’s crude oil gas.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Average reserve life        index*     |   | Ratio between the amount of        reserves at the end of the year and total production for        the year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Barrel/BBL*                            |   | Volume unit corresponding to        159 liters. A barrel of oil corresponds to about 0.137        metric tons.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *BOE*                                   |   | Barrel of Oil Equivalent. It        is used as a standard unit measure for oil and natural        gas. The latter is converted from standard cubic meters        into barrels of oil equivalent using a certain        coefficient (see "Conversion Table").                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Concession contracts*                  |   | Contracts currently applied        mainly in Western countries regulating relationships        between states and oil companies with regards to        hydrocarbon exploration and production. The company        holding the mining concession has an exclusive on        exploration, development and production activities and        for this reason it acquires a right to hydrocarbons        extracted against the payment of royalties on production        and taxes on oil revenues to the state.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Condensates*                           |   | These are light hydrocarbons        produced along with gas that condense to a liquid state        at surface temperature and pressure.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Conversion capacity*                   |   | Maximum amount of feedstock        that can be processed in certain dedicated facilities of        a refinery to obtain finished products. Conversion        facilities include catalytic crackers, hydrocrackers,        visbreaking units, and coking units.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Conversion index*                      |   | Ratio of capacity of        conversion facilities to primary distillation capacity.        The higher the ratio, the higher is the capacity of a        refinery to obtain high value products from the heavy        residue of primary distillation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Deep waters*                           |   | Waters deeper than 200        meters.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *Development*                           |   | Drilling and other        post-exploration activities aimed at the production of        oil and gas.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

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##### Table of Contents

| *Enhanced recovery*                                     |   | Techniques used to increase        or stretch over time the production of wells.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|---------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *EPC*                                                   |   | Engineering, Procurement and        Construction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *EPIC*                                                  |   | Engineering, Procurement,        Installation and Construction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Exploration*                                           |   | Oil and natural gas        exploration that includes land surveys, geological and        geophysical studies, seismic data gathering and analysis        and well drilling.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *FPSO*                                                  |   | Floating Production Storage        and Offloading System.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *FSO*                                                   |   | Floating Storage and        Offloading System.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Infilling wells*                                       |   | Infilling wells are wells        drilled in a producing area in order to improve the        recovery of hydrocarbons from the field and to maintain        and/or increase production levels.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *LNG*                                                   |   | Liquefied Natural Gas        obtained through the cooling of natural gas to minus 160        °C at normal pressure. The gas is liquefied to allow        transportation from the place of extraction to the sites        at which it is transformed back into its natural gaseous        state and consumed. One tonne of LNG corresponds to 1,400        cubic meters of gas.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *LPG*                                                   |   | Liquefied Petroleum Gas, a        mix of light petroleum fractions, gaseous at normal        pressure and easily liquefied at room temperature through        limited compression.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Margin*                                                |   | The difference between the        average selling price and direct acquisition cost of a        finished product or raw material excluding other        production costs (e.g. refining margin, margin on        distribution of natural gas and petroleum products or        margin of petrochemical products). Margin trends reflect        the trading environment and are, to a certain extent, a        gauge of industry profitability.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Mineral Storage*                                       |   | According to Legislative        Decree No. 164/2000, these are volumes required for        allowing optimal operation of natural gas fields in Italy        for technical and economic reasons. The purpose is to        ensure production flexibility as required by long-term        purchase contracts as well as to cover technical risks        associated with production.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Modulation Storage*                                    |   | According to Legislative        Decree No. 164/2000, these are volumes required for        meeting hourly, daily and seasonal swings in demand.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Natural gas liquids (NGL)*                             |   | Liquid or liquefied        hydrocarbons recovered from natural gas through        separation equipment or natural gas treatment plants.        Propane, normal-butane and isobutane, isopentane and        pentane plus, that were previously defined as natural        gasoline, are natural gas liquids.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Network Code*                                          |   | A code containing norms and        regulations for access to, management and operation of        natural gas pipelines.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Over/Under lifting*                                    |   | Agreements stipulated        between partners which regulate the right of each to its        share in the production for a set period of time. Amounts        lifted by a partner different from the agreed amounts        determine temporary Over/Under lifting situations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Primary balanced refining        capacity*             |   | Maximum amount of feedstock        that can be processed in a refinery to obtain finished        products measured in BBL/d.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Production Sharing        Agreement ("PSA")* |   | Contract in use in African,        Middle Eastern, Far Eastern and Latin American countries,        among others, regulating relationships between states and        oil companies with regard to the exploration and        production of hydrocarbons. The mineral right is awarded        to the national oil company jointly with the foreign oil        company that has an exclusive right to perform        exploration, development and production activities and        can enter into agreements with other local or        international entities. In this type of contract the        national oil company assigns to the international        contractor the task of performing exploration and        production with the contractor’s equipment and        financial resources. Exploration risks are borne by the        contractor and production is divided into two portions:        "cost oil" is used to recover costs borne by        the contractor and "profit oil" is divided        between the contractor and the national company according        to variable schemes and represents the profit deriving        from exploration and production. Further terms and        conditions of these contracts may vary from country to        country. |

 

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| *Proved 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        existing economic and operating conditions, i.e., prices        and costs as of the date the estimate is made. Prices        include consideration of the impact of changes in        existing prices on existing contractual arrangements, but        not on escalations based upon future conditions. Proved        reserves include: (i) proved developed reserves: amounts        of hydrocarbons that are expected to be retrieved through        existing wells, facilities and operating methods; and        (ii) non-developed proved reserves: amounts of        hydrocarbons that are expected to be retrieved following        new drilling, facilities and operating methods. Based on        these amounts the company has already defined a clear        development expenditure program which is an expression of        the company’s determination to develop existing        reserves. |
|-----------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Reserve life index*        |   | Ratio between the amount of        proved reserves at the end of the year and total        production for the year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Reserve replacement ratio* |   | Measure of the reserves        produced replaced by proved reserves. Indicates the        company’s ability to add new reserves through        exploration and purchase of property. A rate higher than        100% indicates that more reserves were added than        produced in the period. The ratio should be averaged on a        three-year period in order to reduce the distortion        deriving from the purchase of proved property, the        revision of previous estimates, enhanced recovery,        improvement in recovery rates and changes in the amount        of reserves – in PSAs – due to changes in        international oil prices.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Ship-or-pay*               |   | Clause included in natural        gas transportation contracts according to which the        customer is requested to pay for the transportation of        gas whether or not the gas is actually transported.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Strategic Storage*         |   | According to Legislative        Decree No. 164/2000, these are volumes required for        covering lack or reduction of supplies from        extra-European sources or crises in the natural gas        system.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Take-or-pay*               |   | Clause included in natural        gas supply contracts according to which the purchaser is        bound to pay the contractual price or a fraction of such        price for a minimum quantity of gas set in the contract        whether or not the gas is collected by the purchaser. The        purchaser has the option of collecting the gas paid for        and not delivered at a price equal to the residual        fraction of the price set in the contract in subsequent        contract years.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| *Upstream/Downstream*       |   | The term upstream refers to        all hydrocarbon exploration and production activities.        The term downstream includes all activities inherent to        the oil and gas sector that are downstream of exploration        and production activities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |

 

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**ABBREVIATIONS**

| mmCF   | =      | million cubic feet                       |   | ktonnes  | =      | thousand tonnes                                   |
|--------|--------|------------------------------------------|--------|----------|--------|---------------------------------------------------|
|   |   |                                     |   |     |   |                                              |
| BCF    | =      | billion cubic feet                       |   | mmtonnes | =      | million tonnes                                    |
|   |   |                                     |   |     |   |                                              |
| mmCM   | =      | million cubic meters                     |   | MW       | =      | megawatt                                          |
|   |   |                                     |   |     |   |                                              |
| BCM    | =      | billion cubic meters                     |   | GWh      | =      | gigawatthour                                      |
|   |   |                                     |   |     |   |                                              |
| BOE    | =      | barrel of oil equivalent                 |   | TWh      | =      | terawatthour                                      |
|   |   |                                     |   |     |   |                                              |
| KBOE   | =      | thousand barrel of oil        equivalent |   | /d       | =      | per day                                           |
|   |   |                                     |   |     |   |                                              |
| mmBOE  | =      | million barrel of oil        equivalent  |   | /y       | =      | per year                                          |
|   |   |                                     |   |     |   |                                              |
| BBOE   | =      | billion barrel of oil        equivalent  |   | E&P  | =      | the Exploration &        Production segment   |
|   |   |                                     |   |     |   |                                              |
| BBL    | =      | barrels                                  |   | G&P  | =      | the Gas & Power segment                       |
|   |   |                                     |   |     |   |                                              |
| KBBL   | =      | thousand barrels                         |   | R&M  | =      | the Refining & Marketing        segment       |
|   |   |                                     |   |     |   |                                              |
| mmBBL  | =      | million barrels                          |   | E&C  | =      | the Engineering &        Construction segment |
|   |   |                                     |   |     |   |                                              |
| BBBL   | =      | billion barrels                          |   |     |   |                                              |

 

**CONVERSION TABLE**

| 1 acre                               | =      | 0.405 hectares                                         |   |                                                                                  |
|--------------------------------------|--------|--------------------------------------------------------|--------|---------------------------------------------------------------------------------------|
|                                 |   |                                                   |   |                                                                                  |
| 1 barrel                             | =      | 42 U.S. gallons                                        |   |                                                                                  |
|                                 |   |                                                   |   |                                                                                  |
| 1 BOE                                | =      | 1 barrel of crude oil                                  | =      | 5,742 cubic feet of natural        gas                                                |
|                                 |   |                                                   |   |                                                                                  |
| 1 barrel of crude oil per        day | =      | approximately 50 tonnes of        crude oil per year   |   |                                                                                  |
|                                 |   |                                                   |   |                                                                                  |
| 1 cubic meter of natural gas         | =      | 35.3147 cubic feet of        natural gas               |   |                                                                                  |
|                                 |   |                                                   |   |                                                                                  |
| 1 cubic meter of natural gas         | =      | approximately 0.00615        barrels of oil equivalent |   |                                                                                  |
|                                 |   |                                                   |   |                                                                                  |
| 1 kilometer                          | =      | approximately 0.62 miles                               |   |                                                                                  |
|                                 |   |                                                   |   |                                                                                  |
| 1 short ton                          | =      | 0.907 tonnes                                           | =      | 2,000 pounds                                                                          |
|                                 |   |                                                   |   |                                                                                  |
| 1 long ton                           | =      | 1.016 tonnes                                           | =      | 2,240 pounds                                                                          |
|                                 |   |                                                   |   |                                                                                  |
| 1 tonne                              | =      | 1 metric ton                                           | =      | 1,000 kilograms                                                                       |
|                                 |   |                                                   | =      | approximately 2,205 pounds                                                            |
|                                 |   |                                                   |   |                                                                                  |
| 1 tonne of crude oil                 | =      | 1 metric ton of crude oil                              | =      | approximately 7.3 barrels of        crude oil (assuming an API gravity of 34 degrees) |

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**PART I**

**Item 1. IDENTITY OF DIRECTORS, SENIORMANAGEMENT AND ADVISORS**

NOT APPLICABLE

 

 

**Item 2. OFFER STATISTICS AND EXPECTEDTIMETABLE**

NOT APPLICABLE

 

 

**Item 3. KEY INFORMATION**

**Selected Financial Infor****mation**

The Consolidated Financial Statements of Eni have beenprepared in accordance with IFRS issued by the InternationalAccounting Standards Board (IASB). The tables below show Eniselected historical financial data prepared in accordance withIFRS as of and for the years ended December 31, 2004, 2005, 2006,2007 and 2008. The selected historical financial data for theyears ended December 31, 2004, 2005, 2006, 2007 and 2008 arederived from Eni’s Consolidated Financial Statementsincluded in Item 18. All such data should be read in connectionwith the Consolidated Financial Statements and the related notesthereto included in Item 18.

|   | **Year ended December 31,** |
|--------|-----------------------------|
|   |                             |

|   | **2004** |   | **2005** |   | **2006** |   | **2007** |   | **2008** |
|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|
|   |          |   |          |   |          |   |          |   |          |

|   | **(euro        million except data per share and per ADR)** |
|--------|-------------------------------------------------------------|

| **CONSOLIDATED PROFIT STATEMENT DATA**                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |    |   |
|---------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|
| Net sales        from operations                                                            |   | 57,545 |   |   | 73,728 |   |   | 86,105 |   |   | 87,256 |   |   | 108,148 |   |
| Operating profit by segment                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |    |   |
|      Exploration        & Production                           |   | 8,185  |   |   | 12,592 |   |   | 15,580 |   |   | 13,788 |   |   | 16,415  |   |
|      Gas & Power                                               |   | 3,428  |   |   | 3,321  |   |   | 3,802  |   |   | 4,127  |   |   | 3,933   |   |
|      Refining        & Marketing                               |   | 1,080  |   |   | 1,857  |   |   | 319    |   |   | 729    |   |   | (1,023  | )      |
|      Petrochemicals                                                |   | 320    |   |   | 202    |   |   | 172    |   |   | 74     |   |   | (822    | )      |
|      Engineering        & Construction                         |   | 203    |   |   | 307    |   |   | 505    |   |   | 837    |   |   | 1,045   |   |
|      Other activities                                              |   | (395   | )      |   | (934   | )      |   | (622   | )      |   | (444   | )      |   | (346    | )      |
|      Corporate        and financial companies                      |   | (363   | )      |   | (377   | )      |   | (296   | )      |   | (217   | )      |   | (686    | )      |
|      Impact of        unrealized intragroup profit elimination (1) |   | (59    | )      |   | (141   | )      |   | (133   | )      |   | (26    | )      |   | 125     |   |
| Operating        profit                                                                     |   | 12,399 |   |   | 16,827 |   |   | 19,327 |   |   | 18,868 |   |   | 18,641  |   |
| Net profit attributable to Eni                                                              |   | 7,059  |   |   | 8,788  |   |   | 9,217  |   |   | 10,011 |   |   | 8,825   |   |
| **Data        per ordinary share******(euro)        (2)                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Operating profit:                                                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |    |   |
| - basic                                                                                     |   | 3.29   |   |   | 4.48   |   |   | 5.23   |   |   | 5.14   |   |   | 5.12    |   |
| - diluted                                                                                   |   | 3.28   |   |   | 4.47   |   |   | 5.22   |   |   | 5.14   |   |   | 5.12    |   |
| Net profit        attributable to Eni basic and diluted                                     |   | 1.87   |   |   | 2.34   |   |   | 2.49   |   |   | 2.73   |   |   | 2.43    |   |
| **Data per ADR******($)        (2) (3)                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Operating        profit:                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |    |   |
| - basic                                                                                     |   | 8.18   |   |   | 11.14  |   |   | 13.13  |   |   | 14.10  |   |   | 15.07   |   |
| - diluted                                                                                   |   | 8.17   |   |   | 11.12  |   |   | 13.12  |   |   | 14.10  |   |   | 15.07   |   |
| Net profit attributable to Eni basic and diluted                                            |   | 4.66   |   |   | 5.82   |   |   | 6.26   |   |   | 7.48   |   |   | 7.14    |   |

|   |  |   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|--------|--|

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##### Table of Contents

|   | **As of December 31,** |
|--------|------------------------|
|   |                        |

|   | **2004** |   | **2005** |   | **2006** |   | **2007** |   | **2008** |
|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|
|   |          |   |          |   |          |   |          |   |          |

|   | **(euro        million except number of shares and dividend information)** |
|--------|----------------------------------------------------------------------------|

| **CONSOLIDATED BALANCE SHEET DATA**                                                                   |   |   |   |   |   |   |   |    |   |    |
|-------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|---------|--------|---------|
| Total        assets                                                                                   |   | 72,853 |   | 83,850 |   | 88,312 |   | 101,460 |   | 116,590 |
| Short-term and long-term debt                                                                         |   | 12,684 |   | 12,998 |   | 11,699 |   | 19,830  |   | 20,837  |
| Capital        stock issued                                                                           |   | 4,004  |   | 4,005  |   | 4,005  |   | 4,005   |   | 4,005   |
| Minority interest                                                                                     |   | 3,166  |   | 2,349  |   | 2,170  |   | 2,439   |   | 4,074   |
| Shareholders’        equity - Eni share                                                          |   | 32,374 |   | 36,868 |   | 39,029 |   | 40,428  |   | 44,436  |
| Capital expenditures                                                                                  |   | 7,499  |   | 7,414  |   | 7,833  |   | 10,593  |   | 14,562  |
| Weighted        average number of ordinary shares outstanding (fully        diluted - shares million) |   | 3,775  |   | 3,763  |   | 3,701  |   | 3,669   |   | 3,639   |
| Dividend per share (euro)                                                                             |   | 0.90   |   | 1.10   |   | 1.25   |   | 1.30    |   | 1.30    |
| Dividend        per ADR ($) (2)                                                                       |   | 2.17   |   | 2.73   |   | 3.24   |   | 3.74    |   | 3.72    |

|   |  |   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|--------|--|

----

| (1) | i | This item        concerned mainly intra-group sales of commodities,        services and capital goods recorded in the assets of the        purchasing business segment as of end of the period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|-----|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | Euro per        share or U.S. dollars per American Depositary Receipt        (ADR), as the case may be. From 2006, one ADR represents        two Eni shares. Previously, one ADR was equivalent to        five Eni shares. Data per ADR for the years 2004-2005        have been recalculated accordingly.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (3) | i | Eni’s        financial statements are stated in euro. The translations        of certain euro amounts into U.S. dollars are included        solely for the convenience of the reader. The convenient        translations should not be construed as representations        that the amounts in euro have been, could have been, or        could in the future be, converted into U.S. dollars at        this or any other rate of exchange. Data per ADR, with        the exception of dividends, were translated at the        EUR/U.S. $ average exchange rate as recorded by in the        Federal Reserve Board official statistics for each year        presented (see the table on page 5). Dividends per ADR        for the years 2004 through 2007 have been translated into        U.S. dollars for each year presented using the Noon        Buying Rate on payment dates, as recorded on the payment        date of the interim dividend and of the balance to the        full-year dividend, respectively. Eni started to pay an        interim dividend in 2005. The dividend for 2008 was        converted at the Noon Buying Rate recorded on the payment        date of the interim dividend (euro 0.65 per share) which        occurred on September 25, 2008. The balance of euro 0.65        per share payable on May 21 and May 29, 2009 for the        holders of the Eni share and the ADR respectively was        translated at the Noon Buying Rate as recorded on        December 31, 2008. On May 4, 2009, the Noon Buying Rate        was $1.34 per euro 1.00. |

2 

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##### Table of Contents

**Selected Operating Information**

The tables below set forth selected operating information withrespect to Eni’s proved reserves, developed and undeveloped,of crude oil (including condensates and natural gas liquids) andnatural gas, as well as other data as of and for the years endedDecember 31, 2004, 2005, 2006, 2007 and 2008. Data on productionof oil and natural gas and hydrocarbon production sold includesEni’s share of production of affiliates and joint venturesaccounted for under the equity or cost method of accounting.

|   | **Year ended December 31,** |
|--------|-----------------------------|
|   |                             |

|   | **2004** |   | **2005** |   | **2006** |   | **2007** |   | **2008** |
|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|
|   |          |   |          |   |          |   |          |   |          |

| Proved reserves of liquids of consolidated        subsidiaries at period end (mmBBL)           |   | 3,972    |   | 3,748    |   | 3,457    |   | 3,127    |   | 3,243    |
|------------------------------------------------------------------------------------------------|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|
| *of        which developed*                                                                    |   | *2,471*  |   | *2,331*  |   | *2,126*  |   | *1,953*  |   | *2,009*  |
| Proved reserves of liquids of equity-accounted        entities at period end (mmBBL)           |   | 36       |   | 25       |   | 24       |   | 142      |   | 142      |
| *of        which developed*                                                                    |   |     |   | *19*     |   | *18*     |   | *26*     |   | *33*     |
| Proved reserves of natural gas of consolidated        subsidiaries at period end (BCF)         |   | 18,278   |   | 17,501   |   | 16,897   |   | 16,549   |   | 17,214   |
| *of        which developed*                                                                    |   | *10,501* |   | *11,159* |   | *10,949* |   | *10,967* |   | *11,138* |
| Proved reserves of natural gas of        equity-accounted entities at period end (BCF)         |   | 157      |   | 90       |   | 68       |   | 3,022    |   | 3,015    |
| *of        which developed*                                                                    |   |     |   | *70*     |   | *48*     |   | *428*    |   | *420*    |
| Proved reserves of hydrocarbons of consolidated        subsidiaries in mmBOE at period end (1) |   | 7,154    |   | 6,796    |   | 6,400    |   | 6,010    |   | 6,242    |
| *of        which developed*                                                                    |   | *4,300*  |   | *4,275*  |   | *4,032*  |   | *3,862*  |   | *3,948*  |
| Proved reserves of hydrocarbons of        equity-accounted entities in mmBOE at period end (a) |   | 64       |   | 41       |   | 36       |   | 668      |   | 666      |
| *of        which developed*                                                                    |   |     |   | *31*     |   | *27*     |   | *101*    |   | *107*    |
| Reserve replacement ratio (2)                                                                  |   | 91       |   | 43       |   | 38       |   | 38       |   | 136      |
| Average        daily production of liquids (KBBL/d)                                            |   | 1,034    |   | 1,111    |   | 1,079    |   | 1,020    |   | 1,026    |
| Average daily production of natural gas        available for sale (mmCF/d) (3)                 |   | 3,171    |   | 3,344    |   | 3,679    |   | 3,819    |   | 4,143    |
| Average        daily production of hydrocarbons available for sale (KBOE/d)(3)                 |   | 1,586    |   | 1,693    |   | 1,720    |   | 1,684    |   | 1,748    |
| Hydrocarbon production sold (mmBOE)                                                            |   | 576.5    |   | 614.9    |   | 625.1    |   | 611.4    |   | 632.0    |
| Oil and        gas production costs per BOE (4)                                                |   |     |   | 5.59     |   | 5.79     |   | 6.90     |   | 7.77     |
| Profit per barrel of oil equivalent (5)                                                        |   |     |   | 12.20    |   | 14.97    |   | 14.03    |   | 15.80    |

|   |  |   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|--------|--|

----

| (a) |    | Mainly refers        to Eni’s share of proved reserves relating to three        Russian companies purchased in 2007 by Eni as part of a        bid procedure for assets of bankrupt Yukos (Eni’s        share was 60%). Gazprom was granted an option to acquire        a 51% interest in these three entities. Considering that        Gazprom has exercised its call option, Eni’s        interest will be diluted to approximately 30% and proved        reserves that were booked in connection with the        acquisition will be reduced by approximately 50%.                                                                                                                                                 |
|-----|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) |    | Includes        approximately 737, 760, 754, 749 and 746 BCF of natural        gas held in storage in Italy at December 31, 2004, 2005,        2006, 2007 and 2008, respectively. See "Item 4        – Information on the Company – Exploration        & Production – Storage".                                                                                                                                                                                                                                                                                                                                                                                                                         |
| (2) |    | Consists of:        (i) the increase in proved reserves of consolidated        subsidiaries attributable to: (a) purchases of minerals        in place; (b) revisions of previous estimates; (c)        improved recovery; and (d) extensions and discoveries,        less sales of minerals in place; divided by (ii)        production during the year as set forth in the reserve        tables, in each case prepared in accordance with SFAS 69.        See the unaudited supplemental oil and gas information in        Item 18 – Notes to the Consolidated Financial        Statements. Expressed as a percentage.                                                                                                       |
| (3) |    | Natural gas        production volumes exclude gas consumed in operations        (220, 251, 286, 296 and 281 mmCF/d in 2004, 2005, 2006,        2007 and 2008, respectively).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| (4) |    | Expressed in        U.S. dollars. Consists of production costs (costs        incurred to operate and maintain wells and field        equipment including also royalties) prepared in        accordance with IFRS divided by actual production net of        production volumes of natural gas consumed in operations.        See the unaudited supplemental oil and gas information in        Item 18 – Notes to the Consolidated Financial        Statements. Data for the years prior to 2005 are not        available as they were prepared in accordance with U.S.        GAAP.                                                                                                                                             |
| (5) |    | Expressed in        U.S. dollars. Results of operations from oil and gas        producing activities, divided by actual sold production,        in each case prepared in accordance with IFRS to meet        ongoing U.S. reporting obligations. See the unaudited        supplemental oil and gas information in Item 18 –        Notes to the Consolidated Financial Statements for a        calculation of results of operations from oil and gas        producing activities. Data for the years prior to 2005        are not available as they were in accordance with U.S.        GAAP. Includes results of operations of joint ventures        and other equity-accounted entities which results were        immaterial. |

3 

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##### Table of Contents

**Selected Operating Information***continued*

|   | **Year ended December 31,** |
|--------|-----------------------------|
|   |                             |

|   | **2004** |   | **2005** |   | **2006** |   | **2007** |   | **2008** |
|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|
|   |          |   |          |   |          |   |          |   |          |

| Sales of natural gas to third parties (6)                                                       |   | 72.79  |   | 77.08  |   | 79.63  |   | 78.75  |   | 83.69  |
|-------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Natural        gas consumed by Eni (6)                                                          |   | 3.70   |   | 5.54   |   | 6.13   |   | 6.08   |   | 5.63   |
| Sales of natural gas of affiliates (Eni’s        share) (6)                                |   | 5.84   |   | 7.08   |   | 7.65   |   | 8.74   |   | 8.91   |
| Total        sales and own consumption of natural gas of the Gas &        Power segment (6) |   | 82.33  |   | 89.70  |   | 93.41  |   | 93.57  |   | 98.23  |
| E&P natural gas sales in Europe and in the        Gulf of Mexico (6)(7)                     |   | 4.70   |   | 4.51   |   | 4.69   |   | 5.39   |   | 6.00   |
| Worldwide        natural gas sales (6)                                                          |   | 87.03  |   | 94.21  |   | 98.10  |   | 98.96  |   | 104.23 |
| Transport of natural gas for third parties in        Italy (6)                                  |   | 28.26  |   | 30.22  |   | 30.90  |   | 30.89  |   | 33.84  |
| Length of        natural gas transport network in Italy at period end (8)                       |   | 30.2   |   | 30.7   |   | 30.9   |   | 31.1   |   | 31.5   |
| Electricity sold (9)                                                                            |   | 16.95  |   | 27.56  |   | 31.03  |   | 33.19  |   | 29.93  |
| Refinery        throughputs (10)                                                                |   | 35.75  |   | 36.68  |   | 36.27  |   | 35.21  |   | 33.98  |
| Balanced capacity of wholly-owned refineries (11)                                               |   | 504    |   | 524    |   | 534    |   | 544    |   | 544    |
| Retail        sales (in Italy and rest of Europe) (10)                                          |   | 14.40  |   | 13.72  |   | 12.48  |   | 12.65  |   | 12.67  |
| Number of service stations at period end (in        Italy and rest of Europe)                   |   | 9,140  |   | 6,282  |   | 6,294  |   | 6,440  |   | 5,956  |
| Average        throughput per service station (in Italy and rest of        Europe) (12)         |   | 2,488  |   | 2,479  |   | 2,470  |   | 2,486  |   | 2,502  |
| Petrochemical production (10)                                                                   |   | 7.12   |   | 7.28   |   | 7.07   |   | 8.80   |   | 7.37   |
| Engineering        & Construction order backlog at period end (13)                          |   | 8,521  |   | 10,122 |   | 13,191 |   | 15,390 |   | 19,105 |
| Employees at period end        (units)                                                          |   | 70,348 |   | 72,258 |   | 73,572 |   | 75,862 |   | 78,880 |

|   |  |   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|--------|--|

----

| (6)  |    | Expressed in        BCM.                                                                                                                                                                                                             |
|------|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (7)  |    | From 2006,        also includes E&P sales of volumes of natural gas        produced in the Gulf of Mexico.                                                                                                                       |
| (8)  |    | Expressed in        thousand kilometers.                                                                                                                                                                                             |
| (9)  |    | Expressed in        TWh.                                                                                                                                                                                                             |
| (10) |    | Expressed in        mmtonnes.                                                                                                                                                                                                        |
| (11) |    | Expressed in        KBBL/d.                                                                                                                                                                                                          |
| (12) |    | Expressed in        thousand liters per day. Refers to the Agip branded        network only, as in years up to 2005 Eni also sold        refined products on the "IP" branded network of        service stations in Italy. |
| (13) |    | The sum of        the order backlog of Saipem SpA and Snamprogetti SpA,        expressed in million euro.                                                                                                                            |

4

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##### Table of Contents

**Exchange Rates**

The following tables set forth, for the periods indicated,certain information regarding the Noon Buying Rate in U.S.dollars per euro, rounded to the second decimal (Source: TheFederal Reserve Board).

|   | **High** |   | **Low** |   | **Average**(1) |   | **At period end** |
|--------|----------|--------|---------|--------|----------------|--------|-------------------|
|   |          |   |         |   |                |   |                   |

|   | **(U.S.        dollars per euro)** |
|--------|------------------------------------|

| Year ended December 31, |   |   |   |   |   |   |   |   |
|-------------------------|--------|--------|--------|--------|--------|--------|--------|--------|
| 2004                    |   | 1.36   |   | 1.18   |   | 1.24   |   | 1.35   |
| 2005                    |   | 1.35   |   | 1.17   |   | 1.24   |   | 1.18   |
| 2006                    |   | 1.33   |   | 1.19   |   | 1.26   |   | 1.32   |
| 2007                    |   | 1.49   |   | 1.29   |   | 1.37   |   | 1.46   |
| 2008                    |   | 1.60   |   | 1.24   |   | 1.47   |   | 1.39   |

|   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|

----

| (1) |    | Average of        the Noon Buying Rates for the last business day of each        month in the period. |
|-----|--------------|-------------------------------------------------------------------------------------------------------|

 

|   | **High** |   | **Low** |   | **At period end** |
|--------|----------|--------|---------|--------|-------------------|
|   |          |   |         |   |                   |

|   | **(U.S.        dollars per euro)** |
|--------|------------------------------------|

| November 2008                  |   | 1.30 |   | 1.25 |   | 1.27 |
|--------------------------------|--------|------|--------|------|--------|------|
| December        2008           |   | 1.44 |   | 1.26 |   | 1.39 |
| January 2009                   |   | 1.39 |   | 1.28 |   | 1.28 |
| February        2009           |   | 1.31 |   | 1.25 |   | 1.27 |
| March 2009                     |   | 1.37 |   | 1.25 |   | 1.31 |
| April 2009                     |   | 1.35 |   | 1.30 |   | 1.32 |
| May 2009 (through May 4, 2009) |   | 1.34 |   | 1.33 |   | 1.34 |

|   |  |   |  |   |  |
|--------|--|--------|--|--------|--|

Fluctuations in the exchange rate between the euro and thedollar affect the dollar equivalent of the euro price of theShares on the Telematico and the dollar price of the ADRs on theNYSE. Exchange rate fluctuations also affect the dollar amountsreceived by owners of ADRs upon conversion by the Depository ofcash dividends paid in euro on the underlying Shares. The NoonBuying Rate on May 4, 2009 was $1.34 per euro 1.00.

 

**Risk Factors**

> 
***Competition***

*There is strong competition worldwide, both within the oilindustry and with other industries, to supply energy to theindustrial, commercial and residential energy markets.*

Eni encounters competition from other oil and natural gascompanies in all areas of its operations.

| • |   | In the Exploration &        Production business, Eni faces competition from both        international oil companies and state run oil companies        in a number of geographic markets for obtaining        exploration and development rights, and developing and        applying new technology to maximize hydrocarbon recovery.        Furthermore, Eni may face a competitive disadvantage in        many of these markets because of its relatively smaller        size compared to other international oil companies,        particularly when bidding for large scale or capital        intensive projects, and may be exposed to industry-wide        cost increases to a greater extent compared to its larger        competitors given its potentially smaller market power        with respect to suppliers. If as a result Eni fails to        obtain new exploration and development acreage or to        apply and develop new technology, its growth prospects        and future results of operations and cash flows may be        adversely affected. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | Eni is increasingly in        competition with state run oil companies who are partners        of Eni in a number of oil and gas projects and titles in        the host countries where Eni conducts its upstream        operations. These state run oil companies can change        contractual terms and other conditions of oil and gas        projects in order to obtain a larger profit share from a        given project, by this way reducing Eni’s profit        share. For example, Sonatrach, the Algeria national oil        company, is seeking to modify the contractual terms of        certain PSAs in which Eni is party to achieve a        redistribution of the tax burden of such PSAs. Sonatrach        alleges that it is currently bearing part of the tax        burden attributable to Eni following the enactment of        certain modifications to the                                                                                                                                                                                      |

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|   |   | country’s tax regime. If this negotiation        results in a negative outcome for Eni, the future        profitability of certain of Eni’s PSAs in Algeria        will be reduced. For more information on this matter see        "Item 4 – Exploration & Production –        Algeria".                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | In its domestic natural gas        business, Eni faces increasingly strong competition from        both national and international natural gas suppliers,        particularly following the liberalization of the Italian        natural gas market introduced by Legislative Decree No.        164/2000 which provides for, among other things, the        opening of the Italian market to competition, limitations        to the size of gas companies relatively to the market and        third party access to infrastructures. Increasingly high        levels of competition in the Italian natural gas market        could possibly entail reduced natural gas selling margins        (see below). In addition, Legislative Decree No. 164/2000        grants the Italian Authority for Electricity and Gas        certain regulatory powers in matters of natural gas        pricing and access to infrastructures. Outside of Italy,        particularly in Europe, Eni faces competition from large        well-established European utilities and other        international oil and gas companies in growing its market        share and acquiring or retaining clients. Furthermore, a        number of large clients, particularly electricity        producers, in both the domestic market and other European        markets are planning to enter the supply market of        natural gas. At the same time, a number of national gas        producers from countries with large gas reserves are        planning to sell natural gas directly to final clients,        which would threaten the market position of companies        like Eni which resell gas purchased from producing        countries to final customers. These developments may        increase the level of competition in both the national        and other European markets for natural gas and reduce        Eni’s operating profit. Risks of increasing        competition in the natural gas sector are exacerbated by        the current economic downturn. Due to the commoditized        nature of natural gas, lowering gas demand could result        in a situation where suppliers compete more aggressively        on pricing thus leading to lower gas margins for the        whole sector. |

| • |   | In its domestic electricity        business, Eni competes with other producers and traders        from Italy or outside of Italy who sell electricity in        the Italian market. The Company expects in the near        future increasing competition from suppliers outside        Italy due to the current economic downturn. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | In retail marketing of        refined products both in and outside Italy, Eni competes        with third parties (including international oil companies        and local operators such as supermarket chains) to obtain        concessions to establish and operate service stations.        Once established, Eni’s service stations compete        primarily on the basis of pricing, services and        availability of non-petroleum products. In Italy,        political and institutional forces are urging greater        levels of competition in the retail marketing of fuels.        Eni expects developments on this issue to further        increase pressure on selling margins in the retail        marketing of fuels. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | Competition in the oilfield        services, construction and engineering industries is        primarily based on technical expertise, quality and        number of services and availability of technologically        advanced facilities (for example, vessels for offshore        construction). Lower oil prices could result in lower        margins and low demand for volumes of oil services.                                                                                                                                                                                                                                                                                                                                        |

The Company’s failure or inability to respond effectivelyto competition could adversely impact the Company’s growthprospects, future results of operations and cash flows.

 

> 
***Risks associated with the exploration and production    of oil and natural gas***

The exploration and production of oil and natural gas requireshigh levels of capital expenditures and entails particulareconomic risks. It is subject to natural hazards and otheruncertainties including those relating to the physicalcharacteristics of oil and natural gas fields. The production ofoil and natural gas is highly regulated and is subject toconditions imposed by governments throughout the world in matterssuch as the award of exploration and production interests, theimposition of specific drilling and other work obligations,environmental protection measures, control over the developmentand abandonment of fields and installations, and restrictions onproduction. The oil and gas industry is subject to the payment ofroyalties and income taxes which tend to be higher than thosepayable in many other commercial activities.

> 
*Exploratory drilling efforts may not be successful*

Drilling for oil and gas involves numerous risks including therisk of dry holes or failure to find commercial quantities ofhydrocarbons. The costs of drilling, completing and operatingwells are often uncertain, and drilling operations may beunsuccessful as a result of a variety of factors, includingunexpected drilling conditions, pressure or irregularities informations, equipment failures or fires, blow-outs and variousforms of accidents, marine risks such as collisions and adverseweather conditions and shortages or delays in the delivery ofequipment. Exploring or drilling in offshore areas, particularlyin deep waters, is generally more complex and riskier thanonshore areas; the same is true for exploratory activity inremote areas or in challenging environmental conditions such asthose we are experiencing in the Caspian region or Alaska.Failure to discover commercial quantities of oil and natural gascould have an adverse impact on Eni’s future growthprospects, results of operations and liquidity. Because Eni plansto invest significant capital expenditures in executing high riskexploration projects, it is likely that Eni will incursignificant exploration and dry hole expenses in future years.High risk exploration projects include projects executed in deepand ultra-deep offshore and in new areas where the Company lacksinstalled production facilities. In particular Eni plans toexplore for oil and gas offshore, frequently in deep water or atdeep drilling depths, where 

6

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operations are more difficult and costly than on land or atshallower depths and in shallower waters. Deep water operationsgenerally require a significant amount of time between adiscovery and the time that Eni can produce and market the oil orgas, increasing both the operational and financial risksassociated with these activities. In the case of the Company,risky exploration projects are conducted in the deep offshore ofthe Gulf of Mexico, Australia, Brazil, the Barents Sea, India,and offshore Ireland. In 2009, management plans to spendsignificant amounts of exploration expenditures in these areasthat may result in significant dry hole expenses.

Furthermore, shortage of deep water rigs and failure to findadditional commercial reserves could reduce future production ofoil and natural gas which is highly dependent on the rate ofsuccess of exploratory activity.

> 
*Development projects bear significant operational risks    which may adversely affect actual returns on such projects*

Eni is involved in a number of development projects for theproduction of hydrocarbon reserves, principally offshore.Eni’s future results of operations rely upon its ability todevelop and operate major projects as planned. Key factors thatmay affect the economics of these projects include:

| • |   | the outcome of negotiations        with co-venturers, governments, suppliers, customers or        others including, for example, Eni’s ability to        negotiate favorable long-term contracts with customers;        the development of reliable spot markets that may be        necessary to support the development of particular        production projects, or commercial arrangements for        pipelines and related equipment to transport and market        hydrocarbons. Furthermore, projects executed with        partners and co-venturers reduce the ability of the        Company to manage risks and costs, and Eni could have        limited influence over and control of the operations,        behaviors and performance of its partners; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | timely issuance of permits        and licenses by government agencies;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| • |   | the Company’s relative        size compared to its main competitors which may prevent        it from affording opportunities to participate in        large-scale projects or affect its ability to reap        benefits associated with economies of scale, for example        by obtaining more favorable contractual terms by supplier        of goods and services;                                                                                                                                                                                                                                                                                                                                                                                          |
| • |   | the ability to design        development projects so as to prevent the occurrence of        technical inconvenience;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| • |   | delays in manufacturing and        delivery of critical equipment, or shortages in the        availability of such equipment, causing cost overruns and        delays;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| • |   | risks associated with the        use of new technologies and the inability to develop        advanced technologies to maximize the recoverability rate        of hydrocarbons or gain access to previously inaccessible        reservoirs;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| • |   | changes in operating        conditions and costs, including the sharp rise in        procurement costs and costs for leasing third party        equipment or purchase services such as drilling rigs and        shipping that we have experienced in recent years as a        result of industry-wide cost inflation, resulting in cost        overruns;                                                                                                                                                                                                                                                                                                                                                                                                              |
| • |   | the actual performance of        the reservoir and natural field decline; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| • |   | the ability and time        necessary to build suitable transport infrastructures to        export production to final markets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

Furthermore, deep waters and other hostile environments, wherethe majority of Eni’s planned and existing developmentprojects are located, can exacerbate these problems. Delays anddifferences between scheduled and actual timing of criticalevents, as well as cost overruns may adversely affect completion,the total amount of expenditures to be incurred and start up ofproduction from such projects and, consequently, actual returns.Finally, developing and marketing hydrocarbons reserves typicallyrequires several years after a discovery is made. This is becausea development project involves an array of complex and lengthyactivities, including appraising a discovery in order to evaluateits commercial potential, sanctioning a development project andbuilding and commissioning related facilities. As a consequence,rates of return for such long-lead-time projects are exposed tothe volatility of oil and gas prices which may be substantiallylower with respect to prices assumed when the investment decisionwas actually made, leading to lower rates of return. For example,we have experienced increased budgeted expenditures and asubstantial delay in the scheduling of production start up at theKashagan field, where development is ongoing. Moreover, in July2007 these matters triggered a dispute with the relevant Kazakhauthorities. On October 31, 2008, all the international partnersof the project and the Kazakh authorities agreed upon a newcontractual and governance framework of the Kashagan project,settling the dispute. See "Item 4 – Exploration &Production – Caspian Sea" for a full description of thematerial terms of the agreement. In conjunction with thefinalization of the agreements, parties also sanctioned therevised expenditure budget of phase-one, amounting to U.S. $32.2billion (excluding general and administrative expenses) of whichU.S. $25.4 billion related to the original scope of work of phase1 (including tranches 1 and 2), with the remaining part plannedto be spent to execute tranche 3 and build certain exportingfacilities. First oil is expected late in 2012. Eni will fundthose investments in proportion to its participating interest of16.81%. The original development plan that was filed with KazakhAuthorities in 2004 forecast expenditures of U.S. $10.3 billion(Eni’s interest being at the time 18.52%) to executetranches 1&2 (to be adjusted to take into account costinflation up to 2007) and first oil in 2008. The change inproduction start-up and the relevant cost increase over theoriginal budget were driven by: depreciation of the U.S. dollarversus the euro and other currencies; cost price escalation ofgoods and services required to execute the project; an originalunderestimation of the costs and complexity to operate in theNorth Caspian Sea due to lack of benchmarks; design changes toenhance the operability and safety standards of the offshorefacilities.

7

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See "Item 4 – Business Overview – Exploration& Production". If the Company is unable to develop andoperate major projects as planned, it may have a material adverseeffect on our results of operations and liquidity.

> 
*Inability to replace oil and natural gas reserves could    adversely impact results of operations and financial    condition*

Eni’s results of operations and financial condition aresubstantially dependent on its ability to develop and sell oiland natural gas. Unless the Company is able to replace producedoil and natural gas, its reserves will decline. TheCompany’s reserve replacement is affected by the entitlementmechanism in its Production Sharing Agreements and similarcontractual schemes. In accordance with such contracts, Eni isentitled to a portion of a field’s reserves, the sale ofwhich should cover expenditures incurred by the Company todevelop and operate the field. The higher the reference pricesfor Brent crude oil used to determine year-end amounts ofEni’s proved reserves, the lower the number of barrelsnecessary to recover the same amount of expenditures. TheCompany’s reserve replacement was negatively affected byreduced entitlements in its PSAs in the years 2006 and 2007 whenEni’s reserve replacement ratio was 38% in both years,meaning that the Company replaced less reserves than thoseproduced. Eni’s proved reserves of subsidiaries declined by6.1% in 2007 and by 5.8% in 2006. See "Item 4 –Business Overview – Exploration & Production".Future oil and gas production is dependent on the Company’sability to access new reserves through new discoveries,application of improved techniques, success in developmentactivity, negotiation with countries and other owners of knownreserves and acquisitions. An inability to replace reserves couldadversely impact future production levels and growth prospects,thus negatively affecting Eni’s future results of operationsand financial condition.

*We forecast a significant reduction in costs to develop andoperate oil and gas fields. If we fail to benefit from thisexpected trend, our oil and gas margins will deteriorate due tofalling hydrocarbons prices*

Due to the current oil downturn, we expect that prices foroilfield services and materials will trend lower in the future.We intend to benefit from this reduction by implementing theneeded cost initiatives to preserve our profitability in anenvironment of low oil prices. Cost initiatives includerescheduling of certain field developments to obtain cost savingand renegotiating contracts for oilfield services with oursupplies on more favorable terms. If we fail to achieve thetargeted levels of cost reductions, our profits per BOE in theExploration & Production segment will be adversely affected.

> 
*Changes in crude oil and natural gas prices may    adversely affect Eni’s results of operations*

The exploration and production of oil and gas is a commoditybusiness with a history of price volatility. The single largestvariable that affects the Company’s results of operationsand financial condition is crude oil prices. Eni generally doesnot hedge its exposure to variability in future cash flows due tocrude oil price movements. As a consequence, Eni’sprofitability depends heavily on crude oil and natural gasprices.

Crude oil and natural gas prices are subject to internationalsupply and demand and other factors that are beyond Eni’scontrol, including among other things:

| (i)   |   | the control on production        exerted by OPEC member countries which control a        significant portion of the worldwide supply of oil and        can exercise substantial influence on price levels;                                                                                                          |
|-------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii)  |   | global geopolitical and        economic developments, including sanctions imposed on        certain oil-producing countries on the basis of        resolutions of the United Nations or bilateral sanctions;                                                                                                        |
| (iii) |   | global and regional dynamics        of demand and supply of oil and gas; in the current        economic downturn we have experienced a significant        reduction in worldwide demand for crude oil and in the        European gas demand which have negatively impacted crude        oil and natural gas prices; |
| (iv)  |   | prices and availability of        alternative sources of energy;                                                                                                                                                                                                                                                    |
| (v)   |   | governmental and        intergovernmental regulations, including the        implementation of national or international laws or        regulations intended to limit greenhouse gas emissions,        which could impact the prices of hydrocarbons; and                                                            |
| (vi)  |   | success in developing and        applying new technology.                                                                                                                                                                                                                                                           |

All these factors can affect the global balance between demandand supply for oil and prices of oil. Such factors can alsoaffect the prices of natural gas because natural gas prices forthe major part of our supplies are typically indexed to theprices of crude oil and certain refined petroleum products. Lowercrude oil prices have an adverse impact on Eni’s results ofoperations and cash flows from operations.

Furthermore, lower oil and gas prices over prolonged periodsmay also adversely affect Eni’s results of operations andcash flows by: (i) reducing rates of return of developmentprojects either planned or being implemented, leading the Companyto reschedule, postpone or cancel development projects; (ii)reducing the Group’s liquidity, entailing lower resources tofund expansion projects, further dampening the Company’sability to grow future production and revenues; and (iii)triggering a review of future recoverability of theCompany’s carrying amounts of oil and gas properties, whichcould lead to the recognition of significant impairments charges.

8

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> 
*Uncertainties in Estimates of Oil and Natural Gas    Reserves*

Numerous uncertainties are inherent in estimating quantitiesof proved reserves and in projecting future rates of productionand timing of development expenditures. The accuracy of provedreserve estimates depends on a number of factors, assumptions andvariables, among which the most important are the following:

| • |   | the quality of available        geological, technical and economic data and their        interpretation and judgment;                                                  |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | projections regarding future        rates of production and timing of development        expenditures;                                                                 |
| • |   | whether the prevailing tax        rules, other government regulations and contractual        conditions will remain the same as on the date estimates        are made; |

| • |   | results of drilling, testing        and the actual production performance of Eni’s        reservoirs after the date of the estimates which may        require substantial upward or downward revisions; and                                                                                                                                                                                                                                                  |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | changes in oil and natural        gas prices which could affect the quantities of        Eni’s proved reserves because the estimates of        reserves are based on prices and costs existing as of the        date when those estimates are made. In particular the        reserves estimates are subject to revisions as prices        fluctuate due to the cost recovery mechanism under the        Company’s PSAs and similar contractual schemes. |

Many of these factors, assumptions and variables involved inestimating proved reserves are beyond Eni’s control and maychange over time and impact the estimates of oil and natural gasreserves. Accordingly, the estimated reserves could besignificantly different from the quantities of oil and naturalgas that ultimately will be recovered. Additionally, any downwardrevision in Eni’s estimated quantities of proved reserveswould indicate lower future production volumes, which couldadversely impact Eni’s results of operations and financialcondition.

> 
*Oil and gas activity may be subject to increasingly    high levels of income taxes*

In recent years, Eni has experienced adverse changes in taxregimes applicable to oil and gas operations in Italy and in anumber of countries where the Company conducts its upstreamoperations. Management believes that adverse changes are alwayspossible in the tax regimes of any country in which Eni conductsits oil and gas operations, regardless of the level of stabilityof the political and legislative framework in each country. Inrecent years, developments in the regulatory framework, mainlyregarding tax issues, have been implemented or announced also inEU countries and in North America. In 2008, Italy enacted new taxrules that increased the statutory tax rate applicable to energycompanies with annual turnover in excess of euro 25 million by5.5 percentage points, thus reversing a reduction in thestatutory tax rate of the same amount that was enacted theprevious year. Early in 2009, the Italian Parliament enacted asupplemental tax rate of 4% that has to be applied to profitbefore income taxes reported by the parent company Eni SpAassociated with the Treaty between Italy and Libya. Thissupplemental tax rate will entail increased tax payablesamounting to approximately euro 300 million for the full year2009.

Adverse changes in the tax rate applicable to the Group profitbefore income taxes would translate into negative impacts onEni’s future results of operations and cash flows.Furthermore, the marginal tax rate in the oil and gas industrytends to increase in correlation with higher oil prices whichcould make it difficult for Eni to translate higher oil pricesinto increased net profit. However, the Company does not expectthat the marginal tax rate will trend lower in response tofalling oil prices.

 

> 
***Political Considerations***

*A substantial portion of our oil and gas reserves and    gas supplies are located in politically, socially and    economically unstable countries where we are exposed to    material disruptions to our operations*

Substantial portions of Eni’s hydrocarbon reserves arelocated in countries outside the EU and North America, some ofwhich may be politically or economically less stable than EU orNorth American countries. At December 31, 2008, approximately 80%of Eni’s proved hydrocarbon reserves were located in suchcountries. Similarly, a substantial portion of Eni’s naturalgas supplies comes from countries outside the EU and NorthAmerica. In 2007, approximately 70% of Eni’s supplies ofnatural gas came from such countries. See "Item 4 – Gas& Power – Natural Gas Supplies". Adverse political,social and economic developments in any of those countries mayaffect Eni’s ability to continue operating in an economicway, either temporarily or permanently, and Eni’s ability toaccess oil and gas reserves. Particularly Eni faces risks inconnection with the following issues: (i) lack ofwell-established and reliable legal systems and uncertaintiessurrounding enforcement of contractual rights; (ii) unfavorabledevelopments in laws, regulations and contractual arrangementsleading for example to expropriations or forced divestitures ofassets and unilateral cancellation or modification of contractualterms. For example, in conjunction with the rescheduling of theKashagan project in 2007, the Kazakh authorities opened a disputeagainst the international partners of the consortium operatingthe Kashagan development claiming failure on part of theconsortium to fulfill certain contractual obligations.Subsequently, the Kazakh authorities and the internationalpartners of the consortium have agreed on a new contractualframework of the project. See "Item 4 – Exploration& Production – Caspian Sea" for a full descriptionof the material terms of the agreement; (iii) restrictions onexploration, production, imports and exports; (iv) tax or royaltyincreases (including retroactive claims); and (v) civil andsocial unrest leading to sabotages, acts of violence andincidents. For example, we have been 

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experiencing continuing social unrest in Nigeria leading to anumber of disruptions at certain Eni oil producing facilities inthe country. As a consequence, our oil and gas production in thecountry has yet to return to normal production levels. In thefirst quarter of 2009, security problems have continued to impactour operations.

In 2008 we incurred significant asset impairments in ourExploration & Production business amounting to euro 989million mainly driven by changes in contractual arrangements andregulatory provisions and environmental obligations leading theCompany to reassess the recoverable amounts of a number of itsoil and gas properties.

See "Item 4 – Exploration & Production –Oil and Natural Gas Reserves"; and "Item 5 –Recent Developments". While the occurrence of these eventsis unpredictable, it is likely that the occurrence of such eventscould cause Eni to incur material losses or facility disruptions,by this way adversely impacting Eni’s results of operationsand cash flows.

> 
*Our activities in Iran could lead to sanctions under    relevant U.S. legislation*

Eni is currently conducting oil and gas operations in Iran.The legislation and other regulations of the United States ofAmerica impose sanctions on this country and may lead to theimposition of sanctions on any persons doing business in thiscountry or with Iranian counterparties.

Under the Iran Sanctions Act of 1996 (as amended,"ISA"), which implements sanctions against Iran withthe objective of denying it the ability to support acts ofinternational terrorism and fund the development or acquisitionof weapons of mass destruction, upon receipt by the U.S.authorities of information indicating potential violation of thisact, the President of the United States is authorized to start aninvestigation aiming at possibly imposing sanctions from asix-sanction menu against any person found in particular to haveknowingly made investments of U.S. $20 million or more in anytwelve-month period, contributing directly and significantly tothe enhancement of Iran’s ability to develop itshydrocarbons resources. Furthermore, the ISA envisages that thePresident of the United States is bound to impose sanctionsagainst any persons that knowingly contribute to certain militaryprograms of Iran, effective on June 6, 2006. Eni cannot predictinterpretations of, or the implementation policy of the U.S.Government under ISA with respect to Eni’s current or futureactivities in Iran or other areas. Eni has incurred capitalexpenditures in excess of U.S. $20 million in Iran in each of thelast 9 years. Management expects to continue investing in Iranyearly amounts in excess of that threshold in the foreseeablefuture. Eni’s current activities in Iran are primarilylimited to carrying out residual development activities relatingto certain buy-back contracts it entered into in 2000 and 2001and no sanctions have ever been imposed on Eni’s activitiesin the country.

Adding to Eni’s risks arising from this matter, a bill toamend and extend the extra-territorial reach of the economicsanctions imposed by the United States with respect to Iran hasbeen passed by the U.S. House of Representatives and may lead tothe passage of new laws in this area. Iran continues to bedesignated by the U.S. State Department as a State sponsoringterrorism. For a description of Eni’s operations in Iran see"Item 4 – Information on the Company – Exploration& Production – North Africa and Rest of World". Itis possible that in future years Eni’s activities in Iranmay be sanctioned under relevant U.S. legislation.

We are aware of initiatives by certain U.S. states and U.S.institutional investors, such as pension funds, to adopt orconsider adopting laws, regulations or policies requiringdivestment from, or reporting of interests in, companies that dobusiness with countries designated as states sponsoringterrorism. These policies could adversely impact investment bycertain investors in our securities.

 

> 
***Cyclicality of the Petrochemical Industry***

The petrochemical industry is subject to cyclical fluctuationsin demand, with consequential effects on prices and profitabilityexacerbated by the highly competitive environment of thisindustry. Eni’s petrochemical operations have been in thepast and may be adversely affected in the future by worldwideeconomic slowdowns and excess installed production capacity.Furthermore, Eni’s petrochemical operations face increasingcompetition from Asiatic companies and national oilcompanies’ petrochemical divisions which can leverage oncertain long-term competitive advantages in terms of loweroperating costs and feedstock purchase costs. In particular,Eni’s petrochemical operations are located mainly in Italyand Western Europe where regulatory framework and publicenvironmental sensitivity are generally more stringent than inother countries, especially Far East countries, resulting inhigher operating costs of our petrochemical operation compared tothe Company’s Asiatic competitors due to the need to complywith applicable laws and regulations in environmental and otherrelated matters. In 2008 our petrochemicals operations postedoperating losses of euro 822 million due to sharply higherfeed-stock costs in the first half of the year and lower productvolumes and margins in the second half due to the currenteconomic downturn and related asset impairments. Impairmentlosses were recorded amounting to euro 278 million as therecoverable amounts of certain petrochemicals plants were lowerthan their carrying amounts due to deteriorating profitabilityprospects on the back of lowered expectations for industryfundamentals and unfavorable trends in the trading environment.As 

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the downturn is expected to continue for the full year 2009,we do not project any significant improvement in ourpetrochemicals business profitability.

 

> 
***Liberalization of the Italian Natural Gas Market***

Legislative Decree No. 164/2000 opened up the Italian naturalgas market to competition as from January 1, 2003. As a result,all customers in Italy are free to choose their supplier ofnatural gas. The decree, among other things, introduced ruleswhich have a significant impact on Eni’s activity, as theCompany is present in all the phases of the natural gas chain:

| • |   | until December 31, 2010,        antitrust thresholds are in place for gas operators in        Italy as follows: (i) effective January 1, 2002,        operators are prohibited to transmit into the national        transport network imported or domestically produced gas        volumes higher than a preset share of Italian final        consumption. This share was 75% of total final        consumption in the first year of regulation, decreasing        by 2 percentage points per year to achieve a 61%        threshold in terms of final consumption by 2009 (this        share amounted to 63% in 2008); and (ii) effective        January 1, 2003, operators are forbidden from marketing        gas volumes to final customers in excess of 50% of        overall volumes marketed to final customers. Compliance        with these ceilings is verified annually by comparing        actual average shares reached by any operator in a given        three-year period for both volumes input and volumes        marketed to customers to average shares permitted by the        law for the same period. Actual shares are computed net        of losses (in the case of sales) and volumes of natural        gas consumed in own operations. Based on a bill passed by        the Italian upper house, Eni expects that these antitrust        thresholds will be renewed when they expire in 2010; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | access to natural gas        infrastructures is guaranteed to any natural gas operator        on the basis of certain procedures that must be        transparent and non discriminatory. Natural gas        infrastructures comprise high pressure, high sized        pipelines for transporting natural gas over long        distances, certain depleted fields to store natural gas,        re-gasification facilities and low pressure, small sized        pipelines for distributing natural gas to residential and        commercial clients located in urban centers. Tariffs to        use these infrastructures are set by the Authority for        Electricity and Gas, an independent governmental body.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |

Furthermore, on June 30, 2008 provisions came into effect onthe unbundling of regulated entities in the Italian gas sector onthe basis of a Code that was adopted by the Authority forElectricity and Gas in 2007. According to unbundling rules,controlling entities as in the case of the parent company Eni SpAare forbidden from interfering in the decision-making process ofits subsidiaries running gas transport, storage and distributioninfrastructures.

Eni expects that a combination of regulatory effects andincreasing competition will limit growth prospects andprofitability of our natural gas business in Italy as discussedbelow.

> 
*Eni has been experiencing significant pressure on its    natural gas margins*1*since the inception of    the liberalization process in Italy. In the current economic    downturn, margin pressures could worsen also considering an    expected increase in supplies of natural gas to the Italian    market in light of new import capacity that has been    completed or is expected to come on stream in the next one to    three years*

Since the inception of the liberalization process in theItalian natural gas market, Eni has been experiencing risingcompetition in its natural gas business leading to lower sellingmargins due to the entry of new competitors into the market.Certain competitors of Eni are supplied by the Company itself,generally on the basis of long-term contracts. In fact, in orderto comply with the above mentioned regulatory thresholds relatingto volumes supplied through the national transport network andsales volumes in Italy, Eni sold part of its gas availabilityunder its take-or-pay supply contracts to third parties importingsaid volumes to Italy and marketing them to Italian customers.For more information on Eni’s take-or-pay contracts, see"Item 4 – Gas & Power – Natural gaspurchases".

Management expects Eni’s gas selling margins in Italy toremain under pressure in the foreseeable future consideringdeteriorating demand fundamentals in the current economicdownturn, Eni’s gas availability under its take-or-paysupply contracts, build-up of Eni’s supplies to the abovementioned competitors and new competitors entering the Italianmarket also in light of ongoing or already implemented capitalprojects designed to expand the transport capacity of importpipelines to Italy and to build new import infrastructures,particularly LNG terminals. In fact, Eni is currentlyimplementing its plans to upgrade its natural gas importpipelines mainly from Algeria and Russia to Italy to achieve anincrease of 13 BCM/y in import capacity reaching full operationin 2010. Specifically, the upgrading of the TTPC pipeline fromAlgeria was completed in 2008 and is expected to be fullyoperational in 2009. The upgrade of the Russian pipeline isongoing. Further 3 BCM/y of new import capacity will be added byupgrading the GreenStream gasline from Libya with expected startup in 2012. A large portion of the new capacity deriving fromEni’s upgrading projects has been or is planned to be soldto third parties. In addition, a third party project has beenimplemented to build a new LNG terminal with an 8 BCM/y capacityin the Adriatic Sea and is expected to commence operations bylate 2009. These new or upgraded gas infrastructures willconsiderably increase supplies to the Italian natural gas marketat a time when demand is falling due to the economic downturn.

 

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| (1) | i | For a        definition of margin see "Glossary". |
|-----|---|-------------------------------------------------------------|

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Despite the fact that an increasing portion of natural gasvolumes purchased by Eni under its take-or-pay contracts isplanned to be marketed outside Italy, management believes thatunfavorable trends in the Italian demand and supply for naturalgas on both the short and the longer-term, also due to thereaching of full operation at new supply infrastructures, and theevolution of Italian regulations of the natural gas sector,represent risk factors to the fulfillment of Eni’sobligations in connection with its take-or-pay supply contractsand may result in a downward pressure on the Company’s gasselling margins. Based on the foregoing, Eni’s futureresults of operations and cash flows might be adversely affected.

> 
*Eni is committed to increasing natural gas sales in    Europe. If Eni fails to achieve this target, future growth    prospects may be adversely affected. Furthermore, Eni may be    unable to fulfill its minimum take obligations under its    take-or-pay purchase contracts and this could adversely    impact results of operations and liquidity*

Over the medium-term, Eni plans to increase its natural gassales in Europe leveraging on its natural gas availability undertake-or-pay purchase contracts it has entered into with majornatural gas producing countries (namely Russia, Algeria, Libya,Norway and the Netherlands) and synergies from the acquisition ofthe Belgian gas operator Distrigas that was completed in 2008.Should Eni fail to increase natural gas sales in Europe asplanned due to poor strategy execution or competition, Eni’sfuture growth prospects, results of operations and cash flowsmight be adversely affected also taking account that Eni might beunable to fulfill its contractual obligations to purchase certainminimum amounts of natural gas based on its take-or-pay purchasecontracts currently in force.

> 
*Due to the regulated access to natural gas transport    infrastructures in Italy, Eni may not be able to sell in    Italy all the natural gas volumes it planned to import and,    as a consequence, the Company may be unable to sell all the    natural gas volumes which it is committed to purchase under    take-or-pay contract obligations*

Over the medium-term, Eni has scheduled its import volumes ofnatural gas to Italy based on the assumption to use the purchaseflexibility contractually provided by its take-or-pay purchasecontracts during periods in which demand is expected to peak.These import programs are also based on the assumption that Eniwill obtain the necessary transport capacity entitlements on theItalian transport network. However, Eni’s planningassumptions may be considered to be not fully in line withcurrent rules regulating the access to the Italian transportinfrastructures as provided for by the Network Code currently inforce which has been drafted in accordance with Decision No. 137of July 17, 2002 of the Authority for Electricity and Gas. Suchrules establish certain priority criteria for transport capacityentitlements at points where the Italian transport infrastructureconnects with international import pipelines (the so-called entrypoints to the Italian transport system). Specifically, Eni’sgas volumes purchased under take-or-pay contracts are entitled toa priority in the allocation of available transport capacity foramounts not exceeding average daily contractual volumes.Accordingly, Eni’s purchase volumes exceeding average dailycontractual volumes are not entitled to any priority in gainingaccess to the Italian transport infrastructures. The contractualflexibility represented by Eni’s right to uplift dailyvolumes larger than average daily contractual volumes under itstake-or-pay purchase contracts is used when demand peaks, usuallyduring the wintertime. In the event congestion occurs at entrypoints to the Italian transport network, under current regulationavailable transport capacity would be entitled firstly tooperators having a priority right, i.e. holders of take-or-paycontracts within the limits of average daily contractual volumes.Then any residual available transport capacity would be allocatedin proportion to all pending capacity requests. Eni considersDecision No. 137/2002 to be inconsistent with the overallrationale of the European natural gas regulatory framework,especially with reference to Directive 98/30/CE (superseded andreplaced by Directive 03/55/CE) and Legislative Decree No.164/2000, and has opened an administrative procedure to repealDecision No. 137/2002 before an administrative court. See"Item 4 – Regulation of the Italian HydrocarbonsIndustry – Gas & Power". Eni cannot rule out anegative outcome for this matter. However, management believesthat Eni’s results of operations and cash flows could beadversely affected should market conditions in light of currentregulatory constraints prevent Eni from selling its wholeavailability of natural gas purchased to fulfill its minimum takecontract obligations (e.g. in case a congestion occurs at theentry points of the Italian transport infrastructure, Eni wouldbe forced to uplift a smaller volume of gas than the minimumcontractual take). See "Item 5 – ManagementExpectations of Operations".

> 
*The Italian Government, Parliament and the regulatory    authorities in Italy and in Europe may take further steps to    increase competition in the Italian natural gas market and    such regulatory developments may adversely affect Eni’s    results of operations and cash flows*

Italian institutional and political forces are urging a higherdegree of competition in the Italian natural gas market and thismay produce significant developments in this area. A briefdescription follows of certain recently enacted laws and certainproceedings before the Authority for Electricity and Gas and theItalian Antitrust Authority in order to allow investors to gainsome insight into the complexity of this matter. For a fulldiscussion of laws and procedures described herein see "Item4 – Regulation of the Italian Hydrocarbons Industry –Gas & Power".

In 2003, Law No. 290 was enacted which prohibits Eni fromholding an interest higher than 20% in undertakings owningnatural gas transport infrastructure in Italy (Eni currentlyholds a 50.04% interest in Snam Rete Gas, which owns and managesapproximately 97% of the Italian natural gas transportinfrastructure). A decree is expected to be enacted by theItalian Prime Minister to establish the relevant provisions toimplement this mandatory disposal. The deadline for the disposal,which was initially scheduled for December 31, 2008, is to be re-

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scheduled in a 24-month term starting from the date in whichthis decree from the Italian Prime Minister becomes effective.Currently, Eni is unable to foresee a deadline for this disposal.

On the basis of a joint inquiry conducted from 2003 throughJune 2004 on the Italian natural gas market, the Authority forElectricity and Gas and the Italian Antitrust Authority (the"Antitrust Authority") concluded that the overall levelof competition of the Italian natural gas market isunsatisfactory due to the dominant position held by Eni in manyphases of the natural gas chain. According to both the Authorityfor Electricity and Gas and the Antitrust Authority, the verticalintegration of Eni in the supply, transport and storage of gashas restricted the development of competition in Italynotwithstanding the antitrust ceilings introduced by LegislativeDecree No. 164/2000. It was further stated that the price ofnatural gas in Italy (in particular for the industrial sector) ishigher than in other European countries. In order to implement aLaw Decree defined by the Italian Government to face the economicdownturn, in March 2009 the Authority for Electricity and Gasproposed certain rules on the Italian gas market designed toincrease competition. These rules provide that Eni supplies tothe market preset amounts of natural gas at fixed prices.Implementation of these rules could materially and adverselyaffect the Company’s results of operations and cash flow.

In November 2006, the Authority for Electricity and Gasconcluded an inquiry concerning the competitive behavior ofoperators selling natural gas to residential and commercialcustomers. This inquiry found that the retailing market fornatural gas in Italy lacked a sufficient degree of competitiondue to current commercial practices and the existence of bothentry and exit barriers.

In November 2007, the Italian Authority for Electricity andGas and the Italian Antitrust Authority opened an inquiry to gaininsight into the functioning of the natural gas storage activityin Italy, particularly with regard to lack of investments byoperators directed to expand capacity to store natural gas inItaly. Eni through its wholly-owned subsidiary Stogit Italia ownsalmost the entire storage capacity currently existing in Italy.

Management believes the institutional debate on the degree ofcompetition in the Italian natural gas market and the regulatoryactivity to be areas of attention and cannot exclude negativeimpacts deriving from developments on these matters on Eni’sfuture results of operations and cash flows.

> 
*Decisions of the Authority for Electricity and Gas on    the matter of natural gas tariffs may diminish Eni’s    ability to determine the price at which it sells natural gas    to customers*

On the basis of certain legislative provisions, the Authorityfor Electricity and Gas ("the Authority") holds ageneral monitoring power on pricing in the natural gas market inItaly and the power to establish selling tariffs for supplyingnatural gas to residential and commercial users consuming lessthan 200,000 CM/y (qualified as non eligible customers atDecember 31, 2002 as defined by Legislative Decree No. 164/2000)taking into account, among other things, the public interest ofcontaining inflationary pressure due to rising energy costs. Thedecisions of the Authority on these matters may limit the abilityof Eni to pass an increase in the purchase cost of natural gas onto the final consumers. Following a complex and lengthyadministrative procedure started in 2004 and finalized in March2007 with Resolution No. 79/2007, the Authority established a newindexation mechanism for updating the raw material cost componentin supplies to residential and commercial users consuming lessthan 200,000 CM/y, establishing, among other things: (i) that anincrease in the international price of Brent crude oil is onlypartially transferred to residential and commercial users ofnatural gas in case international prices of Brent crude oilexceed the 35 dollars per barrel threshold; and (ii) that Italiannatural gas importers – including Eni – mustrenegotiate wholesale supply contracts in order to take accountof this new indexation mechanism. Management cannot exclude thepossibility that in the future the Authority could implementsimilar measures that may negatively affect Eni results ofoperations and liquidity.

Certain provisions of law may also limit the Company’sability to set commercial margins. Specifically, Law Decree No.112 enacted in June 2008 forbids energy companies such as Eni totransfer on to customers, through higher prices, the higherincome taxes incurred in connection with a supplemental tax rateof 5.5 percentage points introduced by the same decree on energycompanies with a yearly turnover in excess of euro 25 million.The Authority for Electricity and Gas is in charge of monitoringcompliance with the rule. The Authority has subsequently thatenergy companies have to adopt effective operational andmonitoring systems in order to prevent the transfer to customersby means of unlawful variations of final prices of gas.

For more information on these issues (particularly theAuthority’s Decisions No. 248/2004, 134/2006 and 79/2007)see "Item 4 – Regulation – Gas & Power".

 

> 
***Antitrust and competition law***

The Group’s activities are subject to antitrust andcompetition laws and regulations in many countries of operations,especially in Europe. In the years prior to 2008, Eni recordedsignificant loss provisions due to unfavorable developments incertain antitrust proceedings before the Italian AntitrustAuthority, and the European 

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Commission. It is possible that the Group may incursignificant loss provisions in future years relative to ongoingantitrust proceedings or possible new proceedings. The Group isparticularly exposed to this risk in its natural gas and refiningand marketing activities due to its large presence in thesemarkets in Italy and in Europe. See Note 29 to the ConsolidatedFinancial Statements for a full description of Eni’s mainpending antitrust proceedings. Particularly, as a result of aninquiry on the level of competition in the European natural gasmarket, on March 9, 2009 the European Commission sent Eni aStatement of Objections related to a proceeding under Article No.82 of the EU Treaty and Article No. 54 of the SEE agreement withreference to an alleged unjustifiable refusal of access to theTAG and TENP/Transitgas gas pipelines, that are interconnectedwith the Italian gas transport system through actions intended to"capacity hoarding, capacity degradation and strategiclimitation of investment" with the effect of "hinderingthe development of a real competition in the downstream marketand [...] harming the consumers". The European Commissionenvisages the possible imposition of a fine and of structuralremedies. Based on available information and its knowledge of theproceeding, the Company is currently unable to determine theoutcome of the matter.

Furthermore, based on the findings of antitrust proceedings,plaintiffs could seek payment to compensate for any allegeddamages as a result of antitrust business practices on part ofEni. Both these risks could adversely affect the Group’sfuture results of operations and cash flows.

 

> 
***Environmental, Health and Safety Regulation***

*Eni may incur material operating expenses and    expenditures in relation to compliance with applicable    environmental, health and safety regulations*

Eni is subject to numerous EU, international, national,regional and local environmental, health and safety laws andregulations concerning its oil and gas operations, products andother activities. In particular, these laws and regulationsrequire the acquisition of a permit before drilling forhydrocarbons may commence, restrict the types, quantities andconcentration of various substances that can be released into theenvironment in connection with exploration, drilling andproduction activities, as well as refining, petrochemicals andother Group operations, limit or prohibit drilling activities incertain protected areas, provide for measures to be taken toprotect the safety of the workplace and health of communitiesinvolved by the company’s activities, and impose criminal orcivil liabilities for polluting the environment or harmingemployees or communities health and safety resulting from oil,natural gas, refining, petrochemical and other Group’soperations.

These laws and regulations may also restrict emissions anddischarges to surface and subsurface water resulting from theoperation of natural gas processing plants, petrochemical plants,refineries, pipeline systems and other facilities owned by Eni.In addition, Eni’s operations are subject to laws andregulations relating to the production, handling, transportation,storage, disposal and treatment of waste materials. Breach ofenvironmental, health and safety laws exposes the Company’semployees to criminal and civil liability and the Company to theincurrence of liabilities associated with compensation forenvironment health or safety damage. Additionally, in the case ofviolation of certain rules regarding safety in the workplace, theCompany can be liable as provided for by a general EU rule onbusinesses liability due to negligent or willful conduct on partof their employees as adopted in Italy with Law Decree No.231/2001.

Environmental, health and safety laws and regulations have asubstantial impact on Eni’s operations. Management expectsthat the Group will continue to incur significant amounts ofoperating expenses and expenditures to comply with environmental,health and safety laws and regulations, also taking into accountpossible future developments in environmental regulations inItaly and in other countries where Eni operates, particularly theimplementation of increasingly strict measures decided at bothinternational and country level to reduce greenhouse gasemissions.

> 
*Eni’s results of operations and financial    condition are exposed to risks deriving from environmental,    health and safety accidents and liabilities*

Risks of environmental, health and safety incidences andliabilities are inherent in many of Eni’s operations andproducts. Notwithstanding management believes that Eni adoptshigh operational standards to ensure safety of its operations andto protect the environment and health of people and employees, itis always possible that incidents like blow-outs, spillovers,contaminations and similar events could occur that would resultin damage to the environment, employees and communities. Inparticular, Eni is performing a number of remedial actions torestore and clean-up certain industrial sites that werecontaminated by the Group’s industrial activities inprevious years, mainly in Italy. Management expects furtherremedial actions to be implemented in future years. The Group hasaccrued risk provisions to cope with all existing environmentalliabilities whereby both a legal or constructive obligation toperform a clean-up or other remedial actions is in place and theassociated costs can be reasonably estimated. The accrued amountrepresents the management’s best estimates of futureenvironmental expenses to be incurred. Notwithstanding this,management believes that it is possible that in the future Enimay incur significant environmental expenses and liabilities inaddition to the amounts already accrued due to: (i) the chance ofas yet 

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unknown contamination; (ii) the results of on-going surveys orsurveys to be carried out on the environmental status of certainEni’s industrial sites as required by the applicableregulations on contaminated site; (iii) unfavorable developmentsin ongoing litigation on the environmental status of certainCompany’s site where a number of public administrations andthe Italian Ministry for environment act as plaintiffs; (iv) thepossibility that new litigation might arise; and (v) theprobability that new and stricter environmental laws might beimplemented.

 

> 
***Legal Proceedings***

Eni is party to a number of civil actions and administrativeproceedings arising in the ordinary course of the business. Inaddition to existing provisions accrued as of the balance sheetdate to account for ongoing proceedings, it is possible that infuture years Eni may incur significant losses in addition toamounts already accrued in connection with pending legalproceedings due to: (i) uncertainty regarding the final outcomeof each proceeding; (ii) the occurrence of new developments thatmanagement could not take into consideration when evaluating thelikely outcome of each proceeding in order to accrue the riskprovisions as of the date of the latest financial statements;(iii) the emergence of new evidence and information; and (iv)underestimation of probable future losses.

 

> 
***Risks related to Changes in the Price of Oil,    Natural Gas, Refined Products and Chemicals***

Operating results in Eni’s Exploration & Production,Refining & Marketing, and Petrochemical segments are affectedby changes in the price of crude oil and by movements in crudeoil prices on margins of refined and petrochemical products.

> 
*Eni’s results of operations are affected by    changes in international oil prices*

Overall, lower oil prices have a net adverse impact onEni’s results of operations. The effect of lower oil priceson Eni’s average realizations for produced oil is generallyimmediate. Furthermore, Eni’s average realizations forproduced oil differ from the price of Brent crude markerprimarily due to the circumstance that Eni’s productionslate, which also includes heavy crude qualities, has a lower APIgravity compared with Brent crude (when processed the latterallows for higher yields of valuable products compared to heavycrude qualities, hence higher market price).

> 
*The favorable impact of higher oil prices on Eni’s    results of operations may be offset by different trends in    margins for Eni’s downstream businesses*

The impact of changes in crude oil prices on Eni’sdownstream businesses, including the Gas & Power, theRefining & Marketing and the Petrochemical businesses,depends upon the speed at which the prices of gas and productsadjust to reflect these changes. Wholesale margins in the Gas& Power business are substantially independent fromfluctuations in crude oil prices as purchase and selling pricesof natural gas are contractually indexed to prices of crude oiland certain refined products according to similar pricingschemes. However, quarterly performance and year-to-yearcomparability of results of Eni’s natural gas business maybe somewhat affected by the indexation mechanism of the rawmaterial component in gas supplies to residential customers andcertain resellers to residentials in Italy in accordance withapplicable regulations from the Italian Authority for Electricityand Gas as outlined above in the risk factor describing the"Liberalization of the Italian Natural Gas Market".Specifically, this indexation mechanism provides a certain timelag between movements in the price of crude oil and the relatedadjustment to the selling price of natural gas. For a detaileddiscussion of this indexation mechanism in Italy see "Item 4– Regulation – Gas & Power – Natural gasprices".

In the Refining & Marketing and Petrochemical businesses atime lag exists between movements in oil prices and in prices offinished products.

> 
*Eni’s results of operations are affected by    changes in European refining margins*

The results of operations of Eni’s Refining &Marketing segment are substantially affected by changes inEuropean refining margins which reflect changes in relativeprices of crude oil and refined products as outlined above. Theprices of refined products in turn depend on global and regionalsupply/demand balances, inventory levels, refinery operations,import/export balances and weather. Furthermore, Eni’srealized margins are also affected by relative price movements ofheavy crude qualities vs. light crude qualities, taking intoaccount the ability of Eni’s refineries to process complexcrudes that represent a cost advantage when market prices ofheavy crudes are relatively cheaper than the marker Brent price.In 2009, Eni expects that weak demand for products and narrowingprice differentials between heavy and light crudes ones willnegatively affect the performance of Eni’s refiningoperations.

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> 
*Eni’s results of operations are affected by    changes in petrochemical margins*

Eni’s margins on petrochemical products are affected bytrends in demand for petrochemical products and changes in oilprices which influence changes in purchase costs ofpetroleum-based feedstock. Given the commoditized nature of Enipetrochemical products, it is difficult for the Company totransfer higher purchase costs for oil-based feedstock to sellingprices to customers. In 2008, the profitability of Eni’spetrochemical segment was significantly affected by lower sellingmargins for commodity petrochemical products due to higherpurchase costs for oil-based feedstock that were not fullytransferred to selling prices of products in the first half ofthe year and, subsequently by weak demand for petrochemicalproducts. These negative factors also triggered assetimpairments. Management’s outlook for 2009 is alsochallenging, and management does not expect any significantimprovement in the trading environment from 2008 and possibly afurther contraction in margins on petrochemical products.

 

> 
***Risks from Acquisitions***

Eni constantly monitors the oil and gas market in search ofopportunities to acquire individual assets or corporations inorder to achieve its growth targets or complement its assetportfolio. Acquisitions entail an execution risk – the riskthat the acquirer will not be able to effectively integrate thepurchased assets so as to achieve expected synergies. Inaddition, acquisitions entail a financial risk – the risk ofnot being able to recover the purchase costs of acquired assets,in case a prolonged decline in the market prices of oil andnatural gas occurs. We also incur unanticipated costs or assumeunexpected liabilities and losses in connection with companies orassets we acquire. If the integration and financial risksconnected to acquisitions materialize our financial performancemay be adversely affected.

 

> 
***Credit risk***

Credit risk is the potential exposure of the Group to lossesin case counterparties fail to perform or pay amounts due. Creditrisks arise from both commercial partners and financial ones.Although the Group has never experienced material non-performancefrom its counterparties, due to the severity of the currenteconomic and financial crisis it is possible that we mayexperience a higher than normal level of counterparty failure. Inour consolidated financial statements for the year 2008, weaccrued an allowance against doubtful accounts amounting to euro251 million more than doubling the allowance made a year earlier.

 

> 
***Exchange Rates***

Movements in the exchange rate of the euro against the U.S.dollar can have a material impact on Eni’s results ofoperations. Prices of oil, natural gas and refined productsgenerally are denominated in, or linked to, U.S. dollars, while asignificant portion of Eni’s expenses are denominated ineuros. Similarly, prices of Eni’s petrochemical products aregenerally denominated in, or linked to, the euro, whereasexpenses in the Petrochemical segment are denominated both ineuros and U.S. dollars. Accordingly, a depreciation of the U.S.dollar against the euro generally has an adverse impact on Eniresults of operations and liquidity because it reduces bookedrevenues by an amount greater than the decrease indollar-denominated expenses. The Exploration & Productionsegment is particularly affected by movements in the U.S. dollarvs. the euro exchange rates. In 2008, Eni’s operating profitin this business segment has been impacted by an estimated amountof euro 1.2 billion due to a 7.3% depreciation of the U.S. dollarversus the euro.

 

> 
***Risks deriving from Eni’s Exposure to Weather    Conditions***

Significant changes in weather conditions in Italy and in therest of Europe from year to year may affect demand for naturalgas and some refined products; in colder years, demand is higher.Accordingly, the results of operations of the Gas & Powersegment and, to a lesser extent, the Refining & Marketingsegment, as well as the comparability of results over differentperiods may be affected by such changes in weather conditions.

Furthermore, our operations, particularly offshore productionof oil and natural gas, are exposed to extreme weather phenomenathat can result in material disruption to our operations andconsequent loss or damage of properties and facilities.

 

> 
***Interest Rates***

Interest on Eni’s finance debt is primarily indexed at aspread to benchmark rates such as the Europe Interbank OfferedRate, "Euribor", and the London Interbank Offered Rate,"Libor". As a consequence, movements in interest ratescan have a material impact on Eni’s finance expense inrespect to its finance debt.

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> 
***Critical Accounting Estimates***

The preparation of financial statements requires management tomake certain accounting estimates that are characterized by ahigh degree of uncertainty, complexity and judgment. Theseestimates affect the reported amount of the Company’s assetsand liabilities, as well as the reported amount of theCompany’s income and expenses for a given period. Althoughmanagement believes these estimates to represent the best outcomeof the estimation process, actual results could differ from suchestimates, due to, among other things, the following factors:uncertainty, lack or limited availability of information; theavailability of new informative elements, variations in economicconditions such as prices, significant factors (e.g. removaltechnologies and costs) and the final outcome of legal,environmental or regulatory proceedings. See "Item 5 –Critical Accounting Estimates".

 

 

**Item 4. INFORMATION ON THE COMPANY**

**History and Development of the Company**

Eni SpA with its consolidated subsidiaries is engaged in theoil and gas, electricity generation, petrochemicals, oilfieldservices and engineering industries. Eni has operations in about70 countries and 78,880 employees as of December 31, 2008.

Eni, the former Ente Nazionale Idrocarburi, a public lawagency, established by Law No. 136 of February 10, 1953, wastransformed into a joint stock company by Law Decree No. 333published in the Official Gazette of the Republic of Italy No.162 of July 11, 1992 (converted into law on August 8, 1992, byLaw No. 359, published in the Official Gazette of the Republic ofItaly No. 190 of August 13, 1992). The Shareholders’ Meetingof August 7, 1992 resolved that the company be called Eni SpA.Eni is registered at the Companies Register of Rome, register taxidentification number 00484960588, R.E.A. Rome No. 756453. Eni isexpected to remain in existence until December 31, 2100; itsduration can however be extended by resolution of theshareholders.

Eni’s registered head office is located at PiazzaleEnrico Mattei 1, Rome, Italy (telephone number: +39-0659821). Enibranches are located in:

• San Donato Milanese (Milan), Via Emilia, 1; and

• San Donato Milanese (Milan), Piazza Ezio Vanoni, 1.

Internet address: www.eni.it.

The name of the agent of Eni in the United States is De LucaVincenzo, 485 Madison Ave., New York, NY 10002.

Eni’s principal segments of operations are describedbelow.

Eni’s Exploration & Production segment engages in oiland natural gas exploration and field development and production,as well as LNG operations in 39 countries, including Italy,Libya, Egypt, Norway, the UK, Angola, Congo, the U.S.,Kazakhstan, Russia, Algeria, Pakistan and Australia. In 2008,Eni’s production of oil and natural gas amounted to 1,748KBOE/d on an available-for-sale basis. As of December 31, 2008,Eni’s proved reserves of subsidiaries stood at 6,242 mmBOE;Eni’s share of reserves of equity-accounted entitiesamounted to 666 mmBOE. In 2008, Eni’s Exploration &Production segment reported net sales from operations (includinginter-segment sales) of euro 33,318 million and operating profitof euro 16,415 million.

Eni’s Gas & Power segment engages in supply,transport, distribution and marketing of natural gas, as well asof LNG. This segment also includes the activity of powergeneration that enables Eni to extract further value from gas,diversifying its commercial outlets. In 2008, Eni’sworldwide sales of natural gas amounted to 104.23 BCM, including6.00 BCM of gas sales made directly by the Eni’s Exploration& Production segment in Europe and the U.S. Sales in Italyamounted to 52.87 BCM, while sales in European markets were 43.03BCM that included 11.25 BCM of gas sold to certain importers toItaly. Sales to markets outside Europe amounted to 2.33 BCM.Through its 50.03 per cent-owned subsidiary Snam Rete Gas, Enioperates an Italian network of high and medium pressure pipelinesfor natural gas transport that is approximately 31,474-kilometerlong, while outside Italy Eni holds capacity entitlements on anetwork of European pipelines extending for approximately 4,400kilometers made up of high pressure pipelines to import gas fromRussia, Algeria, Libya and North Europe production basins toEuropean markets. Eni, through its 100 percent-owned subsidiaryItalgas and other subsidiaries, is engaged in natural gasdistribution activity in Italy serving 1,320 municipalitiesthrough a low pressure network consisting of approximately 49,400kilometers of pipelines as of December 31, 2008. Eni produceselectricity and steam at its operated sites of Livorno, Taranto,Mantova, Ravenna, Brindisi, Ferrera Erbognone and Ferrara with atotal installed capacity of 4.9 GW as of December 31, 2008. In2008, sales of electricity totaled 29.93 TWh. Eni operates are-gasification terminal in Italy and holds indirect interest orcapacity entitlements in a number of LNG facilities in 

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Europe, Egypt and in certain projects under construction inthe U.S. In 2008, Eni’s Gas & Power segment reported netsales from operations (including inter-segment sales) of euro36,936 million and operating profit of euro 3,933 million.Eni’s Refining & Marketing segment engages in refiningand marketing of petroleum products mainly in Italy and in therest of Europe. In 2008, processed volumes of crude oil and otherfeedstock amounted to 35.84 mmtonnes and sales of refinedproducts were 50.68 mmtonnes, of which 28.92 mmtonnes in Italy.Retail sales of refined product at operated service stationsamounted to 12.67 mmtonnes including Italy and the rest ofEurope. In 2008, Eni’s retail market share in Italy throughits Agip-branded network of service stations was 30.6%. In 2008,Eni’s Refining & Marketing segment reported net salesfrom operations (including inter-segment sales) of euro 45,083million and operating net loss of euro 1,023 million.

Eni’s petrochemical activities include production ofolefins and aromatics, basic intermediate products, polyethylene,polystyrenes, and elastomers. Eni’s petrochemical operationsare concentrated in Italy and Western Europe. In 2008, Eni sold4.7 mmtonnes of petrochemical products. In 2008, Eni’sPetrochemical segment reported net sales from operations(including inter-segment sales) of euro 6,303 million and anoperating net loss of euro 822 million.

Eni’s oilfield services, construction and engineeringactivities are conducted through its 42.91 per cent-ownedsubsidiary Saipem and Saipem’s controlled entities.Activities involve offshore construction, particularly fixedplatform installation, sub-sea pipe laying and floatingproduction systems and onshore construction. Offshore and onshoredrilling services and engineering and project management servicesare also provided to the oil and gas, refining and petrochemicalindustries. In 2008, Eni’s Engineering & Constructionsegment reported net sales from operations (including intra-groupsales) of euro 9,176 million and operating profit of euro 1,045million.

A list of subsidiaries of Eni is included as an exhibit tothis Annual Report on Form 20-F.

 

> 
***Strategy***

Eni’s strategy is to grow the Company’s mainbusinesses, over both the medium and the long-term, withimproving profitability. This strategy has remained unchanged inspite of the current economic downturn and an uncertain outlookfor the global energy demand. In executing this strategy,management intends to preserve a solid capital structuretargeting an optimal mix between net borrowings andshareholders’ equity. By this means, management expects tomaintain the Company’s current credit rating. Over the nextfour-years, Eni plans to execute a capital expenditure programamounting to euro 48.8 billion to support organic growth. Eniplans to fund this capital expenditure program mostly by means ofcash flows provided by operating activities. Capital projectswill be assessed and implemented in accordance with tightfinancial criteria. The Company intends to remunerate itsshareholders through significant dividend distributions so as toensure to its shareholders competitive dividend yields (measuredas the ratio of dividend to the share price recorded on averagein the month of December on the Italian stock exchange).Management intends to support the Company’s profitability byfocusing on cost reduction initiatives, including a number ofactions that will be implemented in order to benefit from theexpected reduction in purchase costs for oilfield materials,equipment and services in the Exploration and Production segment.For a description of risks and uncertainties associated with theCompany’s outlook and the capital expenditure program See"Item 5 – Management’s Expectations ofOperations".

Eni’s strategy in its Exploration & Productionoperations is to grow production leveraging on the development ofthe Company’s asset portfolio. Eni targets to achieve aproduction growth rate of 3.5% on average over the 2009-2012period, assuming Eni’s Brent price scenario of 55 U.S.dollar per barrel in 2012. For a discussion of Eni’sproduction volume sensitivity to oil prices see "Item 5– Management’s Expectations of Operations".Management will continue to assess opportunities to increaseproduction through acquisitions. Eni intends to pay specialattention to reserve replacement in order to secure the medium tolong-term sustainability of its business.

In its Gas & Power activities, Eni intends to grow naturalgas sales in the international market, preserve the profitabilityof the Italian marketing business, effectively manage regulatedbusinesses, and develop a global LNG business. Due to the currenteconomic downturn, the Company has revised down its long-termgrowth expectations for the European gas demand from 3% to 2% perannum until 2020. For a description of trends in the natural gasmarkets see "Gas & Power" below. The impact of aworsening demand outlook and increasing competitive pressure onEni’s results of operations on the domestic market isexpected to be offset by the contribution of regulated businessesand continuing growth in European markets, mainly driven by theintegration of the recently acquired Belgian company Distrigas.Eni targets worldwide gas sales of 124 BCM in 2012, includingE&P sales in Europe and the U.S. In particular, Eni targetsto achieve an annual average growth rate of 7% in internationalsales in the four-year period 2009 to 2012. The Company’sstrategy contemplates a further strengthening of Eni’spresence in the European market, leveraging on the synergiesexpected from the acquisition of Distrigas (for further detailssee below – "Significant business and portfoliodevelopments"). The integration with upstream activitieswill provide the Gas & Power business with opportunities tomonetize the equity gas reserves and develop LNG sales.

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In its Refining & Marketing activities, the Company’sstrategy focuses on improving the business profitability andreducing the cash requirements of the business by means of strictcapital discipline also in light of a weak outlook for refinedproducts demand. The Company intends to selectively upgrade itsrefinery system and improve quality standards in marketingactivities as well as increase operating efficiency. In refiningEni plans to increase the conversion index and flexibility ofplants in order to achieve a higher yield of middle distillatesand increase the ability of its refineries to process lessvaluable crudes. In marketing, Eni intends to strengthen itsleadership position in the Italian retail market trough plantupgrading, loyalty programs and enhanced non-oil service formats.In Europe, Eni’s growth strategy will continue to beselective, focusing on those markets where it can leverage onscale, supply and logistic synergies and brand awareness.

In its Engineering & Construction activities, Eni aims atdeveloping and expanding its geographical reach and technicalcharacteristics of its world class fleet in order to maintain itsstrong competitive position and reduce its exposure to thecyclicality of the oil industry.

In technological research and innovation activities, Eni plansto implement significant capital expenditures amounting to euro1.1 billion in the next four years to develop such technologiesthat management believes may ensure competitive advantages in thelong-term. Eni plans to continue developing ongoing programsfocused on reducing costs to find and recover hydrocarbons,developing clean fuels, upgrading heavy crude (in particular theEST project), monetizing natural gas through projects such ashigh pressure high distance gas transmission (TAP) and Gas toLiquids (GTL), and protecting the environment by investing in thefields of renewable sources of energy and reduction of GHGemissions.

 

> 
***Significant business and Portfolio Developments***

The significant business and portfolio developments thatoccurred in 2008 and to date in 2009 were the following:

| • |   | In January 2008, Eni        completed the acquisition of the entire issued share        capital of the UK-based oil company Burren Energy Plc,        for a total cash consideration amounting to approximately        euro 2.4 billion (including Burren’s shares        purchased in 2007, for a total amount of euro 0.6        billion). In 2008 production of Burren assets averaged 25        KBBL/d in Congo and Turkmenistan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | In October 2008, all the        international parties to the North Caspian Sea Production        Sharing Agreement (NCSPSA) consortium and the Kazakh        authorities signed the final agreement implementing the        new contractual and governance framework of the Kashagan        project, based on the Memorandum of Understanding signed        on January 14, 2008. Eni’s management expects to        achieve first oil at the Kashagan field by the end of        2012.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| • |   | In October 2008, following        authorization from the European Commission, Eni closed        the acquisition of a 57.243% majority stake in the        Belgian company Distrigas NV from the French company        Suez-Tractebel. The deal entailed cash consideration of        euro 2.75 billion. On December 30, 2008, Eni was granted        authorization from the Belgian market authorities to        execute a mandatory tender offer on the minority        shareholders of Distrigas. On March 19, 2009, the        mandatory tender offer on the minority shareholders of        Distrigas was finalized. Shareholders representing 41.61%        of the share capital of Distrigas tendered 292,390 shares        on Eni’s offer. Publigaz Scrl tendered its entire        interest (31.25%). On April 8, 2009 Eni paid to those        shareholders cash consideration amounting to euro 1,991        million. Following the tender offer, Eni owned 98.86% of        the share capital of Distrigas. The squeeze-out on the        residual 1.14% was completed in early May. Consequently        Eni now holds all the shares of Distrigas except for one        share belonging to the Belgian State with special powers.        Distrigas shares have been delisted from Euronext        Brussels.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| • |   | In October 2008, Eni signed        an agreement with Suez related to the sale of a number of        Eni’s assets as well as long-term gas and        electricity supply contracts. As of end of December 2008        the following agreements have been finalized: (i) the        Virtual Power Plant agreement that grants Suez the right        to off-take volumes of electricity corresponding to        capacity of up to 1,100 MW for a period of 20 years, with        proceeds of euro 1.21 billion; (ii) gas supply contracts        up to 4 BCM/y to be delivered in Italy for a period of 20        years and an option to purchase up to 2.5 BCM/y to be        delivered in Germany for a period of 11 years, with        proceeds amounting to euro 255 million; (iii) supply        contracts for 0.9 BCM/y of LNG for a period of 20 years        at a price of euro 87 million; (iv) on October 30, 2008        the Eni fully-owned subsidiary Italgas and the partner        Suez signed a purchase and sale contract regarding an        asset identified as the gas distribution network of the        city of Rome and certain nearby municipalities owned by        Italgas. The contract is a final one which validity is        conditional upon approval by the Municipal body of the        city of Rome to be granted not later than August 31, 2009        regarding the change in the entity who will act as        operator of the service concession arrangement in place        as a consequence of the closing of the contract; and (v)        a number of contracts were also signed for the divestment        of a number of upstream exploration and production        concessions in the UK, the Gulf of Mexico, Egypt and        Indonesia entailing cash consideration up to euro 273        million. Closing of the contracts regarding properties in        Egypt and Indonesia is conditional upon approval from        relevant local Authorities, while contracts have been        closed regarding the sale of properties in the UK and the        Gulf of Mexico. |
| • |   | In November 2008, Eni        finalized an agreement to acquire all the common shares        of First Calgary Petroleums Ltd, a Canadian oil and gas        company with exploration and development activities in        Algeria.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

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|   |   | The acquisition values the        fully diluted share capital of First Calgary at        approximately euro 605 million. Production start-up is        expected in 2011 with a projected plateau of        approximately 30 KBOE/d net to Eni by 2012. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

In addition, in 2008 Eni completed the followingtransactions:

| • |   | In February 2008, Eni signed        a strategic agreement with the Venezuelan State oil        company PDVSA for the definition of a plan to develop a        field located in the Orinoco oil belt, with a gross        acreage of 670 square kilometers. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | In February 2008, as part of        the announced plan to dispose of non core assets, Eni        sold its 30% interest in Gaztransport & Technigaz SA        (GTT), a company owning a patent for the construction of        tanks for LNG transport, to Hellman & Friedman for a        total value of euro 310 million.                                                                                                                                                    |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | In June 2008, Eni finalized        a strategic oil transaction with the Libyan national oil        company based on the framework agreement of October 2007.        This transaction effective from January 1, 2008, extends        the duration of Eni’s oil and gas properties in        Libya until 2042 and 2047 respectively and lays the        foundations for a number of projects targeting        development of the significant gas potential in the        country. |

| • |   | In April 2008, Eni signed a        Memorandum of Understanding with the state-owned company        Qatar Petroleum International to target joint investment        opportunities in the exploration and production of oil        and gas.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | In May 2008, Eni defined a        cooperation agreement with the Republic of Congo for the        extraction of unconventional oil from the Tchikatanga and        Tchikatanga-Makola oil sands deposits with over extension        of 1,790 square kilometers. Eni plans to monetize the        heavy oil by applying its EST (Eni Slurry Technology)        proprietary technology intended to convert entirely the        heavy barrel into high-quality light products. The        agreement also comprises the construction of a new 450 MW        electricity generation plant (Eni’s share 20%) to be        fired by 2009 with the associated natural gas from the        operated M’Boundi field and a partnership for the        production of bio-diesel. |
| • |   | In July 2008, Eni renewed        the Memorandum of Understanding with Brazilian oil        company Petrobras for the evaluation of joint initiatives        in the upstream and downstream sectors, to produce and        market renewable fuels and the possible options for the        valorization of the natural gas reserves discovered by        Eni offshore Brazil.                                                                                                                                                                                                                                                                                                                                                                                                    |
| • |   | In September 2008, Eni        finalized the purchase of a 17% stake in the share        capital of Gaz de Bordeaux SAS active in the marketing of        natural gas in the Bordeaux area. Eni’s associate        Altergaz (Eni’s interest being 38.91%) also entered        the transaction with an equal stake. The two partners        signed also a long-term agreement for the supply of 250        mmCM/y of gas for ten years to Gas de Bordeaux.                                                                                                                                                                                                                                                                                                             |
| • |   | In September 2008, Eni        signed a strategic agreement with Petroleos de Venezuela,        SA (PDVSA) for the exploration and development of two        offshore Venezuelan areas and the subsequent development        of gas resources via an LNG project.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| • |   | In October 2008, Eni        completed the divestment of the entire share capital of        the subsidiary Eni Agip España to Galp Energia SGPS SA        following the exercise of a call option in October 2007,        pursuant to agreements among Galp’s shareholders.        The divested asset includes 371 service stations as well        as wholesale marketing activities of oil products located        in the Iberian Peninsula.                                                                                                                                                                                                                                                                                                                         |
| • |   | In October 2008, Eni signed        a partnership agreement with Papua New Guinea for the        exploration of oil and gas and identification of        opportunities to develop the Country’s resources.        Eni is also interested to joint opportunities related to        power generation projects and the development of        alternative and existing renewable energies.                                                                                                                                                                                                                                                                                                                                                                                     |
| • |   | In November 2008, Eni        finalized an agreement with the British company Tullow        Oil Ltd to purchase a 52% stake and the operatorship of        fields in the Hewett Unit and relevant facilities in the        North Sea in close proximity to the Interconnector        pipeline. Eni plans to upgrade certain depleted fields in        the area so as to achieve a gas storage facility with a        177 BCF capacity to support seasonal upswings in gas        demand in the UK.                                                                                                                                                                                                                                                                              |
| • |   | In November 2008, Eni        finalized a Memorandum of Understanding with        Colombia’s state oil company Ecopetrol to evaluate        joint exploration opportunities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

Recent developments are described below.

| • |   | On April 7, 2009 Gazprom        exercised its call option to purchase the 20% interest in        OAO Gazprom Neft held by Eni following agreements between        the two partners. The 20% interest in Gazprom Neft was        acquired by Eni on April 4, 2007 as part of a bid        procedure for the assets of bankrupt Russian company        Yukos. The exercise price of the call option is equal to        the bid price (U.S. $3.7 billion) as adjusted by        subtracting dividends distributed and adding the        contractual yearly remuneration of 9.4% on the capital        employed and financing collateral expenses. At the same        time, Eni and Gazprom signed new cooperation agreements        targeting certain development projects to be conducted        jointly in Russia and other countries of interest. Terms        of the call option granted to Gazprom to purchase a 51%        interest in the share capital of OOO SeverEnergia        (Eni’s interest being 60%), which owns 100% of three        Russian companies engaging in the development of gas        reserves, are currently under review by Eni, Enel and        Gazprom. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | On February 12, 2009,        Eni’s Board of Directors approved the divestment of        100% of Italgas SpA and Stoccaggi Gas Italia SpA (Stogit)        to Snam Rete Gas (50.03% owned by Eni) for total cash        consideration of euro 4,720 million (euro 3,070 million        and euro 1,650 million, respectively). The transaction        will be                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |

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|   |   | financed by Snam Rete Gas        through: (i) a rights issue up to a maximum of euro 3.5        billion (Eni has already committed to subscribe its        relative share of the rights issue); and (ii) new medium        to long-term financing for euro 1.3 billion. The main        impacts expected on Eni’s consolidated financial        statements when the transaction closes will be: (i) a        decrease of euro 1.5 billion in net borrowings and a        corresponding increase in total equity as a consequence        of the pro-quota subscription of the Snam Rete Gas        capital increase by the minoritiy shareholders; and (ii)        a decrease in Eni’s net profit equal to 45% of the        aggregate net profit of Italgas and Stogit, with a        corresponding increase in net profit attributable to        minoritiy shareholders. From an industrial perspective        the transaction, expected to close in July 2009, will        create significant synergies in the regulated businesses        segment and maximize the value of Italgas and Stogit due        to the higher visibility of regulated businesses as a        part of Snam Rete Gas. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

In 2008 capital expenditures amounted to euro 14,562 million,of which 84% related to the Exploration & Production, Gas& Power and Refining & Marketing segments and mainlyrelated to: (i) the development of oil and gas reserves (euro6,429 million) deployed mainly in Kazakhstan, Egypt, Angola,Congo and Italy and exploration projects (euro 1,918 million),primarily in the United States, Egypt, Nigeria, Angola and Libya;(ii) the purchase of proved and unproved property for euro 836million related mainly to the extension of mineral rights inLibya following an agreement signed in October 2007 with thestate company NOC and the purchase of a 34.81% interest in theABO project in Nigeria; (iii) the development and upgrading ofEni’s natural gas transport and distribution networks inItaly (euro 1,130 million and euro 233 million, respectively) andupgrading of natural gas import pipelines to Italy (euro 233million); (iv) the ongoing construction of combined cycle powerplants (euro 107 million); (v) projects designed to upgrade theconversion capacity and flexibility of Eni’s refineries,including construction of a new hydrocracking unit at theSannazzaro refinery, and to build of new service stations andupgrade of existing ones in Italy and outside Italy (totalingeuro 965 million); and (vi) the upgrading of the fleet used inthe Engineering & Construction division (euro 2,027 million).

In 2008, Eni’s acquisitions amounted to euro 5.85 billion(euro 4.3 billion net of acquired cash of euro 1.54 billion) andmainly related to: (i) the acquisition of the 57.243% majoritystake in Distrigas NV; (ii) the completion of the acquisition ofBurren Energy Plc; (iii) the purchases of certain upstreamproperties and gas storage assets, related to the entire sharecapital of the Canadian company First Calgary operating inAlgeria, a 52% stake in the Hewett Unit in the North Sea, a 20%stake in the Indian company Hindustan Oil Exploration Co; and(iv) other investments in non-consolidated entities mainlyrelated to funding requirements for an LNG project in Angola.

In 2007, capital expenditures amounted to euro 10,593 million,of which 84.7% related to the Exploration & Production,Gas & Power and Refining & Marketing businesses, andprimarily related to: (i) the development of oil and gas reserves(euro 4,788 million) deployed predominantly in Kazakhstan, Egypt,Angola, Italy and Congo, and exploration projects (euro 1,659million) particularly in the Gulf of Mexico, Egypt, Norway,Nigeria and Brazil; (ii) development and upgrading of Eni’snatural gas transport and distribution networks in Italy (euro886 million) as well as upgrading of natural gas import pipelinesto Italy (euro 253 million); (iii) the ongoing construction ofcombined cycle power plants (euro 175 million); (iv) projectsdesigned to upgrade the conversion capacity and flexibility ofEni’s refineries, including construction of a newhydrocracking unit at the Sannazzaro refinery, and to build andupgrade service stations (totaling euro 979 million); and (v) theupgrading of the fleet used in the Engineering & Constructionsegment (euro 1,410 million).

In 2007, Eni’s acquisitions amounted to euro 9.7 billionand mainly related to: (i) a 60% interest in three Russian gascompanies as part of the liquidation procedure of bankruptRussian company Yukos. Through the same transaction Eni alsopurchased a 20% stake in the oil and gas company OAO GazpromNeft. Gazprom was granted a call option to purchase a 51%interest in those three gas companies and the 20% stake in OAOGazprom Neft; (ii) the purchase of upstream assets in theGulf of Mexico; (iii) the purchase of upstream assets onshoreCongo; (iv) the purchase of a 24.9% interest in BurrenEnergy; (v) the acquisition of a further 16.11% stake in theCeska Rafinerska in the Czech Republic increasing Eni’sownership interest to 32.4%; (vi) the purchase of 102 retail fuelstations and related marketing assets located in the CzechRepublic, Slovakia and Hungary; and (vii) the purchase of a 13.6%stake in the Angola LNG consortium.

 

 

**BUSINESS OVERVIEW**

**Exploration & Production**

Eni’s Exploration & Production segment engages in oiland natural gas exploration and field development and production,as well as LNG operations, in 39 countries, including Italy,Libya, Egypt, Norway, the UK, Angola, Congo, the U.S.,Kazakhstan, Russia, Algeria, Pakistan and Australia. In 2008, Eniproduced 1,748 KBOE/d on an available for-sale basis. As ofDecember 31, 2008, Eni’s proved reserves of subsidiariesstood at 6,242 mmBOE; Eni’ share of reserves ofequity-accounted entities amounted to 666 mmBOE.

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Eni’s strategy in its Exploration & Productionoperations is to increase production leveraging on thedevelopment of its asset portfolio. Eni plans to achieve aproduction growth rate of 3.5% on average over the 2009-2012period, under certain trading environment assumptions (See"Item 5 – Management’s Expectations ofOperations"). A description of Eni’s production volumesensitivity to oil prices is disclosed under "Item 5 –Management’s Expectations of Operations".

Future growth will be driven by the development of newprojects located in a number of strategic oil and gas basins inthe world, namely the Caspian Region, North and West Africa andthe Gulf of Mexico. A high-quality portfolio geographicallyfocused and resilient, with one of the lowest breakeven prices inthe industry, high exposure to the most competitive giantprojects and long-standing relationships with key host countrieswill enable any to deliver industry-leading growth even incurrent market conditions. Management will continue to evaluateopportunities to increase production through focusedacquisitions. Eni intends to pay special attention to reservereplacement in order to guarantee the medium-to long-termsustainability of its business. Eni intends to optimize itsportfolio of development properties by focusing on areas whereits presence is established, seeking new opportunities anddivesting marginal assets. Eni also intends to develop its LNGbusiness in order to monetize its large base of gas reservesmainly in North and West Africa.

In exploration activities, Eni intends to concentrateresources in well established areas of presence whereavailability of production facilities, existing competencies andlong-term relationships with host countries will enable Eni toreadily put in production discovered reserves, reducing thetime-to-market and capturing synergies. Approximately 80% ofplanned capital expenditures will be directed to such core areas(located mainly in the United States, Egypt, Libya, Nigeria,Angola, Italy, Norway and Congo). Eni also plans to selectivelypursue high risk/high reward opportunities arising from expansionin areas with high mineral potential. Eni expects to purchase newexploration permits and to divest or exit marginal or nonstrategic ones.

In order to execute these strategies, Eni intends to investapproximately euro 32.6 billion on reserve development and fieldoptimization as well as exploration projects over the nextfour-year period; euro 1.8 billion of which will be spent tobuild transportation infrastructures and execute LNG projectsthrough equity-accounted entities.

In 2009, oil and gas prices are expected to be significantlylower than 2008. In response Eni plans to improve profitabilityof its operations by implementing a number of initiativesdesigned to reduce costs to develop and operate oil and gasfields by leveraging on the expected reduction in purchase costsof oilfield services, materials and equipment due to the economicdownturn. Management has yet to commit a large amount of futuredevelopment expenditures and plans to be able to benefit fromongoing downward trends in rates of oilfield services andpurchase costs of goods and equipment. Additional cost controlmeasures will address ongoing operations. The amount of plannedcapital expenditures for the years 2009-2012 already factors inthe benefits associated with cost control. See "Item 3– Risk Factors".

 

> 
***Oil and Natural Gas Reserves***

Eni has always exercised rigorous control over the booking ofproved reserves. The Reserve Department of the Exploration &Production segment is entrusted with the task of continuouslyupdating the Company’s guidelines regarding reservesevaluation. The department monitors the periodic estimationprocess. Company guidelines follow Regulation S-X Rule 4-10 ofthe U.S. Securities and Exchange Commission (SEC) as well as onspecific issues not regulated by the SEC rules, the establishedpractice endorsed by qualified institutions on the marketplace.Company guidelines have been reviewed by DeGolyer and MacNaughton(D&M), an independent petroleum engineering company, whichhas certified their compliance with applicable SEC rules. D&Mhas also stated that the Company guidelines regulate situationsfor which the SEC rules are less precise, providing a reasonableinterpretation in line with the generally accepted practices ininternational markets. When participating in exploration andproduction activities operated by other entities, Eni alsoestimates its proved reserves on the basis of the aboveguidelines.

The process for evaluating reserves involves: (i) businessunit managers (geographic units) and Local Reserve Evaluators(LRE) who perform the evaluation and classification of reservesincluding estimates of production profiles, capital expenditures,operating costs and costs related to asset retirementobligations; (ii) geographic area managers at head officeschecking evaluations carried out by business unit managers; and(iii) the Reserve Department, which provides independent reviewsof the fairness and correctness of classifications carried out bybusiness units, aggregates worldwide reserve data and performs aneconomic assessment of reserves to calculate equity volumes.Moreover, the Reserve Department has the responsibility to ensurethe periodic certification process of reserves and to updatecontinuously the Company guidelines on reserves evaluation andclassification.

Since 1991, Eni has requested qualified independent oilengineering companies to carry out an independent evaluation2of its proved reserves on a rotational basis. Eni believes thoseindependent evaluators to be experienced 

----

| (2) | i | From 1991 to        2002 DeGolyer and MacNaughton, from 2003 also Ryder        Scott. |
|-----|---|---------------------------------------------------------------------------------------|

22

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##### Table of Contents

and qualified in the marketplace. In the preparation of theirreports, those independent evaluators relied, without independentverification, upon information furnished by Eni with respect toproperty interest, production, current cost of operation anddevelopment, agreements relating to future operations and sale,prices and other factual information and data that were acceptedas represented by the independent evaluators. This informationwas used by Eni in determining its proved reserves and includedlog, directional surveys, core and PVT (Pressure VolumeTemperature) analysis, maps, oil/gas/water production/injectiondata of wells, reservoir, and field, reservoir studies; technicalanalysis relevant to field performance, reservoir performance,long-term development plans, future capital and operating costs.In order to calculate the economic value of reserves net presentvalue (NPV), actual prices received from hydrocarbon sales,instructions on future prices, and other pertinent informationare provided. Accordingly, Eni believes that the work performedby the independent evaluators is to be considered an evaluationof Eni’s proved reserves carried out in parallel with theinternal evaluation. The circumstance that the independentevaluations achieved the same results as those of the Company forthe vast majority of fields support management’s confidencethat the company’s booked reserves meet the regulatorydefinition of proved reserves which are reasonably certain to beproduced in the future. When the assessment of independentengineers is lower than internal evaluations, Eni revises itsestimates based on information provided by independentevaluators. In any case, those differences were not significant.

In 2008, a total of 1.5 BBOE of proved reserves ofsubsidiaries have been evaluated, representing approximately 25%of Eni’s total proved reserves of subsidiaries at December31, 2008. In the 2006-2008 three-year period, 76% of Eni’stotal proved reserves of subsidiaries were subject to independentevaluations. As at December 31, 2008 the most important ofEni’s properties which were not subject to an independentevaluation were: Bouri and Bu Attifel (Libya), Barbara (Italy),M’Boundi (Congo) and Elgin-Franklin (United Kingdom).

Eni’s proved reserves of subsidiaries at December 31,2008 totaled 6,242 mmBOE (oil and condensates 3,243 mmBBL;natural gas 17,214 BCF) representing an increase of 232 mmBOE, or3.9%, from December 31, 2007. Additions to proved reserves bookedby Eni’s subsidiaries in 2008 were 850 mmBOE deriving from:(i) revisions of previous estimates of 746 mmBOE, partly relatedto higher entitlements reported in certain PSAs (up 340 mmBOE)resulting from lower year end oil prices from a year ago (Brentprice was $36.55 per barrel at December 31, 2008 compared to$96.02 per barrel at December 31, 2007), net of downwardrevisions associated with marginal productions in certain maturefields such as Angola, Kazakhstan and Libya; (ii) extensions anddiscoveries (71 mmBOE) with major increases booked in Angola,Egypt, Nigeria, Norway and United States; and (iii) improvedrecovery (33 mmBOE) mainly reported in Algeria, Angola, Congo andLibya. Acquisitions amounted to 91 mmBOE reflecting thecontribution of the acquired Burren assets in Congo, Turkmenistanand India. Sales of reserves (59 mmBOE) related to the divestmentof a 1.71% stake in the Kashagan project following thefinalization of the agreements implementing the new contractualand governance framework of the project effective January 1, 2008(information on the Kashagan agreements is provided below underthe section "Caspian Area" on page 39). Due to risksinherent in the exploration and production business, a degree ofuncertainty still exists as to whether these additions willactually be produced. See "Item 3 – Risks associatedwith exploration and production of oil and natural gas" and– "Uncertainties in estimates of oil and natural gasreserves".

As of December 31, 2008 Eni’s share of proved reserves ofequity-accounted entities amounted to 666 mmBOE. The 2008 yearend amounts comprise 60% of proved reserves of the three Russiangas companies purchased in 2007 as part of a bid procedure forassets of bankrupt Russian company Yukos. Terms of the calloption granted to Gazprom to purchase a 51% interest in the sharecapital of OOO SeverEnergia (Eni’s interest being 60%),which owns 100% of these three Russian companies engaging in thedevelopment of gas reserves, are currently under review by Eni,Enel and Gazprom.

The reserve replacement ratio for Eni’s subsidiaries was136% in 2008 (38% in 2007 and 38% in 2006). The average reservelife index for Eni’s subsidiaries was 9.6 years at December31, 2008. The reserve replacement ratio was calculated bydividing additions to proved reserves by total production, eachas derived from the tables of changes in proved reserves preparedin accordance with SFAS No. 69 (see the supplemental oil and gasinformation in the Consolidated Financial Statements). Thereserve replacement ratio is a measure used by management toassess the extent to which produced reserves in the year arereplaced by reserve additions booked according with SEC criteriaunder Rule 4-10 of Regulation S-X. Management considers thereserve replacement ratio to be an important gauge of the abilityof the Company to sustain its growth prospects. However, thisratio measures past performances and is not an indicator offuture production because the ultimate development and productionof reserves is subject to a number of risks and uncertainties.These include the risks associated with the successful completionof large-scale projects, including addressing ongoing regulatoryissues and completion of infrastructure, as well as changes inoil and gas prices, political risks and geological and otherenvironmental risks. Specifically, in recent years Eni’sreplacement produced reserves has been affected by the impact ofhigher year-end oil prices on reserves entitlements in theCompany’s Production Sharing Agreements (PSAs) and similarcontractual schemes. In accordance with such contracts, Eni isentitled to a portion of field reserves, the sale of which shouldcover expenditures incurred by the Company to develop and operatethe field. The higher the reference prices for Brent crude oilused to determine year-end amounts of Eni’s proved reserves,the lower the number of barrels necessary to cover the sameamount of expenditures. In 2008 this negative trend reversedresulting in a higher amount of booked reserves associated withthe Company’s PSAs as the oil price recorded at 2008year-end was lower than the previous year.

23

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##### Table of Contents

The table below show Eni’s calculations ofits reserve replacement ratios for the years ended December 31,2006, 2007 and 2008.

|   | **Subsidiaries** |   | **Equity-accounted        entities** |
|--------|------------------|--------|--------------------------------------|
|   |                  |   |                                      |

|   | **2006** |   | **2007** |   | **2008** |   | **2006** |   | **2007** |   | **2008** |
|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|
|   |          |   |          |   |          |   |          |   |          |   |          |

|   | **(mmBOE)** |
|--------|-------------|

| Additions to proved reserves                               |   | 244    |   |   | 237   |   |   | 882  |   |   | 1      |   |   | 639   |   |   | 6      |   |
|------------------------------------------------------------|--------|--------|--------|--------|-------|--------|--------|------|--------|--------|--------|--------|--------|-------|--------|--------|--------|--------|
| *of        which purchases and sales of reserves-in-place* |   | *(172* | *)*    |   | *156* |   |   | *32* |   |   |   |   |   | *617* |   |   |   |   |
| Production for the year                                    |   | (640   | )      |   | (627  | )      |   | (650 | )      |   | (6     | )      |   | (7    | )      |   | (8     | )      |

|   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

 

|   | **Subsidiaries** |
|--------|------------------|
|   |                  |

|   | **2006** |   | **2007** |   | **2008** |
|--------|----------|--------|----------|--------|----------|
|   |          |   |          |   |          |

|   | **(%)** |
|--------|---------|

| Proved reserves replacement ratio of        subsidiaries | 38 |   | 38 |   | 136 |
|----------------------------------------------------------|----|--------|----|--------|-----|

|   |  |   |  |   |  |
|--------|--|--------|--|--------|--|

Proved developed reserves of subsidiaries at December 31, 2008amounted to 3,948 mmBOE (2,009 mmBBL of liquids and 11,138 BCF ofnatural gas) representing 63% of total estimated proved reserves(64% and 63% at December 31, 2007 and 2006, respectively).

Volumes of oil and natural gas applicable to long-term supplyagreements with foreign governments in mineral assets where Eniis operator totaled 679 mmBOE as of December 31, 2008 (676 and583 mmBOE as of December 31, 2007 and 2006, respectively). Saidvolumes are not included in reserves volumes shown in the tableherein.

The tables below set forth a geographical breakdown ofEni’s proved reserves and proved developed reserves ofhydrocarbons, on a barrel of oil equivalent basis, for theperiods indicated.

**Proved reserves**

Eni’s proved reserves of hydrocarbons by geographic area

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(mmBOE)** |
|--------|-------------|

| Italy                               |   | 805       |   | 747       |   | 681       |
|-------------------------------------|--------|-----------|--------|-----------|--------|-----------|
| North        Africa                 |   | 2,018     |   | 1,879     |   | 1,922     |
| West Africa                         |   | 1,122     |   | 1,095     |   | 1,146     |
| North Sea                           |   | 682       |   | 617       |   | 510       |
| Caspian Area                        |   | 1,219     |   | 1,061     |   | 1363      |
| Rest of        the World            |   | 554       |   | 611       |   | 620       |
| **Total consolidated subsidiaries** |   | **6,400** |   | **6,010** |   | **6,242** |
| Equity-accounted        entities    |   | 36        |   | 668       |   | 666       |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Eni’s proved reserves of liquids by geographic area

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(mmBBL)** |
|--------|-------------|

| Italy                               |   | 215       |   | 215       |   | 186       |
|-------------------------------------|--------|-----------|--------|-----------|--------|-----------|
| North        Africa                 |   | 982       |   | 878       |   | 823       |
| West Africa                         |   | 786       |   | 725       |   | 783       |
| North Sea                           |   | 386       |   | 345       |   | 276       |
| Caspian Area                        |   | 893       |   | 753       |   | 939       |
| Rest of        the World            |   | 195       |   | 211       |   | 236       |
| **Total consolidated subsidiaries** |   | **3,457** |   | **3,127** |   | **3,243** |
| Equity-accounted        entities    |   | 24        |   | 142       |   | 142       |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

24

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##### Table of Contents

Eni’s proved reserves of natural gas by geographic area

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(BCF)** |
|--------|-----------|

| Italy                               |   | 3,391      |   | 3,057      |   | 2,844      |
|-------------------------------------|--------|------------|--------|------------|--------|------------|
| North        Africa                 |   | 5,946      |   | 5,751      |   | 6,311      |
| West Africa                         |   | 1,927      |   | 2,122      |   | 2,084      |
| North Sea                           |   | 1,697      |   | 1,558      |   | 1,336      |
| Caspian Area                        |   | 1,874      |   | 1,770      |   | 2,437      |
| Rest of        the World            |   | 2,062      |   | 2,291      |   | 2,202      |
| **Total consolidated subsidiaries** |   | **16,897** |   | **16,549** |   | **17,214** |
| Equity-accounted        entities    |   | 68         |   | 3,022      |   | 3,015      |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Eni’s proved developed reserves of hydrocarbons bygeographic area

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(mmBOE)** |
|--------|-------------|

| Italy                               |   | 562       |   | 534       |   | 465       |
|-------------------------------------|--------|-----------|--------|-----------|--------|-----------|
| North        Africa                 |   | 1,242     |   | 1,183     |   | 1,229     |
| West Africa                         |   | 798       |   | 766       |   | 827       |
| North Sea                           |   | 571       |   | 524       |   | 407       |
| Caspian Area                        |   | 525       |   | 494       |   | 670       |
| Rest of        the World            |   | 334       |   | 361       |   | 350       |
| **Total consolidated subsidiaries** |   | **4,032** |   | **3,862** |   | **3,948** |
| Equity-accounted        entities    |   | 27        |   | 101       |   | 107       |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Eni’s proved developed reserves of liquids by geographicarea

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(mmBBL)** |
|--------|-------------|

| Italy                               |   | 136       |   | 133       |   | 111       |
|-------------------------------------|--------|-----------|--------|-----------|--------|-----------|
| North        Africa                 |   | 713       |   | 649       |   | 613       |
| West Africa                         |   | 546       |   | 511       |   | 576       |
| North Sea                           |   | 329       |   | 299       |   | 222       |
| Caspian Area                        |   | 262       |   | 219       |   | 321       |
| Rest of        the World            |   | 140       |   | 142       |   | 166       |
| **Total consolidated subsidiaries** |   | **2,126** |   | **1,953** |   | **2,009** |
| Equity-accounted        entities    |   | 18        |   | 26        |   | 33        |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Eni’s proved developed reserves of natural gas bygeographic area

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(BCF)** |
|--------|-----------|

| Italy                               |   | 2,449      |   | 2,304      |   | 2,031      |
|-------------------------------------|--------|------------|--------|------------|--------|------------|
| North        Africa                 |   | 3,042      |   | 3,065      |   | 3,537      |
| West Africa                         |   | 1,447      |   | 1,469      |   | 1,443      |
| North Sea                           |   | 1,395      |   | 1,293      |   | 1,065      |
| Caspian Area                        |   | 1,511      |   | 1,580      |   | 2,006      |
| Rest of        the World            |   | 1,105      |   | 1,256      |   | 1,056      |
| **Total consolidated subsidiaries** |   | **10,949** |   | **10,967** |   | **11,138** |
| Equity-accounted        entities    |   | 48         |   | 428        |   | 420        |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

> 
25

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##### Table of Contents

> 
***Mineral Right Portfolio and Exploration************Activity    for the year***

As of December 31, 2008, Eni’s mineral right portfolioconsisted of 1,244 exclusive or shared rights for exploration anddevelopment in 39 countries on five continents, for a total netacreage of 415,494 square kilometers (394,490 at December 31,2007). Of these 39,244 square kilometers concerned production anddevelopment (37,642 at December 31, 2007). Outside Italy netacreage (395,085 square kilometers) increased by 21,258 squarekilometers mainly due to the acquisition of Burren Energy Plc fora total net exploration and development acreage of 9,569 squarekilometers (mainly in Turkmenistan, Yemen, Congo and Egypt) andan increase of net exploration acreage in Mali. These increaseswere partly offset by the contractual revision in Libya. Inaddition, new exploration leases were awarded in Angola, Algeria,Alaska, the Gulf of Mexico, Gabon, Indonesia, Norway and theUnited Kingdom for a total acreage of 57,361 square kilometers(net to Eni, 99% operated).

In Italy, net acreage (20,409 square kilometers) declined by255 square kilometers due to releases.

A total of 111 new exploratory wells were drilled in 2008(58.4 of which represented Eni’s share), as compared to 81exploratory wells completed in 2007 (43.5 of which representedEni’s share). In addition, 21 exploratory wells were inprogress at year end. The overall commercial success rate was36.5% (43.4% net to Eni) as compared to 40% (38% net to Eni) in2007. In 2006, 68 exploratory wells were completed (35.9 of whichrepresented Eni’s share), with an overall success rate of43% (the success rate of Eni’s share of exploratory wellswas 49%).

 

> 
***Production***

*The matters regarding future production, additions toreserves and related production costs and estimated reservesdiscussed below and elsewhere herein are forward-lookingstatements that involve risks and uncertainties that could causethe actual results to differ materially from those in suchforward-looking statements. Such risks and uncertainties relatingto future production and additions to reserves include politicaldevelopments affecting the award of exploration or productioninterests or world supply and prices for oil and natural gas, orchanges in the underlying economics of certain of Eni’simportant hydrocarbons projects. Such risks and uncertaintiesrelating to future production costs include delays or unexpectedcosts incurred in Eni’s production operations.*

In 2008, oil and natural gas production available for saleaveraged 1,748 KBOE/d (liquids 1,026 KBBL/d; natural gas 4,143mmCF/d), an increase of 64 KBOE/d, or 3.8%, compared to 2007.This improvement mainly came from the assets acquired in the Gulfof Mexico, Congo and Turkmenistan (up 62 KBOE/d), as well ascontinuing production ramp-up in Angola, Congo, Egypt, Pakistanand Venezuela. This increase was partially offset by mature fielddeclines as well as planned and unplanned facility downtime inthe North Sea and hurricane-related impacts in the Gulf of Mexico(down 11 KBOE/d). Higher oil prices on a yearly average resultedin lower volume entitlements in Eni’s PSAs and similarcontractual schemes, down approximately 37 KBOE/d. When excludingthe impact of lower entitlements in PSAs, production was up 5.6%.The share of oil and natural gas produced outside Italy was 89%(88% in the full year 2007).

Production of liquids amounted to 1,026 KBBL/d and was up 0.6%from a year ago. The most significant increases were registeredin: (i) the Gulf of Mexico, Congo and Turkmenistan due to thecontribution of acquired assets; (ii) Angola due to the start-upof the Mondo and Saxi/Batuque fields in the development area offormer Block 15 (Eni’s interest 20%); and (iii) Venezueladue to the start-up of the Corocoro field (Eni’s interest26%). Production decreases were reported in the North Sea andItaly due to planned and unplanned facility downtime and maturefield declines. In addition, lower volume entitlements associatedwith higher average yearly oil prices were reported in theCompany’s PSAs.

Production of natural gas for the full year was 4,143 mmCF/dand increased by 324 mmCF/d, or 8.5%, from a year ago. Theimprovement was driven by growth in the Gulf of Mexico, due tothe contribution of acquired assets, and Pakistan due toproduction ramp-up of the Zamzama field (Eni’s interest17.25%) and start-up of the Badhra field (Eni operator with a 40%interest). Production decreased in Italy and the United Kingdomdue to mature field declines.

Oil and gas production sold in 2008 amounted to 632 mmBOE.Approximately 53% of liquids production sold (370.2 mmBBL) wasdestined to Eni’s Refining & Marketing division; about32% of natural gas production sold (1,503 BCF) was destined toEni’s Gas & Power division.

> 
26

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##### Table of Contents

The tables below set forth Eni’s production of liquidsand natural gas on an available-for-sale basis for the periodsindicated.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(KBBL/d)** |
|--------|--------------|

| **Liquids production**(1) (2) |   |      |   |      |   |      |
|-------------------------------|--------|-----------|--------|-----------|--------|-----------|
| Italy                         |   | 79        |   | 75        |   | 68        |
| North Africa                  |   | 329       |   | 337       |   | 338       |
| West        Africa            |   | 322       |   | 280       |   | 289       |
| North Sea                     |   | 178       |   | 157       |   | 140       |
| Caspian        Area           |   | 64        |   | 70        |   | 81        |
| Rest of the World             |   | 107       |   | 101       |   | 110       |
| **Total**                     |   | **1,079** |   | **1,020** |   | **1,026** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

----

| (1) | i | Data includes        Eni’s share of production of affiliates and joint        venture accounted for under the equity method of        accounting amounting to 5, 7 and 8 KBBL/d in 2008, 2007        and 2006, respectively. |
|-----|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(mmCF/d)** |
|--------|--------------|

| **Natural gas production available for sale**(1) (2) |   |      |   |      |   |      |
|------------------------------------------------------|--------|-----------|--------|-----------|--------|-----------|
| Italy                                                |   | 883       |   | 763       |   | 725       |
| North Africa                                         |   | 1,187     |   | 1,357     |   | 1,661     |
| West        Africa                                   |   | 232       |   | 220       |   | 204       |
| North Sea                                            |   | 557       |   | 557       |   | 521       |
| Caspian        Area                                  |   | 214       |   | 222       |   | 227       |
| Rest of the World                                    |   | 606       |   | 700       |   | 805       |
| **Total**                                            |   | **3,679** |   | **3,819** |   | **4,143** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

----

| (1) | i | Data includes        Eni’s share of production of affiliates and joint        venture accounted for under the equity method of        accounting amounting to 13, 28 and 31 mmCF/d in 2008,        2007 and 2006, respectively. |
|-----|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | It excludes        production volumes of natural gas consumed in operations.        Said volumes were 281, 296 and 286 mmCF/d in 2008, 2007        and 2006, respectively.                                                           |

Volumes of oil and natural gas purchased under long-termsupply contracts with foreign governments or similar entities inproperties where Eni acts as producer totaled 93 KBOE/d, 75KBOE/d and 57 KBOE/d in 2008, 2007 and 2006, respectively.

> 
27

----

##### Table of Contents

The table below sets forth certain information and operatingdata regarding Eni’s principal oil and natural gas interestsas of December 31, 2008.

**Principal oil and natural gas interests at December 31,2008**

|                                           |   | **Commencement        of operations** |   | **Number of interests** |   | **Gross exploration and development acreage**(1) |   | **Net exploration and development acreage**(1) |   | **Type of fields** |   | **Number of producing fields** |   | **Number of other fields** |
|------------------------------------------------|--------|---------------------------------------|--------|-------------------------|--------|--------------------------------------------------|--------|------------------------------------------------|--------|--------------------|--------|--------------------------------|--------|----------------------------|
|                                                |   |                                       |   |                         |   |                                                  |   |                                                |   |                    |   |                                |   |                            |
| **Italy**                                      |   | 1926                                  |   | **159**                 |   | **25,522**                                       |   | **20,409**                                     |   | Onshore/Offshore   |   | **87**                         |   | **99**                     |
| **Outside        Italy**                       |   |                                  |   | **1,085**               |   | **732,976**                                      |   | **395,085**                                    |   | Onshore/Offshore   |   | **419**                        |   | **219**                    |
| **North Africa**                               |   |                                  |   |                    |   |                                             |   |                                           |   |               |   |                           |   |                       |
| Algeria                                        |   | 1981                                  |   | 34                      |   | 2,921                                            |   | 909                                            |   | Onshore            |   | 28                             |   | 12                         |
| Egypt                                          |   | 1954                                  |   | 59                      |   | 26,335                                           |   | 9,741                                          |   | Onshore/Offshore   |   | 34                             |   | 34                         |
| Libya                                          |   | 1959                                  |   | 13                      |   | 36,375                                           |   | 18,164                                         |   | Onshore/Offshore   |   | 12                             |   | 17                         |
| Mali                                           |   | 2006                                  |   | 5                       |   | 193,200                                          |   | 128,801                                        |   | Onshore            |   |                           |   |                       |
| Tunisia                                        |   | 1961                                  |   | 11                      |   | 6,464                                            |   | 2,274                                          |   | Onshore/Offshore   |   | 21                             |   | 4                          |
|                                           |   |                                  |   | **122**                 |   | **265,295**                                      |   | **159,889**                                    |   |               |   | **95**                         |   | **67**                     |
| **West        Africa**                         |   |                                  |   |                    |   |                                             |   |                                           |   |               |   |                           |   |                       |
| Angola                                         |   | 1980                                  |   | 55                      |   | 20,492                                           |   | 3,323                                          |   | Onshore/Offshore   |   | 45                             |   | 27                         |
| Congo                                          |   | 1968                                  |   | 26                      |   | 15,655                                           |   | 8,244                                          |   | Onshore/Offshore   |   | 20                             |   | 8                          |
| Gabon                                          |   | 2008                                  |   | 6                       |   | 7,615                                            |   | 7,615                                          |   | Onshore/Offshore   |   |                           |   |                       |
| Nigeria                                        |   | 1962                                  |   | 50                      |   | 44,049                                           |   | 8,574                                          |   | Onshore/Offshore   |   | 95                             |   | 38                         |
|                                           |   |                                  |   | **137**                 |   | **87,811**                                       |   | **27,756**                                     |   |               |   | **160**                        |   | **73**                     |
| **North        Sea**                           |   |                                  |   |                    |   |                                             |   |                                           |   |               |   |                           |   |                       |
| Norway                                         |   | 1965                                  |   | 50                      |   | 11,771                                           |   | 3,861                                          |   | Offshore           |   | 13                             |   | 8                          |
| United        Kingdom                          |   | 1964                                  |   | 91                      |   | 5,207                                            |   | 1,450                                          |   | Offshore           |   | 35                             |   | 14                         |
|                                           |   |                                  |   | **141**                 |   | **16,978**                                       |   | **5,311**                                      |   |               |   | **48**                         |   | **22**                     |
| **Caspian        Area**                        |   |                                  |   |                    |   |                                             |   |                                           |   |               |   |                           |   |                       |
| Kazakhstan                                     |   | 1995                                  |   | 6                       |   | 4,933                                            |   | 880                                            |   | Onshore/Offshore   |   | 1                              |   | 5                          |
| Turkmenistan                                   |   | 2008                                  |   | 1                       |   | 200                                              |   | 200                                            |   | Onshore            |   | 2                              |   |                       |
|                                           |   |                                  |   | **7**                   |   | **5,133**                                        |   | **1,080**                                      |   |               |   | **3**                          |   | **5**                      |
| **Rest of        world**                       |   |                                  |   |                    |   |                                             |   |                                           |   |               |   |                           |   |                       |
| Australia                                      |   | 2001                                  |   | 18                      |   | 60,486                                           |   | 29,520                                         |   | Offshore           |   | 2                              |   | 2                          |
| Brazil                                         |   | 1999                                  |   | 2                       |   | 1,389                                            |   | 1,389                                          |   | Offshore           |   |                           |   |                       |
| China                                          |   | 1983                                  |   | 3                       |   | 899                                              |   | 192                                            |   | Offshore           |   | 10                             |   | 3                          |
| Croatia                                        |   | 1996                                  |   | 2                       |   | 1,975                                            |   | 988                                            |   | Offshore           |   | 6                              |   | 5                          |
| East Timor                                     |   | 2006                                  |   | 5                       |   | 12,224                                           |   | 9,779                                          |   | Offshore           |   |                           |   |                       |
| Ecuador                                        |   | 1988                                  |   | 1                       |   | 2,000                                            |   | 2,000                                          |   | Onshore            |   | 1                              |   | 1                          |
| India                                          |   | 2005                                  |   | 3                       |   | 24,425                                           |   | 9,091                                          |   | Onshore/Offshore   |   | 4                              |   | 2                          |
| Indonesia                                      |   | 2001                                  |   | 11                      |   | 28,605                                           |   | 17,316                                         |   | Onshore/Offshore   |   | 7                              |   | 12                         |
| Iran                                           |   | 1957                                  |   | 4                       |   | 1,456                                            |   | 820                                            |   | Onshore/Offshore   |   | 3                              |   |                       |
| Pakistan                                       |   | 2000                                  |   | 21                      |   | 35,938                                           |   | 18,855                                         |   | Onshore/Offshore   |   | 7                              |   | 3                          |
| Russia                                         |   | 2007                                  |   | 5                       |   | 6,636                                            |   | 3,891                                          |   | Onshore            |   |                           |   | 9                          |
| Saudi        Arabia                            |   | 2004                                  |   | 1                       |   | 51,687                                           |   | 25,844                                         |   | Onshore            |   |                           |   |                       |
| Trinidad & Tobago                          |   | 1970                                  |   | 1                       |   | 382                                              |   | 66                                             |   | Offshore           |   | 3                              |   | 4                          |
| United        States                           |   | 1968                                  |   | 575                     |   | 11,478                                           |   | 6,648                                          |   | Onshore/Offshore   |   | 69                             |   | 11                         |
| Venezuela                                      |   | 1998                                  |   | 3                       |   | 1,556                                            |   | 614                                            |   | Offshore           |   | 1                              |   |                       |
| Yemen                                          |   | 2008                                  |   | 1                       |   | 3,911                                            |   | 3,598                                          |   | Onshore            |   |                           |   |                       |
|                                           |   |                                  |   | **656**                 |   | **245,047**                                      |   | **130,611**                                    |   |               |   | **113**                        |   | **52**                     |
| Other        countries                         |   |                                  |   | 9                       |   | 6,311                                            |   | 1,363                                          |   | Offshore           |   |                           |   |                       |
| Other countries with only exploration activity |   |                                  |   | 13                      |   | 106,401                                          |   | 69,075                                         |   | Onshore/Offshore   |   |                           |   |                       |
| **Total**                                      |   |                                  |   | **1,244**               |   | **758,498**                                      |   | **415,494**                                    |   |               |   | **506**                        |   | **318**                    |
|                                                |   |                                       |   |                         |   |                                                  |   |                                                |   |                    |   |                                |   |                            |

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| (1) | i | Square        kilometers. |
|-----|---|---------------------------|

Eni’s principal regions of operations are describedbelow. In the discussion that follows references to hydrocarbonproduction are to be intended to hydrocarbon production availablefor sale.

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| *Italy*

Eni has been operating in Italy since 1926. In 2007,        Eni’s oil and gas production amounted to 195 KBOE/d.        Eni’s activities in Italy are deployed in the        Adriatic Sea, the Central Southern Apennines, mainland        and offshore Sicily and the Po Valley. Eni’s        exploration and development activities in Italy are        regulated by concession contracts.

The Adriatic Sea represents Eni’s main production        area in Italy, accounting for 48% of Eni’s domestic        production in 2008. Main operated fields are Barbara (124        mmCF/d net to Eni), Angela-Angelina (57 mmCF/d), Porto        Garibaldi (49 mmCF/d), Cervia (39 mmCF/d) and        Tea-Arnica-Lavanda (42 mmCF/d).

Eni is operator of the Val d’Agri concession        (Eni’s interest 60.77%) in Basilicata Region,        Southern Italy, resulting from the unitization of the        Volturino and Grumento Nova concessions made in late        2005. Production from the Monte Alpi, Monte Enoc and        Cerro Falcone fields is fed by 21 production wells of the        47 foreseen by the sanctioned development plan and is        supported by the Viggiano oil center with a treatment        capacity of 104 KBBL/d. Oil produced is carried to        Eni’s refinery in Taranto via a 136-kilometer long        pipeline. Gas produced is treated at the Viggiano oil        center. In 2008, the Val d’Agri concession produced        95 KBOE/d (58 net to Eni) corresponding to 29% of        Eni’s production in Italy.

Eni is operator of 15 production concessions onshore        and offshore Sicily. Its main fields are Gela, Ragusa,        Giaurone, Fiumetto and Prezioso, which in 2008 accounted        for 9% of Eni’s production in Italy.

Development activities concerned in particular: (i)        optimization of producing fields by means of |   |  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--|

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sidetracking and infilling (Antares, Cervia, Emma, FratelloNorth, Giovanna, Hera-Lacinia, Gela, Luna and Fiumetto); (ii)continuation of drilling and upgrading of producing facilities inthe Val d’Agri; and (iii) completion of developmentactivities at Cascina Cardana field and phase 1 of the Vald’Agri project.

Other development activities were the development of theAnnamaria and the Guendalina gas fields in the Adriatic Sea. TheAnnamaria project provides for the installation of a productionplatform and the linkage by sealines to the Fano plant. Start-upis expected in 2009. Actions on Guendalina include theinstallation of a platform and the linkage by existing facilitiesto the Ravenna plant. Start-up is expected in 2010.

In December 2008 Eni was awarded two onshore explorationblocks in Puglia region.

Major discoveries were made in offshore Sicily with theoperated gas discovery Cassiopea that has yielded excellentresults in addition to the positive appraisal of the Argo gasfield. Eni holds a 60% interest in the two discoveries. Inparticular for Cassiopea an accelerated development plan isforeseen in order to provide optimal synergies with the nearbyPanda and Argo discoveries. The project provides for the drillingof undersea producing wells and the installation of a productionplatform linked to the existing onshore treatment facilities.Production start up is expected in 2011.

In the medium-term, management expects production in Italy toremain stable at current level due to the production ramp-up ofthe Val d’Agri fields and ongoing new field project andcontinuing development activities designed to counteract maturefield decline.

> 
*North Africa*

Eni’s operations in North Africa are conducted inAlgeria, Egypt, Libya and Tunisia. In 2008, North Africaaccounted for 36% of Eni’s total worldwide production of oiland natural gas.

*Algeria.* Eni has been present in Algeria since 1981. In2008, Eni’s oil and gas production averaged 80 KBOE/d.Operating activities are located in the Bir Rebaa area in theSouth-Eastern desert and include the following exploration andproduction blocks: (a) Blocks 403 a/d (Eni’s interest 100%);(b) Blocks 401a/402a (Eni’s interest 55%); (c) Blocks 403(Eni’s interest 50%) and 404a (Eni’s interest 12.25%);and (d) under development Blocks 212 (Eni’s interest 22.38%)and 208 (Eni’s interest 12.25%).

| In November 2008, Eni        completed the acquisition of First Calgary Petroleums        Ltd, a Canadian oil and gas company with exploration and        development activities in Algeria. The acquisition values        the fully diluted share capital of First Calgary at        approximately CAN $923 million (equal to euro 605        million). Assets acquired include the operatorship of        Block 405b with a 75% interest. Production start-up is        expected in 2011 with a projected production plateau of        approximately 30 KBOE/d net to Eni by 2012.
In December        2008, following an international bid procedure, Eni was        awarded the operatorship of the Kerzaz exploration block        (Block 319a-321a) covering a gross acreage of 16,000        square kilometers. Exploration activity start-up is        expected in 2009.

Exploration and production activities in Algeria are        regulated by Production Sharing Agreements (PSAs) and        concession contracts.

Production in Block 403a/d is supplied mainly by the        HBN and Rom and satellite fields and accounted for        approximately 12% of Eni’s production in Algeria in        2008. The main project underway is the Rom Integrated        project, designed to develop the reserves of the Rom        Main, ZEA and Rom North fields. The development project        provides construction of a new oil treatment plant with a        capacity of 32 KBBL/d with production start-up expected        in 2012. In 2008 Eni and Sonatrach signed a framework        agreement to set out the common contractual ground of the        project and to extend the duration of the |   |  |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--|

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Rhourde Messaoud and Zemlet Adreg development licenses forfurther 10 years and the Bir Rebaa North license for further 5years.

Production in Blocks 401a/402a is supplied mainly by the Rodand satellite fields and accounted for approximately 23% ofEni’s production in Algeria in 2008. Infilling activitiesare being performed in order to maintain the current productionplateau.

The main fields in Block 403 are BRN, BRW and BRSW andaccounted for approximately 14% of Eni’s production inAlgeria in 2008. Exploration activities for appraising themineral potential of the area are planned.

Block 208 is located south of Bir Rebaa. The El Merk Synergy,designed to jointly develop of this block and adjoining blocksoperated by other companies, is the main project underway inAlgeria. In 2008 following an international bid procedure, theseven EPC contracts of the project have been awarded. The projectprovides for the construction of a new treatment plant with acapacity of 11 KBOE/d net to Eni and production facilities inBlock 404/208. Start-up is expected in the first quarter of 2012.

Main discoveries for the year were achieved in: (a) theBlock 401a/402a with the ROD-21 appraisal well that startedproduction through existing facilities; (b) the Block 404a withthe BKNE-24 and HBNSE-12 appraisal wells, with the latterstarting production through existing facilities.

The new Algerian hydrocarbon law No. 05 of 2007 introduced ahigher tax burden for the national oil company Sonatrach thatrequested to renegotiate the economic terms of certain PSAs inorder to restore the initial economic equilibrium. Eni signed anagreement for Block 403 while negotiations are ongoing for Block401a/402a (Eni’s interest 55%) and Block 208 (Eni’sinterest 12.25%). At present, management is not able to foreseethe final outcome of such renegotiations.

In the medium-term, management expects to increase Eni’sproduction in Algeria to approximately 110 KBOE/d, reflecting thedevelopment and integration of the First Calgary acquired assets.

*Egypt.* Eni has been present in Egypt since 1954. In2008, Eni’s share of production in this country amounting to232 KBOE/d and accounted for 13% of Eni’s total annualhydrocarbon production. Eni’s main producing liquid fieldsare located in the Belayim concession (Eni’s interest 100%)and offshore the Gulf of Suez. Gas production mainly comes fromthe operated or participated concession of North Port Said(former Port Fouad, Eni’s interest 100%), Baltim (50%interest), Ras el Barr (50% interest, non-operated) and el Temsah(50% interest) offshore the Nile Delta. In 2008 production fromthese concessions also including a portion of liquids accountedfor 90% of Eni’s production in Egypt.

| Exploration and production        activities in Egypt are regulated by concession contracts        and PSAs. 
In May 2009, Eni signed an agreement with        the Egypt’s Ministry of Petroleum to broaden and        enhance an integrated model of cooperation aimed at        developing hydrocarbon reserves in the Country and to        implement a joint education project for the training of        Egyptian professionals. The agreement include the        extension of the licence for the Belayim field until 2030        and the initiatives to develop and market natural gas        reserves at high depths. 

In 2008 a number of fields started to produce:        (i) the West Ashrafi (Eni’s interest 100%)        field was completed underwater and linked to existing        facilities; and (ii) in the Ras el Barr concession        (Eni’s interest 50%), the Taurt field was linked to        the onshore West Harbour treatment plant. Production        peaked at approximately 38 KBOE/d (13 net to Eni) in        2008. In the el Temsah concession (Eni operator with a        50% interest), development activities progressed at the        Denise field started-up in late 2007. The production        build-up was reached in 2008 through the completion of        phase A of the development plan. Current production        amounts to 37 KBOE/d (11 net to Eni). The Taurt and        Denise fields are expected to ensure natural gas supplies        of 23 KBOE/d to the first train of the Damietta LNG        plant.

In the Gulf of Suez optimization activities progressed        at the Belayim field (Eni’s interest 100%) by        finalizing |   |  |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--|

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|  |   | basic engineering for the        upgrading of the water injection system intended to        recover residual reserves.
Development activities are        underway offshore the Nile Delta: (i) in the Thekah        concession (Eni operator with a 50% interest); and (ii)        the North Bardawil concession (Eni operator with a 60%        interest). Upgrading of the el Gamil compression plant        progressed by adding new capacity.

Through its affiliate Unión Fenosa Gas, Eni has an        indirect interest in the Damietta natural gas        liquefaction plant with a producing capacity of 5.1        mmtonnes/y of LNG corresponding to approximately 268        BCF/y of feed gas. Eni is currently supplying 53 BCF/y to        the first unit for a twenty-year period. Eni and the        partners of the Damietta LNG plant have planned to double        the capacity of this facility through the construction of        a second train with a treatment capacity of approximately        268 BCF/y of gas. Eni will provide 88 BCF/y to the second        train for a period of twenty years. The project is        awaiting to be sanctioned by the Egyptian authorities.        The reserves which are needed to feed the second train,        have been already identified including the additional        amounts that must be developed to meet the country’s        domestic requirements under existing laws.

Main discoveries for the year were achieved in:        (a) the offshore area of the Nile Delta with the        Satis-1 gas discovery (Eni’s interest 50%) and the        appraisal activity of the Ha’py field; and (b) the        onshore area with the Eky oil discovery (Eni operator        with a 100% interest) and Jasmine Est (Eni’s        interest 56%). |
|--|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

In the medium-term, management expects production in Egypt tobe one of Eni’s largest oil and gas producing countries.

*Libya.* Eni started operations in Libya in 1959. In2008, Eni’s oil and gas production averaged 300 KBOE/d, theportion of liquids being 48%. Production activity is carried outin the Mediterranean offshore facing Tripoli and in the LibyanDesert area.

In June 2008, Eni and the Libyan national oil company NOCfinalized six Exploration and Production Sharing contracts (EPSA)converting the original agreements that regulated Eni’sexploration and development activities in the country. The termsof Eni’s assets in Libya have been extended till 2042 and2047 for oil and gas properties respectively. The two partnershave also agreed to develop a number of industrial initiativesdesigned to monetize the large reserve base, particularly throughthe implementation of important gas projects. The economiceffects and Eni’s production entitlements based on the newcontracts have been determined effective from January 1, 2008.

Under above agreement the Eni’s assets have been groupedinto six contract areas as follows: (i) area A including theformer concession 82 (Eni’s interest 50%); (ii) Area B,former concessions 100 (Bu Attifel field) and the NC 125 Block(Eni’s interest 50%); (iii) Area E with El Feel (Elephant)field (Eni’s interest 33.3%); and (iv) Area F withBlock 118 (Eni’s interest 50%). Offshore areas are: (i) AreaC with the Bouri oil field (Eni’s interest 50%); and (ii)Area D with Blocks NC 41 and NC 169 (onshore) that feed theWestern Libyan Gas Project (Eni’s interest 50%).

In the exploration phase, Eni is operator of four onshoreblocks in the Muzurk basin (161/1, 161/2&4, 176/3) and in theKufra area (186/1, 2, 3 & 4).

The tax burden on Eni’s taxable profit has beendetermined based on the renewed tax framework, enacted in 2007,applicable to foreign oil companies operating under PSA schemes.In line with past practice, NOC has retained the role of taxagent on behalf of foreign oil companies. This tax regime doesnot alter the agreed economic value of the EPSAs currently inplace between Eni and NOC. Based on the arrangements agreed uponwith NOC, the tax base of the Company’s Libyan oilproperties has been reassessed resulting in the partialutilization of previously accrued deferred tax liabilitiesamounting to euro 173 million.

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| Within the Western Libyan        Gas project upgrading of plants and facilities is        underway aimed at increasing gas exports by 106 BCF/y        fully operating from the 2014 and maintaining production        profiles at the Wafa oil field. In 2008 exported volumes        amounted to 332 BCF, equal to 90% of the total gas        production of the two fields. In addition 35 BCF were        sold on the Libyan market for power generation.
Other        ongoing development activities concern the A-NC118 field        (Eni’s interest 50%) linking it to the pipelines        connecting Wafa with Mellitah plant and the valorization        of associated gas of the Bouri field. The partially        treated gas and associated condensates will be shipped by        sealine to the nearby Sabratha platform and exported        through the GreenStream pipeline.

Main discoveries for the year were achieved in: (a)        the offshore Block NC41, where the U1-NC41 discovery well        showed the presence of oil and natural gas and the        D4-NC41 appraisal well showed the presence of natural gas        and condensates; and (b) in former Concession 82, the        YY-1 discovery well showed the presence of oil.

In the medium-term, management expects to increase        Eni’s production in Libya owing to the expected        ramp-up of new mineral structures near the Western Libyan        Gas Project fields with the support of the upgrade of the        GreenStream pipeline, despite mature field declines. Eni        targets a production level in excess of 280 KBOE/d. If        this target is achieved, in the medium-term Libya will        become the largest producing country by volume in        Eni’s portfolio. |   |  |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--|

 

*Tunisia.* Eni has been present in Tunisia since 1961. In2008, Eni’s production amounted to 15 KBOE/d. Eni’sactivities are located mainly in the Mediterranean offshorefacing Hammamet and in the Southern desert areas.

Exploration and production in this country are regulated byconcessions.

Production mainly comes from the Adam (Eni operator with a 25%interest), Oued Zar (Eni operator with a 50% interest), MLD(Eni’s interest 50%) and El Borma (Eni’s interest 50%)onshore blocks.

The ongoing development activities mainly regarded theoptimization of production at the Adam, Oued Zar, MLD and ElBorma concessions.

Development activities started also at the production platformof the Maamoura (Eni’s interest 49%) and Baraka (Eni’sinterest 49%) fields. Production start-up is expected in 2009.

Main discoveries for the year were achieved in the followingpermits: (a) Adam, where the Mejda-1 and El Azzel North-1 wellsshowed the presence of oil; (b) Bek (Eni operator with a 25%interest), where the Abir-1 well found oil and natural gas; (c)MLD, where the LASSE-1 well found oil and natural gas; and (d) ElBorma, where the EB-406 exploratory well showed additional oilresources.

In the medium-term, Eni expects production in Tunisia toincrease due to the development of recent discoveries.

> 
*West Africa*

Eni’s operations in West Africa are conducted in Angola,Congo and Nigeria. In 2008, West Africa accounted for 19% ofEni’s total worldwide production of oil and natural gas.

*Angola.*Eni has been present in Angola since 1980. In2008, Eni’s production averaged 121 KBOE/d. Eni’sactivities are concentrated in the conventional and deepoffshore.

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|  |   | The main blocks with        Eni’s participation are: (i) Block 0 in Cabinda        (Eni’s interest 9.8%) west of the Angolan coast;        (ii) Development Areas in the former Block 14 (Eni’s        interest 20%) in the deep offshore west of Block 0; and        (iii) Development Areas in the former Block 15        (Eni’s interest 20%) in the deep offshore of the        Congo basin. Eni also holds interests in other minor        concessions, in particular in some areas of Block 3 (with        interests varying from 12 to 15%) and in the Lianzi        Development Area (former 14K/A IMI Unit Area-Eni’s        interest 10%). In the exploration phase, Eni is operator        of Block 15/06 (with a 35% interest) and holds interests        in Block 3/05-A with a 12% interest.
Exploration and        production activities in Angola are regulated by        concessions and PSAs.

In May 2008, Eni acquired a 10% interest in the        Cabinda North Block from the state oil company Sonangol.

In February, 2009 Eni signed the first three        agreements pertaining to the Memorandum of Understanding        signed in August 2008 with Angola’s state oil        company Sonangol. These agreements provide for:        (i) a feasibility study that addresses the        utilization of associated gas feeding a new onshore power        plant; (ii) a joint study that evaluates areas of the        highly prospective Angolan onshore basins and their        production potential for further upstream sector        initiatives; and (iii) the definition of educational        projects and the training of Angolan professionals with        the aim of implementing energy initiatives. |
|--|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Development at the Landana and Tombua oil fields in offshoreBlock 14 (Eni’s interest 20%) progressed. Early productionis ongoing in the north area of Landana that was linked to theBenguela/Belize-Lobito/Tomboco facilities. Production is expectedto peak at 100 KBBL/d in 2010 at the end of the drilling program.

Activities at the Banzala oil field in Block 0 in Cabinda(Eni’s interest 9.8%) progressed as planned. Thecommissioning of a third production platform was achieved early2008. Peak production at 27 KBBL/d (3 net to Eni) is expected in2009. Mafumeira project in Block 0 also progressed according toschedule toward first production expected in 2009.

With respect to the activities for gas flaring reduction,projects progressed at the Takula and Nemba fields in Block 0.The start-up of Takula project is expected in 2009. Gas currentlyflared will be re-injected in the field; condensates will beshipped via a new pipeline to the Malongo treatment plant to beconverted into LPG. Development activities at the Nemba field areplanned including the drilling of gas injection wells and theinstallation of a new production platform. Start-up is expectedin 2011.

The Mondo and Saxi/Batuque fields in Block 15 (Eni’sinterest 20%) were started-up by means of a floating, production,storage and offloading (FPSO) vessel. Peak production at 100KBBL/d (18 KBBL/d net to Eni) was achieved at both fields in2008. The outlined projects and other ongoing developmentactivities aim at maintaining current oil production plateau inthe area.

In 2008 the final investment decision was achieved regardingthe development of the Kizomba Satellites project-phase 1. Theproject plans to produce reservoir of the Clochas and Mavacolaoil discoveries. Start-up is expected in 2012.

Eni holds a 13.6% interest in the Angola LNG Limited (A-LNG)consortium responsible for the construction of an LNG plant inSoyo, 300 kilometers north of Luanda. It will be designed with aprocessing capacity of 1 BCF/y of natural gas and produce 5.2mmtonnes/y of LNG and related products. The project has beensanctioned by relevant Angolan authorities. It envisages thedevelopment of 10,594 BCF of associated gas reserves in 30 years.Gas volumes currently being produced from offshore productionblocks are flared. In 2008 the final investment decision wasreached to build a pipeline linking the fields located in Blocks0 and 14 to LNG plant in order to monetize gas currently flared.Start-up is expected in 2012.

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Main oil discoveries for the year were made in: (a) Block15/06, with the Ngoma-1 and Sangos-1 discoveries. Bothdiscoveries were declared of commercial interest; (b) Block 0,with the Kambala appraisal well; (c) the development area offormer Block 14, with the Lucapa-5 appraisal well; and (d) thedevelopment area of former Block 15 with the Mavacola-3 appraisalwell.

In the medium-term, management expects to increase Eni’sproduction to approximately 150 KBBL/d reflecting contributionsfrom ongoing development projects, despite mature field declines.

| *Congo.* Eni has been        present in Congo since 1968. In 2008 production averaged        85 KBOE/d net to Eni. Eni’s activities are        concentrated in the conventional and deep offshore facing        Pointe Noire and onshore.
Exploration and production        activities in the Congo are regulated by Production        Sharing Agreements.

Eni’s main operated oil producing interests in        Congo are the Zatchi (Eni’s interest 65%) and Loango        (Eni’s interest 50%) fields, Blocks Marine VI        (Eni’s interest 65%), Marine VII (Eni’s        interest 35.75%), M’Boundi (Eni’s interest        80.1% pursuant to the acquisition of Burren Energy) and        Kouakouala A (Eni’s interest 100% pursuant to the        acquisition of Burren Energy).

Other relevant producing areas are a 35% interest in        the Pointe Noire Grand Fonde and Pex permits. Eni also        holds interests in three deep offshore blocks currently        in the exploration phase: Mer Très Profonde Nord (Eni        operator with a 40% interest), Mer Très Profonde Sud        (Eni’s interest 30%), Marine X (Eni operator with a        90% interest), and Le Kouilou onshore permit (Eni        operator with a 85% interest pursuant to the acquisition        of Burren Energy).

In May 2008, Eni signed a cooperation agreement with        the Republic of Congo with the aim to develop the        country’s mineral and oil potential. The agreement        provides for: (i) development and extraction of        unconventional oil from the Tchikatanga and        Tchikatanga-Makola oil sands deposits. The two deposits        that cover an acreage of approximately 1,790 square        kilometers are deemed to contain significant amounts of        resources based on a recent survey. |   |  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--|

Eni plans to monetize the heavy oil by applying its EST (EniSlurry Technology) proprietary technology intended to fullyconvert the heavy oil into high quality light products. Theproject will also benefit from synergies resulting from the closeproximity of the operated M’Boundi oilfield; (ii)collaboration in the use of vegetable oils, aimed at coveringdomestic demand for food uses and using excess amounts for theproduction of bio-diesel with Eni’s proprietary technologyUltra-Bio-Diesel; and (iii) construction of a 450 MW electricitygeneration plant near the Djeno oil terminal, with start-upexpected in late 2009. The power station (Eni’s share 20%)will be fired with the associated natural gas from theM’Boundi field and offshore discoveries in permit Marine XII(Eni operator with a 90% interest) contributing to the reductionof gas flaring. The final investment decision was reached in2008. This project aims at qualifying as Clean DevelopmentMechanism in implementing the Kyoto protocol and as acontribution to the sustainable development of the Country.

The Awa Paloukou (Eni’s interest 90%) and Ikalou-IkalouSud (Eni’s interest 100%) operated fields in the Marine Xand Madingo permits were started up in 2008 with productionpeaking at 13 KBOE/d net to Eni in 2009.

Development activities of the M’Boundi field movedforward with the revision of the production schemes and layout toplan application of advanced recovery techniques and a design tomonetize associated gas.

In the medium-term, management expects to increase Eni’sproduction in Congo due to the integration and development ofrecently acquired assets as well as projects underway, targetinga level in excess of 140 KBBL/d in 2012.

*Nigeria.* Eni has been present in Nigeria since 1962. In2008, Eni’s oil and gas production averaged 119 KBOE/dlocated mainly in the onshore and offshore of the Niger Delta.

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In the development/production phase Eni is operator of onshoreOil Mining Leases (OML) 60, 61, 62 and 63 (Eni’s interest20%) and offshore OML 125 (Eni’s interest 85%), OMLs 120-121(Eni’s interest 40%) and holds a 12.5% interest in OML 118as well as in OML 119 and 116 service contracts. Through SPDC JVoil joint venture, Eni also holds a 5% interest in 31 onshoreblocks and a 12.86% interest in 5 conventional offshore blocks.In the exploration phase Eni is operator of Oil prospectingLeases (OPL) 244 (Eni’s interest 60%), OML 134 (former OPL211 - Eni’s interest 85%) and onshore OPL 282 (Eni’sinterest 90%) and OPL 135 (Eni’s interest 48%). Eni alsoholds a 12.5% interest in OML 135 (former OPL 219).

In December 2008 Eni exercised its pre-emption rights on theremaining 49.81% interest in Blocks OML 125 and 134. On the sameoccasion Eni transferred a 15% stake to the Nigerian companyOANDO. This transaction has been approved by relevantauthorities.

Exploration and production activities in Nigeria are regulatedmainly by Production Sharing Agreements and concession contractsas well as service contracts, where Eni acts as contractor forstate owned companies.

In Blocks OMLs 60, 61, 62 and 63 development activities of gasreserves are underway: (i) the basic engineering work forincreasing capacity at the Obiafu/Obrikom plant was completed.The project also provides for the installation of a new treatmentplant and transport facilities; and (ii) the development plan ofthe Tuomo gas field has been progressing. Production is expectedto start by means of linkage to the Ogbainbiri treatment plant.These activities target to supply 311 mmCF/d of feed gas to theBonny liquefaction plant (Eni’s interest 10.4%) for a periodof 20 years.

In the OML 118, Bonga field produced about 19 KBOE/d net toEni via a FPSO unit with a 225 KBBL/d treatment capacity. Theassociated gas is gathered into a platform in EA field and thendelivered to the Bonny liquefaction plant.

In the OML 119, Okono/Okpoho production reached about 12KBBL/d net to Eni via a FPSO unit with a 40 KBBL/d treatmentcapacity.

In the OMLs 120/121 blocks (Eni operator with a 40% interest),the development plan of the Oyo oil discovery was approved. Theproject provides for the installation of an FPSO unit withtreatment capacity of 40 kBBL/d and storage capacity of 1 mmBBL.Production start-up is expected in 2009.

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Through the SPDC JV, the Forcados/Yokri oil and gas field isunder development as part of the integrated associated gasgathering project aimed at supplying gas to the Bonnyliquefaction plant. Offshore production facilities have beeninstalled. Onshore activities regard the upgrading of the Yokriand North/South Bank flow stations and the construction of a gascompression plant with a 233 mmCF/d capacity. Completion isexpected in 2009.

In the OML 125, oil production deriving from Abo field.Ongoing development activities aim at reaching a peak productionof 27 KBBL/d (18 KBBL/d net to Eni) in 2009. Production issupported by an FPSO unit with a 45 KBBL/d capacity and an 800KBBL storage capacity.

Eni holds a 10.4% interest in Nigeria LNG Ltd that manages theBonny liquefaction plant located in the Eastern Niger Delta, witha treatment capacity of approximately 1,236 BCF/y of feed gascorresponding to a production of 22 mmtonnes/y of LNG on 6trains. The seventh unit is being engineered with start-upexpected in 2012. When fully operational, total capacity willamount to approximately 30 mmtonnes/y of LNG, corresponding to afeedstock of approximately 1,624 BCF/y. Natural gas supplies tothe plant are provided under gas supply agreements with a 20-yearterm from the SPDC joint venture (Eni’s interest 5%) and theNAOC JV, the latter operating the OMLs 60, 61, 62 and 63. In 2008total supplies were 3,461 mmCF/d (268 mmCF/d net to Eni,corresponding to 46 KBOE/d). LNG production is sold underlong-term contracts and exported to European and American marketsby the Bonny Gas Transport fleet, wholly-owned by Nigeria LNG Co.

Eni is operator with a 17% interest of the Brass LNG LtdCompany for the construction of a natural gas liquefaction plantto be built near the existing Brass terminal. This plant isexpected to start operating in 2014 with a production capacity of10 mmtonnes/y of LNG corresponding to 618 BCF/y (approximately 64net to Eni) of feed gas on 2 trains for twenty years. Supplies tothis plant will derive from the collection of associated gas fromnearby producing fields and from the development of gas reservesin the OMLs 60 and 61 onshore blocks. The venture signedpreliminary long-term contracts to sell the whole LNG productioncapacity. Eni acquired 1.67 mmtonnes/y of LNG capacity. The frontend engineering is underway and the final investment decision isexpected in 2009.

In the medium-term, management expects to increase Eni’sproduction in Nigeria to approximately 200 KBOE/d, reflecting inparticular the development of gas reserves.

> 
*North Sea*

Eni’s operations in the North Sea area are conducted inNorway and United Kingdom. In 2008, the North Sea accounted for13% of Eni’s total worldwide production of oil and naturalgas.

| *Norway.* Eni has been        operating in Norway since 1964. Eni’s activities are        performed in the Norwegian Sea, in the Norwegian section        of the North Sea and in the Barents Sea. Eni’s        production in Norway amounted to 126 KBOE/d in 2008.
Exploration        and production activities in Norway are regulated by        Production Licenses (PL). According to a Production        License, the holder is entitled to perform seismic        surveys and drilling and production activities for a few        years with possible extensions.

In February 2008, following an international bid        procedure, Eni was awarded the operatorship of 2        exploration licenses with a 40% and 65% stake,        respectively, in the Barents Sea and further 3 licenses        in the Norwegian Sea with stakes from 19.6% to 29.4%.

In May 2009, following an international bid procedure,        Eni was awarded the operatorship of the PL 533 and PL 529        exploration permits with a 40% stake as well as a 30%        interest of the PL 532 permit.

Eni holds interests in 6 production areas in the        Norwegian Sea. The main producing fields are Aasgaard        (Eni’s interest 14.82%), Kristin (Eni’s        interest 8.25%), Heidrun (Eni’s interest 5.12%),        Mikkel (Eni’s interest 14.9%) and Norne (Eni’s        interest 6.9%) which in 2008 accounted for 67% of        Eni’s production in Norway. |   |   |
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| Activities in 2008 were        aimed at maintaining production levels by means of        sidetracking and infilling activities at the main        producing fields. The main structures under development        are located near Kristin, particularly Tyrihans        (Eni’s interest 6.23%). Economic development of this        field is expected to be achieved through synergies with        the Kristin production facilities. Production is expected        to start in 2009, in coincidence with the expected        production decline of Kristin which will make spare        capacity available to process production from Tyrihans.        Pre-development activities are underway on recent oil and        gas discoveries near Aasgaard field. In particular: (i)        in May 2008, the relevant authorities sanctioned the        development plan of the Morvin discovery. The basic        design provides linkage to existing production facilities        that will be upgraded. Production start-up is expected in        2010; and (ii) the drilling program at the Yttergryta        field was completed. Production commenced at 81 mmCF/d in        early 2009.
Eni holds interests in four production        licenses in the Norwegian section of the North Sea. The        main producing field is Ekofisk (Eni’s interest        12.39%) in PL018 which in 2008 produced 42 KBOE/d net to        Eni and accounted for 33% of Eni’s production in        Norway. Ongoing projects aim at maintaining and        optimizing production at Ekofisk by means of infilling        wells, the development of the South Area, upgrading of        existing facilities and optimization of water injection. |   |  |
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Currently Eni is only performing exploration activities inBarents Sea. Operations in this area are focused on the appraisalof the mineral potential of the large Goliath discovery made in2000 at a water depth of 370 meters in PL 229 (Eni operator witha 65% interest) aimed at its commercial development. The projectis progressing according to schedule. Commencement is expected in2013 with a production plateau at 100 kBBL/d. In 2008 contractswere awarded for the study of two possible development plans bymeans of a cylindrical FPSO unit. The final investment decisionis expected in 2009.

Main discoveries for the year were achieved in the: (a)Prospecting License 312 (Eni’s interest 17%) with the Gammagas discovery at a depth of about 2,500 meters. Production willbe treated at the nearby Aasgaard facilities; (b) the ProspectingLicense 122 (Eni operator with a 20% interest), where appraisalactivities confirmed the mineral potential of the Marulkdiscovery; (c) the Prospecting License 293 (Eni operator with a45% interest), with the gas and condensate Aphrodite discovery.Ongoing pre-development activities aim to assessing the economicviability of the project; and (d) Prospecting License 128(Eni’s interest 11.5%) with the Dompap gas discovery at adepth of about 2,750 meters. Appraisal activities are underway.

*United Kingdom.* Eni has been present in the UnitedKingdom since 1964. Eni’s activities are carried out in theBritish section of the North Sea, in the Irish Sea and in someareas East and West of the Shetland Islands. In 2008 Eni’snet production of oil and gas averaged 104 KBOE/d.

Exploration and production activities in the United Kingdomare regulated by concession contracts.

In November 2008, Eni finalized an agreement with the Britishcompany Tullow Oil to purchase a 52% stake and the operatorshipof fields in the Hewett Unit in the British section of the NorthSea and relevant facilities including the associated Bactonterminal. Eni acquired operatorship of the assets with an 89%interest. Eni aims to upgrade certain depleted fields in the areaso as to achieve a gas storage facility with a 177 BCF workinggas capacity to support seasonal upswings in gas demand in the UKleveraging on the strategic purchased facilities. The Bactonterminal, in fact, is very close to the incoming point of theInterconnector pipeline connecting the United Kingdom withEurope. For this purpose, Eni intend to request a storagelicense.

In December 2008 following an international bid procedure, Eniwas awarded four exploration blocks with a 22% interest locatedin the Shetland Islands. One of the awarded blocks is locatednear the Tormore (Eni’s interest 20%) and Laggan (Eni’sinterest 20%) recent gas discoveries in the North Sea.

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Eni holds interests in 12 production areas in the Britishsection of the North Sea. The main fields are Elgin/Franklin(Eni’s interest 21.87%), the J-Block (Eni’s interest33%), Andrew (Eni’s interest 16.21%), Farragon (Eni’sinterest 30%), the Flotta Catchment Area (Eni’s interest20%) and Mac-Culloch (Eni’s interest 40%) which in 2008accounted for 63% of Eni’s production in the United Kingdom.Development activities progressed at the West Franklin field(Eni’s interest 21.87%) by completing a second developmentwell planned. The production is supported by facilities of thenearby Elgin/Franklin field which peaked at 20 KBOE/d (4 net toEni). Other activities related to: (i) optimization of productionin the J-Block through the upgrading of existing facilities; and(ii) infilling actions at the Flotta Catchment Area andMac-Culloch fields targeting to maintain production levels.Development activities started at the Burghely field (Eni’sinterest 21.92%). Pre-development activity continued on theSuilven discovery (Eni’s interest 8.75%).

Eni holds a 53.9% interest in 6 production fields in theLiverpool Bay area in the Eastern section of the Irish Sea. Mainfields are Douglas, Hamilton and Lennox and their extension whichin 2008 accounted for 24% of Eni’s production in UK.Facilities upgrading is underway.

Eni holds interest in 6 production permits located East of theShetland Islands. Main fields are Ninian (Eni’s interest12.94%) and Magnus (Eni’s interest 5%) which in 2008accounted for 4% of Eni’s production in the United Kingdom.In 2008 maintenance and optimization actions were performed withthe drilling of infilling wells.

Main discoveries for the year were achieved in the: (i) Block16/23 (Eni’s interest 16.67%) with the Kinnoul oil and gasdiscovery which is planned to be developed in synergy with theproduction facilities of the Andrew field (Eni’s interest16.21%); (ii) Block 30/6 (Eni’s interest 33%) where gas andcondensates were found near the recent Jasmine discovery. Jointdevelopment of these two structures is being assessed incombination with existing facilities; and (iii) Block 22/25a(Eni’s interest 16.95%) with the gas and condensate Culzeandiscovery near the Elgin/Franklin producing field (Eni’sinterest 21.87%). Study of development activities is underway.

> 
*Caspian Area*

In 2008, Eni’s operations in the Caspian Area accountedfor 7% of its total worldwide production of oil and natural gas.

*Kazakhstan*. Eni has been present in Kazakhstan since1992. Eni is co-operator of the Karachaganak field and, up toJanuary 2009, acted as the single operator of the North CaspianSea Production Sharing Agreement (NCSPSA) activities.

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| *Kashagan*. Eni holds a        16.81% participating interest in the NCSPSA. The change        in the participating interest from a previous 18.52% was        effective as of January 1, 2008 according to an agreement        signed in October 2008 with the Kazakh authorities. The        Eni partners of this international consortium are the        Kazakh national oil company KazMunayGas and the        international oil companies Total, Shell and ExxonMobil,        each with a participating interest currently of 16.81%,        ConocoPhillips with 8.40%, and Inpex with 7.56% based on        the renewed contractual arrangements.
The NCSPSA        defines terms and conditions for the exploration and        development activities to be performed in the area        covered by the contract. The Kashagan field was        discovered in the northern section of the contractual        area in the year 2000. Management believes this field to        contain a large amount of hydrocarbon resources.

The phased development plan of the Kashagan field        provides for the drilling of about 240 wells and the        construction of production plants located on artificial        islands which will collect production from other        satellite artificial islands. Oil production will be        marketed. Natural gas will be mostly used (80%) for        re-injection into the reservoir for maintaining pressure        levels. The natural gas not re-injected will be treated        for the removal of hydrogen sulphide and will be used as        fuel in power generation for the production plants. The        remaining amounts will be marketed. |   |  |
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As outlined above, on October 31, 2008, all the internationalpartners of the NCSPSA consortium and the Kazakh authoritiessigned the final agreement implementing the new contractual andgovernance framework of the Kashagan project, based on theMemorandum of Understanding signed on January 14, 2008.

The material terms of the agreement are: (i) the proportionaldilution of the participating interest of all the internationalmembers of the Kashagan consortium, following which the stakeheld by the national Kazakh Company KazMunayGas and the stakeheld by the other four major stakeholders are each equal to16.81%, effective from January 1, 2008. The Kazakh partner willpay the other co-ventures an aggregate amount of $1.78 billion;(ii) a value transfer package to be implemented through changesto the terms of the NCSPA, the amount of which will vary inproportion to future levels of oil prices. Eni is expected tocontribute to the value transfer package in proportion to its newparticipating interest in the project (16.81%); and (iii) a newoperating model which entails an increased role of the Kazakhpartner and defines the international parties’responsibilities in the execution of the subsequent developmentphases of the project. The new North Caspian Operating Company(NCOC) BV has been established and capitalized by the sevenpartners of the consortium. In January 2009 the new entity hastaken over the operatorship of the project. Subsequentlydevelopment, drilling and production activities have beendelegated by NCOC BV to the main partners of the Consortium. Eniis confirmed to be the operator of phase-one of the project (theso-called "Experimental Program") and in addition willretain operatorship of the onshore operations of phase 2 of thedevelopment plan.

In conjunction with the signing of the final agreements, thepartners also reached a final approval of the revised expenditurebudget of phase-one of the development plan, amounting to $32.2billion (excluding general and administrative expenses) of which$25.4 billion related to the original scope of work of phase 1(including tranches 1 and 2), with the remaining part planned tobe spent to execute tranche 3 and build certain exportingfacilities. Eni will fund those expenditures in proportion to itsparticipating interest of 16.81%. Management expects to achievefirst oil late in 2012 on the basis of progress to completion(55% of phase 1 of the project) and accumulated expertise andproject know-how. In the following 12-15 months treatmentfacilities and compression units for gas re-injection will beentirely commissioned enabling the Consortium to deploy aninstalled production capacity of 370 KBBL/d in 2014.Subsequently, production capacity of phase-one (ExperimentalProgram) is expected to step-up to 450 KBBL/d, leveraging onadditional compression capacity for gas re-injection associatedwith the start-up of phase-two offshore facilities. In addition,within phase-one a rail terminal with carrying capacity at 300KBBL/d of oil and 4,500 tonnes/d of sulphur will be built.

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The development plan of the Kashagan field was originallysanctioned by the Kazakh authorities in February 2004,contemplating a three-phase development scheme including partialgas re-injection in the reservoir to enhance the recovery factorof the crude oil. The sanctioned plan budgeted expendituresamounting to U.S. $10.3 billion (in 2007 real terms) to developphase-one, with a target production level of 300 KBBL/d. Firstoil was originally scheduled to be produced by the end of 2008.Eni was expected to fund these expenditures according to itsparticipating interest in this project. On June 29, 2007, Eni, asoperator, filed with the relevant Kazakh authorities amendmentsto the sanctioned development plan. These amendments rescheduledthe production start-up to 2010 and estimated developmentexpenditures for phase-one at U.S. $19 billion. As outlined abovethe amended development plan that was sanctioned in October 2008forecast production start-up late in 2012 and an expenditurebudget for phase one amounting to $25.4 billion. The productiondelay and cost overruns were driven by a number of factors:depreciation of the U.S. dollar versus the euro and othercurrencies; cost price escalation of goods and services requiredto execute the project; an original underestimation of the costsand complexity to operate in the North Caspian Sea due to lack ofbenchmarks; design changes to enhance the operability and safetystandards of the offshore facilities.

The magnitude of the reserves base, the results of the welltests conducted and the findings of subsurface studies completedso far support expectations for a full field production plateauof 1.5 mmBBL/d, which represents a 25% increase above theoriginal plateau as presented in the 2004 development plan. Anindependent reserve evaluation performed by a petroleum engineer(Ryder Scott Petroleum Consultants) fully supports the targetproduction plateau. The achievement of the full field productionplateau will require a material amount of expenditures inaddition to the development expenditures needed to complete theexecution of phase-one. However, taking into account that futuredevelopment expenditures will be incurred over a long timehorizon, management does not expect any material impact on thecompany’s liquidity or its ability to fund these capitalexpenditures.

In addition to the expenditures for developing the field,further capital expenditures will be required to build theinfrastructures needed for exporting the production tointernational markets, for which various options are currentlyunder review by the consortium. These include: (i) the use ofexisting infrastructure, such as the Caspian Pipeline Consortiumpipeline (Eni’s interest 2%) and the Atyrau-Samara pipeline,both of which are expected to undergo a capacity expansion; (ii)the construction of a new transportation system. In this respect,it is worth mentioning the project aimed at building a lineconnecting the onshore Bolashak production centre with theBaku-Tbilisi-Cehyan pipeline (where Eni holds an interest of 5%corresponding to the right to transport 50 KBBL/d) through theKCTS pipeline to Kuryk and a further shipping across the CaspianSea to Baku; and (iii) the construction of a new transport systemlinking Samsum on the Turkish coast of the Black Sea to Cehyan onthe Mediterranean coast in order to bypass the Turkish Straits ofBosporus and Dardanelles.

As of December 31, 2008, Eni’s proved reserves booked forthe Kashagan field amounted to 594 mmBOE determined according toEni’s participating interest of 16.81%, recording anincrease of 74 mmBOE with respect to 2007 despite the divestmentof a 1.71% stake in the Kashagan project following thefinalization of the agreements implementing the new contractualand governance framework of the project. The amount booked forthe year reflected higher volume entitlements resulting fromlower year end oil prices from a year ago and upward revisions ofprevious estimates which were supported by an independentevaluation of the field made by an oil engineering company (RyderScott Petroleum Consultants).

As of December 31, 2007, Eni’s proved reserves booked forthe Kashagan field amounted to 520 mmBOE, recording a decrease of76 mmBOE with respect to 2006 mainly due to the impact ofincreased year-end oil prices on reserve entitlements inaccordance with the PSA scheme. Proved reserves for the field asof December 31, 2007 were determined according to Eni’s thencurrent participating interest of 18.52%.

As of December 31, 2006, Eni’s proved reserves booked forthe Kashagan field amounted to 596 mmBOE, recording an increaseof 107 mmBOE with respect to 2005 due to an extension of theproved area and project cost revision, offset in part by theimpact of price revisions.

As of December 31, 2008, the aggregate costs incurred by Enifor the Kashagan project capitalized in the financial statementsamounted to $3.3 billion (euro 2.4 billion at the EUR/USDexchange rate of December 31, 2008) net of the divestment of a1.71% stake in the Kashagan project following the finalization ofthe agreements implementing the new contractual and governanceframework of the project ($0.4 billion). This capitalized amountincluded: (i) $2.3 billion relating to expenditures incurred byEni for the development of the oilfield; and (ii) $1 billionrelating primarily to accrued finance charges and expendituresfor the acquisition of interests in the North Caspian Sea PSAconsortium from exiting partners upon exercise of pre-emptionrights in previous years.

As of December 31, 2007, the aggregate costs incurred by Enifor the Kashagan project capitalized in the financial statementsamounted to $2.6 billion. This capitalized amount included: (i)$1.8 billion relating to expenditures incurred by Eni for thedevelopment of the oilfield; and (ii) $0.8 billion relatingprimarily to accrued finance charges and expenditures for theacquisition of interests in the North Caspian Sea PSA consortiumfrom exiting partners upon exercise of pre emption rights inprevious years. The $2.6 billion amount was equivalent to euro1.8 billion based on the 2007 year-end euro /U.S. dollar exchangerate.

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As of December 31, 2006 the aggregate costs incurred by Enifor the Kashagan project that were capitalized by Eni in itsfinancial statements amounted to $1.9 billion, corresponding toeuro 1.5 billion based on 2006 year-end exchange rates.

Costs borne by Eni to explore and develop this field arerecovered in accordance with the mechanisms typicallycontemplated by a PSA scheme, which is widely used in theindustry. In this type of contract the national oil company orState-owned entity assigns to the international oil company (thecontractor) the task of performing exploration and productionwith the contractor’s equipment and financial resources.Exploration risks are borne by the contractor and production isgenerally divided into two portions: "cost oil" is usedto recover costs borne by the contractor and "profitoil" is divided between the contractor and the nationalcompany according to variable schemes and represents the profitderiving from exploration and production. Accordingly,recoverability of the expenditures is subject to approval fromthe relevant State-owned or controlled entity who is party to theagreement. Similarly, cost overruns are recovered to the extentthey are sanctioned by the State-owned or controlled entity whois party to the agreement.

*Karachaganak.* Located in West onshore Kazakhstan,Karachaganak is a liquid and gas field. Operations are conductedby the Karachaganak Petroleum Operating consortium (KPO) and areregulated by a Production Sharing Agreement lasting 40 years,until 2037. Eni and British Gas are co-operators of the ventureboth with a 32.5% interest.

In 2008 production from this field averaged 234 KBBL/d ofliquids (69 KBBL/d net to Eni) and 774 mmCF/d of natural gas (227mmCF/d net to Eni). This field is developed by producing liquidsfrom the deeper layers of the reservoir and re-injecting theassociated gas in the higher layers. Approximately two thirds ofliquid production are stabilized at the Karachaganak ProcessingComplex (KPC) with a capacity in excess of 150 KBBL/d andexported to Western markets through the Caspian PipelineConsortium (Eni’s interest 2%) and the Atyrau-Samarapipeline. The remaining third of non-stabilized liquid productionand volumes of associated gas not re-injected in the reservoirare marketed at the Russian terminal in Orenburg.

The execution of fourth oil treatment unit has been progressedto completion and will enable to increase the exported oilvolumes to Western markets.

The Phase 3 project engineering activities have identified astaged approach to best develop the Karachaganak field. The firststage envisages the development of approximately 55 mmtonnes ofliquids the doubling of the existing gas injection capacity (from233 to 466 BCF/y) and the maintenance of a production plateau at12 mmtonnes/y of stabilized liquids (until 2018) and 318 BCF/y ofacid gas at Orenburg. An alternative option is under review whichentails marketing of a portion of the additional gas re-injected.Start-up is expected late in 2013 subject to approval by therelevant authorities.

The construction of the Uralsk Gas Pipeline is ongoing. Thisnew infrastructure, with a length of 150 kilometers, will linkthe Karachaganak field to the Kazakhstan gas network. Start-up isexpected in 2009.

In April 2008, the Kazakh authorities approved a tax decreeenacting an Export Duty on crude oil; such tax was applied onKarachaganak from July 2008 up to January 2009 when it was"zero rated". In the same month the authorities enacteda new tax code that does not affect the profitability of thisproject taking into account that certain clauses in the PSAregulating the activities at the field provide the stability ofthe tax burden for the ventures.

As of December 31, 2008, Eni’s proved reserves booked forthe Karachaganak field amounted to 740 mmBOE, recording anincrease of 200 mmBOE with respect to 2007 and derived fromupward revisions of previous estimates mainly related to higherentitlements reported in PSA resulting from lower year end oilprices from a year ago.

As of December 31, 2007, Eni’s proved reserves booked forthe Karachaganak field amount to 541 mmBOE, recording a decreaseof 82 mmBOE with respect to 2006 as a result of downward andupward revisions of previous estimates. Downward revisions mainlyrelated to an adverse price impact in determining volumeentitlements in accordance with the PSA scheme. These negativerevisions were partly offset by upward revisions mainly relatedto the finalization of the gas sale contract as outlined above.

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| *Turkmenistan.* Eni        started its activities in Turkmenistan in connection with        the purchase of British company Burren Energy plc in        2008. Activities are mainly focused in the western part        of the country. In 2008 Eni’s production averaged 12        KBOE/d.
Exploration and production activities in        Turkmenistan are regulated by Production Sharing        Agreements.

Eni is operator of the Nebit Dag producing block (with        a 100% interest). Production derives mainly from the        Burun oil field.

During 2008, the development activities were focused        at the production optimization by means of drilling        development wells and carry-over of the program for water        injection and facility upgrading.

The drilling activity at Uzboy and Balkan fields,        nearby Burun field, progressed. The fields achieved early        production in 2006. |   |  |
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> 
*Rest of the World*

In 2008, Eni’s operations in the rest of world accountedfor 14% of its total worldwide production of oil and natural gas.

*Australia.* Eni has been present in Australia since2000. In 2008 Eni’s production of oil and natural gasaveraged 16 KBOE/d. Activities are focused on conventional anddeep offshore fields.

The main production blocks in which Eni holds interests areWA-25-L (Eni operator with a 65% interest) and JPDA 03-13(Eni’s interest 10.99%). In the exploration phase Eni holdsinterests in 13 licenses (in 7 as operator and in 5 of which witha 100% interest), of particular interest are the blocks WA-33-Land WA-313-P, where the Blacktip and Penguin discoveries arelocated.

Exploration and production activities in Australia areregulated by concessions, while in the cooperation zone betweenEast Timor and Australia (Joint Petroleum Development Area -JPDA) they are regulated by PSAs.

The main producing fields are Woollybutt and Bayu Undan inWA-25-L and JPDA03-13, respectively.

In 2008 development activities have been completed in thesouthern area of the Woollybutt oil field with a new horizontalproduction well that was linked to an FPSO unit with relevantproduction ramp-up in July 2008.

Development activities are underway at the Blacktip gas field(Eni operator with a 100% interest). The development strategyenvisages installation of an unmanned platform that will belinked to an onshore treatment plant. Start-up is expected in2009, peaking at 26 BCF/y in 2010. Natural gas production isdestined to supply a power plant.

In 2008, an important discovery was made in the Block JPDA06-105 (Eni operator with a 40% interest), located in theinternational offshore cooperation zone between East Timor andAustralia, where the Kitan discovery showed the presence of oilat a depth of 3,658 meters and yielded 6.1 KBBL/d in testproduction. In June 2008, the oilfield development area wasapproved by the Timor Sea Designated Authority pursuant to thedeclaration of commercial discovery that was made by Eni.Activities are ongoing for the preparation of a development planto be filed with relevant authorities. The final investmentdecision is expected in 2009.

In the medium-term, management expects to increase Eni’sproduction in Australia through ongoing development activities.

*Brazil.* Eni has been present in Brazil since 1999 andis performing exploration activities in: (i) operated blocksBM-S-4 and BM-S-857, subjected official awarding, (both with a100% interest) located in the deep offshore in the Santos basin;(ii) block BM-CAL-14 (Eni operator with a 100% interest) in thedeep offshore in the Camamu-Almada basin.

The current exploration program aims at appraising theBelmonte gas discovery in block BM-S-4.

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| In 2008 Eni and Petrobras        renewed a Memorandum of Understanding signed on 2007        aimed at identifying joint production and refining        opportunities. Eni will make available its EST (Eni        Slurry Technology) proprietary technology for the        complete conversion of heavy oils (typical of the        Brazilian upstream) into high-quality light products.
*China.*        Eni has been present in China since 1984. Activities are        located in the South China Sea. In 2008 Eni’s        production amounted to 8 KBOE/d.

Exploration and production activities in China are        regulated by Production Sharing Agreements.

Production derives mainly from offshore blocks 16/08        and 16/09 operated by the CACT-Operating Group        (Eni’s interest 16.33%). Oil production, destined to        the domestic market, mainly derives from the HZ25-4 field        (Eni’s interest 49%) through fixed platforms        underwater linked to an FPSO. Natural gas production from        the HZ21-1 field is delivered to the Zhuhai treatment        plant. |   |  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--|

Ongoing development activities are mainly focused on theHZ25-4 and the HZ25-3/1 fields, on the latter the construction ofa production platform is ongoing and start-up is expected in2009. The development plan of the HZ25-4 field, on stream since2007, provides for the drilling of addition producing wells asplanned.

*Colombia.*In 2008 Eni signed a Memorandum ofUnderstanding with the national oil company Ecopetrol aimed atidentifying joint opportunities for exploration and production inColombia and in other Southern American countries.

|  |   | *Croatia*. Eni has been        present in Croatia since 1996. In 2008 Eni’s        production of natural gas averaged 66 mmCF/d. Activities        are deployed in the Adriatic Sea facing the city of Pula.
Exploration        and production activities in Croatia are regulated by        PSAs.

The main producing gas fields are Ivana, Ika &        Ida, Marica and Katerina operated by Eni through a 50/50        joint venture with the Croatian oil company INA. In 2008        the Ana field (Eni’s interest 50%) was started-up        through linkage to the facilities existing in the area.

Development activities are nearing completion in the        Irina, Vesna and Annamaria fields. Start-ups are expected        in 2009.

Exploration activities yielded positive results in the        Bozica (Eni’s interest 50%) and the Ika gas fields        with appraisal activity. |
|--|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*East Timor.* Eni entered East Timor in 2006 and isoperator with an 80% interest of 5 offshore blocks. The firstexploration phase of the exploration plan with a three-year termprovides for the acquisition seismic data which was completedduring the year, and the drilling of 2 wells.

*Ecuador.* Eni has been present in Ecuador since 1988. In2008 Eni’s production averaged 16 KBBL/d. Since 2000, Enibecame operator of Block 10 (Eni’s interest 100%) located inthe Amazon forest and on which Villano field has been discovered.

Exploration and production activities in Ecuador are regulatedby a service contract.

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Production derives from the Villano field, started-up in 1999.Production is carried out by means of a Central ProductionFacility linked by pipeline to the storage facility. During theyear work-over and infilling activities were aimed to contrastthe natural depletion.

*India.* Eni has been present in India since 2005.

In August 2008, Eni acquired control of the Indian CompanyHindustan Oil Exploration Ltd (HOEC) following execution of amandatory tender offer on a 20% stake of the HOEC share capital.The mandatory offer was associated with Eni’s acquisition ofa 27.18% of HOEC as part of the Burren Energy deal. Assetsacquired, located onshore in the Cambay Basin and offshoreChennai, include: (i) development and producing assets which areexpected to reach a production plateau of 10 KBOE/d in 2010; and(ii) fields where exploration and appraisal activities areunderway. Main development activities are focused on the PY1 gasfield. Start-up is expected in 2009.

Other activities are related to exploration of the onshoreBlock RJ-ONN-2003/1 (Eni operator with a 34% interest) andoffshore Blocks AN-DWN-2003/2 (Eni operator with a 40% interest)and MN-DWN-2002/1 (Eni’s interest 34%).

The exploration program for Block RJ-ONN-2003/1 located in thedesert of Rajasthan provides for the drilling of 4 wells in thefirst four years of the license. Any hydrocarbons discovered willbe sold locally.

The exploration program for Block AN-DWN-2003/2 near theAndaman Islands provides for the drilling of 3 wells in the firstfour years of the license and expected start-up in 2010.

The exploration program for Block AN-DWN-2002/1 located in thedeep offshore of the eastern coast provides for the drilling of 3wells in the first year of the license.

*Indonesia.* Eni has been present in Indonesia since2000. Eni’s production amounted to 16 KBOE/d, mainly gas, in2008. Activities are concentrated in the eastern offshore andonshore of Borneo and the offshore Sumatra, where Eni holdsinterest in 11 blocks.

In May 2008, following an international bid procedure, Eni wasawarded the operatorship of the West Timor exploration blockextending over an offshore and onshore area of about 4,000 squarekilometers.

Exploration and production activities in Indonesia areregulated by PSAs.

Production consists mainly of gas and derives from the SangaSanga permit (Eni’s interest 37.81%) with seven productionfields. This gas is treated at the Bontang liquefaction plant,one of the largest in the world, and is exported to the Japanese,South Korean and Taiwanese markets.

Eni as operator is evaluating major development opportunitiesin the Bukat permit (Eni’s interest 66.25%) where oil andgas discoveries were recently made. Eni, as partner, is alsoinvolved in the ongoing joint development of the five discoveriesin the Kutei Deep Water Basin area (Eni’s interest 20%), gasproduction of which will be sent to the Bontang LNG plant. 

During 2008, the exploration activity was focused: (i) in theKrueng Mane permit (Eni operator with a 85% interest), with thestart-up of the drilling activities; and (ii) in the Bukatpermit, with the finalization of a seismic data acquisitioncampaign.

*Iran.*Eni has been present in Iran since 1957. In 2008Eni’s production averaged 28 KBBL/d. Activities areconcentrated in the offshore and onshore facing of the PersianGulf.

Exploration and production activities in Iran are regulated bybuy-back contracts.

The main producing fields are South Pars phases 4&5 in theoffshore of the Persian Gulf and Darquain field located onshorewhich accounted for 91% of Eni’s production in Iran in 2008.Eni also holds interests in the Dorood field (Eni’s interest45%).

The main project regards the Darquain field operated by Eniwith a 60% interest. Upgrading activities are underway by meansof drilling additional wells, increasing capacity of the existingtreatment plant and gas injection. These actions aim atincreasing production from the present 100 KBBL/d to over 160KBBL/d (14 net to Eni) by 2009.

The legislation and other regulations of the United States ofAmerica impose sanctions on this country and may lead to theimposition of sanctions on any persons doing business in thiscountry or with Iranian counterparties. Particularly, under theIran Sanctions Act of 1996 (as amended, "ISA"), whichimplements sanctions against Iran with the objective of denyingit the ability to support acts of international terrorism andfund the development or acquisition 

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of weapons of mass destruction, upon receipt by the U.S.authorities of information indicating potential violation of thisact, the President of the United States is authorized to start aninvestigation aiming at possibly imposing sanctions from asix-sanction menu against any person found in particular to haveknowingly made investments of U.S. $20 million or more in anytwelve-month period, contributing directly and significantly tothe enhancement of Iran’s ability to develop itshydrocarbons resources. Furthermore, the ISA envisages that thePresident of the United States is bound to impose sanctionsagainst any persons that knowingly contribute to certain militaryprograms of Iran, effective on June 6, 2006. Eni cannot predictinterpretations of, or the implementation policy of the U.S.Government under, ISA with respect to Eni’s current orfuture activities in Iran or other areas. Eni has incurredcapital expenditures in excess of U.S. $20 million in Iran ineach of the last 9 years. Management expects to continueinvesting in Iran yearly amounts in excess of that threshold inthe foreseeable future. Eni’s current activities in Iran areprimarily limited to carrying out residual development activitiesrelating to certain buyback contracts it entered into in 2000 and2001 and no sanctions have ever been imposed on Eni’sactivities in the country. It is possible that in future yearsEni’s activities in Iran may be sanctioned under relevantU.S. legislation.

*Pakistan.* Eni has been present in Pakistan since 2000.In 2008 Eni’s production averaged 54 KBOE/d, mainly gas.

Exploration and production activities in Pakistan areregulated by concessions (onshore) and PSAs (offshore).

In March, 2009 Eni signed a Protocol for Cooperation with thegovernment of Pakistan to develop a number of important upstream,midstream and downstream projects in the Country. This dealfollows Eni’s growth strategy through the discovery of newreserves. Eni will provide its expertise as well as newtechnologies developed in the oil and gas sector, mainly in theexploration and production of hydrocarbon fields.

Eni’s main permits are Bhit (Eni operator with a 40%interest), Sawan (Eni’s interest 23.68%) and Zamzama(Eni’s interest 17.25%), which in 2008 accounted for 90% ofEni’s production in Pakistan.

As part of the reserve development of the Bhit permit theoperations of a third treatment unit started increasing the plantcapacity by 46 mmCF/d and allowing the start-up of the satelliteBadhra field. Other activities were targeted at optimizingproduction from the Kadanwari, Miano, Sawan and Zamzama fields bymeans of the drilling additional wells and upgrading the existingfacilities.

Main discoveries for the year were made in: (a) the MubarakBlock (Eni’s interest 38%) with the Saquib gas discoverywhich was tested at a production rate of 2,472 KCF/d; and (b) theLatif exploration license, where the Latif-2 appraisal well hasconfirmed the hydrocarbon potential of the area.

*Papua New Guinea.* In 2008 Eni signed a PartnershipAgreement with Papua New Guinea for the start of an explorationprogram aimed at identifying development opportunities and oiland gas projects. The agreement provides also for projects inelectrical power generation and unconventional and renewableenergy sources, which will foster sustainable development in thiscountry.

*Qatar.* In 2008 Eni signed a Memorandum of Understandingwith the state-owned company Qatar Petroleum International totarget joint investment opportunities in the exploration andproduction of oil and gas. The agreement also envisages thedevelopment of joint projects in the petrochemical industry andpower generation.

| *Russia.* Eni has been        present in Russia since 2007 following the acquisition of        Lot 2 in the Yukos liquidation procedure.
In        particular, acquired assets included three Russian        companies operating in the exploration and development of        natural gas reserves: OAO Arctic Gas Co, ZAO Urengoil Inc        and OAO Neftegaztechnologia.

The three companies are managed by the OOO        SeverEnergia subholding, owned by Eni (60%) and Enel        (40%). Eni and Enel granted to Gazprom a call option on a        51% interest in OOO SeverEnergia. Terms of the call        option are currently under review by Eni, Enel and        Gazprom.

Acquired companies are located in the Yamal Nenets        region: (i) OAO Arctic Gas Co owns two exploration        licenses, Sambugurskii and Yevo-Yahinskii including seven        gas and condensates fields currently in the        appraisal/development phase. Main fields are |   |  |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--|

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Sambugorskoye currently under development and Urengoiskoye.The final investment decision for both fields is expected in 2009with production start-up in 2010; (ii) ZAO Urengoil Inc ownsexploration and development licenses for the Yaro-Yakhinskoye gasand condensates field. Ongoing are representend by workovers ofsome existing wells and by new seismic acquisition; and (iii) OAONeftegaztechnologia owns the exploration and development licenseof the Severo-Chasselskoye field where an acquisition ofseismographic data is underway.

Other activities concern exploration in the Karalatskiy block(Eni’s interest 54%) in the Astrakhan region. Thisexploration license is part of the assets acquired from BurrenEnergy Plc.

*Saudi Arabia.* Eni entered Saudi Arabia in 2004 and isperforming exploration activities in the so called C Area inorder to discover and develop gas reserves. This license islocated in the Rub Al Khali basin at the border with Qatar andthe United Arab Emirates. The exploration plan provides for thedrilling of 4 wells in five years. In case of a commercialdiscovery, the contract will last 25 years with a possibleextension to a maximum of 40 years. Any gas discovered will besold locally for power generation and as feedstock forpetrochemical plants. Condensates will be sold on internationalmarkets.

*Trinidad and Tobago.* Eni has been present in Trinidad& Tobago since 1970. In 2008 Eni’s production averaged55 mmCF/d. Activity is concentrated offshore north of Trinidad.

Exploration and production activities in Trinidad & Tobagoare regulated by PSAs.

Production is provided by the Chaconia, Ixora and Hibiscus gasfields in the North Coast Marine Area 1 Block (Eni’sinterest 17.4%). Production is supported by fixed platformslinked to the Hibiscus treatment facility. Natural gas is used tofeed trains 2, 3 and 4 of the Atlantic LNG liquefaction plantunder long-term contracts. LNG production is sold in the UnitedStates, Spain and the Dominican Republic.

The main development project concerns the Poinsettia,Bougainvillea and Heliconia fields. The project provides for theinstallation of a production platform on Poinsettia and linked tothe Hibiscus treatment facility, due to be upgraded. During theyear drilling activity was started. Production start-up isexpected in 2009.

*United States.* Eni has been present in the UnitedStates since 1966. Activities are performed in the conventionaland deep offshore in the Gulf of Mexico and more recently onshoreand offshore Alaska.

In 2008 Eni’s oil and gas production deriving mainly fromthe Gulf of Mexico averaged 86 KBOE/d.

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Exploration and production activities in the United States areregulated by concessions.

Eni holds interests in 412 exploration and production blocksin the Gulf of Mexico, 60% operated.

The main fields operated by Eni with a 100% interest areAllegheny, East Breaks and Morphet as well as Devils Towers,Triton and Goldfinger (Eni operator with a 75% interest). Enialso holds interests in the Medusa (Eni’s interest 25%),Europa (Eni’s interest 32%), and King Kong (Eni operatorwith a 56% interest) fields.

In March 2008, following an international bid procedure Eniwas awarded 32 exploration blocks. The subsequent developmentphase will leverage synergies relating to the proximity ofacquired acreage to existing operated facilities.

In August 2008, Eni was awarded 5 exploration licenses in theKeathley Canyon area, one of the main exploration areas in theGulf of Mexico. The blocks will be 100% operated by Eni. Thetransaction is subject to authorization from relevantauthorities.

In November 2008 Eni signed a cooperation agreement with theColombian state company Ecopetrol for exploration assets in theGulf of Mexico. Under the terms of this agreement, Ecopetrol willinvest approximately $220 million to acquire a 20-25% interest infive exploration wells due to be drilled before 2012.

The development program of the Longhorn discovery (Eni’sinterest 75%) was sanctioned. The project provides for theinstallation of a fixed platform linked to three underwaterwells. Start-up is expected in 2009 with peak production at 29KBOE/d (about 20 net to Eni).

| Main discoveries for the        year were made in the following blocks: (a) Block        Mississippi Canyon 771 (Eni’s interest 25%) with the        oil and gas Kodiak discovery close to the operated        Devil’s Tower platform (Eni’s interest 75%);        (b) Block Walker Ridge 508 (Eni’s interest 15%) the        Stones-3 discovery well found oil. This discovery is part        of the exploration assets acquired from Dominion        Resources; (c) Block Mississippi Canyon 459 (Eni’s        interest 100%) with the Appaloosa oil discovery. The        final investment decision was reached at the end of 2008.        Start-up is expected in 2010 with peak production at 7.5        KBBL/d; (d) Block Keathley Canyon 1008 (Eni’s        interest 100%) with appraisal activities of the Hadrian        oil discovery; and (e) Block offshore Green Canyon 859        (Eni’s interest 12.5%) with the oil and gas        Heidelberg-1 discovery at a depth of 9,163 meters.
Eni’s        activities in Alaska are currently in the exploration and        development phase in 158 blocks with interests ranging        from 10 to 100%, over half as operator.

In February 2008, following an international bid        procedure Eni was awarded 18 offshore exploration blocks,        4 of which as operator, in the Chukchi Sea. The acquired        acreage will strengthen Eni’s position in the area.

The phased development plan of the Nikaitchuq field        (Eni operator with a 100% interest) was sanctioned.        Production is expected to start in 2010 with production        plateau at 26 KBOE/d. |   |  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--|

In June 2008, production started at the Oooguruk oil field(Eni’s interest 30%), in the Beaufort Sea, by linking toonshore facilities located on an artificial island. Peakproduction at 17 KBOE/d is expected in 2011.

In the medium-term, management expects to increase Eni’sproduction due to the development and integration of assetsacquired and the start-up of fields in Alaska, targeting atapproximately 110 KBOE/d in 2012.

*Venezuela.* Eni has been present in Venezuela since1998. In 2008 Eni’s production averaged 5 KBBL/d. Activityis concentrated in the Gulf of Venezuela and in the Gulfo dePaira.

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Exploration and production are regulated by the terms of theso called Empresa Mixta. Under the new legal framework, only acompany incorporated under the law of Venezuela is entitled toconduct petroleum operations. A stake of at least 60% in thecapital of such company is held by an affiliate of VenezuelaState oil company PDVSA, preferably Corporación Venezuelana dePetróleo (CVP).

In February 2008, Eni and the Venezuelan Authorities reached afinal settlement over the dispute regarding the expropriation ofthe Dación field which took place on April 1, 2006. Under theterms of the settlement, Eni will receive cash compensation inline with the carrying amount of the expropriated asset. Part ofthis cash compensation has been collected in the period. Enibelieves this settlement represents an important step towardsimproving and strengthening cooperation with the PDVSA.

As part of improving cooperation with PDVSA, the two partnerssigned two agreements in September 2008: (i) a joint studyagreement for the development of the Junin Block 5 located in theOrinoco oil belt, covering a gross acreage of 670 squarekilometers. Once relevant studies have been performed and adevelopment plan defined, a joint venture between PDVSA and Eniwill be established to execute the project. Eni intends tocontribute its experience and leading technology to the projectin order to maximize the value of the heavy oil; and (ii) anagreement for the exploration of two offshore areas, Blanquillaand Tortuga in the Caribbean Sea, both with a 20% interest overan area of 5,000 square kilometers. The prospective developmentof these areas will take place through an integrated LNG project.

In 2008, production started at the Corocoro field (Eni’sinterest 26%) in the Gulfo de Paira West Block. A seconddevelopment phase is expected to be designed based on the resultsachieved in the first one regarding well production rate andfield performance under water and gas injection. A productionpeak of 66 KBBL/d (17 net to Eni) is expected in 2012.

Eni holds an interest of 50% in the Cardon IV offshoreexploration block, covering an area of 938 square kilometers.

Eni is participating with 19.5% interest in the Gulfo de PairaCentrale offshore exploration block, covering an area of 259square kilometers, where the Punta Sur oil discovery is located.

 

**Capital Expenditures**

See "Item 5 – Liquidity and Capital Resources –Capital Expenditures by Segment".

 

> 
***Storage***

Natural gas storage activities are performed by Stoccaggi GasItalia SpA (Stogit) to which such activity was conferred onOctober 31, 2001 by Eni SpA and Snam SpA, in compliance withArticle 21 of Legislative Decree No. 164 of May 23, 2000, whichprovides for the separation of storage from other activities inthe field of natural gas.

Storage services are provided by Stogit through eight storagefields located in Italy, based on ten storage concessions3vested by the Ministry of Productive Activities.

In 2008, the share of storage capacity used by third partieswas 61%. From the beginning of its operations, Stogit markedlyincreased the number of customers served and the share ofrevenues from third parties; the latter, from a non-significantvalue, passed to 50%.

| **Storage** |   | **2006** |   | **2007** |   | **2008** |
|-------------|--------|----------|--------|----------|--------|----------|
|        |   |          |   |          |   |          |

| Available capacity:                 |   |   |   |   |   |   |   |   |
|-------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|
| -        modulation and mineral     |   | (BCM)  |   | 8.4    |   | 8.5    |   | 8.6    |
|   . share utilized by Eni |   | (%)    |   | 54     |   | 44     |   | 39     |
| -        strategic                  |   | (BCM)  |   | 5.1    |   | 5.1    |   | 5.1    |
| Total customers                     |   | (No.)  |   | 38     |   | 44     |   | 48     |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Until 2008, results of the storage activities in Italy havebeen reported within the Exploration & Production segment.Following the 100% divestment of Stogit to Snam Rete Gas that wasapproved by Eni’s Board of Directors and is expected toclose by mid 2009 (for details on this deal see "SignificantBusiness and Portfolio Developments" above), from 2009 theresults of the storage business conducted in Italy will bereported within the Gas & Power segment, under the"Regulated Business".

In 2008 operating profit reported by the natural gas storagebusiness was euro 183 million down euro 83 million or 31.2% from2007.

 

----

| (3) |    | Two of these        are not yet operational. |
|-----|--------------|----------------------------------------------|

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**Gas & Power**

Eni’s Gas & Power segment engages in supply,transport, distribution, storage and marketing of natural gas, aswell as of LNG. This segment also includes the activity of powergeneration that enables Eni to extract further value from gas,diversifying its commercial outlets.

Eni’s strategy in its Gas & Power segment is to growinternational sales also leveraging on the Distrigas acquisition,preserve the profitability of Italian gas marketing operations,increase operational efficiency and effectiveness mainly inregulated businesses (i.e., Italian transport and distributionactivities), and develop a global LNG business.

Eni has revised down its long-term expectations for gas demandgrowth due to the current economic downturn that is reducing gasconsumption in all industrial segments and in power generation.In Europe, Eni expects gas demand to remain substantially stableduring 2009 and to resume growing at an average annual rate of 2%in the following years till 2020, reaching an amount of 722 BCM.The main long-term driver of growth in European demand will bethe wider use of gas in power generation. A growing portion ofEuropean gas requirements is expected to be satisfied by importsvia pipeline. According to Eni’s estimates, European gasimports will cover at least 80% of consumption from the currentlevel of 60%, due to domestic production decrease, stressingEuropean dependence on producing countries. The most importantpipeline supply sources will remain Russia and Algeria and, to alesser degree, Norway and Libya. Eni expects that LNG supplieswill contribute to diversify sources of supply.

In 2008, natural gas demand in Italy amounted to 84.88 BCMrepresenting a small decline from 2007 due to the economicslowdown; approximately 90% of gas requirements were met throughimports and 10% was covered by domestic production. The outlookfor the Italian demand is more challenging as demand is expectedto shrink in 2009 and to post a moderate recovery in subsequentyears. Over the long-term, the Company expects Italian gas demandto increase at an average growth rate of approximately 2% through2020, reaching an amount of 106.7 BCM in 2020 (gas volumes areprojected at 94.2 BCM in 2012), driven by rising consumption inthe power generation sector. Growing gas needs will be met by aprojected increase in import capacity, which will be supported bysignificant capital expenditure projects designed to upgradeexisting infrastructures and to build new ones, including new LNGterminals. The Company expects additional import capacity tosupply up to 10 BCM in 2009 as Eni’s upgrades of its mainTTPC and TAG pipelines from Algeria and Russia respectively reachfull operations. In addition, Eni is completing another leg ofexpansion at the TAG pipeline and is planning to upgrade itspipeline from Libya. A competitor has commenced commissioningoperations at a new LNG terminal in the Adriatic Sea. Overall theCompany expects that import capacity will increase by 25 BCM by2012 of which 90% available by 2010.

Against this backdrop, management plans to increaseinternational natural gas sales leveraging on the integration ofand expected synergies from the Distrigas acquisition as well asEni’s competitive advantages ensured by gas availabilityunder long-term supply contracts and equity gas, access toinfrastructures, long-term relationships with key producingcountries (mainly Russia, Algeria and Libya), market knowledgeand a wide portfolio of clients. Eni intends to strengthen itspositioning in European markets where its presence is alreadyestablished – such as the Iberian Peninsula, Germany,France, the United Kingdom, Benelux and Turkey – and todevelop its marketing activities internationally, particularly inthe U.S. leveraging on the planned expansion of theCompany’s LNG business.

In Italy, in an increasingly competitive market, Eni salesvolumes are projected to decline from the 53 BCM level achievedin 2008 to approximately 50 BCM in 2012. The Company intends topreserve the profitability of its marketing operations byleveraging on cost controls and a number of marketing initiativesdesigned: (i) to focus the most profitable customer segments;(ii) to upgrade the commercial offer by tailoring pricing andservices to customers’ specific needs; and (iii) to developthe combined offer of gas and power ("dual offer"). Astrong focus will be devoted to reducing general and sellingexpenses. 

In the medium-term, Eni plans to increase worldwide gas salestargeting a volume of 124 BCM by 2012, leveraging on expectedgrowth in international sales that are projected to achieve anaverage annual rate of increase of 7% and upon synergies derivingfrom the Distrigas acquisition.

*The matters regarding future natural gas demand and salestarget discussed in this section and elsewhere here in areforward-looking statements that involve risks and uncertaintiesthat could cause the actual results to differ materially fromthose in such forward-looking statements. Such risks anduncertainties relating to future natural gas demand includechanges in underlying economic factors, changes in regulation,population growth or shrinkage, changes in the relative mix ofdemand for natural gas and its principal competing fuels, andunexpected developments in the markets for natural gas and itsprincipal competing fuels.*

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> 
**Supply of natural gas**

In 2008 Eni’s consolidated subsidiaries, includingDistrigas’ share amounting to 5.15 BCM, supplied 89.65 BCMof natural gas with a 5.85 BCM increase from 2007, up 7%.Excluding the contribution of Distrigas, gas volumes suppliedoutside Italy (76.50 BCM from consolidated companies), importedin Italy or sold outside Italy, represented 91% of total supplieswith an increase of 1.35 BCM from 2007, or 1.8%, mainly due tothe growth registered on European markets in particular in thefirst months of the year, with higher volumes purchased:(i) from Algeria via pipeline (up 1.07 BCM); (ii) from Libya(up 0.63 BCM) in line with the growth of gas equity production;and (iii) from the Netherlands (up 0.36 BCM); (iv) from Russia toTurkey (up 0.31 BCM) in line with the increased gas demand on theTurkish market. Supplies in Italy (8 BCM) declined by 0.65 BCMfrom 2007, or 7.5%, due to lower domestic production. Supplies ofRussian gas for the Italian market declined by 0.97 BCM mainlydue to the implementation of agreements with Gazprom providingfor Gazprom’s entrance in the market of supplies to Italianimporters and the corresponding reduction in Eni offtakes. 

In 2008, main gas volumes from equity production derived from:(i) Italian gas fields (7.5 BCM); (ii) the Wafa and Bahr Essalamfields in Libya linked to Italy through the GreenStream pipeline.In 2008 these two fields supplied 3.2 BCM net to Eni; (iii)certain Eni’s fields located in the British and Norwegiansections of the North Sea (2.3 BCM); and (iv) other Europeanareas (in particular Croatia with 0.6 BCM). Considering also thedirect sales of the Exploration & Production division inEurope and in the Gulf of Mexico and LNG supplied from the Bonnyliquefaction plant in Nigeria, supplied gas volumes from equityproduction were approximately 21 BCM representing 21% of totalvolumes available for sale.

In 2008, net input of natural gas volumes to storage depositsowned by Eni’s subsidiary Stoccaggi Gas were 0.08 BCMcompared to volumes uplifted from storage of 1.49 BCM in 2007.

The table below sets forth Eni’s purchases of natural gasby source for the periods indicated.

| **Natural        gas supply** |   | **2006** |   | **2007** |   | **2008** |
|-------------------------------|--------|----------|--------|----------|--------|----------|
|                          |   |          |   |          |   |          |

|   | **(BCM)** |
|--------|-----------|

| **Italy**                                                   |   | **10.21** |   |   | **8.65**  |   |   | **8.00**   |   |
|-------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|
| **Outside        Italy**                                    |   | **79.06** |   |   | **75.15** |   |   | **81.65**  |   |
| *Russia*                                                    |   | *24.98*   |   |   | *23.44*   |   |   | *22.91*    |   |
| *Algeria        (including LNG)*                            |   | *20.42*   |   |   | *18.41*   |   |   | *19.22*    |   |
| *Libya*                                                     |   | *7.70*    |   |   | *9.24*    |   |   | *9.87*     |   |
| *the        Netherlands*                                    |   | *10.28*   |   |   | *7.74*    |   |   | *9.83*     |   |
| *Norway*                                                    |   | *5.92*    |   |   | *5.78*    |   |   | *6.97*     |   |
| *the        United Kingdom*                                 |   | *2.50*    |   |   | *3.15*    |   |   | *3.12*     |   |
| *Hungary*                                                   |   | *3.28*    |   |   | *2.87*    |   |   | *2.84*     |   |
| *Qatar        (LNG)*                                        |   | *-*       |   |   | *-*       |   |   | *0.71*     |   |
| *Other supplies of natural gas*                             |   | *2.41*    |   |   | *2.2*     |   |   | *4.07*     |   |
| *Other        supplies of LNG*                              |   | *1.57*    |   |   | *2.32*    |   |   | *2.11*     |   |
| **Total supplies of subsidiaries**                          |   | **89.27** |   |   | **83.80** |   |   | **89.65**  |   |
| Withdrawals        from (input to) storage                  |   | (3.01     | )      |   | 1.49      |   |   | (0.08      | )      |
| Network losses and measurement differences                  |   | (0.50     | )      |   | (0.46     | )      |   | (0.25      | )      |
| **Volumes        available for sale of Eni's subsidiaries** |   | **85.76** |   |   | **84.83** |   |   | **89.32**  |   |
| **Volumes available for sale of Eni's        affiliates**   |   | **7.65**  |   |   | **8.74**  |   |   | **8.91**   |   |
| **E&P        volumes**                                  |   | **4.69**  |   |   | **5.39**  |   |   | **6.00**   |   |
| **Total volumes available for sale**                        |   | **98.10** |   |   | **98.96** |   |   | **104.23** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

In order to meet the medium and long-term demand for naturalgas, in particular in the Italian market, Eni entered intolong-term purchase contracts with producing countries. Theresidual average life of the Company’s supply portfoliocurrently amounts to approximately 21 years. Such contracts,which generally contain take-or-pay clauses, will ensure a totalof approximately 62.4 BCM/y of natural gas by 2010.

The finalization of the purchase of the Belgian companyDistrigas (for details on this deal see "SignificantBusiness and Portfolio Developments" above) has entailedsignificant expansion of Eni’s supply portfolio with anaddition of long-term supplies of approximately 14.7 BCM (Norway,the Netherlands and Qatar) having a residual average life ofabout 14 years. Eni’s supply portfolio will be morediversified and less risky, as Eni will depend from one singlesupplier for about 20-22% of total projected supplies in 2012. 

Despite the fact that an increasing portion of natural gasvolumes is planned to be sold outside Italy, management believesthat in the long-term unfavorable trends in the Italian naturalgas demand and supply, also due to the increase in importcapacity (pipeline upgrading and new LNG plants) that took placein 2008 and the 

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finalization of projects in progress or publicly announced byEni and third parties, as well as the evolution of Italianregulations in the natural gas sector, represent risk factors tothe fulfillment of Eni’s obligations in connection with itstake-or-pay supply contracts. See "Item 3 – RiskFactors" and "Item 5 – ContractualObligations".

In 2008, Eni purchases under its take-or-pay contracts werehigher than its minimum uplift obligation. This amount relatesmainly to a contractual year, rather than a calendar year (fromOctober to end of September for a sizeable part of Eni Gas &Power long-term supply contracts).

 

> 
**Marketing**

***Natural Gas Sales for the Year 2008***

In 2008, worldwide natural gas sales of 104.23 BCM, includingown consumption, sales by affiliates and E&P sales in Europeand in the Gulf of Mexico, increased by 5.3% from 2007 mainly dueto the organic growth recorded in the European markets (up 9%)and the contribution of the acquisition of Distrigas as well ashigher seasonal sales recorded in the first quarter. Thesepositives were partly offset by the lower performance of theItalian market (down 5.8%).

Natural gas sales in Italy were 52.87 BCM (including ownconsumption) and declined by 3.26 BCM from 2007, or 5.8%.

The Italian market includes large businesses, power generationusers, wholesalers, middle-sized enterprises and service andresidential customers; they are further grouped as follows: (i)large industrial clients and power generation utilities directlylinked to the national and the regional natural gas transportnetworks; (ii) wholesalers, mainly local selling companies whichresell natural gas to residential customers through low pressuredistribution networks and distributors of natural gas forautomotive use; and (iii) residential customers includehouseholds (also referred to as the retail market), the tertiarysector (mainly commercial outlets, hospitals, schools and localadministrations) and middle-sized enterprises (also referred toas the middle market) located in large metropolitan areas andurban centers. As of December 31, 2008, Eni clients amounted to6.63 million units.

In 2008, the decline in sales on the Italian gas market wasprimarily due to wholesalers (down 2.49 BCM) and industrialcustomers (down 2.13 BCM) mainly reflecting the impact of lowergas demand and competitive pressures. The decrease was partlyoffset by higher supplies to the power generation sector (up 0.48BCM) and higher seasonal sales to residential customers (up 0.43BCM) due to colder weather in the first quarter. The decline insales to wholesalers and industrial customers also reflects theincrease in sales under the gas release programs (3.28 BCM, up0.91 BCM from 2007). These sales related to certain proceedingssettled between Eni and the Italian Antitrust Authority. In June2004, Eni agreed with the Antitrust Authority to sell a totalvolume of 9.2 BCM of natural gas (2.3 BCM/y) in the four thermalyears from October 1, 2004 to September 30, 2008 at the Tarvisioentry point into the Italian network. In March 2007 a new gasrelease program was signed for volumes amounting to 4 BCM ofnatural gas to sell in the two thermal years from October 1, 2007to September 30, 2009 at a virtual exchange point in the Italianmarket.

Sales to importers in Italy (11.25 BCM) increased by 0.58 BCM,up 5.4%, as a larger portion of these sales in 2007 was replacedwith direct sales in Italy.

Gas sales in European markets (31.78 BCM including affiliatesand the contribution of Distrigas acquisition) increased by 7.43BCM, or 30.5%, also reflecting market share gains. Excluding theimpact of Distrigas, sales of natural gas on European marketsamounted to 26.55 BCM, increasing by 2.20 BCM, or 9%, mainly dueto the growth registered in: (i) France (up 0.64 BCM) due tomarketing initiatives targeting wholesalers and industrialcustomers; (ii) the Iberian Peninsula (up 0.53 BCM) due to highersupplies to wholesalers and the power generation segment; (iii)Turkey (up 0.31 BCM), due to the progressive reaching of fulloperations of the Blue Stream pipeline; and (iv) Germany-Austria(up 0.20 BCM) due to higher sales to wholesalers. Sales tomarkets outside Europe (2.33 BCM) are substantially in line with2007.

E&P sales in Europe and in the United States increased by0.61 BCM, up 11.3%, as a result in particular of the productionramp-up in the Gulf of Mexico. 

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The tables below set forth Eni’s sales of natural gas byprincipal market for the periods indicated.

| **Natural        gas sales by entities** |   | **2006** |   | **2007** |   | **2008** |
|------------------------------------------|--------|----------|--------|----------|--------|----------|
|                                     |   |          |   |          |   |          |

|   | **(BCM)** |
|--------|-----------|

| **Total sales of subsidiaries**                         |   | **85.76** |   | **84.83** |   | **89.32**   |
|---------------------------------------------------------|--------|-----------|--------|-----------|--------|-------------|
| *Italy*                                                 |   | *57.07*   |   | *56.08*   |   | ***52.82*** |
| *Rest of Europe*                                        |   | *27.93*   |   | *27.86*   |   | ***35.61*** |
| *Outside        Europe*                                 |   | *0.76*    |   | *0.89*    |   | ***0.89***  |
| **Total sales of Eni's affiliates**(Eni's        share) |   | **7.65**  |   | **8.74**  |   | **8.91**    |
| *Italy*                                                 |   | *0.02*    |   | *0.05*    |   | ***0.05***  |
| *Rest of Europe*                                        |   | *6.88*    |   | *7.16*    |   | ***7.42***  |
| *Outside        Europe*                                 |   | *0.75*    |   | *1.53*    |   | ***1.44***  |
| **Total sales of G&P**                              |   | **93.41** |   | **93.57** |   | **98.23**   |
| E&P in        Europe and in the Gulf of Mexico (a)  |   | 4.69      |   | 5.39      |   | 6.00        |
| **Worldwide gas sales**                                 |   | **98.10** |   | **98.96** |   | **104.23**  |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

----

| (a) | i | E&P sales        include volumes marketed by the Exploration &        Production division in Europe (4.07, 3.59, 3.36 BCM in        2006, 2007 and 2008, respectively) and in the Gulf of        Mexico (0.62, 1.8 and 2.64 BCM in 2006, 2007 and 2008,        respectively). |
|-----|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

| **Natural        gas sales by market** |   | **2006** |   | **2007** |   | **2008** |
|----------------------------------------|--------|----------|--------|----------|--------|----------|
|                                   |   |          |   |          |   |          |

|   | **(BCM)** |
|--------|-----------|

| **ITALY**                                                       |   | **57.09** |   | **56.13** |   | **52.87**  |
|-----------------------------------------------------------------|--------|-----------|--------|-----------|--------|------------|
| Wholesalers                                                     |   | 11.54     |   | 10.01     |   | 7.52       |
| Gas release                                                     |   | 2.00      |   | 2.37      |   | 3.28       |
| Italian        gas exchange and spot markets                    |   | -         |   | 1.90      |   | 1.89       |
| Industries                                                      |   | 14.33     |   | 12.77     |   | 10.64      |
| *Industries*                                                    |   | *13.33*   |   | *11.77*   |   | *9.59*     |
| *Medium-sized enterprises and services*                         |   | *1.00*    |   | *1.00*    |   | *1.05*     |
| Power        generation                                         |   | 16.67     |   | 17.21     |   | 17.69      |
| Residential                                                     |   | 6.42      |   | 5.79      |   | 6.22       |
| Own        consumption                                          |   | 6.13      |   | 6.08      |   | 5.63       |
| **INTERNATIONAL SALES**                                         |   | **41.01** |   | **42.83** |   | **51.36**  |
| **Importers        in Italy**                                   |   | **14.10** |   | **10.67** |   | **11.25**  |
| **European markets**                                            |   | **20.71** |   | **24.35** |   | **31.78**  |
| *Iberian        Peninsula*                                      |   | *5.24*    |   | *6.91*    |   | *7.44*     |
| *Germany-Austria*                                               |   | *4.72*    |   | *5.03*    |   | *5.29*     |
| *Turkey*                                                        |   | *3.68*    |   | *4.62*    |   | *4.93*     |
| *Belgium*                                                       |   | -         |   | -         |   | *4.57*     |
| *Northern        Europe*                                        |   | *2.62*    |   | *3.15*    |   | *3.21*     |
| *Hungary*                                                       |   | *3.10*    |   | *2.74*    |   | *2.82*     |
| *France*                                                        |   | *1.07*    |   | *1.62*    |   | *2.66*     |
| *Other*                                                         |   | *0.28*    |   | *0.28*    |   | *0.86*     |
| **Extra        European markets**                               |   | **1.51**  |   | **2.42**  |   | **2.33**   |
| **E&P**********in Europe and in        the Gulf of Mexico** |   | **4.69**  |   | **5.39**  |   | **6.00**   |
| **WORLDWIDE        GAS SALES**                                  |   | **98.10** |   | **98.96** |   | **104.23** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

> 
***Planned Actions and Sales Target***

In the medium-term, Eni plans to increase its sales volumes ofnatural gas in international markets, mainly in Europe and theU.S., in order to compensate for lower growth opportunities onits domestic market due to sector-specific regulation imposinglimits to the size of Italian gas operators. In order to achieveits growth targets, Eni will leverage on its strengthsrepresented by gas availability both as equity gas and underlong-term purchase contracts, operational flexibility ensured byaccess to a large transport network, regasification terminals andlogistic assets, a large portfolio of clients and marketknowledge. Eni expects to increase international sales alsoleveraging on synergies deriving from the Distrigas acquisitionthat will help drive sales growth and markets share gains inEni’s target markets in spite of an unfavorable short-termoutlook for European gas demand.

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> 
***(i) Italy***

In the medium-term, the Italian gas market will becharacterized by greater competition related to the short-termdecline in demand resulting from the economic slowdown and theentry on the market of new supplies related to the upgrade ofimport infrastructure. In particular import capacity is expectedto increase by approximately 25 BCM in the next four years. About90% of new capacity is expected to come on stream in 2010. Thiscapacity derives in particular from the upgrades achieved by Enion pipelines from Russia (TAG), Algeria (TTPC) and Libya(GreenStream) and the full operation of the re-gasification plantof Rovigo owned by third parties. 

In order to support sales and profitability of its marketingoperations in Italy, Eni intends to implement an effectivemarketing policy, intended to deliver value to customersleveraging on the quality of the service and the offer ofcustomized price formulas. Eni’s marketing initiatives willfocus on all segments in particular the middle and retailmarkets, also leveraging on the expected development of thecombined offer of gas and power to residential customers("dual offer"). Large industrial clients will beretained based on selective marketing policies targeting the mostvaluable and profitable. Volumes to thermoelectric utilities willbe supported in order to maintain current levels.

At the same time, Eni expects to preserve its selling marginsby means of reducing the cost to serve leveraging ontechnological innovation, streamlining front-end and back-endprocesses and achieving economies of scale and synergies,particularly those driving from the dual offer in terms ofprocess integration for acquiring, retaining and managingcustomers. 

As part of its marketing activities in Italy, Eni engages inthe marketing of power. Particularly, the Company offers to itsretail clients a commercial offer that provides the combinedsupply of gas and power ("the dual offer"). Eni plansto achieve by 2012 a penetration rate of over 20% of Eni’sretail customer base.

In 2008, sales of power amounted to 29.93 TWh and decreased by3.26 TWh from 2007, down 9.8%, reflecting lower traded volumes asthe economic activity declined in the last part of the year. Thedecrease mainly regarded sales to the power exchange. Sales onthe free market to wholesalers increased due to higher spotsales, and so did sales to industrial users due to new customersacquired. Sales of power amounting to 29.93 TWh were directed tothe free market (76%), the power exchange (13%), industrial sites(9%) and Electricity Service Operator (2%). In 2008, the programfor expanding the combined integrated offer of gas and power(dual offer) progressed in accordance with the Company’sexpansion plans. 

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(TWh)** |
|--------|-----------|

| Power generation                          |   | 24.82     |   | 25.49     |   | 23.33     |
|-------------------------------------------|--------|-----------|--------|-----------|--------|-----------|
| Trading of        electricity             |   | 6.21      |   | 7.70      |   | 6.60      |
|                                      |   | **31.03** |   | **33.19** |   | **29.93** |
| **Power        sales by market**          |   |      |   |      |   |      |
| Free market                               |   | 16.22     |   | 20.73     |   | 22.89     |
| Italian        Exchange for electricity   |   | 9.67      |   | 8.66      |   | 3.82      |
| Industrial plants                         |   | 2.70      |   | 2.81      |   | 2.71      |
| Electricity        Service operator (ESO) |   | 2.44      |   | 0.99      |   | 0.51      |
|                                      |   | **31.03** |   | **33.19** |   | **29.93** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Power availability to Eni is ensured by internal production(see the generation business below) and purchases on the freemarket. In 2008, production availability covered 78% of salesvolumes.

 

> 
***(ii) European Markets***

In the future, Eni intends to strengthen its leadership in theEuropean gas markets, targeting to increase both volumes andmarket shares. A review of Eni’s presence in key Europeanmarkets and volume targets for 2012 is presented below.

*Benelux.* The acquisition of Distrigas finalized inOctober 2008 granted Eni a solid base from which to develop itspresence in Benelux countries (Belgium, the Netherlands andLuxembourg). Distrigas is a key operator in Benelux, inparticular in Belgium, the strategic hub of the continentalEuropean gas market thanks to its central position and high levelof interconnectivity with the transit gas networks of central andnorthern Europe. The company sells natural gas mainly toindustries, wholesalers and power generation. Distrigas also hasdiversified sources of supply, both in geographical terms withits long-term supply contracts portfolio in the Netherlands,Norway and Qatar, and technically as it purchases natural gas,transports it via pipeline and as LNG. It also owns an 

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11% interest in Interconnector UK Ltd, the company that ownsthe interconnection of the transit gas networks between Belgiumand the UK and the Methania gas tanker ship. Its transport assetsconnect natural gas sources with European markets and theZeebrugge hub on the Belgian coast. 

In 2008 Distrigas natural gas sales in Benelux amounted toapproximately 13.5 BCM and by 2012 Eni targets sales of 14.8 BCM,an annual average growth rate of 2% and a 22% market share.

*France.*Eni sells natural gas to industrial clients andresellers and to the segments of small businesses and retailthough its partnership with Altergaz in which it holds a 38.91%stake. Altergaz supplies approximately 23,000 clients (of these17,000 are residential customers), with revenues of approximatelyeuro 260 million. Eni will support Altergaz’s development inthe target segments through a 10-year supply contract of 1.3BCM/y and will pursue synergies with its own commercialstructure. On September 23, 2008, Eni and Altergaz acquired a 17%stake each in the share capital of Gaz de Bordeaux SAS, a gasdistributor in the municipality of Bordeaux and defined the termsof a long-term supply contract for 250 mmCM/y to Gaz de Bordeaux.

In addition, the recent acquisition of Distrigas provides Eniwith a customer base and sound commercial structures. 

The retail segment in France presents attractive developmentopportunities with its 10.8 million of sites and delivery pointsand consumption equaling 27% of total national consumption. 

Eni expects to ramp sales on the French market to achieve 6.8BCM of sales by 2012. This target represents an annual averagegrowth rate of 14%. Eni’s market share is expected to reach13%. 

*Germany/Austria.* Eni is present on the German naturalgas market through its affiliate GVS (GasversorgungSüddeutschland GmbH - Eni 50%) which sold approximately 4.22 BCMin 2008 (2.11 BCM being Eni’s share) and through a directmarketing structure (Eni G&P GmbH). In the medium-term, Eni,supported by the synergies achieved with GVS, plans tosignificantly increase its sales to the local distributioncompanies and industrial segment, leveraging on the pursuit ofopportunities arising from the ongoing liberalization process.The objective is to sell 7.6 BCM in 2012, equal to a 7% marketshare with an annual growth rate of 9%.

*Iberian PeninsulaPortugal.* Eni operates on the Portuguese market through itsaffiliate Galp Energia (Eni’s interest 33.34%) which soldapproximately 5.78 BCM in 2008 (1.93 BCM being Eni’s share).

*Spain.* Eni operates in the Spanish gas market through adirect marketing structure that markets in particular LNG fromNigeria and through Unión Fenosa Gas (UFG) (Eni’s interest50%) which supplies natural gas mainly to final customers andpower generation utilities. In 2008 gas sales of UFG in Europeamounted to 4.32 BCM (2.16 BCM Eni’s share). UFG holds an80% interest in the Damietta liquefaction plant, on the Egyptiancoast (see below), and a 7.36% interest in a liquefaction plantin Oman. In addition, it holds interests in the Sagunto(Valencia) and El Ferrol (Galicia) regasification plants, with a42.5% and 18.9% interest, respectively. 

Eni targets to increase its sales in the Iberian Peninsulafrom the current 7.44 BCM level to approximately 8.6 BCM by 2012,with an annual average growth rate of 4%, in line with the growthof the Spanish market.

*UK/Northern Europe.* Eni through its subsidiary NorthSea Gas & Power (Eni UK Ltd) markets equity gas produced atEni’s fields in the North Sea and operates in the maincontinental natural gas hubs (NBP, Zeebrugge, TTF). Eni plans togrow volumes sold on the markets of the UK/ Northern Europe fromthe current 3.2 BCM level to approximately 6.8 BCM by 2012, witha 21% average annual growth rate. 

*Turkey.* Eni sells gas supplied from Russia andtransported via the Blue Stream pipeline. In 2008 sales amountedto 4.93 BCM. Leveraging on the expected demand growth, Eni plansto increase sales up to 6.4 BCM by 2012, equal to a 7% growthrate.

 

> 
***(iii) The United States***

Eni’s plans to expand its natural gas sales in the U.S.are described under the "LNG business" below.

 

> 
**The LNG Business**

Eni is present in the all phases of LNG: liquefaction,shipping, regasification and sale, and intends to speed up thedevelopment of its LNG business on a global scale, aiming atbuilding or acquiring assets in the LNG value chain in order toseize the opportunities arising from the increasing role of LNGin satisfying energy requirements. 

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Expansion of LNG business in particular on extra Europeanmarkets, mainly in the USA, will enable Eni to fully monetize itslarge equity reserves.

Eni’s main assets in the LNG business are describedbelow.

*Italy.*Eni, through Snam Rete Gas, operates the onlyregasification terminal operating in Italy at Panigaglia(Liguria). At full capacity, this terminal can regasify 17,500 CMof LNG per day and input 3.5 BCM/y into the Italian transportnetwork. Eni plans to increase the capacity of the Panigagliaplant from the current 3.5 BCM to 8 BCM. From 2014 the upgrade ofthis structure will allow to increase imports to Italy by 4.5BCM/y. In accordance with Management’s revised plans, worksare expected to commence by 2011, if all authorizations aregranted.

*Qatar.* The closing of the acquisition of Distrigasallowed Eni to increase its development opportunities in the LNGbusiness with the access to new supply sources mainly from Qatar,under a 20-year long agreement with RasGas (owned by QatarPetroleum with a 70% interest and ExxonMobil with a 30% interest)and to the Zeebrugge LNG terminal on the Western coast ofBelgium. In 2008 the terminal was authorized to load gascarriers, allowing Distrigas to start its LNG export activity tovery profitable markets. 

*Egypt.* Eni, through its interest in Unión Fenosa Gas,owns a 40% interest in the Damietta liquefaction plant producingapproximately 5 mmtonnes/y of LNG equal to a feedstock of 7 BCM/yof natural gas. In 2008, the Gas & Power segmentwithdrew 0.7 mmtonnes of LNG (approximately 1 BCM of natural gas)to be marketed in Europe. 

*Spain.* Eni through Unión Fenosa Gas holds a 21.25%interest in the Sagunto regasification plant, near Valencia, witha capacity of 6.7 BCM/y. At present, Eni’s capacityentitlement amounts to 1.6 BCM/y of gas. A capacity upgradingplan has been sanctioned targeting a 0.8 BCM/y capacity increaseby 2009. Eni through Unión Fenosa Gas also holds a 9.5% interestin the El Ferrol regasification plant, located in Galicia, whichstarted operations in November 2007, with a treatment capacity ofapproximately 3.6 BCM/y, 0.4 BCM/y being Eni’s capacityentitlements. 

*USA Cameron.* Eni acquired from the U.S. company Sempra a capacityentitlement in the Cameron regasification plant, underconstruction on the banks of the Calcasieu River, approximately15 miles south of Lake Charles in Louisiana. Eni’s capacityentitlement amounts to 6.5 BCM/y, equal to a 40% share of thetotal plant capacity for a duration of 20 years. The validity ofthe contract is conditional upon the actual start-up of theregasification service, expected by end of 2009. This transactionwill allow Eni to market the natural gas reserves that it isdeveloping in North Africa and Nigeria on the North Americanmarket.

*Pascagoula.* Within the upstream project related to theconstruction of an LNG plant in Angola designed to produce 5.2mmtonnes/y of LNG (approximately 7.3 BCM/y) for the NorthAmerican market, Eni has an option to purchase a capacityentitlement amounting to 5.8 BCM/y for 20 years at theregasification plant that will be built near Pascagoula inMississippi, with start up expected by end of 2011. 

With the contribution of the Distrigas acquisition and ofsales of the E&P segment, by 2012 Eni targets sales of LNG ofabout 17 BCM (12 BCM in 2008). 

| **LNG        sales** |   | **2006** |   | **2007** |   | **2008** |
|----------------------|--------|----------|--------|----------|--------|----------|
|                 |   |          |   |          |   |          |

|   | **(BCM)** |
|--------|-----------|

| **G&P sales**                           |   | **6.4** |   | **8.0**  |   | **8.4**  |
|---------------------------------------------|--------|---------|--------|----------|--------|----------|
| Italy                                       |   | 1.5     |   | 1.2      |   | **0.3**  |
| European markets                            |   | 4.4     |   | 5.6      |   | **7.0**  |
| Extra        european markets               |   | 0.5     |   | 1.2      |   | **1.1**  |
| **E&P sales**                           |   | **3.5** |   | **3.7**  |   | **3.6**  |
| Liquefaction        plants:                 |   |    |   |     |   |     |
| Bontang (Indonesia)                         |   | 0.9     |   | 0.7      |   | **0.7**  |
| Point        Fortin (Trinidad & Tobago) |   | 0.4     |   | 0.6      |   | **0.5**  |
| Bonny (Nigeria)                             |   | 1.8     |   | 2.0      |   | **2.0**  |
| Darwin        (Australia)                   |   | 0.4     |   | 0.4      |   | **0.4**  |
|                                        |   | **9.9** |   | **11.7** |   | **12.0** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

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> 
**Power Generation**

Eni conducts its power generation activities at its sites ofFerrera Erbognone, Ravenna, Livorno, Taranto, Mantova, Brindisiand Ferrara. In 2008 production of power amounted to 23.33 TWh,down 2.16 TWh from 2007, or 8.5% due mainly to a decline in salesvolumes. Total installed capacity was 4.9 GW at December 31,2008. Sales of steam (10,584 ktonnes) in 2008 decreased by 265ktonnes from 2007, down 2.4% and were directed to end customers.

In the medium-term Eni intends to complete its plan forexpanding power generation capacity, targeting an installedcapacity of 5.5 GW. At full capacity in 2012, production isexpected to amount to approximately 29 TWh, corresponding toapproximately 8% of power expected to be generated in Italy atthat date. This expansion will allow Eni to consolidate itsmarket share and its position as third power producer in Italy.Supplies of natural gas are expected to amount to approximately5.6 BCM/y from Eni’s diversified supply portfolio. Residualexpected capital expenditure amount to euro 0.7 billion inaddition to the euro 2.4 billion already invested until 2008. Thedevelopment plan is underway at Ferrara (Eni’s interest51%), where in partnership with EGL Holding Luxembourg (a companybelonging to Swiss group EGL) construction of two new 390 MWcombined cycle units is currently undergoing testing and therelevant authorizations are pending with start up expected inearly 2009. 

New installed generation capacity uses the combined cycle gasfired technology (CCGT), ensuring a high level of efficiency andlow environmental impact. In particular, management estimatesthat for a given amount of energy (electricity and heat)produced, the use of the CCGT technology on a production of 26.5TWh reduces emissions of carbon dioxide by approximately 5mmtonnes, as compared to emissions using conventional powergeneration technology. The CCGT technology has been acknowledgedby the Authority for Electricity and Gas as a productiontechnology that entails priority on the national dispatchingnetwork and the exemption from the purchase of "greencertificates". Article 11 of Legislative Decree No. 79/1999concerning the opening up of the Italian electricity marketobliges importers and producers of power from non renewablesources to input into the national power system a share of powerproduced from renewable sources set at 2% of power imported orproduced from non renewable sources exceeding 100 GW.Calculations are made on total amounts net of co-generation andown consumption. This obligation can be met also by purchasingvolumes or rights from other producers employing renewablesources (the so-called green certificates) to cover all or partof such 2% share. Legislative Decree No. 387/2003 establishedthat from 2004 to 2006 the minimum amount of power from renewablesources to be input in the grid in the following year beincreased by 0.35% per year. The Minister of ProductiveActivities, with decrees issued in consent with the Minister ofthe Environment, will define further increases for the 2007-2009and 2010-2012 periods.

Eni’s operated power plants are described below. 

**Ferrera Erbognone.** This power plant has an installedcapacity of approximately 1,030 MW divided on three combinedcycle units, two of them with an approximately 390 MW capacityare fired with natural gas, the third one with approximately 250MW capacity is fired whit a mixed fuel, natural gas and refinerygas obtained from the gasification of a heavy residue form crudeprocessing at the nearby Eni-operated Sannazzaro refinery.

**Ravenna.**Two new combined cycle 390 MW units startedoperations in 2004. Added to the existing capacity, the powerplant’s installed capacity has reached approximately 1,100MW.

**Brindisi.**This power plant has been upgraded byinstalling three new combined cycle units, each with capacity of390 MW, increasing overall capacity at approximately 1,500 MW.

**Mantova.**This power plant has been upgraded byinstalling two new combined cycle units, each with capacity of390 MW, increasing overall capacity at approximately 900 MW. Thispower plant also provides steam for heating purposes delivered tothe Mantova’s urban network through a heat exchanger.

**Livorno.** This power plant has an installed capacity ofapproximately 200 MW, divided on gas and steam turbines withsteam generators.

**Taranto.**The existing power units have a capacity ofapproximately 75 MW, divided on gas and steam turbines with steamgenerators.

**Ferrara.** Two new combined cycle 390 MW units startedoperations in 2008. Added to already existing gas and steamturbines, the power plant’s installed capacity has reachedapproximately 840 MW.

57

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| **Power Generation** |   | **2006** |   | **2007** |   | **2008** |
|----------------------|--------|----------|--------|----------|--------|----------|
|                 |   |          |   |          |   |          |

| **Purchases**                            |   |      |   |    |   |    |   |    |
|------------------------------------------|--------|-----------|--------|---------|--------|---------|--------|---------|
| Natural        gas                       |   | (mmCM)    |   | 4,775   |   | 4,860   |   | 4,530   |
| Other fuels                              |   | (ktoe)    |   | 616     |   | 720     |   | 560     |
| *- of        which steam cracking*       |   |      |   | *136*   |   | *137*   |   | *131*   |
| **Production**                           |   |      |   |    |   |    |   |    |
| Electricity                              |   | (TWh)     |   | 24.82   |   | 25.49   |   | 23.33   |
| Steam                                    |   | (ktonnes) |   | 10,287  |   | 10,849  |   | 10,584  |
| **Installed        generation capacity** |   | (GW)      |   | **4.9** |   | **4.9** |   | **4.9** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

> 
 

**Infrastructures**

Eni operates a large European network of integratedinfrastructure for transporting natural gas, which links keyconsumption basins with the main producing areas (North Africa,Russia and the North Sea). 

In Italy Eni operates almost all the national transportnetwork and can count on an extended system of local distributionnetworks serving retail markets. The availability ofregasification capacity in Italy and the Iberian Peninsulacoupled with a significant storage capacity ensures a high levelof operating flexibility. These assets represent a significantcompetitive advantage. Eni is implementing plans for upgradingits import pipelines from Russia, Algeria and Libya and itsstorage capacity, and for expanding and modernizing its nationaltransport and distribution networks. The Company plans to investapproximately euro 7 billion in the next four years in thesebusinesses to cope with long-term growth expected in the Europeangas demand. 

| **Transport        infrastructure**         |   |                         |   |                    |   |              |   |                      |   |                    |   |                     |
|---------------------------------------------|--------|------------------------------|--------|-------------------------|--------|-------------------|--------|---------------------------|--------|-------------------------|--------|--------------------------|
| **Route**                                   |   | **Lines**                    |   | **Length of main line** |   | **Diameter**      |   | **Transport capacity**(1) |   | **Pressure min-max**    |   | **Compression stations** |
|                                   |   |                              |   |                         |   |                   |   |                           |   |                         |   |                          |
| **ITALY**                                   |   | **(units)**                  |   | **(km)**                |   | **(inch)**        |   | **(mmCM/d)**              |   | **(bar)**               |   | **(No.)**                |
| Mazara del Vallo-Minerbio (under upgrading) |   | 2/3                          |   | 1,480                   |   | 48/42 - 48        |   | 101.8                     |   | 75                      |   | 7                        |
| Tarvisio-Sergnano-Minerbio                  |   | 3                            |   | 433                     |   | 42/36, 34 e 48/56 |   | 106.0                     |   | 58/75                   |   | 3                        |
| Passo Gries-Mortara                         |   | 2                            |   | 177                     |   | 48/34             |   | 64.9                      |   | 55/75                   |   | 1                        |
|                                        |   |                         |   |                    |   |              |   |                      |   |                    |   |                     |
|                                        |   | **Lines**                    |   | **Total length**        |   | **Diameter**      |   | **Transport capacity**(2) |   | **Transit capacity**(3) |   | **Compression stations** |
|                                   |   |                              |   |                         |   |                   |   |                           |   |                         |   |                          |
| **OUTSIDE        ITALY**                    |   | **(units)**                  |   | **(km)**                |   | **(inch)**        |   | **(BCM/y)**               |   | **(BCM/y)**             |   | **(No.)**                |
| TENP (Bocholtz-Wallbach)                    |   | 2 lines of km 500            |   | 1,000                   |   | 36/38/40          |   | 22.9                      |   | 15.5                    |   | 4                        |
| Transitgas        (Rodersdorf-Lostorf)      |   | 3 lines of km 165, 71 and 55 |   | 291                     |   | 36/48             |   | 24.9                      |   | 19.9                    |   | 1                        |
| TAG (Baumgarten-Tarvisio)                   |   | 3 lines of km 380            |   | 1,140                   |   | 36/38/40/42       |   | 45.2                      |   | 37.4                    |   | 5                        |
| TTPC (Oued        Saf Saf-Cap Bon)          |   | 2 lines of km 370            |   | 740                     |   | 48                |   | 34.0                      |   | 33.2                    |   | 5                        |
| TMPC (Cap Bon-Mazara del Vallo)             |   | 5 lines of km 155            |   | 775                     |   | 20/26             |   | 33.2                      |   | 33.2                    |   |                     |
| GreenStream        (Mellitah-Gela)          |   | 1 line of km 520             |   | 520                     |   | 32                |   | 8.0                       |   | 8.0                     |   | 1                        |
| Blue Stream (Beregovaya-Samsun)             |   | 2 lines of km 387            |   | 774                     |   | 24                |   | 16.0                      |   | 16.0                    |   | 1                        |

----

| (1) | i | Transport        capacity refers to the capacity at the entry point        connected to the import pipelines.                                                |
|-----|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | Includes both        transit capacity and volumes of natural gas destined to        local markets and withdrawn at various points along the        pipeline. |
| (3) | i | The maximum        volume of natural gas which is input at various entry        points along the pipeline and transported to the next        pipeline.       |

> 
 

***International Transport Activities***

In order to import natural gas to Italy, Eni owns capacityentitlements in a network of international high pressurepipelines extending for a total of over 4,400 kilometers enablingthe Company to import natural gas produced in Russia, Algeria,the North Sea and Libya to Italy. A description of the mainpipelines is provided below.

| • |   | The TAG pipeline,        1,140-kilometer long, made up of three lines, each about        380-kilometer long, with a transport capacity of 37        BCM/y, and three compression stations. This pipeline        transports Russian natural gas from Baumgarten, the        delivery point at the border of Austria and Slovakia, to        Tarvisio, point of entry in the Italian natural gas        transport system. This facility is undergoing an upgrade        project entailing the construction of two new compression        stations in order to increase the transport capacity by        6.5 BCM/y. A first portion of 3.2 BCM/y has started        operating in October 2008. The second portion of 3.3        BCM/y is |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   |   | expected to start operating        in the fourth quarter of 2009. In 2008 the whole new        capacity has been awarded to third parties following a        transparent and non discriminatory procedure (lottery)        agreed with Austrian and European Authorities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | The TTPC pipeline,        740-kilometer long, made up of two lines each        370-kilometer long with a transport capacity of 33.2        BCM/y and five compression stations. This pipeline        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. In 2008 the transport capacity of this facility        has been increased by 6.5 BCM/y. A first portion of 3.2        BCM/y came on line on April 1, 2008, while the second        portion of 3.3 BCM/y started operations in October 2008.        The whole new capacity has been awarded to third parties.                                                                                                                  |
| • |   | The TMPC pipeline for the        import of Algerian gas, 775-kilometer long, made up of        five lines each 155-kilometer long with a transport        capacity of 33.5 BCM/y. It crosses underwater the Sicily        Channel from Cap Bon to Mazara del Vallo in Sicily, the        point of entry into the Italian natural gas transport        system.                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| • |   | The TENP pipeline,        1,000-kilometer long (two 500-kilometer long lines) with        transport capacity of 15.5 BCM/y and four compression        stations. It transports natural gas from the Netherlands        through Germany, from the German-Dutch border of Bocholtz        to Wallbach at the German-Swiss border.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| • |   | The Transitgas pipeline,        291-kilometer long, with one compression station, that        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 transport capacity of 20        BCM/y. 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. Eni is assessing an        upgrade of the capacity of this pipeline of 2 BCM/y. The        final investment decision is subject to the approval of        relevant authorities. |
| • |   | The GreenStream pipeline        that started operations in October 2004 for the import of        Libyan gas produced in Eni operated fields at Bahr        Essalam and Wafa. It is 520-kilometer long with a        transport capacity of 8 BCM/y and crosses underwater the        Mediterranean Sea from Mellitah on the Libyan coast to        Gela in Sicily, the point of entry into the Italian        natural gas transport system. Eni plans to upgrade the        transport capacity of this pipeline by additional 3 BCM/y        to 11 BCM/y with completion expected in 2012.                                                                                                                                                                                                                                        |

Eni holds a 50% interest in the Blue Stream underwaterpipeline (water depth greater than 2,150 meters) linking theRussian coast to the Turkish coast of the Black Sea. Thispipeline is 774-kilometer long on two lines and has transportcapacity of 16 BCM/y. 

> 
*The South Stream project*

Eni and Gazprom are assessing a project to build a new routefor importing gas from Russia to Europe through the Black Sea.The South Stream pipeline is expected to be composed by twosections: (i) an offshore 900-kilometer long section crossing theBlack Sea from the Russian coast at Beregovaya (the same startingpoint of the Blue Stream pipeline) to the Bulgarian coast atVarna. It will be laid reaching water depths of more than 2,000meters; and (ii) an onshore section for which two options arecurrently being evaluated: one envisages crossing Serbia andHungary to connect to existing trunklines from Russia; anothersection pointing South West crossing Greece and Albania thenlinking to the Italian network. Eni and Gazprom will carry outthe project using the most advanced technologies in full respectof the strictest environmental criteria.

 

> 
***Regulated businesses in Italy***

> 
*Italian Transport Activity*

Eni, through Snam Rete Gas, a company listed on the ItalianStock Exchange, in which Eni holds a 50.03% interest, operatesmost of the Italian natural gas transport network as well as theonly regasification terminal currently operating in Italy. 

Under Legislative Decree No. 164/2000 concerning the openingup of the natural gas market in Italy, transport andregasification activities are regulated by the Authority forElectricity and Gas which determines the methods for calculatingtariffs and fixing the return on capital employed. This makestransport a low risk business capable of delivering stablereturns. 

Eni’s network extends for 31,474 kilometers andcomprises: (i) a national transport network extending over 8,779kilometers, made up of high pressure trunk-lines mainly with alarge diameter, which carry natural gas from the entry points tothe system – import lines, storage sites and main Italiannatural gas fields – to the linking points with regionaltransport networks. The national network includes also someinterregional lines reaching important markets; and (ii) aregional transport network extending over 22,695 kilometers, madeup of smaller lines and allowing the transport of natural gas tolarge industrial complexes, power stations and local distributioncompanies in the various local areas served. The major pipelinesinterconnected with import trunk-lines that are part ofEni’s national network are:

| • |   | for natural gas imported        from Algeria (Mazara del Vallo delivery point): |
|--------|--------|---------------------------------------------------------------------------------|

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|   |   | - |   | two lines with a 48/42-inch        diameter, each approximately 1,500-kilometer long,        including the smaller pipes that cross underwater the        Messina Strait, connect Mazara del Vallo on the Southern        coast of Sicily where they link with the TMPC pipeline        carrying Algerian gas, to Minerbio (near Bologna). This        pipeline is undergoing an upgrade with the laying of a        third line with a 48-inch diameter 528-kilometer long (of        these 309 are already operating). At the Mazara del Vallo        entry point the available transport capacity, which is        measured at the beginning of each thermal year starting        on October 1, is approximately 102 mmCM/d; |
|--------|--------|---|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | for natural gas imported        from Libya (Gela delivery point): |
|--------|--------|-------------------------------------------------------------------|

|   |   | - |   | a 36-inch line, 67-kilometer        long linking Gela, the entry point of the GreenStream        underwater pipeline, to the national network near Enna        along the trunkline transporting gas coming from Algeria.        Transport capacity at the Gela entry point is        approximately 31 mmCM/d; |
|--------|--------|---|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | for natural gas imported        from Russia (Tarvisio and Gorizia delivery points): |
|--------|--------|-------------------------------------------------------------------------------------|

|   |   | - |   | two lines with 42/36/34-inch        diameters extending for a total length of approximately        900 kilometers connect the Austrian network at Tarvisio.        This facility crosses the Po Valley reaching Sergnano        (near Cremona) and Minerbio. This pipeline has been        upgraded by the laying of a third 264-kilometer long line        with diameter from 48 to 56 inches. The pipeline        transport capacity at the Tarvisio entry point amounts to        approximately 106 mmCM/d plus the transport capacity        available at the Gorizia entry point of approximately 5        mmCM/d; |
|--------|--------|---|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | for natural gas imported        from the Netherlands and Norway (Passo Gries delivery        point): |
|--------|--------|------------------------------------------------------------------------------------------------------|

|   |   | - |   | one line, with a 48-inch        diameter, 177-kilometer long extends from the Italian        border at Passo Gries (Verbania), to the node of Mortara,        in the Po Valley. The pipeline transport capacity at the        Passo Gries entry point amounts to 65 mmCM/d; |
|--------|--------|---|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | for natural gas coming from        the Panigaglia LNG terminal: |
|--------|--------|-----------------------------------------------------------------|

|   |   | - |   | one line, with a 30-inch        diameter, 170-kilometer long links the Panigaglia        terminal to the national transport network near Parma.        The pipeline transport capacity at the Panigaglia entry        point amounts to 13 mmCM/d; |
|--------|--------|---|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | for natural gas coming from        the Rovigo Adriatic LNG terminal: |
|--------|--------|----------------------------------------------------------------------|

|   |   | - |   | a 36-inch connection at the        Minerbio junction with the Cavarzere-Minerbio pipeline        belonging to Edison Stoccaggio SpA, which will receive        gas from the LNG terminal located offshore of Porto Viro,        once in operation. |
|--------|--------|---|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

In 2008, Eni’s national transport network increased by393 kilometers due to certain upgrades to both nationaltrunklines (231 kilometers) and the regional network (162kilometers). Eni’s system is completed by: (i) 11 compressorstations with a total power of 830 MW used to increase gaspressure in pipelines to the level required for its flow; and(ii) 5 marine terminals linking underwater pipelines with theon-land network at Mazara del Vallo, Messina and Gela in Sicilyand Favazzina and Palmi in Calabria. The interconnections managedby Snam Rete Gas in the Italian transport network are guaranteedby 23 linkage and dispatching nodes and by 569 plant unitsincluding pressure reduction and regulation plants. These plantsallow to regulate the flow of natural gas in the network andguarantee the connection of pipes working at different pressures.

Snam Rete Gas is currently assessing a project to build theItalian section of the new Galsi pipeline connecting Algeria toItaly through Sardinia with an 8 BCM/y capacity. The Italiansection of this new infrastructure will be consist of an onshoresection crossing Sardinia and an offshore section reachingTuscany where it will link with the national network for a totallength of 600 kilometers. Galsi will be responsible for projectengineering and obtaining needed licenses and authorizations,while Snam Rete Gas will build the pipeline and manage it whenoperational.

For the next four years Snam Rete Gas approved a capitalexpenditure plan of approximately euro 4.3 billion aimed mainlyat increasing transport capacity by 25% and upgrading the networkin view of increasing import flows. 

In 2008, volumes of natural gas input in the national grid(85.64 BCM) increased by 2.36 BCM from 2007, up 2.8%, mainly dueto higher volumes of natural gas input to storage for therebuilding of stocks in summer months as a result of higherofftakes related to higher seasonal sales registered in the firstmonths of the year. Eni transported 33.84 BCM of natural gas onbehalf of third parties, up 2.95 BCM from 2007, or 9.6%.

| **Gas        volumes transported**(a) |   | **2006** |   | **2007** |   | **2008** |
|---------------------------------------|--------|----------|--------|----------|--------|----------|
|                                  |   |          |   |          |   |          |

|   | **(BCM)** |
|--------|-----------|

| Eni                               |   | 57.09     |   | 52.39     |   | 51.80     |
|-----------------------------------|--------|-----------|--------|-----------|--------|-----------|
| On behalf        of third parties |   | 30.90     |   | 30.89     |   | 33.84     |
|                              |   | **87.99** |   | **83.28** |   | **85.64** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

----

| (a) | i | Includes        amounts destined to domestic storage. |
|-----|---|-------------------------------------------------------|

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| **Transport        capacity in Italy** |   | **2007-2008 Thermal year** |   | **2008-2009 Thermal year** |
|----------------------------------------|--------|----------------------------|--------|----------------------------|
|                                   |   |                            |   |                            |

| **Entry        points** |   | **Available capacity** |   | **Awarded capacity** |   | **Saturation** |   | **Available capacity** |   | **Awarded capacity** |   | **Saturation** |
|-------------------------|--------|------------------------|--------|----------------------|--------|----------------|--------|------------------------|--------|----------------------|--------|----------------|
|                    |   |                        |   |                      |   |                |   |                        |   |                      |   |                |
|                    |   | **(mmCM/d)**           |   | **(mmCM/d)**         |   | **(%)**        |   | **(mmCM/d)**           |   | **(mmCM/d)**         |   | **(%)**        |
| Tarvisio                |   | 112.6                  |   | 92.2                 |   | 81.9           |   | 106.0                  |   | 97.8                 |   | 92.2           |
| Mazara del        Vallo |   | 90.7                   |   | 80.4                 |   | 88.7           |   | 101.8                  |   | 93.2                 |   | 91.6           |
| Passo Gries             |   | 63.5                   |   | 59.6                 |   | 93.8           |   | 64.9                   |   | 60.8                 |   | 93.7           |
| Gela                    |   | 30.3                   |   | 29.5                 |   | 97.3           |   | 30.5                   |   | 30.5                 |   | 100.0          |
| GNL Panigaglia          |   | 13.0                   |   | 11.4                 |   | 87.7           |   | 13.0                   |   | 11.4                 |   | 87.7           |
| Gorizia                 |   | 4.8                    |   | 0.5                  |   | 9.4            |   | 4.8                    |   |                 |   |           |
|                    |   | **314.9**              |   | **273.6**            |   | **86.9**       |   | **321.0**              |   | **293.7**            |   | **91.5**       |
|                    |   |                        |   |                      |   |                |   |                        |   |                      |   |                |

In 2008, the LNG terminal in Panigaglia (La Spezia) regasified1.52 BCM of natural gas (2.38 BCM in 2007).

 

> 
***Distribution Activity***

Distribution involves the delivery of natural gas toresidential and commercial customers in urban centers through lowpressure networks. Eni, through its 100% subsidiary Italgas andother subsidiaries, operates in the distribution activity inItaly serving 1,320 municipalities through a low pressure networkconsisting of approximately 49,400 kilometers of pipelinessupplying 5.6 million customers and distributing 7.3 BCM in 2008.Under Legislative Decree No. 164/2000 on the opening up of thenatural gas market in Italy, distribution activities areconsidered a public service and therefore are regulated by theAuthority for Electricity and Gas which determines the methodsfor calculating tariffs and fixing the return on capitalemployed. This business, therefore, presents a low risk and asteady cash generation profile.

Distribution activities are conducted under concessionagreements whereby local public administrations award the serviceof gas distribution to companies. According to Legislative DecreeNo. 164/2000, the award of the service has to take place bycompetitive bid from the end of a transition period no later thanDecember 31, 2012. Future concessions will last no more thantwelve years. Eni intends to develop its market and improveefficiency and quality of services rendered.

| **Distribution activity        in Italy** |   | **2006** |   | **2007** |   | **2008** |
|-------------------------------------------|--------|----------|--------|----------|--------|----------|
|                                      |   |          |   |          |   |          |

| Volumes distributed          |   | (BCM)                 |   | 7.54      |   | 7.44      |   | 7.63      |
|------------------------------|--------|-----------------------|--------|-----------|--------|-----------|--------|-----------|
| - on        behalf of Eni    |   |                  |   | 6.90      |   | 6.39      |   | 6.33      |
| - on behalf of third parties |   |                  |   | 0.64      |   | 1.05      |   | 1.30      |
| Installed        network     |   | (km)                  |   | 48,724    |   | 48,746    |   | 49,410    |
| Active meters                |   | (No. of        users) |   | 5,550,700 |   | 5,598,677 |   | 5,676,056 |
| Municipalities        served |   | (No.)                 |   | 1,317     |   | 1,318     |   | 1,320     |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

For the next four years Eni defined a capital expendituresplan of approximately euro 1 billion for the development/upgradeof its distribution networks and their technological upgrade.

 

> 
***Storage***

Following the 100% divestment of Stogit to Snam Rete Gas thatwas approved by Eni’s Board of Directors and is expected toclose by mid 2009 (for details on this deal see "SignificantBusiness and Portfolio Developments" above), from 2009 theresults of the storage business conducted in Italy described inthe Exploration & Production section will be reported withinthe Gas & Power segment, under the "RegulatedBusiness". The storage gas business in Italy is afully-regulated activity which returns are preset by the ItalianAuthority for Electricity and Gas. Italian regulated storageservices are provided through eight storage fields, with amodulation capacity of 8.6 BCM.

In addition to storage activities conducted in Italy, Eni,through its Gas & Power segment, engages in certain gasstorage activities in Europe. Particularly, the Company isdeveloping a storage facility in the UK section of the North Seafollowing the acquisition of the Hewett Unit where certaindepleted fields will be converted to gas storage deposits (forfurther detailed information see "Item 4 – Exploration& Production" above). The expected capital expenditureprogram for this project amounts to euro 0.7 billion withexpected start-up in 2011. The storage capacity 

61

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##### Table of Contents

will be located to complement Eni’s production, sales andtrading activities in Europe and will further enhance theflexibility of Eni’s portfolio in serving the main markets.Eni considers the development of gas storage facilities as a coreelement of the gas business. Gas storage capacity providesflexibility to match gas demand in peak periods, therebycontributing to the optimization of the gas supply portfolio. Theactivity of gas storage in the UK is de-regulated and resultsfrom this project will be reported within the "Marketingbusiness".

 

> 
***Capital Expenditures***

See "Item 5 – Liquidity and Capital Resources –Capital Expenditures by Segment".

 

**Refining & Marketing**

Eni’s Refining & Marketing segment engages inrefining of crude oil and marketing of refined products in Italyand in a number of European markets. Based on public data, Eni isthe main operator in the markets for refining and marketing ofrefined products in Italy. Eni’s refining and marketingoperations are efficiently integrated and supported by a full setof logistic assets. Refining know-how, strong market acceptanceof the brand, the ability to develop innovative fuels, and theintegration with upstream operations represent Eni’sprincipal competitive advantages. Eni’s key medium-termtarget is to enhance the profitability of its downstream oilbusiness and to reduce the cash requirements of the business byapplying tight financial discipline on capital expenditures.

The strategic guidelines to attain this target are:

| • |   | to upgrade Eni’s        refining system through a focused capital program; |
|--------|--------|---------------------------------------------------------------------------------|

| • |   | to improve profitability and        qualitative standards of the Italian retail network; and |
|--------|--------|----------------------------------------------------------------------------------------------|
| • |   | to pursue higher levels of        operational efficiency.                                    |

In the next four years the implementation of these strategieswill be supported by a capital expenditure program ofapproximately euro 2.8 billion that will be directed to upgradeEni’s most efficient and profitable refineries and improvethe quality standards of Eni’s retail operations, inparticular in Italy, expanding activities for the supply of nonoil products and developing the market share in selected Europeanmarkets. Efficiency improvement actions will be directed to allactivities targeting control of operating costs and improvementof energy efficiency.

*The matters regarding future plans discussed in thissection and elsewhere herein are forward-looking statements thatinvolve risks and uncertainties that could cause the actualresults to differ materially from those in such forward-lookingstatements. Such risks and uncertainties include difficulties inobtaining approvals from relevant Antitrust Authorities anddevelopments in the relevant market.*

 

> 
**Supply and Trading**

In 2008, a total of 57.91 mmtonnes of crude were purchased bythe Company’s Refining & Marketing segment (59.56mmtonnes in 2007), of which 29.71 mmtonnes from Eni’sExploration & Production segment. Volumes amounting to 16.11mmtonnes were purchased under long-term supply contracts withproducing countries, while 12.09 mmtonnes were purchased on thespot market. Approximately 29% of crude purchased in 2008 camefrom West Africa, 19% from European and Asian Russia, 29% fromNorth Africa, 14% from the Middle East, 14% from the North Seaand 6% from Italy.

Approximately 26 mmtonnes of crude purchased in 2008 wereresold, up 0.7% from 2007. In addition, 3.39 mmtonnes ofintermediate products were purchased (3.59 mmtonnes in 2007) tobe used as feedstock in conversion plants and 17.42 mmtonnes ofrefined products (16.14 mmtonnes in 2007) were purchased tocomplement production availability.

 

> 
**Refining**

Eni’s refining system has total refinery capacity(balanced with conversion capacity) of approximately 36.8mmtonnes (equal to 737 KBBL/d) and a conversion index of 57.6%.The conversion index is a measure of a refinery complexity. Thehigher the index, the wider is the spectrum of crude qualitiesand feedstock that a refinery is able to process thus enabling itto benefit from the cost economies associated with the fact thatcertain qualities of crude (particularly the heavy ones) trade atdiscount with reference to the light crude benchmark Brent.Eni’s five 100-percent owned refineries have balancedcapacity of 27.2 mmtonnes (equal to 544 KBBL/d), with a 60.3%conversion rate. In 2008, refinery throughputs in Italy andoutside Italy were 35.84 mmtonnes.

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In the next four years, Eni plans to selectively upgrade itsrefining system by increasing complexity and flexibility ofplants, using Eni’s proprietary EST technology and achievinga conversion index of 65% in Europe (71% in Italy). Thecompletion of construction of three new hydrocrackers atSannazzaro, Taranto and Bayernoil is scheduled in 2009. Middledistillate yields are expected to come in at 45% from 40% in 2008(more than double of gasoline yields) and equity crude volumesprocessed to increase from 19.0% to 19.6%. Improvement inoperations as result of investment upgrading and efficiencyactions targeting operating costs are expected to enable refiningoperations to lower the break-even level with respect to 2008.This means that in the medium-term our refineries will achievepositive results in a lower refining margin scenario compared to2008. Management’s projections about the break-even levelalso take into account the operating expenses required to complywith environmental rules on the emissions of carbon dioxide (CO2)which amounted to approximately euro 17 million in 2008 as thebusiness emissions are higher than the entitled allowance basedon the criteria of Law Decree No. 216/2006 which implemented inItaly the EU Directive on Emission Trading (see below under thesection Environmental Regulation). Management expects that theRefining & Marketing business will incur a level of operatingexpenses similar to 2008 in the next four-years to comply withthe outlined environmental regulation.

In the next four-years period, Eni’s investment plans aredesigned to take advantage of certain expected market trends inthe refining industry:

| (i)   |   | a significant reduction in        European demand for gasoline, despite the diffusion of        new gasoline fuelled engines with efficiency levels in        consumption comparable to those of diesel fuel, is        expected in the medium-term, while consumption of diesel        fuel is expected to grow driven by the continuing renewal        of the car fleet; |
|-------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii)  |   | a slowdown in the demand for        gasoline on the U.S. market is expected, reflecting the        negative economic scenario, the diffusion of more energy        efficient car models and the increasingly widespread use        of bio-fuels;                                                                                                                           |
| (iii) |   | implementation of        increasingly tight environmental regulations in Europe        will require significant capital expenditures for        refinery upgrading;                                                                                                                                                                                                        |

| (iv) |   | demand for fuel oil is        expected to decrease due to increasingly strong        competition from natural gas in firing power plants; and |
|------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|

| (v) |   | opportunities will arise to        monetize heavy crudes and non conventional resources by        applying advanced refinery technologies. |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------|

Eni’s refinery capital projects will be designed to: (i)increase plant conversion capacity in view of boosting middledistillate yields and extracting value from equity crude; (ii)improve refinery flexibility in order to optimize processedfeedstock and capture market opportunities arising from anexpected increased availability of heavy/sour crudes that aretypically discounted in the marketplace; (iii) produce fuels inline with product specifications provided for increasingly tightEuropean environmental standards; and (iv) enhance operationalefficiency of refineries, including energy efficiency gains.

The table below sets forth certain statistics regardingEni’s refineries at December 31, 2008.

**Refining system in 2008**

|   |   | Ownership share        (%) |   | Distillation capacity        (total)        (KBBL/d) |   | Distillation capacity        (Eni’s share)        (KBBL/d) |   | Primary balanced refining        capacity        (Eni’s share)        (KBBL/d) |   | Conversion index (1)        (%) |   | Fluid catalytic cracking -        FCC (2)        (KBBL/d) |   | Residue conversion        (KBBL/d) |   | Go-Finer        (KBBL/d) |   | Mild Hydro- cracking/        Hydro- cracking        (KBBL/d) |   | Visbreaking/ Thermal        Cracking        (KBBL/d) |   | Coking        (KBBL/d) |   | Distillation capacity        utilization rate        (Eni’s share)        (%) |   | Balanced refining capacity        utilization rate        (Eni’s share)        (%) |
|--------|--------|----------------------------|--------|------------------------------------------------------|--------|-----------------------------------------------------------------|--------|-------------------------------------------------------------------------------------|--------|---------------------------------|--------|-----------------------------------------------------------|--------|------------------------------------|--------|--------------------------|--------|--------------------------------------------------------------|--------|------------------------------------------------------|--------|------------------------|--------|------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------|
|   |   |                            |   |                                                      |   |                                                                 |   |                                                                                     |   |                                 |   |                                                           |   |                                    |   |                          |   |                                                              |   |                                                      |   |                        |   |                                                                                    |   |                                                                                         |

| **Wholly owned refineries**                                                                                      |   |   |   | **685**   |   | **685** |   | **544** |   | **60.3** |   | **69**  |   | **22** |   | **37** |   | **29**  |   | **89**  |   | **47** |   | **82** |   | **94** |
|------------------------------------------------------------------------------------------------------------------|--------|--------|--------|-----------|--------|---------|--------|---------|--------|----------|--------|---------|--------|--------|--------|--------|--------|---------|--------|---------|--------|--------|--------|--------|--------|--------|
| Italy                                                                                                            |   |   |   |      |   |    |   |    |   |     |   |    |   |   |   |   |   |    |   |    |   |   |   |   |   |   |
|      Sannazzaro                                                                         |   | 100    |   | 223       |   | 223     |   | 170     |   | 50.9     |   | 34      |   |   |   |   |   | 29      |   | 29      |   |   |   | 73     |   | 99     |
|      Gela                                                                               |   | 100    |   | 129       |   | 129     |   | 100     |   | 144.8    |   | 35      |   |   |   | 37     |   |    |   |    |   | 47     |   | 82     |   | 101    |
|      Taranto                                                                            |   | 100    |   | 120       |   | 120     |   | 110     |   | 64.6     |   |    |   | 22     |   |   |   |    |   | 38      |   |   |   | 97     |   | 79     |
|      Livorno                                                                            |   | 100    |   | 106       |   | 106     |   | 84      |   | 11.4     |   |    |   |   |   |   |   |    |   |    |   |   |   | 88     |   | 102    |
|      Porto Marghera                                                                     |   | 100    |   | 107       |   | 107     |   | 80      |   | 20.2     |   |    |   |   |   |   |   |    |   | 22      |   |   |   | 79     |   | 86     |
| **Partially        owned refineries** (3)                                                                        |   |   |   | **874**   |   | **245** |   | **193** |   | **49.7** |   | **163** |   | **25** |   |   |   | **99**  |   | **27**  |   |   |   | **77** |   | **98** |
| Italy                                                                                                            |   |   |   |      |   |    |   |    |   |     |   |    |   |   |   |   |   |    |   |    |   |   |   |   |   |   |
|      Milazzo                                                                            |   | 50     |   | 248       |   | 124     |   | 80      |   | 73.0     |   | 41      |   | 25     |   |   |   | 32      |   |    |   |   |   | 68     |   | 99     |
| Germany                                                                                                          |   |   |   |      |   |    |   |    |   |     |   |    |   |   |   |   |   |    |   |    |   |   |   |   |   |   |
|      Ingolstadt/Vohburg/             Neustadt (Bayernoil)      |   | 20     |   | 215       |   | 43      |   | 41      |   | 34.0     |   | 49      |   |   |   |   |   | 43      |   |    |   |   |   | 93     |   | 95     |
|      Schwedt                                                                            |   | 8.33   |   | 231       |   | 19      |   | 19      |   | 41.8     |   | 49      |   |   |   |   |   |    |   | 27      |   |   |   | 98     |   | 102    |
| Czech        Republic                                                                                            |   |   |   |      |   |    |   |    |   |     |   |    |   |   |   |   |   |    |   |    |   |   |   |   |   |   |
|      Kralupy e Litvinov                     (Ceska Rafinerska) |   | 32.4   |   | 180       |   | 59      |   | 53      |   | 29.6     |   | 24      |   |   |   |   |   | 24      |   |    |   |   |   | 86     |   | 80     |
| **Total        refineries**                                                                                      |   |   |   | **1,559** |   | **930** |   | **737** |   | **57.6** |   | **232** |   | **47** |   | **37** |   | **128** |   | **116** |   | **47** |   | **81** |   | **95** |
|                                                                                                             |   |        |   |           |   |         |   |         |   |          |   |         |   |        |   |        |   |         |   |         |   |        |   |        |   |        |

----

| (1) | i | Stated in        fluid catalytic cracking equivalent/topping (% by        weight), based on 100% of balanced primary distillation        capacity.                                                                                                      |
|-----|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | Conversion        plant where vacuum feedstock undergoes cracking at high        pressure and moderate temperature thus producing mostly        high quality gasoline. This kind of plant guarantees high        operating flexibility to the refinery. |
| (3) | i | Capacity of        conversion plant is 100%.                                                                                                                                                                                                            |

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> 
***Italy***

Eni’s refining system in Italy is composed of five100-percent owned refineries and a 50% interest in the Milazzorefinery in Sicily. Each of Eni’s refineries in Italy hasoperating and strategic features that aim at maximizing the valueassociated to the asset structure, the geographic positioningwith respect to end markets and the integration with Eni’sother activities.

The **Sannazzaro** refinery has balanced refining capacityof 170 KBBL/d and a conversion index of 50.9%. It is one of themost efficient refineries in Europe. Located in the Po Valley, itsupplies mainly markets in North-Western Italy and Switzerland.The high degree of flexibility of this refinery allows it toprocess a wide range of feedstock. From a logistical standpointthis refinery is located along the route of the Central EuropePipeline, which links the Genova terminal with French speakingSwitzerland. This refinery contains two primary distillationplants and relevant facilities, including three desulphurizationunits. Conversion is obtained through a fluid catalytic cracker(FCC), a mild hydrocracker (HdCK) middle distillate conversionunit and a visbreaking thermal conversion unit with agasification facility using the heavy residue from visbreaking(tar) to produce syngas to feed the nearby EniPower power plantat Ferrera Erbognone. A significant conversion capacity andflexibility upgrading program is ongoing in order to transform itin a world class plant. In particular, a new hydrocracking unitwith a processing capacity of 28 KBBL/d is under constructionwith expected start-up in 2009. In addition Eni plans to developa conversion plant employing the Eni Slurry Technology with a 23KBBL/d capacity for the processing of extra heavy crude with highsulphur content producing high quality middle distillates, inparticular gasoil, and reducing the yield of fuel oil to zero.Start-up of this facility is scheduled in 2012.

The **Taranto** refinery has balanced refining capacity of110 KBBL/d and a conversion index of 64.6%. This refinery canprocess a wide range of crude and other feedstock. It mainlyproduces fuels for automotive use and residential heatingpurposes for the Southern Italian markets. Besides its primarydistillation plants and relevant facilities, including two unitsfor the desulphurization of middle distillates, this refinerycontains a two-stage thermal conversion plant(visbreaking/thermal cracking) and an RHU conversion plant forthe conversion of high sulphur content residues into valuableproducts and catalytic cracking feedstocks. It processes most ofthe oil produced in Eni’s Val d’Agri fields carried toTaranto through the Monte Alpi pipeline (in 2008 a total of 2.3mmtonnes of this oil were processed). A new hydrocracking unitwith a capacity of 17 KBBL/d is expected to start production in2009. Eni’s plan to upgrade the conversion capacity of thisrefinery will enable to extract value from fuel oil and othersemifinished products currently exported.

**Gela**, with a balanced refining capacity of 100 KBBL/dand a conversion index of 144.8%, this refinery located on theSouthern coast of Sicily is highly integrated with upstreamoperations as it processes heavy crude produced from nearby Enifields offshore and onshore Sicily. In addition, it is integrateddownstream as it supplies large volumes of petrochemicalfeedstock to Eni’s in site petrochemical plants. Therefinery also manufactures fuels for automotive use andpetrochemical feedstock. Its high conversion level is ensured byan FCC unit with go-finer for the upgrading of feedstocks and twocoking plants for the vacuum conversion of heavy residues. Thepower plant of this refinery also contains modern residue andexhaust fume treatment plants which allow full compliance withthe tightest environmental standards. An upgrade of the Gelarefinery is underway by means of an upgrade of its power plant,through the revamping of its boilers, aimed at increasingprofitability by exploiting the synergies deriving from theintegration of refining and power generation.

**Livorno**, with a balanced refining capacity of 84 KBBL/dand a conversion index of 11.4%, manufactures mainly gasoline,fuel oil for bunkering and lubricant bases. Besides its primarydistillation plants, this refinery contains two lubricantmanufacturing lines. Its pipeline links with the local harbor andwith the Florence storage sites by means of two pipelinesoptimizes intake, handling and distribution of products.

**Porto Marghera**, with a balanced refining capacity of 80KBBL/d and a conversion index of 20.2%, this refinery suppliesmainly markets in North-Eastern Italy and Austria. Besides itsprimary distillation plants, this refinery contains a two-stagethermal conversion plant (visbreaking/thermal cracking) designedto increase yields of valuable products.

 

> 
***Rest of Europe***

In Germany Eni holds an 8.3% interest in the Schwedt refineryand a 20% interest in Bayernoil, an integrated pole that includedthe Ingolstadt, Vohburg and Neustadt refineries. Eni’srefining capacity in Germany amounts to approximately 70 KBBL/dmainly used to supply Eni’s distribution network in Bavariaand Eastern Germany. In 2008 the restructuring of the wholecomplex was completed with the closing down and divestment of theIngolstadt site, the construction of a new hydrocracker with acapacity of approximately 2 mmtonnes/y (40 KBBL/d), the revampingother assets (in particular a reformer and a hydrofiner) and theshutting-down of a topping unit in Neustadt. The projectcompleted in 2008 with start-up in the second half of Decemberand production expected in 2009, aimed at increasing middledistillate yields and reducing the production of gasoline.

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Eni holds a 32.4% stake in Ceska Rafinerska, which includestwo refineries, Kralupy and Litvinov, in the Czech Republic.Eni’s share of refining capacity amounts to about 53 KBBL/d.

In addition, with its 33.34% interest in Galp, with thePortuguese group Amorim Eni jointly controls two refineries inPortugal: a small one in Porto specialized in the manufacture oflubricant bases and a larger and more complex one in Sinesintegrated with petrochemicals.

The table below sets forth Eni’s petroleum productsavailability figures for the periods indicated.

| **Availability        of refined products** |   | **2006** |   | **2007** |   | **2008** |
|---------------------------------------------|--------|----------|--------|----------|--------|----------|
|                                        |   |          |   |          |   |          |

|   | **(mmtonnes)** |
|--------|----------------|

| ***Italy***                                                           |   |      |   |   |      |   |   |      |   |
|-----------------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|
| **Refinery        throughputs**                                       |   |      |   |   |      |   |   |      |   |
| At wholly-owned refineries                                            |   | 27.17     |   |   | 27.79     |   |   | 25.59     |   |
| Less input        on account of third parties                         |   | (1.53     | )      |   | (1.76     | )      |   | (1.37     | )      |
| At affiliates refineries                                              |   | 7.71      |   |   | 6.42      |   |   | 6.17      |   |
| **Refinery        throughputs on own account**                        |   | **33.35** |   |   | **32.45** |   |   | **30.39** |   |
| Consumption and losses                                                |   | (1.45     | )      |   | (1.63     | )      |   | (1.61     | )      |
| **Products        available for sale**                                |   | **31.90** |   |   | **30.82** |   |   | **28.78** |   |
| Purchases of refined products and change in        inventories        |   | 4.45      |   |   | 2.16      |   |   | 2.56      |   |
| Products        transferred to operations outside Italy               |   | (4.82     | )      |   | (3.80     | )      |   | (1.42     | )      |
| Consumption for power generation                                      |   | (1.10     | )      |   | (1.13     | )      |   | (1.00     | )      |
| **Sales        of products**                                          |   | **30.43** |   |   | **28.05** |   |   | **28.92** |   |
| ***Outside Italy***                                                   |   |      |   |   |      |   |   |      |   |
| **Refinery        throughputs on own account**                        |   | **4.69**  |   |   | **4.70**  |   |   | **5.45**  |   |
| Consumption and losses                                                |   | (0.32     | )      |   | (0.31     | )      |   | (0.25     | )      |
| **Products        available for sale**                                |   | **4.37**  |   |   | **4.39**  |   |   | **5.20**  |   |
| Purchases of finished products and change in        inventories       |   | 11.51     |   |   | 13.91     |   |   | 15.14     |   |
| Products        transferred from Italian operations                   |   | 4.82      |   |   | 3.80      |   |   | 1.42      |   |
| **Sales of products**                                                 |   | **20.70** |   |   | **22.10** |   |   | **21.76** |   |
| **Refinery        throughputs on own account**                        |   | **38.04** |   |   | **37.15** |   |   | **35.84** |   |
| *of which: total equity crude input*                                  |   | *12.50*   |   |   | *9.29*    |   |   | *6.98*    |   |
| **Total        sales of refined products in Italy and outside Italy** |   | **51.13** |   |   | **50.15** |   |   | **50.68** |   |
| **Crude oil sales**                                                   |   | **30.66** |   |   | **25.82** |   |   | **26.00** |   |
| **TOTAL        SALES**                                                |   | **81.79** |   |   | **75.97** |   |   | **76.68** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

In 2008, refining throughputs on own account in Italy andoutside Italy were 35.84 mmtonnes, down 1.31 mmtonnes from 2007,or 3.5%. Volumes processed in Italy decreased by 2.06 mmtonnes,or 6.3%, due to planned and unplanned refinery downtime at theTaranto, Porto Marghera and Gela plants, as well as lower volumesat the Livorno refinery due to a challenging refining environmentin the first half of the year. The increase recorded outsideItaly (up 750 ktonnes) was mainly due to higher capacityentitlements at Ceska Rafinerska following the purchase of anadditional ownership interest made in 2007, partly offset by thelower volumes in Germany.

Total throughputs in wholly-owned refineries (25.59 mmtonnes)decreased 2.20 mmtonnes, down 7.9%, from 2007. Approximately21.5% of volumes processed crude was supplied by Eni’sExploration & Production segment (30.2% in 2007) representinga 8.7% decrease from 2007, equivalent to a lower volume of 2.3mmtonnes due to lower equity crude availability from Russia,Libya and Italy.

 

> 
**Logistics**

Eni is a primary operator in storage and transport ofpetroleum products in Italy with its logistical integratedinfrastructure consisting of 21 directly managed storage sitesand a network of petroleum product pipelines for the sale andstorage of refined products, LPG and crude.

Eni holds interests in five joint entities established bypartnering the major Italian operators. These are located in VadoLigure-Genova (Petrolig), Arquata Scrivia (Sigemi), Venice(Petroven), Ravenna (Petra) and Trieste (DCT) and aim at reducinglogistic costs, and increasing efficiency.

Eni operates in the transport of oil and refined products: (i)on land through a pipeline network of leased and owned pipelinesextending over 3,019 kilometers (1,447 kilometers are owned byEni); and (ii) by sea through spot and long-term lease contractsof tanker ships. Secondary distribution to retail and wholesalemarkets is effected through third parties who also own theirmeans of transportation, in some instances with minorityparticipation of Eni.

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In 2008 Eni implemented a new hub model made up of five mainareas in Italy and including all Eni logistic assets among whichrefining ones. This new model aims to enhance the efficiency oflogistic operations by: (i) centralizing the handling ofproducts flows on a single platform enabling real timemonitoring; and (ii) introducing more efficient operatingmodes in the collection and delivery of orders with the aim ofreducing unit delivery costs.

 

> 
**Marketing**

Eni markets a wide range of refined petroleum products,primarily in Italy, through an extensive operated network ofservice stations, franchises and other distribution systems.

The table below sets forth Eni’s sales of refinedproducts by distribution channel for the periods indicated.

| **Oil        products sales in Italy and outside Italy** |   | **2006** |   | **2007** |   | **2008** |
|----------------------------------------------------------|--------|----------|--------|----------|--------|----------|
|                                                     |   |          |   |          |   |          |

|   | **(mmtonnes)** |
|--------|----------------|

| *Italy*                    |   |      |   |      |   |      |
|----------------------------|--------|-----------|--------|-----------|--------|-----------|
| Retail        marketing    |   | 8.66      |   | 8.62      |   | 8.81      |
| Wholesale marketing        |   | 11.74     |   | 11.09     |   | 11.15     |
|                       |   | **20.40** |   | **19.71** |   | **19.96** |
| Petrochemicals             |   | 2.61      |   | 1.93      |   | 1.70      |
| Other        sales         |   | 7.42      |   | 6.41      |   | 7.26      |
| **Total**                  |   | **30.43** |   | **28.05** |   | **28.92** |
| *Outside        Italy*     |   |      |   |      |   |      |
| Retail marketing           |   | 3.82      |   | 4.03      |   | 3.86      |
| Wholesale        marketing |   | 4.60      |   | 4.96      |   | 5.38      |
|                       |   | **8.42**  |   | **8.99**  |   | **9.24**  |
| Other        sales         |   | 12.28     |   | 13.11     |   | 12.52     |
| **Total**                  |   | **20.70** |   | **22.10** |   | **21.76** |
|                       |   | **51.13** |   | **50.15** |   | **50.68** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

In 2008, sales volumes of refined products (50.68 mmtonnes)were up 0.53 mmtonnes from 2007, or 1.1%, mainly due to largervolumes sold on retail and wholesale markets in Italy andwholesale market in the rest of Europe.

 

> 
***Retail Sales in Italy***

Eni markets refined products in Italy trough its Agip-brandednetwork of operated service stations. In 2008, volumes of refinedproducts marketed on the Italian network (8.81 mmtonnes) were up190 ktonnes from 2007, or 2.2%, despite a decrease recorded indomestic consumption, mainly due to marketing activities("Iperself" promotional campaign – see below– and fidelity programs) that sustained market share growthfrom 29.2% to 30.6%; market share is computed as ratio ofEni’s sales volumes to national consumption as published innational statistics. Higher sales mainly related to gasoil saleswhile gasoline sales registered a decrease.

The average throughput per service station measured ongasoline and gasoil sales was 2,470 kliters, an increase of 26kliters from 2007, or up 1.1%.

At December 31, 2008, Eni’s retail network in Italyconsisted of 4,409 service stations, 19 more than at December 31,2007, resulting from the positive balance ofacquisitions/releases of lease concessions (32 units), theopening of new service stations (7 units), partly offset by theclosing of service stations with low throughput (19 units) andthe release of one service station under highway concession.

In 2008, fuel sales of the Blu line – high performanceand low environmental impact fuel – declined due tosensitivity of demand to prices of these products in anenvironment of economic downturn and high fuel prices on average.Sales of BluDiesel and its reformulated version BluDieselTechamounted to 583 ktonnes (677 mmliters), declining by 152 ktonnesfrom 2007 and represented 10.6% of gasoil sales on Eni’sretail network. At year end, service stations marketing BluDieseltotaled 4,095 units (4,065 in 2007) covering to approximately 93%of Eni’s network. Retail sales of BluSuper amounted to 78ktonnes (91 mmliters) and decreased by 20 ktonnes from 2007 andcovered 2.5% of gasoline sales on Eni’s retail network. Atyear end, service stations marketing BluSuper totaled 2,631 units(2,565 at December 31, 2007), covering approximately 60% ofEni’s network.

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In 2007, Eni launched its "You&Agip" promotionalcampaign, lasting 3 years, designed to boost customer loyalty tothe Agip brand. This three-year long initiative offers prizes tocustomers in proportion to purchases of fuels and convenienceitems at Agip’s stores as well as at the ones of certainpartners to the program. At every purchase of fuels orconvenience items, clients are granted a proportional amount ofpoints that are credited to a fidelity card. Clients are able todecide how to accumulate points and when to spend them. AtDecember 31, 2008, the number of customers that actively used thecard in the period amounted to over about 4 million. The averagenumber of cards active each month was over 3 million. Volumes offuel marketed under this initiative represented 46% of totalvolumes marketed on Eni’s service stations joining theprogram, and 44% of overall volumes marketed on Eni’snetwork.

In 2008, Eni revamped its "Iperself" promotionalcampaign, which provides a euro 0.06 discount per liter tocustomers purchasing fuel in self service stations during closinghours. Supported by other marketing activities this initiativeallowed to achieve higher sales and a higher market share inretail marketing even in an environment characterized by a steepdecline in domestic demand.

Eni plans to strengthen its competitive positioning in Italyby upgrading its outlets. Management targets to expand its sharein the domestic retail market for fuels by 2012 from the 2008level of 30.6%. Planned actions are designed to attain Europeanstandards of quality and services, leveraging on innovativemarketing initiatives aimed at strengthening clients loyalty,develop the offer of premium products and develop innovative nonoil formats. A strong focus will be devoted to pursue high levelsof operating efficiency. In the next four years, Eni planscapital expenditures for the construction, upgrading andrestructuring of its plants, increasing the number of"Iperself" and fully automated service stations as wellas complying with applicable environmental standards andregulations.

By 2012, Eni expects to achieve volumes of approximately 11.4billion liters sold (approximately 11 billion liters in 2008)with a retail network composed of 4,451 service stations, ofwhich 75% owned.

 

> 
***Retail Sales in the Rest of Europe***

In recent years, Eni’s strategy focused on selectivelygrowing its market share, particularly by means of acquiringvaluable assets in European areas with interesting profitabilityperspectives. In implementing its growth strategy, Eni has beenable to leverage on synergies ensured by the proximity of thesemarkets to Eni’s production and logistic facilities, brandawareness and economies of scale.

Growth outside Italy will continue to be selective and aimedat strengthening Eni’s competitive position in key markets.

In 2008 retail sales of refined products marketed in the restof Europe (3.86 mmtonnes) was down 170 ktonnes from 2007, or4.2%, mainly in the Iberian Peninsula, due to the disposal ofdownstream activities to Galp, and in Germany. These decreaseswere partly offset by higher sales in the Czech Republic, Hungaryand Slovakia due to the purchase of assets made in the fourthquarter of 2007.

At December 31, 2008, Eni’s retail network in the rest ofEurope consisted of 1,547 units, a decrease of 503 units fromDecember 31, 2007 (2,050 service stations). The network evolutionwas as follows: (i) divestment of 371 service stations in theIberian Peninsula to Galp; (ii) a negative balance ofacquisition/releases of leased service station was recorded (down135 units), with positive changes in Hungary and Switzerland andnegative ones in Germany; (iii) 17 low throughput servicestations were closed; (iv) purchased 15 service stations; and (v)opened 5 new outlets. Average throughput (2,577 kliters) wassubstantially in line with 2007.

The key markets of Eni’s presence are: Austria with a 7%market share, Hungary with 11.6%, Czech Republic with 11.4%,Slovakia with 10.2%, Switzerland with 6.4% and Germany with a3.8% on national base. These market shares were calculated by Enibased on public data on national consumption and Eni’s salesvolumes.

In 2008, management divested its retail and wholesalemarketing activities in the Iberian Peninsula following theexercise of a call option on part of Eni’s partner GalpEnergia (Eni’s share being 33.34%), in accordance with theagreement signed in December 2005 by the majority shareholders ofGalp Energia (in addition to Eni, Amorim Energia and Caixa Geralde Depósitos). The transaction includes 371 Agip-branded servicestations.

Growth outside Italy will continue to be selective and aimedat strengthening Eni’s competitive position in key markets,based on the competitive advantage provided by synergies insupply, logistics and brand awareness. Eni intends to focus onthe German, Swiss and Austrian markets where it targets toincrease its market share.

Non oil activities in the rest of Europe are carried out underthe CiaoAgip brand name in 1,032 service stations, of these 325are in Germany and 168 in France with a 67% coverage of thenetwork and a virtually complete coverage of owned stations.

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> 
***Other businesses***

*Wholesale*

Eni markets gasoline and other fuels on the wholesale marketin Italy, including diesel fuel for automotive use and forheating purposes, for agricultural vehicles and for vessels andfuel oil. Major customers are resellers, agricultural users,manufacturing industries, public utilities and transports, aswell as final users (transporters, condominiums, farmers,fishers, etc.).

Eni provides its customers with its expertise in the area offuels with a wide range of products that cover all marketrequirements. Along with traditional products provided with thehigh quality Eni standard, there is also an innovative lowenvironmental impact line, which includes AdvanceDieselespecially targeted for heavy duty public and private transports.Customer care and product distribution is supported by awidespread commercial and logistical organization presence allover Italy and articulated in local marketing offices and anetwork of agents and concessionaires.

In 2008 volumes marketed on the wholesale market in Italy,were approximately 11.15 mmtonnes up 0.06 mmtonnes from 2007, or0.5%, mainly reflecting an increase in market bunker consumptionon the and fuel oil sales. Sales volumes on wholesale marketsoutside Italy were 4.82 mmtonnes, up approximately 430 ktonnesfrom 2007, or 9.8%, mainly due to the growth in the Czech andSwiss markets, offset by declines in Spain, Austria, France andGermany.

Eni also markets jet fuel directly at 46 airports, of which 27in Italy. In 2008, these sales amounted to 2.4 mmtonnes (of which1.9 mmtonnes in Italy).

Eni is active also in the international market of bunkering,marketing marine fuel mainly in 40 ports, of which 23 are inItaly. In 2008 marine fuel sales were 2.4 mmtonnes (2.3 mmtonnesin Italy). Other sales were 21.36 mmtonnes of which 19.66mmtonnes referred to sales to oil companies and traders, and 1.70mmtonnes, supplies to the petrochemical sector.

> 
*LPG*

In Italy Eni is leader in LPG production, marketing and salewith 566 ktonnes sold for heating and automotive use (under theAgip brand and wholesale) equal to a 17.8% market share.Additional 234 ktonnes of LPG were marketed through otherchannels mainly to oil companies and traders.

LPG activities in Italy are supported by direct production,availability from 5 bottling plants and 4 owned storage sites, inaddition to products imported at coastal storage sites located inLivorno, Naples and Ravenna.

> 
*Lubricants*

Eni operates 7 (owned and co-owned) blending plants, in Italy,Europe, North and South America and the Far East. With a widerange of products composed of over 650 different blends, Enimasters international state of the-art know-how for theformulation of products for vehicles (engine oil, special fluidsand transmission oils) and industries (lubricants for hydraulicsystems, industrial machinery and metal processing).

In Italy Eni is leader in the manufacture and sale oflubricant bases. Base oils are manufactured primarily at Enirefinery in Livorno. Eni also owns one facility for theproduction of additives and solvents in Robassomero.

In 2008, retail and wholesale sales in Italy amounted to 125ktonnes with a 24.8% market share. Eni also sold approximately 5ktonnes of special products (white oils, transformer oil andanti-freeze fluids). Outside Italy sales amounted toapproximately 111 ktonnes, of these about 50% were registered inEurope (mainly Spain, Germany, and France).

> 
*Oxygenates*

Eni, through its subsidiary Ecofuel (Eni’s interest100%), sells approximately 2 mmtonnes/y of oxygenates mainlyethers (approximately 10% of world demand) and methanol(approximately 1.5% of world demand). About 72% of products aremanufactured in Italy in Eni’s plants in Ravenna, inVenezuela (in joint venture with Pequiven) and Saudi Arabia (injoint venture with Sabic), the remaining 28% is bought andresold.

In 2008 Eni started distributing bio-ETBE on the Italianmarket in compliance with the new legislation indicating theminimum content of bio-fuels. Bio-ETBE is a kind of MTBE thatgained a relevant position in the formulation of gasoline in theEuropean Union, due to the fact that it is produced from ethanolfrom agricultural crops and qualified as bio-component in theEuropean directive on bio-fuels. World market for ETBE iscurrently limited to the European Union and Japan and in 2008 wasestimated to amount to 2.2 mmtonnes.

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> 
***Capital Expenditures***

See "Item 5 – Liquidity and Capital Resources –Capital Expenditures by Segment".

 

 

**Engineering & Construction**

Eni operates in engineering, construction and drilling bothoffshore and onshore for the oil & gas industry throughSaipem, a subsidiary listed on the Italian Stock Exchange(Eni’s interest is 43%). Saipem boasts a strong position inthe relevant market leveraging on technological and operationalskills mainly in frontier areas, harsh environments and complexprojects, as well as on engineering and project managementcapabilities and ownership or availability of necessarytechnologies and also on its integration with Snamprogetti. Inspite of a weaker scenario in the oil industry worldwide and theuncertainty of the changed economic context, Saipem plans tocontinue consolidating its position in onshore and offshoremarkets, completing the expansion of its construction anddrilling fleet.

Saipem plans to achieve these objectives implementing thefollowing strategic guidelines: (i) to maximize the efficiency inall business areas with the aim in particular to maintain topexecution and security standards, optimize the utilization rateof the fleet, preserve competitive supply costs and increasestructure flexibility in order to mitigate the effects ofnegative business cycles; (ii) to consolidate the Company’scompetitive position in large offshore and onshore projects forthe development of hydrocarbon fields strengthening at the sametime its market share in the strategic segments of deepwater,FPSO, heavy crude upgrading and gas monetization; (iii) topromote local content in terms of employment of local contractorsand assets in strategic countries where large projects arecarried out supporting the development of delocalized logistichubs and construction yards when requested by clients in order toachieve a long-term consolidation of its market position in thosecountries; (iv) to leverage on the capacity to execute internallymore phases of large projects on an EPC and EPIC basis, pursuingbetter control of costs and terms of execution adapting withflexibility to clients’ needs, thus expanding theCompany’s value proposition; and (v) to complete theexpansion and revamping program of its construction and drillingfleet in order to confirm the Company’s leading position inthe segment of complex projects with high profitability.

Saipem expects to invest approximately euro 3.9 billion overthe next four years to further expand the geographical reach andoperational features of its fleet as well as to support theactivities related to the execution of projects in portfolio andthe acquisition of new orders.

Orders acquired in 2008 amounted to euro 13,860 million, ofthese projects to be carried out outside Italy represented 94%,while orders from Eni companies amounted to 4% of the total.Order backlog was euro 19,105 million at December 31, 2008 (euro15,390 million at December 31, 2007). Projects to be carried outoutside Italy represented 98% of the total order backlog, whileorders from Eni companies amounted to 13% of the total.

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

| **Orders acquired and breakdown by business**      |   | (euro million) |   | **11,172** |   | **11,845** |   | **13,860** |
|----------------------------------------------------|--------|----------------|--------|------------|--------|------------|--------|------------|
| Offshore        construction                       |   |           |   | 3,681      |   | 3,496      |   | 4,381      |
| Onshore construction                               |   |           |   | 4,923      |   | 6,070      |   | 7,522      |
| Offshore        drilling                           |   |           |   | 2,230      |   | 1,644      |   | 760        |
| Onshore drilling                                   |   |           |   | 338        |   | 635        |   | 1,197      |
| Originated        by Eni companies                 |   | (%)            |   | 24         |   | 16         |   | 4          |
| To be carried out outside Italy                    |   | (%)            |   | 91         |   | 95         |   | 94         |
| **Order        backlog and breakdown by business** |   | (euro million) |   | **13,191** |   | **15,390** |   | **19,105** |
| Offshore construction                              |   |           |   | 4,283      |   | 4,215      |   | 4,682      |
| Onshore        construction                        |   |           |   | 6,285      |   | 7,003      |   | 9,201      |
| Offshore drilling                                  |   |           |   | 2,247      |   | 3,471      |   | 3,759      |
| Onshore        drilling                            |   |           |   | 376        |   | 701        |   | 1,463      |
| Originated by Eni companies                        |   | (%)            |   | 20         |   | 22         |   | 13         |
| To be        carried out outside Italy             |   | (%)            |   | 90         |   | 95         |   | 98         |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

> 
***Business areas***

*Offshore construction*

Saipem is well positioned in the market of large, complexprojects for the development of offshore hydrocarbon fieldsleveraging on its technical and operational skills, supported bya technologically-advanced fleet, the ability to operate incomplex environments, and engineering and project managementcapabilities acquired on the marketplace over recent years.Saipem intends to consolidate its market share strengthening itsEPIC oriented 

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business model and leveraging on its satisfactory long-termrelationships with the major oil companies and National OilCompanies ("NOCs"). Higher levels of efficiency andflexibility are expected to be achieved by outsourcing themanagement of EPC projects and non core engineering activities incost efficient areas reaching economies of scale in itsengineering hubs and employing local resources in contexts wherethis represents a competitive advantage, directly managingoffshore construction processes through the creation of a largeconstruction yard and revamping/upgrading its construction fleet.Over the next years, Saipem will invest in the upgrading of itsfleet, by building a pipelayer, a field development ship fordeepwater and other supporting assets for offshore activity.

Saipem’s offshore construction fleet is made up of 28vessels and 45 robotized vehicles able to perform advancedsub-sea operations. Its major vessels are: (i) the Saipem 7000semi-submersible dynamic positioned vessel, with 14 ktonnes oflift capacity, capable to lay pipelines using the J-lay techniqueto the maximum depth of 3,000 meters; (ii) the Saibos FDS for thedevelopment of underwater fields in dynamic positioning, providedwith cranes lifting up to 600 tonnes and a system for J-lay pipelaying to a depth of 2,000 meters; (iii) the Castoro 6semi-submersible vessel, capable of laying pipes in waters up to1,000 meters deep; (iv) the Saipem 3000 multifunction vessel forthe development of hydrocarbon fields, able to lay rigid andflexible pipes and provided with cranes capable of lifting over 2ktonnes; and (v) the Semac semi-submersible vessel used for largediameter underwater pipe laying. The fleet also includes remotelyoperated vehicles (ROV), highly sophisticated and advancedunderwater robots capable of performing complex interventions indeep waters.

The most significant orders awarded in 2008 in Offshoreconstruction were: (i) a contract on behalf of Nord Stream AG forlaying the Nord Stream gas pipeline constituted by a twin naturalgas pipeline that will link Russia and Germany across the BalticSea. Overall capacity of about 55 BCM/y will be reached when bothlines are operational; (ii) an EPIC contract on behalf of ElfPetroleum Nigeria Ltd (Total) for the construction andinstallation of underwater pipelines and related facilitiesconnecting the Usain offshore oil field to an FPSO unit (FloatingProduction Storage Offloading); and (iii) a contract on behalf ofOLT Offshore LNG Toscana for the FSRU (Floating, Storage andRegasification Unit) of the LNG terminal of Livorno through theconversion of a gas carrier ship moored offshore Tuscany into afloating, storage and regasification unit. The FSRU will have astorage capacity of 137 KCM of LNG and a production capacity of3.75 BCM/y of natural gas.

> 
*Onshore construction*

Saipem operates in the construction of plants for hydrocarbonproduction (extraction, separation, stabilization, collection ofhydrocarbons, water injection) and treatment (removal andrecovery of sulphur dioxide and carbon dioxide, fractioning ofgaseous liquids, recovery of condensates) and in the installationof large onshore transport systems (pipelines, compressionstations, terminals). Saipem intends to capture opportunitiesarising from the market, both in the plants and pipeline segment,by leveraging on its solid competitive position in the strategicareas of Middle East/Caspian Area, North and West Africa andRussia. In 2008, leveraging on its distinctive know-how in thegas monetization segment, Saipem has been awarded for the firsttime the role of main contractor for the construction of a largegas liquefaction plant in Algeria, asserting its reputation as anintegrated player, capable of managing large and complex turnkeyprojects in the high tech market of LNG.

The most significant orders awarded in 2008 in Onshoreconstruction were: (i) an EPC contract on behalf of Sonatrach forthe construction of a single-train gas liquefaction plant, with acapacity of 4.7 mmtonnes/y of LNG near the Algerian city ofArzew; (ii) an EPC contract on behalf of Saudi Aramco for theconstruction of three gas/oil separation trains (GOSP, Gas OilSeparation Process) as part of the Manifa Field DevelopmentProgram to increase the production capacity of Saudi Arabia by900 BBL/d; (iii) an EPC contract on behalf of Sonatrach for theconstruction of three LPG production trains with a total capacityof 8 mmCM/d as part of the development of the Hassi Messaoudfield in Algeria; and (iv) an EPC contract on behalf of TotalExploration and Production Nigeria Ltd for the upgrade of OML 58Block through the revamping of the existing Flow Station and theconstruction of a new gas treatment train in order to increasegas production to 17.5 mmCM/d.

> 
*Offshore drilling*

Saipem is the only engineering and construction contractorthat provides also offshore and onshore drilling services to oilcompanies. In the offshore drilling segment Saipem mainlyoperates in West Africa, North Sea, Mediterranean Sea and MiddleEast and boasts significant market positions in the most complexsegments of deep and ultra-deep offshore, leveraging on theoutstanding technical features of its drilling platforms andvessels, capable of drilling exploration and development wells ata maximum depth of 9,200 meters. In order to better meet industrydemands, Saipem is finalizing an upgrading program of itsdrilling fleet providing it with state-of-art rigs to enhance itsrole as high quality player capable of operating also in complexand harsh environments. In particular, over the next four yearsSaipem intends to build: (i) the Scarabeo 8 and 9, new generationsemi-submersible platforms, to be employed in drilling operationsin the deep-water of the Barents Sea and in the Gulf of Mexico,respectively, initially on behalf of Eni’s upstreamactivity; (ii) the Perro Negro 6 jack-up to conduct operations inshallow waters; and (iii) the new S12000 drilling ship to performoperations in West Africa on behalf of Total. In parallel,significant investments are planned to keep up the productioncapacity of other fleet equipment (upgrade equipment to thecharacteristics of projects or to clients needs and purchase ofsupport equipment).

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Saipem’s offshore drilling fleet consists of 11 vesselsfully equipped for its primary operations and some drillingplants installed on board of fixed offshore platforms. One of itsmost important offshore drilling vessels is the Saipem 10000,designed to explore and develop hydrocarbon reservoirs operatingin excess of 3,000 meters water depth in full dynamicpositioning. The ship has a storage capacity of 140,000 BBL andis able to maintain a steady operating position without anchormoorings by means of 6 computerized azimuth thrusters, whichoffset and correct the effect of wind, waves and current in realtime. The vessel is operating in ultra deep waters (over 1,000meters) in West Africa. Other relevant vessels are Scarabeo 5 and7, third and fourth generation semi-submersible rigs able tooperate at depths of 1,900 and 1,200 meters of water,respectively. Average utilization of drilling vessels in 2008stood at 84.7% (94.7% in 2007).

The most significant contracts awarded in Offshore drilling in2008 included: (i) a 5-year extension of the contract for the useof the Scarabeo 7 semi-submersible platform in West Africa onbehalf of Eni; (ii) a 2-year extension of the contract for theuse of semi-submersible platform Scarabeo 3 in Nigeria on behalfof Addax Petroleum; and (iii) a 12-month contract extension forthe use of the Scarabeo 6 semi-submersible platform in Egypt onbehalf of Burullus Gas Co.

> 
*Onshore drilling*

Saipem operates in this area as main contractor for the majorinternational oil companies and NOCs executing its activitymainly in South America, Saudi Arabia, North Africa and, at alower extent, in Europe. In this areas Saipem can leverage on itsknowledge of the market, long-term relations with customers andsynergies and integration with other business areas. Saipemboasts a solid track record in remote areas (in particular in theCaspian Sea), leveraging on its own operational skills and itsability to operate in complex environments.

Average utilization of rigs in 2008 stood at 99% (99.6% in2007). The 73 rigs owned by Saipem at year end were located asfollows: 30 in Venezuela, 16 in Peru, 9 in Saudi Arabia, 7 inAlgeria, 3 in Kazakhstan, 3 in Brazil, 2 in Italy, 1 in Ecuador,1 in Colombia and 1 in Egypt.

The most significant orders awarded in 2008 in Onshoredrilling were: (i) contracts on behalf of various oil companiesfor the lease of 17 rigs with an average contract duration offive years; and (ii) contracts on behalf of various oil companiesfor the lease of 32 rigs, of which 13 new ones, in South America(mainly in Venezuela and Peru) and Ukraine. The average contractduration was one year for the existent rigs and five years forthe new ones.

 

> 
***Capital Expenditures***

See "Item 5 – Liquidity and Capital Resources –Capital Expenditures by Segment".

 

 

**Petrochemicals**

Eni operates in the businesses of olefins and aromatics, basicand intermediate products, polystyrene, elastomers andpolyethylene. Its major production sites are located in Italy andWestern Europe.

Eni’s strategy in its petrochemical business is toeffectively and efficiently manage operations in order to lowerthe break-even considering the volatility of costs of oil-basedfeedstock and the commoditized feature of Eni’s mainproducts. In fact, Eni’s profitability in the petrochemicalbusinesses is particularly sensitive to movements in productmargins that are mainly affected by changes in oil-basedfeedstock costs and the speed at which product prices adjust tohigher oil prices, also considering the cyclical nature ofdemand. See "Item 3 – Risk factors". The Companydoes not expect to incur significant amount of expenditures todevelop this business. In future years, management forecast ayearly level of expenditures in line with 2008 mainly targeted toupgrade plant efficiency, execute de-bottlenecking interventionsand to comply with all applicable regulations on environment,health and safety issues.

In 2008 sales of petrochemical products (4,684 ktonnes)decreased by 829 ktonnes from 2007, down 15%, in all businessareas as a result of lower petrochemical demand for petrochemicalproducts, due to a negative market scenario.

Petrochemical production (7,372 ktonnes) decreased by 1,423ktonnes from 2007, or 16.2%. In a context of economic downturn,the steep decline in unit margins and sales determined unexpectedoutages of some plants, in particular in the last part of theyear.

Nominal production capacity decreased by approximately 2percentage points from 2007, due to the shutdown of the Gelacracker. The average plant utilization rate calculated on nominalcapacity decreased by 12 percentage 

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points from 80.6% to 68.6%, due to the current economicdownturn that entailed reductions in production in all mainplants.

Approximately 49.5% of total production was directed toEni’s own productions cycle (48.9% in 2007). Oil basedfeedstock supplied by Eni’s Refining & Marketing segmentcovered 24% of requirements (21% in 2007).

Prices of Eni’s main petrochemical products increased onaverage by 7%, increasing in the business of: (i) olefins(up 13%) with increases in all products; (ii) elastomers (up10%), in particular polybutadienic and nytrilic rubbers; and(iii) polyethylene (up 5%), in particular EVA. However, theseprices increases did not made for higher purchase costs ofoil-based feedstock (virgin naphtha was up 17.3% in dollar terms,9.3% in euro), particularly until September, and as a resultproduct margins significantly decreased from a year ago.

The table below sets forth Eni’s main petrochemicalproducts availability for the periods indicated.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(ktonnes)** |
|--------|---------------|

| Olefins                             |   | 2,950     |   |   | 3,490     |   |   | 2,819     |   |
|-------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|
| Aromatics                           |   | 772       |   |   | 938       |   |   | 767       |   |
| Intermediates                       |   | 553       |   |   | 1,260     |   |   | 977       |   |
| Styrene                             |   | 1,088     |   |   | 1,117     |   |   | 1,018     |   |
| Elastomers                          |   | 457       |   |   | 515       |   |   | 494       |   |
| Polyethylene                        |   | 1,252     |   |   | 1,475     |   |   | 1,297     |   |
| **Total production**                |   | **7,072** |   |   | **8,795** |   |   | **7,372** |   |
| Consumption        of monomers      |   | (2,488    | )      |   | (4,304    | )      |   | (3,652    | )      |
| Purchases and change in inventories |   | 692       |   |   | 1,022     |   |   | 964       |   |
|                                |   | **5,276** |   |   | **5,513** |   |   | **4,684** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

The table below sets forth Eni’s sales of mainpetrochemical products by volume for the periods indicated.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(ktonnes)** |
|--------|---------------|

| Olefins         |   | 1,699     |   |   | 1,797     |   |   | 1,423     |   |
|-----------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|
| Aromatics       |   | 530       |   |   | 514       |   |   | 420       |   |
| Intermediates   |   | 654       |   |   | 712       |   |   | 576       |   |
| Styrene         |   | 587       |   |   | 594       |   |   | 543       |   |
| Elastomers      |   | 412       |   |   | 447       |   |   | 433       |   |
| Polyethylene    |   | 1,394     |   |   | 1,449     |   |   | 1,289     |   |
| **Total sales** |   | **5,276** |   |   | **5,513** |   |   | **4,684** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

> 
*Olefins*

Olefins sales (1,423 ktonnes) decreased by 374 ktonnes from2007 (down 20.8%), penalized by a poorer market scenario thatnegatively affected product demand and lower productavailability. Main reductions were registered in sales ofethylene (down 30%), butadiene (down 30.3%) and propylene (down15%).

Olefins production (2,819 ktonnes) declined by 671 ktonnesfrom 2007, or 19.2%, due to the maintenance shutdown of thePriolo cracker, technical problems at the Brindisi and Dunkerqueplants, steep demand reduction and the shutdown of the Gelacracker.

> 
*Aromatics and intermediates*

Aromatics sales (420 ktonnes) decreased by 94 ktonnes from2007 (down 18.3%) due to lower demand for isomers (down 33%),mainly in the second part of the year. Intermediates sales (576ktonnes) decreased by 136 ktonnes from 2007 (down 19.1%) mainlydue to temporary shutdown of the Porto Torres cracker as a resultof the poorer market scenario that negatively affected demand.Main decreases were registered in phenol (down 30.6%) andcyclohexanone (down 6.4%).

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Aromatics production (767 ktonnes) decreased by 171 ktonnesfrom 2007 (down 18.2%) mainly due to the maintenance shutdown ofthe Priolo cracker and the temporary shutdown of the Porto Torresplant.

Intermediates production (977 ktonnes) decreased by 283ktonnes from 2007 (down 22.5%) mainly due to the shutdown ofPorto Torres plant.

> 
*Styrene and elastomers*

Styrene sales (543 ktonnes) declined by 51 ktonnes from 2007(down 8.6%). Sales reductions affected essentially compactpolystyrene (down 13%) and ABS/SAN (down 13.2%) due to lowerdemand. Increases in styrene (up 9.8%) and expanded polystyrene(up 5.6%) were due to higher product availability.

Elastomers sales (433 ktonnes) decreased by 14 ktonnes, or3.1%, due to a steep decline in demand in the last part of theyear, mainly in the automotive sector. Sales decreases wereregistered mainly in lattices (down 11%), NBR (down 9.5%) andpolybutadienic rubbers (down 4%). Increases recorded inthermoplastic rubbers (up 6.3%) and SBR (up 3.4%) were due tohigher product availability.

Styrene production (1,018 ktonnes) decreased by 99 ktonnes, or8.9%.

Elastomer production (494 ktonnes) decreased by 21 ktonnes(down 4.1%) due to maintenance shutdown of the Ravenna plant andunexpected outages of the Porto Torres and Ferrara plants.

> 
*Polyethylene*

Polyethylene sales (1,289 ktonnes) were down 160 ktonnes or11%, from 2007, reflecting mainly negative market conditions forLPDE (down 19.4%) and HDPE (down 11.4%).

Production (1,297 ktonnes) decreased by 178 ktonnes, or 12.1%,due to the maintenance shutdown of the Gela, Ragusa and Prioloplants and the temporary shutdown of Porto Torres and Dunkerqueplants reflecting lower demand. EVA production increased by 8%due to the fact that 2007 was impacted by the outage ofOberhausen plant.

 

> 
***Capital Expenditures***

See "Item 5 – Liquidity and Capital Resources –Capital Expenditures by Segment".

 

 

**Corporate and Other activities**

These activities include the following businesses:

| • |   | the "Other        activities" segment only encompasses results of        operations of Eni’s subsidiary Syndial which runs        minor petrochemical activities and reclamation and        decommissioning activities pertaining to certain        businesses which Eni exited in past years; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | the "Corporate and        financial companies" segment encompasses Eni        Corporate and certain Eni’s subsidiaries engaged in        treasury, finance and other general and business support        services. Eni Corporate is a department of the parent        company Eni SpA and performs Group strategic planning,        human resources management, finance, administration,        information technology, legal affairs, international        affairs and corporate research and development functions.        Through Sofid SpA, Eni International BV and Eni Insurance        Ltd, Eni carries out lending, factoring, leasing,        financing Eni’s projects around the world and        insurance activities, principally on an intercompany        basis. EniServizi, Eni Corporate University, AGI and        other minor subsidiaries are engaged in providing Group        companies with diversified services (mainly services        including training, business support, real estate and        general purposes services to Group’s companies). |

Management does not consider Eni’s activities in theseareas to be material to its overall operations.

 

> 
***Seasonality***

Eni’s results of operations reflect the seasonality indemand for natural gas and certain refined products used inresidential space heating, the demand for which is typicallyhighest in the first quarter of the year, which includes thecoldest months and lowest in the third quarter, which includesthe warmest months. Moreover, year-to-year comparability ofresults of operations is affected by weather conditions affectingdemand for gas and other refined products in residential spaceheating. In colder years that are characterized by lowertemperatures than historical 

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average temperatures, demand for gas and products is typicallyhigher than normal consumption patterns, and vice versa.

 

 

**Research and Development**

Technological research and innovation represent key factors inimplementing Eni’s business strategies. Eni’s effortsin technological innovation are primarily intended to developsuch technologies so as to meet the environmental issues andclimate change, to overcome limits in accessing to hydrocarbonresources, to strengthen partnerships with producing countriesand to develop renewable sources of energy.

Eni is committed to developing advanced upstream technologiesin frontiers areas with environmental and geological complexfeatures, reducing the costs of finding and recoveringhydrocarbons, upgrading heavy oils, monetizing stranded gas andprotecting the environment. Over the next four years, Eni plansto invest euro 1.1 billion to fund ongoing projects in Eni’sbusinesses as well as research in the field of renewable energywhich could result in potential break-through technologies.Particularly in the next four years Eni plans to fund euro 102million to "Along with Petroleum" program aimed atidentifying and developing research projects on the most advancedaspects of large scale use of renewable energy sources and energyefficiency.

In 2008, Eni’s expenditures on R&D amounted to euro217 million which were almost entirely expensed as incurred (euro208 million and euro 220 million in 2007 and 2006).

At December 31, 2008, a total of 1,098 people were employed inresearch and development activities.

In 2008, a total of 96 applications for patents were filed.

 

 

**Insurance**

Eni constantly assesses its exposure for the Italian andforeign activities that are mainly covered through the OilInsurance Ltd ("OIL"), a mutual insurance andreinsurance company that provides its members a broad coveragetailored to the specific requirements of oil and energycompanies. Eni makes use of a captive insurance company thatcovers the risks and implements Eni’s Worldwide InsuranceProgram re-insured with high quality securities in order tointegrate the terms and conditions of the OIL coverage.

An insurance risk manager works in close contact with managersdirectly involved in core business activities in order toevaluate potential risks and their financial impact on the Group.This process allows Eni to define a constant level of riskretention and, conversely, the amount of risk to be transferredto the market.

The level of insurance maintained by Eni is generallyappropriate for the risks of its businesses.

 

 

**Environmental Matters**

> 
***Environmental Regulation***

Eni is subject to numerous EU, international, national,regional and local environmental, health and safety laws andregulations concerning its oil and gas operations, products andother activities, including legislation that implementsinternational conventions or protocols. In particular, these lawsand regulations require the acquisition of a permit beforedrilling for hydrocarbons may commence, restrict the types,quantities and concentration of various substances that can bereleased into the environment in connection with exploration,drilling and production activities, limit or prohibit drillingactivities on certain protected areas, provide for measures to betaken to protect the safety of the workplace and health ofcommunities affected by the company’s activities, and imposecriminal or civil liabilities for pollution resulting from oil,natural gas, refining and petrochemical operations. These lawsand regulations may also restrict emissions and discharges tosurface and subsurface water resulting from the operation ofnatural gas processing plants, petrochemical plants, refineries,pipeline systems and other facilities that Eni owns. In addition,Eni’s operations are subject to laws and regulationsrelating to the production, handling, transportation, storage,disposal and treatment of waste materials. Environmental laws andregulations have a substantial impact on Eni’s operations.Some risk of environmental costs and liabilities is inherent incertain operations and products of Eni, and there can be noassurance that material costs and liabilities will not beincurred.

A brief description of major environmental laws impactingEni’s activities located in Italy and Europe is outlinedbelow.

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> 
**Italy**

On April 29, 2006, Legislative Decree No. 152/2006"Environment Regulation" came into force. This wasdesigned to rationalize and coordinate the whole regulation ofenvironmental matters by setting:

| • |   | procedures for Strategic        Environment Assessment (SEA), Environmental Impact        Assessment (EIA) and Integrated Pollution Prevention and        Pollution Control (IPPC); |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | procedures to preserve soil,        prevent desertification, effectively manage water        resources and protect water from pollution; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | procedures to effectively        manage waste and remediate contaminated sites;                                                          |
| • |   | air protection and reduction        of atmospheric pollution; and                                                                        |
| • |   | environmental liability.                                                                                                                 |

The most important changes introduced by the Decree regardedreclamation and remediation activities as this Decree provided asite-specific risk-based approach to determine objectives ofreclamation and remediation projects, cost-effective analysisrequired to evaluate remediation solutions, criteria for wasteclassification.

The Decree 152/2006 was amended by two subsequent decrees:Legislative Decrees 284/2006 and 4/2008; the latter introducedimportant changes regarding SEA and EIA procedures, landfill,waste and remediation. A principle of waste hierarchy wasintroduced along with definition of by-product and secondary rawmaterials.

The most important aspects of these regulations to Eni arethose regulating permits for industrial activities, wastemanagement, remediation of polluted sites, water protection andenvironmental liability.

On April 9, 2008, Legislative Decree No. 81/2008"Implementation of Article 1 of Law 123/2007, in matter ofprotection of the health and the security on the workingplaces" came into force. This was designed to rationalizeand coordinate working environments, the equipments and theIndividual Protection Devices, the physical agents (noise,mechanical vibrations, electromagnetic fields, opticalradiations, etc.), the dangerous substance (chemical agents,carcinogenic substances, etc.), the biological agents andexplosive atmosphere, the system of signs, the video terminals.

In 2008 Eni worked on the implementation of the generalframework regulations on health and safety contained in thisLegislative Decree No. 81/2008, developing all laws andregulations concerning prevention and protection of workers atnational and European level to be applied for all kinds ofworkers and employees.

At European level Eni continued its work for applying theREACH Regulation (Registration, Evaluation, Authorization andRestriction of Chemicals, EC Regulation No. 197/2006).

The complexity and range of situations where Eni is operatingimposed the definition and application of principles forconsolidating its performance in health and prevention. To thisend Eni upholds:

| • |   | clear policies;                                                 |
|--------|--------|-----------------------------------------------------------------|
| • |   | an ethical code;                                                |
| • |   | endorsement of international        conventions and principles; |
| • |   | guidelines and procedures;        and                           |
| • |   | sharing of knowledge.                                           |

> 
**European Union**

On January 23, 2008 the European Commission put forward afar-reaching package of proposals that will deliver on theEuropean Union’s ambitious commitments to fight climatechange, promote renewable energy and increase energy security(new Energy Policy for Europe - EPE, so called "20-20 by2020"). In December 2008 the European Parliament and Councilreached an agreement on the package.

The EU is committed to reducing its overall emissions to atleast 20% below 1990 levels by 2020, and is ready to scale upthis reduction to as much as 30% under a new global climatechange agreement when other developed countries make comparableefforts. It has also set itself the target of increasing theshare of renewables in energy use to 20% by 2020.

Central to the strategy is a strengthening and expansion ofthe Emissions Trading System (EU ETS), the EU’s key tool forcutting emissions cost-effectively. Emissions from the sectorscovered by the system (energy and manufacturing industries) willbe cut by 21% by 2020 compared with levels in 2005. A singleEU-wide cap on ETS emissions will be set, and free allocation ofemission allowances will be progressively replaced by auctioningof allowances by 2020.

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Emissions from sectors not included in the EU ETS – suchas transport, housing, agriculture and waste – will be cutby 10% from 2005 levels by 2020. Each Member State willcontribute to this effort according to its relative wealth, withnational emission targets ranging from -20% for richer MemberStates to +20% for poorer ones.

The Directive sets legally binding targets for each MemberState, in order to reach the EU target of a 20% share ofrenewable energy in 2020. It creates cooperation mechanisms sothat the EU can achieve the targets in a cost effective way. Italso includes a flat 10% target for renewables in transport(biofuels, "green" electricity, etc.); this legislationalso sets out sustainability criteria that biofuels will have tomeet to ensure they deliver real environmental benefits.

The package also seeks to promote the development and safe useof Carbon Capture & Storage (CCS), a suite of technologiesthat allows the carbon dioxide emitted by industrial processes tobe captured and stored underground where it cannot contribute toglobal warming. The reinforced carbon market will provide along-term incentive for investment, while up to 300 millionallowances in the new entrants reserve under the EU ETS will bemade available to stimulate the construction and operation of upto 12 commercial demonstration CCS projects, and for innovativerenewable energy demonstration technologies in the EU.

The fuel quality Directive will place an obligation onsuppliers to reduce greenhouse gases from the entire life cycleof the fuel 6% by 2020, mostly by an increased use of biofuels. Areview in 2012 will consider increasing the target to 10%,through the inclusion of international projects, carbon captureand storage as well as electricity for cars.

Also a new regulation was approved to set emissions standardsfor new passenger cars, which is an important tool to assistMember States in meeting their emissions targets in the non-ETSsectors. It will set binding emissions targets to ensure thatemissions from the new car fleet will be reduced to an average of120g CO2/km by 2015, including the effect of the FuelQuality Directive, then decreasing to a stringent long-termtarget of 95g CO2/km by 2020.

On January 29, 2008, the new IPPC (Integrated PollutionPrevention and Control) Directive 2008/1/EC was published in theOfficial Journal of the European Union No. 24. Therefore, fromFebruary 18, 2008, the new IPPC directive repeals the Directive96/61/EC with its successive amendments. This directiverationalizes all existing regulations on this issue, confirmingthe achievement of high levels of environmental protection to beof primary importance to member states.

According to the IPPC Directive, the Member States of the EUhave to communicate their national values of emissions into theatmosphere, wastes produced and managed and discharges ofcompounds into waste. The European Commission published inOfficial Journal of European Union, May 16, 2007 (2007/C 110/01)the definitive replacement of the European Pollutant EmissionRegister (EPER) by the European Pollutant Release and TransferRegister (E-PRTR), published in 2006 (Regulation No. 166/2006).In 2008 Italian legislation already required from the IPPC siteowners to account and report environmental data related to 2007according to PRTR Register as requested by the Regulation.

Eni is implementing an Integrated Environmental InformationSystem, able to gather, manage and report the data on all thepollutants released and off-site transferred as requested by PRTRRegulations.

On December 21, 2007, the European Commission published itsproposal of directive on Industrial Emissions. In view of thegeneral call for "better regulation", the draftincorporates the reviews of six sector-specific directives (IPPC,Large Combustion Plants, VOC - Volatile Organic Compounds -emissions, incineration of waste and titanium industry). Theproposed directive intends to enforce BAT definition, togetherwith a tightening of current minimum emission values in somesectors. The directive extends the scope of the IPPC directive tocover certain activities (e.g. combustion plants between 20 and50 MW). The new proposal introduces also more robust monitoringand inspections on installations, the review of permit conditionsand the reporting of compliance.

On November 22, 2008, the new Directive on waste (Directive2008/98/EC) was published in the Official Journal of the EuropeanUnion. The new Directive simplifies the existing legislativeframework by clarifying definitions, streamlining provisions andintegrating the directives on hazardous waste (91/689/EEC) and onwaste oils (75/439/EEC). The Directive introduces a life-cycleapproach, focuses on waste policy by improving the way ofresources consumption. The scope is to improve the recyclingmarket by setting environmental standards, specifying under whichconditions certain recycled waste are no longer considered such.The Directive requires that Member States take appropriatemeasures to encourage the prevention or reduction of wasteproduction and its harmfulness. This can be done by a combinationof several strategies. Especially mentioned are the developmentof clean technologies, the technical development and marketing ofproducts designed so to contribute as little as possible toincreasing the amount of waste. The Directive also sets newrecycling targets.

Core of the Directive is the introduction of a wastemanagement hierarchy. This hierarchy is as follows: 1. Wasteprevention, 2. Re-use, 3. Recycling, 4. Recovery (includingenergy recovery), 5. Disposal.

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Moreover the Directive bolsters the importance of the extendedproducer responsibility in the future waste management measures.

The Member States will have to transpose this Directive intonational legislation until December 12, 2010.

 

> 
***HSE Activity for the Year 2008***

Eni is committed to continuously improve its model formanaging health, safety and environment across all its ownoperational activities in order to minimize risks associated withits industrial activities, ensure reliability of its industrialoperations and comply with all applicable regulations.

In 2008, Eni’s business units continued to obtaincertifications of their management systems, industrialinstallations and operating units according to the most stringentinternational standards.

In 2008, the total number of certifications obtained was 329(248 in 2007), of which 123 certifications according to the ISO14001 standard, 11 certifications according to the EMASregulation (EMAS is the Environmental Management and Audit Schemerecognized by the European Union) and 51 according to the OHSAS18001 standard (Occupational Health and Safety management Systems- requirements).

*Environment*. In 2008, Eni incurred total expendituresamounting to euro 1,081 million for the protection ofenvironment, up 1.7% from 2007. Current environmental expensesdecreased by approximately 9% from 2007, and mainly related tocosts incurred with respect to remediation and reclamationactivities, carried out mainly in Italy. Capitalizedenvironmental expenditure increased by 22% and mainly related tosoil and subsoil protection, water management and air emissions.

*Safety*. The safety of Eni’s employees, of itscontractors and the one of the people living in the area whereits activities and assets are located, is of fundamentalimportance to the Company.

As to safety regulations, in 2008 the Legislative Degree No.81/2008 on health and safety in workplaces came into force. Thisdecree meaningfully increases the responsibility of companies forviolating applicable laws regulating safety at work, thenrequiring more severe controls by supervisors and managers.

Eni’s safety strategy is based on:

| • |   | the improvement and        dissemination of a safety culture through all levels of        its organization;                                                                                |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | a comprehensive policy,        specific guidelines and proper management systems in line        with International standards and best practices; and                                       |
| • |   | a risk management system        with severe procedures for hazards identification and        risk analysis, prevention and mitigation, related to        process, products and operations. |

In 2008, the injury frequency rate was 1.45 and the injuryseverity rate was 0.05.

Cost incurred in 2008 to support the safety levels ofoperations and to comply with applicable rules and regulationswere euro 441 million, down 5.8% from 2007.

*Health*. Eni’s activities for protecting health aimat the continuous improvement of work conditions. Results havebeen achieved through:

| • |   | efficiency and reliability        of plants;                                                                                                                                                                                |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | promotion and dissemination        of knowledge, adoption of best practices and operating        management systems based on advanced criteria of        protection of health and internal and external        environment; |
| • |   | certification programs of        management systems for production sites and operating        units;                                                                                                                        |
| • |   | identified indicators in        order to monitor exposure to chemical and physical        agents;                                                                                                                           |
| • |   | strong engagement in health        protection for workers operating outside Italy,        identifying international health centers capable of        guaranteeing a prompt and adequate response to any        emergency;   |
| • |   | identification of an        effective organization of health centers, in Italy and        abroad; and                                                                                                                       |
| • |   | training programs for medics        and paramedics.                                                                                                                                                                         |

To protect the health and safety of its employees, Eni relieson a network of 332 health care centers located in is mainoperating areas. A set of international agreements with the bestlocal and international health centers ensures efficient servicesand timely responses to emergencies.

In 2008 Eni incurred a total expense of euro 68.6 million, up27.5% from 2007 to protect the health of its employees.

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> 
***Implementation of the Kyoto Protocol***

On February 16, 2005, the Kyoto Protocol entered into forceand, with it, the commitments of the Annex I Parties which haveratified the Protocol, including the EU and Italy. According toLaw No. 120/2002, Italy committed itself to reduce greenhouse gas(GHG) emissions by 6.5% in the period 2008-2012, as compared toGHG levels emitted in 1990. Reductions can be achieved throughboth internal measures and complementary initiatives. The latterinclude the so-called flexible mechanisms, which enables a Partyto carry out projects in developing countries (CDM - CleanDevelopment Mechanism) and in industrial countries withtransition economies (JI - Joint Implementation) in order toobtain emission credits to fulfill the Kyoto compliance.

Italy, as an EU Member State, is part of the EU EmissionTrading Scheme ("ETS") that was established byDirective 2003/87/EC. Effective from January 1, 2005, ETS is thelargest virtual market in the world for exchanging emissionallowances targeting industrial installations with high carbondioxide emissions.

As foreseen by the Directive, Italy has issued two NationalAllocation Plans (NAP) covering the periods 2005-2007 and2008-2012 which set out the allowances awarded to each sector andinstallation. Eni is part to the ETS. Moreover, Eni is active inthe utilization of the Kyoto Flexible Mechanisms. In fact, due toits presence in about 70 countries, Eni is an elective partnerfor carrying out CDM and JI projects thus contributing to theItalian program of greenhouse gas emissions reduction. InDecember 2003 during the Conference of Parties to the KyotoProtocol – COP9 – Eni and the Ministry of theEnvironment signed a Voluntary Agreement for using flexiblemechanisms, promoting CDM and JI and contributing to thesustainable development of host countries.

The ETS EU directive provides that each Member State shallensure that any operator who produces GHG emissions in excess ofthe amounts awarded based on national allocation plan, willprovide allowances to cover excess emissions a year later inaddition to pay a penalty. The excess emissions penalty shall beeuro 100 (euro 40 for the first period 2005-2007) for each tonneof carbon dioxide equivalent emitted. All companies are expectedto identify and carry out projects for emission reductions. Eniparticipates in the ETS scheme with 56 plants in Italy and 4outside Italy, which collectively represent about a third of allgreenhouse gas emissions generated by Eni’s plantsworldwide. In the whole period (2005-2007) Eni was entitled toallowances equal to 77.2 mmtonnes of carbon dioxide for existingand new installations (of which 25.7 mmtonnes of carbon dioxidefor 2007).

Based on the implementation of projects designed to reduceemissions, particularly the start-up of high efficiency combinedcycles for the cogeneration of electricity and steam, the amountof carbon dioxide emitted by Eni’s plants complied withmandatory limits in the whole period.

Management believes that a significant emission reduction canbe achieved in connection with oil and gas production activitiesoutside Italy, that in a number of cases, given lack of localmarket outlets, require the flaring of natural gas associated tooil production. The elimination of flaring and the use ofassociated gas for the development of local economies allowsustainable development while reducing greenhouse gas emissions.The validation of such projects as CDM and JI will provideemission credits and facilitate the achievement of the Italianreduction target, as set by the Kyoto Protocol. Eni alreadycarried out Zero Gas Flaring projects in Nigeria and Congo whileothers are underway.

In November 2006 the Nigerian Kwale-Okpai project has beenregistered as a CDM project. It regarded the construction of acombined cycle power station, which utilizes the associated gasto oil production formerly flared. More projects are beingassessed or implemented in Congo, Nigeria and Angola. Moreover,Eni endorsed the Global Gas Flaring Reduction Initiative of theWorld Bank, in order to fight for the elimination of obstacles tothe completion of gas flaring reduction projects.

The best solutions for compliance with the Kyoto Protocol arethe use of low emission energy sources and the adoption of highlyefficient technologies. To address the greenhouse gas challenge,Eni performed a detailed analysis for defining its strategy torespond to climate change and to participate in the Europeanemissions trading system, identifying a number of projects forenergy saving and emission reductions from its plants.

To ensure comprehensive, transparent and accurate accountingfor GHG emissions, which is consistent over time, Eni introducedin 2005 its own Protocol for the accounting and reporting ofgreenhouse gas emissions (GHG Accounting and Reporting Protocol),which is an essential requirement for emission certification.Indeed, accurate reporting will support the strategic managementof risks and opportunities related to greenhouse gases, thedefinition of objectives and the evaluation of progress.

For safer and more accurate management of GHG emissions andwith a view to supporting accounting, Eni provided all itsdivisions and business units with a dedicated database, in orderto gather and report GHG emissions according to the Protocol andto ensure completeness, accuracy, transparency and consistency ofGHG accounting as required by certification needs.

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As a support to its general strategy for a sustainablemanagement of greenhouse gases, Eni continued its programs forthe development of natural gas in Italy and outside Italy, bymeans of technologically advanced projects such as the BlueStream gas pipeline from Russia to Turkey and the GreenStreampipeline from Libya to Sicily. Increased gas availability inItaly will lead to a further expansion of the gas-powerintegration, through high efficiency combined cycles with muchlower carbon dioxide emissions than coal and liquid fuels.

In the medium-term, work is underway on the separation ofcarbon dioxide and its permanent storage in geologic reservoirs,a part of the CO2 Capture Project, an internationalR&D program carried out in conjunction with other oilcompanies. In the long-term, Eni is actively engaged in thepolitical process regarding future emission reductionregulations. In particular Eni is involved in bioenergy andbiofuels.

 

 

**Regulation of Eni’s Businesses**

> 
***Overview***

*The matters regarding the effects of recent or proposedchanges in Italian legislation and regulations or EU directivesdiscussed below and elsewhere herein are forward-lookingstatements and involve risks and uncertainties that could causethe actual results to differ materially from those in suchforward-looking statements. Such risks and uncertainties includethe precise manner of the interpretation or implementation ofsuch legal and regulatory changes or proposals, which may beaffected by political and other developments.*

 

> 
***Regulation of Exploration and Production Activities***

Eni’s exploration and production activities are conductedin many countries and are therefore subject to a broad range oflegislation and regulations. These cover virtually all aspects ofexploration and production activities, including matters such aslicense acquisition, production rates, royalties, pricing,environmental protection, export, taxes and foreign exchange. Theterms and conditions of the leases, licenses and contracts underwhich these oil and gas interests are held vary from country tocountry. These leases, licenses and contracts are generallygranted by or entered into with a government entity or statecompany and are sometimes entered into with private propertyowners. These arrangements usually take the form of licenses orproduction sharing agreements. See "Regulation of theItalian Hydrocarbons Industry" and "EnvironmentalMatters" for a description of the specific aspects of theItalian regulation and of environmental regulation concerningEni’s exploration and production activities.

Licenses (or concessions) give the holder the right to explorefor and exploit a commercial discovery. Under a license, theholder bears the risk of exploration, development and productionactivities and provides the financing for these operations.

In principle, the license holder is entitled to all productionminus any royalties that are payable in kind. A license holder isgenerally required to pay production taxes or royalties, whichmay be in cash or in kind. Both exploration and productionlicenses are generally for a specified period of time (except forproduction licenses in the United States which remain in effectuntil production ceases). The term of Eni’s licenses and theextent to which these licenses may be renewed vary by area.

In Product Sharing Agreement (PSAs), entitlements toproduction volumes are defined on the basis of contractualagreements drawn up with state oil companies which hold theconcessions. Such contractual agreements regulate the recover ofcosts incurred for the exploration, development and operatingactivities (cost oil) and give entitlement to a portion of theproduction volumes exceeding volumes destined to cover costsincurred (profit oil).

A similar scheme to PSAs applies to Service and"Buy-Back" contracts.

In general, Eni is required to pay income tax on incomegenerated from production activities (whether under a license orproduction sharing agreement). The taxes imposed upon oil and gasproduction profits and activities may be substantially higherthan those imposed on other businesses.

 

> 
***Regulation of the Italian Hydrocarbons Industry***

*The matters regarding the effects of recent or proposedchanges in Italian legislation and regulations or EU directivesdiscussed below and elsewhere herein are forward-lookingstatements and involve risks and uncertainties that could causethe actual results to differ materially from those in suchforward-looking statements. Such risks and uncertainties includethe precise manner of the interpretation or implementation ofsuch legal and regulatory changes or proposals, which may beaffected by political and other developments.*

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> 
***Exploration & Production***

The Italian hydrocarbons industry is regulated by acombination of constitutional provisions, statutes, governmentaldecrees and other regulations that have been enacted and modifiedfrom time to time, including legislation enacted to implement EUrequirements (collectively, the "Hydrocarbons Laws"). 

*Exploration permits and production concessions.*Pursuant to the Hydrocarbons Laws, all hydrocarbons existing intheir natural condition in strata in Italy or beneath itsterritorial waters (including its continental shelf) are theproperty of the State. Exploration activities require anexploration permit, while production activities require aproduction concession, in each case granted by the Ministry ofProductive Activities through competitive auctions. The initialduration of an exploration permit is six years, with thepossibility of obtaining two three-year extensions and anadditional one-year extension to complete activities underway.Upon each of the three year extensions, 25% of the area underexploration must be relinquished to the State. The initialduration of a production concession is 20 years, with thepossibility of obtaining a ten-year extension and an additionalfive-year extension until the field depletes.

*Royalties*. The Hydrocarbons Laws require the payment ofroyalties for hydrocarbon production. Royalties are equal to 7%and 4%, respectively, for onshore and offshore production of oiland 7% for both onshore and offshore production of natural gas. Abill of law is currently under review by the Italian Parliamentwhich provides for an increase of royalties on hydrocarbonproduction from the current rate of 7 to 10%. For the year 2009management expects that this provision would translate intohigher royalties amounting to approximately euro 20 million.

> 
*Storage of natural gas*

Storage activities in Italy are regulated by LegislativeDecree No. 164/2000 ("Decree No. 164"), which enactedthe European Directive on Natural Gas 98/30/CE into Italianlegislation. The most important aspects of Decree No. 164concerning storage activities are the following: (i) invertically integrated enterprises, storage is to be carried outby a separate company not operating in other gas activities (suchas Eni’s subsidiary Stoccaggi Gas Italia SpA) or bycompanies engaged only in transport and dispatching activities,provided the accounts of these two activities are clearlyseparated from the accounts of storage; (ii) storage activity isexercised pursuant to concessions granted by the Ministry ofProductive Activities. The duration of a concession is 20 years,with the possibility of obtaining at most two ten-year extensionsif operators complied with the storage programs and otherobligations deriving from applicable laws. Existing storageconcessions are subject to the Decree. Their original term wasconfirmed and includes relevant production concessions; (iii) theneed for strategic storage in Italy is defined explicitly; theburden of strategic storage is imposed upon companies importingfrom non-EU countries, which have to provide a strategic storagecapacity in Italy corresponding to 10% of the amount of naturalgas imported each year; (iv) holders of storage concessions arerequired to provide storage capacity for domestic production, forstrategic use and for modulation to eligible users withoutdiscriminations, where technically and economically viable; (v)modulation storage costs are charged to shippers which have toprovide modulation services adequate to the requirements of theirfinal customers; (vi) storage tariffs criteria are determined bythe Authority for Electricity and Gas in order to ensure a presetreturn on capital employed, taking into account the typical riskinherent in this activity, as well as volumes stored for ensuringpeak supplies and the need to incentive capital expenditure forupgrading the storage system; and (vii) the Authority forElectricity and Gas establishes the criteria and priority ofaccess storage operators have to include in their own storagecodes.

In compliance with the provisions of Article 21 of Decree No.164/2000, on October 21, 2001 all storage activities carried outwithin the Eni Group were conferred to Stoccaggi Gas Italia SpA("Stogit"), which holds ten storage concessions.

On March 3, 2006, the Authority for Electricity and Gas withResolution No. 50/2006 published the criteria for determiningstorage tariffs for a regulated period starting from April 1,2006 and ending on March 31, 2010.

According to this Resolution, the storage company calculatesrevenues for the determination of unit tariffs for storageservices by adding the following cost elements:

| (i)   |   | a return on the capital        employed by the storage company equal to 7.1% (8.33% in        the first regulated period); |
|-------|--------|----------------------------------------------------------------------------------------------------------------------------|
| (ii)  |   | depreciation and        amortization charges; and                                                                          |
| (iii) |   | operating costs.                                                                                                           |

In the years following the first year of the newly regulatedperiod, reference revenues are updated to take account ofvariations of capital employed and the impact of the indexationof depreciation charges and operating costs to consumer priceinflation lowered by a preset rate of productivity recovery.

Applicable regulation provides for incentives to capitalexpenditures intended to develop and upgrade storage capacity byrecognizing an additional rate of return of 4% on the basic rateto capital expenditure projects aiming at 

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developing new storage deposits and increasing existingcapacity. Such incentives are applicable for a sixteen-yearperiod and an eight-year period, respectively.

In November 2007, the Italian Authority for Electricity andGas and the Italian Antitrust Authority opened an inquiry to gaininsight into the functioning of the natural gas storage activityin Italy, particularly with regards to the lack of investments byoperators aimed at expanding natural gas storage capacity tostore natural gas in Italy. Eni, through its wholly-ownedsubsidiary Stogit Italia, owns nearly the entire storage capacitycurrently existing in Italy.

With Resolution No. 220/2006, the Italian Authority forElectricity and Gas approved the storage code proposed byStoccaggi Gas Italia on the basis of the framework and criteriaestablished by Resolution No. 119/2005 ("Adoption ofguarantees for free access to natural gas storage services,duties of subjects operating storage activities and rules for thepreparation of a storage code").

This code regulates access to and provision of storageservices during normal operational conditions, regulatesprocedures for conferring storage capacities, fees to be chargedto customers in case they uplift from or input to storage sitesvolumes in excess or uses higher input/uplift capacity withrespect to scheduled and operating programs. On the basis ofthese provisions, Eni may incur significant charges for storageservices should the Company fail to use storage services inaccordance with scheduled operating programs.

The code has been in force since November 1, 2006.

The storage company offers services according to an accesspriority established by the Italian Authority for Electricity andGas as follows:

| (i)  |   | mandatory services,        including modulation storage, mineral storage, and        strategic storage services; and |
|------|--------|----------------------------------------------------------------------------------------------------------------------|
| (ii) |   | services for operating needs        of transport companies, including hourly modulation.                             |

The modulation storage service is geared towards satisfyingmodulation needs of natural gas users in terms of peakconsumption and daily or seasonal trends in consumption. Finalclients consuming less than 200,000 CM on an annual basis areentitled to a priority when satisfying their modulationrequirements. To that end, the storage company makes availableits capacity for space, injection and off-take on an annual basisin accordance with its storage code.

The mineral storage service aims to allow natural gasproducers to perform their activity under optimal operatingconditions, according to criteria determined by the Ministry ofEconomic Development.

The strategic storage service aims to satisfy certainobligations of natural gas importers from countries not belongingto the EU in accordance with Article 3 of Legislative Decree No.164/2000. The relevant storage capacity dedicated to this serviceis determined by the Ministry of Economic Development.

Storage capacity is awarded by the storage company for periodsno longer than a thermal year by April 1, of each year. The firstrequests to be met are those for strategic storage and for theoperating balancing of the system. The residual capacityavailable and the maximum daily uplift capacity is awardedaccording to the following order of priority to: (i) holders ofproduction concessions requesting mineral storage services; (ii)natural gas selling operators who are held to provide amodulation service of their supply to their customers accordingto Article 18, paragraphs 2 and 3 of Legislative Decree No.164/2000, for maximum volumes corresponding to a seasonal demandpeak with average temperatures, on the terms and conditionsestablished by a procedure to be issued by the Authority forElectricity and Gas; (iii) to the entities mentioned in (ii)above only for those additional maximum volumes related to aseasonal demand peak in case of certain low temperatures measuredon a 20-year period, under the terms and conditions of theprocedure mentioned in (ii) above; and (iv) the entitiesrequesting access for services different from the ones mentionedabove.

Eni held natural gas for strategic reserve purposes in itsstorage business, as established by Decree No. 164. The strategicreserves of gas are defined as "stock destined to meetsituations of deficit/decrease of supply or crisis of the gassystem". The Ministry of the Economic Development determinesquantities and usage criteria of such reserves. As of December31, 2008 Eni held approximately 179 BCF of strategic reserves ofnatural gas (179 BCF at year end 2007).

 

> 
***Gas & Power***

*Natural gas market in Italy*

The European Directive on Natural Gas was implemented intoItalian legislation through Legislative Decree No. 164 of May 23,2000 ("Decree No. 164"), effective from June 21, 2000.As concerns natural gas activities carried out by Eni, the mostrelevant aspects of the decree are as follows:

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| (i)   |   | starting in 2003 all        customers are eligible customers (with access to the        natural gas system and free to choose their supplier of        natural gas);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|-------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii)  |   | Antitrust thresholds are in        place for gas operators in Italy as follows: (a)        effective January 1, 2002, operators are prohibited to        transmit into the national transport network imported or        domestically produced gas volumes higher than a preset        share of Italian final consumption. This share is 75% of        total final consumption in the first year of regulation        and then is to decrease by 2 percentage points per year        to reach a 61% threshold in terms of final consumption by        2009; and (b) effective January 1, 2003, operators are        prohibited to market gas volumes to final customers in        excess of 50% of overall volumes marketed to final        customers. Compliance with these ceilings is verified        yearly by comparing actual average shares obtained by any        operator in a given three-year period for both volumes        input and volumes marketed to customers with average        shares permitted by the law for the same period. Actual        shares are computed net of losses (in the case of sales)        and volumes of natural gas consumed in own operations.        Based on a bill passed by the Italian upper house, Eni        expects that these antitrust thresholds will be renewed        when they expire in 2010; |
| (iii) |   | natural gas transport and        dispatching activities have to be carried out by a        separate company that is not allowed to carry out any        other activity in the natural gas field, with the only        exception of storage, for which, however, accounting and        operating separation is envisaged. Also distribution,        which includes the transport of natural gas by means of        local gas pipeline networks for delivery to customers,        has to be carried out by a separate company which cannot        perform other gas related activities. Sales activity to        final customers is compatible only with import, export        and production activities and is subject to authorization        from the Ministry of Productive Activities. Concessions        for the distribution of natural gas will be awarded by        bid procedure; and                                                                                                                                                                                                                                                                                                                                                                                                                                                           |

| (iv) |   | tariff criteria and return        on capital employed for transport, dispatching, storage,        use of LNG terminals and distribution are determined by        the Authority for Electricity and Gas. Third parties are        allowed to access transport infrastructure, storage        sites, LNG terminals and distribution networks on a        regulated basis. As provided for by the decree, a Network        Code containing norms and regulations for the operation        of and access to infrastructure was prepared by operators        on the basis of criteria set by the Authority for        Electricity and Gas. |
|------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Year 2008 closed the fifth three-year regulated period fornatural gas volumes input in the domestic transport network, forwhich the allowed average percentage was 63% of domesticconsumption of natural gas, and the fourth three-year regulatedperiod for sales volumes to the Italian market. Eni’spresence on the Italian market complied with said limits.

> 
*Law No. 239 of August 23, 2004 on the restructuring of    the energy sector in Italy*

This law provides for:

| • |   | a derogation to third party        access granted to companies that make direct or indirect        investments for the construction of new infrastructure or        the upgrading of existing ones such as: (i)        interconnections between EU Member States and national        networks; (ii) interconnections between non-EU States and        national networks for importing natural gas to Italy;        (iii) LNG terminals in Italy; and (iv) underground        storage facilities in Italy. Investing companies can        obtain priority on the conferral of new capacity for a        portion of not less than 80% of the new capacity        installed and for a period of at least 20 years; and                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | paragraph 69 provides the        authentic interpretation of the rule introduced by        Legislative Decree No. 164/2000 concerning the        transitional regime of concessions for natural gas        distribution activities in urban centers existing at June        21, 2000, which allows for an anticipated repayment of        the distribution service, despite being provided through        a bid procedure rather than direct entitlements. This law        changes the provisions defined by Legislative Decree No.        164/2000 by: (i) extending to December 31, 2007, the        transitional period for the continuation of existing        concessions, with a possible extension of one further        year when public interest is considered important by        local authorities; and (ii) canceling the adding up of        possible extensions, as provided for by Legislative        Decree No. 164/2000, in case of certain conditions        (business restructuring, size parameters, shareholding        composition). The end of concessions awarded on the basis        of a bid procedure remains set at December 31, 2012. |

> 
*Law Decree No. 239/2003*

Law Decree No. 239/2003, converted with amendments into LawNo. 290/2003, prohibits companies operating in the natural gasand power industries to hold stakes higher than 20% in the sharecapital of companies owning and managing national networks forthe transmission of natural gas and power.

The term by which companies must comply with this provision,which was initially fixed at December 31, 2008, will bere-determined in 24 months after the effective date of saiddecree from the Italian Prime Minister. Currently, Eni is unableto predict that date.

In addition, on March 23, 2006 a Presidential Decree definedcriteria and methods for the divestment of the interest held byEni in Snam Rete Gas SpA, introducing the special powers of theMinistry of Economy and Finance 

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provided for by the regulations on the divestment of interestsheld by the Italian Government ("golden share") in theBy-laws of this company.

> 
*Increasing competition in the wholesale segment of    natural gas and power*

In order to implement the Law Decree defined by the ItalianGovernment to face the economic downturn, on March 2009, theAuthority for Electricity and Gas proposed certain rules on gasand power sales and production to increase competition on theItalian market.

The new rule is aimed at increasing competition on thewholesale segment in Italy, both in the natural gas market andthe electricity one. The Authority for Electricity and Gas willdefine a certain amount of quantities of gas to be sold at afixed price. The main operator in the Italian gas market will beobliged to offer this set amount of natural gas. In particular,from October 1 to March 31 of each year, starting from 2009, themain operator is obliged to offer about 100 mmCM per day and 20mmCM per day from April 1 to September 30. This rule should limitthe discretionarily of the main operator in defining higherprices of natural gas and on the other side to increase liquidityof the natural gas market in Italy.

> 
*Natural gas prices*

Prices of natural gas sold to industrial and thermoelectriccustomers as well as to wholesalers are freely established amongbuyers and sellers following the liberalization of the naturalgas sector introduced by Decree No. 164. Notwithstanding this,the Authority for Electricity and Gas holds a power ofsurveillance on this matter (see below) under Law No. 481/1995(establishing the Authority for Electricity and Gas) andLegislative Decree No. 164/2000.

Furthermore, the Authority is entrusted with the power ofregulating natural gas prices to residential and commercialcustomers which were not eligible customers until December 31,2002.

In fact, the Presidential Decree dated October 31, 2002entrusted the Authority for Electricity and Gas with the power todefine, calculate and update gas selling prices for customers whowere not-eligible customers until December 31, 2002, also afterthe opening up of the gas markets from January 1, 2003,additionally targeting the public goal of containing inflationarypressure deriving from increasing energy costs. Consistently withthis decree, the Authority for Electricity and Gas: (i) withDecision No. 195 of November 29, 2002 changed the methods forperiodically updating selling prices for natural gas inconnection with changes in international prices of crude oil andrefined products. Such changes regarded the scheduled updateprocess (from every two months to every three), and the durationof the reference period for the calculation of changes in averageinternational prices as compared to the first application quarter(changes are calculated with reference to a nine-month periodpreceding the update). The invariance threshold, beyond whichtariffs are updated, remained at 5%; and (ii) with Resolution No.207 of December 12, 2002, it decided that companies sellingnatural gas through local networks have to maintain theconditions applied to non-eligible customers until December 31,2002 until the customer accepts a new contract offer. Inaddition, the Authority for Electricity and Gas decided thatthese companies can propose their own new contract offers and thetariffs determined according to the criteria established by theAuthority for Electricity and Gas, adequately advertising thembefore March 31, 2003 (such offers must be published on thecompanies web page, on at least one newspaper of generalcirculation and on the Gazzetta Ufficiale of their region orautonomous province).

> 
*Changes introduced to the indexation mechanism of the    raw material component in supplies to residential customers    by the Authority for Electricity and Gas: Resolutions No.    248/2004; 134/2006 and 79/2007*

With Resolution No. 79/2007 the Italian Authority forElectricity and Gas established a new indexation mechanism forthe raw material cost component in natural gas supplies tocustomers consuming less than 200,000 CM/y who were not-eligiblecustomers until December 31, 2002 (mainly residential andcommercial customers located in urban centers). The newindexation mechanism of the raw material cost component intariffs paid by end customers consuming less than 200,000 CM/y asset in Resolution No. 79/2007 basically works this way: (i) ithas limited the ability of gas operators to transfer to customerschanges in the raw material cost by setting a cap of 75% forchanges in the raw material component linked to a fall in Brentcrude prices below 20 $/BL or a rise within the 35-60 $/BL range,raising the cap at 95% if Brent crude prices are higher than 60$/BL; (ii) it has changed the relative weight of the threeproducts making up the reference index of energy prices whosevariations – when higher or lower than 2.5% as compared tothe same index in the preceding period – determine theadjustment of raw material costs; (iii) it has replaced one ofthe three products included in the index (a pool of crudes) withBrent crude; and (iv) it has reduced the value of the variablewholesale component of the selling price by 0.26 euro/CM.Additionally, Italian natural gas importers – including Eni– were obliged to renegotiate existing wholesale supplycontracts in order to take account of this new indexationmechanism. For the year 2005, the Resolution introduced atransitory regime whereby the impact of the new indexationmechanism was equally shared by importers and wholesalers in caseimporters had renegotiated existing wholesale contracts andinformed of this the Authority. On these basis, Eni reversed partof the reserves accrued in Eni’s accounts for 2005 and 2006with respect to the 

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preliminary estimated impact of the new indexation mechanismon its gas selling margins resulting in a gain recognized in theprofit and loss for the year 2007. See "Item 5 –Results of Operations – Gas & Power".

This indexation mechanism applies for a two-year periodeffective July 1, 2006, with the option of a one year extensionfollowing a decision of the Authority. Eni cannot foresee anydevelopment of this matter.

> 
*Transport*

*Transport tariffs.*With Resolution No. 120 of May 30,2001, the Authority for Electricity and Gas published thecriteria transport companies have to apply in determining naturalgas transport and dispatching tariffs on national and regionaltransportation networks, for the first regulatory period made upof four thermal years (each thermal year begins on October 1 ofeach calendar year and ends on September 30), as provided for byDecree No. 164/2000. Tariffs are subject to approval by the sameAuthority, which ensures their compliance with preset criteria.This tariff system substituted previous agreements between Eniand customers of all categories. Within the first quarter of eachcalendar year, transport companies submit the tariff proposal tothe Authority for Electricity and Gas who grants approval.

Criteria established by the Authority for Electricity and Gasset a cap on revenues from transport and dispatching activity("allowed revenues") which is adjusted annually; thecriteria also define a separate treatment of revenues on existingassets and on new capital expenditure on expansions and extensionof infrastructure. 

In the first thermal year allowed revenues are calculated asthe sum of: (i) operating costs including storage and modulationcosts; (ii) amortization and depreciation of transport assets;and (iii) return on net capital employed. Net capital employed iscalculated by re-evaluating historic costs of transportinfrastructure (pipelines, compressor stations and other supportequipment) on the basis of certain inflationary indexes;resulting amounts are adjusted to take into account the residualuseful life of assets (pipelines are estimated to have a usefullife of 40 years) and also subtracting State grants. Theapplication of this methodology implies an estimated value ofEni’s transport assets of approximately euro 9.6 billion.This, however, is a valuation for regulatory purposes and shouldnot be read as an indication of the market value of Snam ReteGas. The rate of return on capital employed set by the Authorityfor Electricity and Gas was 7.94% (pre-tax), for the firstregulatory period. Once established, allowed revenues for thefirst year are divided into two components: (i) capacity revenuesequal to 70% of allowed revenues which are the maximum amount ofrevenues collectable from the sale of transport capacity tocustomers; and (ii) commodity revenues equal to 30% of allowedrevenues which are the maximum amount of revenues collectablefrom transported volumes.

Starting from the second year these two components areadjusted on a yearly basis to take into account inflation andcertain reduction factors (set at 2% and 4.5% for capacityrevenues and commodity revenues, respectively); commodityrevenues are also adjusted to transported volumes of the currentregulatory period. The 2% reduction factor on capacity revenuesprovides scope for improving results of operations of thetransport company if cost reductions exceed the set amount,whereas the 4.5% reduction factor on commodity revenues providesscope for improving results of operations of the transportcompany if transported volumes grow more than the reductionfactor. New capital expenditures in extension and expansionenable transport companies to increase the capacity revenue by astated percentage in the regulatory period following the periodin which new capital expenditures are incurred. 

In addition, those capital expenditures give rise to a sixyear fixed increase in allowed commodity revenues. At the end ofthe first regulatory period, all transport cost components wererecalculated and 50% of higher cost reductions with respect toestablished efficiency improvements were recognized to transportcompanies and 50% were transferred to customers. Once the allowedrevenues are established, transport companies define individualtariffs to clients which are based on a charge for the capacityused at the entry location (border, fields, storage sites) andthe capacity used at interconnection nodes with regional networks(divided into 17 zones) and on a charge for the capacity used atregional level, providing for discounts to those outgoing thenetwork at less than 15 kilometers from the interconnection pointbetween regional and national networks. A further charge(commodity charge) is related to the amounts of gas transportedplus an annual fixed charge varying according to the deliverypoints. This tariff system regulated the four-thermal year periodstarting October 1, 2001 and ending on September 30, 2005.

With Resolution No. 166/2005, the Authority for Electricityand Gas revised the outlined tariff regime for the secondregulatory period (October 1, 2005-September 30, 2008). The newtariff structure confirms the breakdown of the tariff into twocomponents: capacity and commodity in a ratio of 70 to 30 and theentry-exit model for the determination of the capacity componenton the national pipeline network, already present in the previoustariff regime established by Resolution No. 120/2001. The majornew elements of the new regime are the following: (i) a reductionof the rate of return of capital employed in transport activitiesfrom 7.94% to 6.7% (pre-tax); (ii) a new set of incentives fornew capital expenditure. In the previous regime, the return onupgrade and capacity expansion expenditure was 7.47% for one yearonly included in the calculation of the capacity component of thetransport tariff and 4.98% for 6 years in the calculation of thecommodity component. The new tariff structure provides anadditional rate of return depending on the type of expenditure onthe return rate recognized for capital employed: 

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from a minimum of 1% for safety measures that do not increasetransport capacity, applied for 5 years, to a maximum of 3% forexpenditure that increases capacity at entry points into thenational network, applied for 15 years. The additional return ispart of the determination of the maximum allowed revenues in thecalculation of the capacity component of the tariff and thereforeis not influenced by changes in volumes transported; (iii) theupdating by means of a price cap mechanism of the allowedrevenues the transport undertaking is entitled to and the annualrecalculation of the portion of allowed revenues relating tocosts incurred for capital expenditure. This price cap mechanismapplies to operating costs and amortization charges (previouslyit applied to all the allowed revenues). The annual rate ofrecovery of productivity was confirmed at 2%; this is used toreduce the effect of changes in the consumer price index on theupdating of the preceding years allowed revenues; instead thepreset annual rate of change of productivity recovery for theupdating of the commodity component of the tariff was reducedfrom 4.5% to 3.5% of; and (iv) confirmation of the tariffreduction for start ups (construction/upgrade of combined cycleplants for power generation) and for off take in low seasonperiods (from May 1 to October 31) already contained in DecisionsNo. 5/2005 and 6/2005 which updated the previous tariff regime.The companies active in the field of gas transport submit theirtariff proposals to the Authority who grants approval, within thefirst quarter of each calendar year.

*Network code*. With Resolution No. 75 of July 1, 2003,the Authority for Electricity and Gas approved Snam Rete GasNetwork Code, which defines rules and regulations for theoperation and management of the transmission network. The NetworkCode, in accordance with Legislative Decree No. 164/2000, isbased on the criteria set by the Authority for Electricity andGas with Resolution No. 137/2002, aimed at guaranteeing equalaccess to all customers, maximum impartiality and neutrality intransport and dispatching activities. The Network Code regulatesentitlement of transport capacity, obligations of transporter andcustomer and the procedures through which customers can sellcapacity to other users. Transport capacity at entry points inthe national gasline network (point of interconnection withimport gas lines) is assigned on an annual basis and can last upto five thermal years. 

Entities eligible to be assigned transport capacity on amulti-year basis are those having multi-year import contractswithin the limit of their daily average contract volumes.Priority criteria envisage that available capacity is assignedfirst to parties in multi-year import contracts containingtake-or-pay clauses signed before August 10, 1998 (date of comingin force of European Directive 98/30/CE). If requests forcapacity in a given thermal year are higher than availablecapacity, a pro-rata mechanism is applied in compliance with theaforementioned priority.

Parties in annual or shorter import contracts and parties inmulti-year import contracts are entitled to annual capacityconferrals corresponding to maximum daily contract volumes andthe difference between maximum daily contract volumes and averagedaily contract volumes, respectively. Available transportcapacity is assigned first to parties in annual import contractsand parties in multi-year import contracts. If requests forcapacity in a given thermal are higher than available capacity, apro-rata mechanism is applied in compliance with theaforementioned priority.

Eni filed a claim against this decision with the RegionalAdministrative Court of Lombardy, which was partially acceptedwith a decision of December 2004. The Authority filed a claimagainst this decision with the Council of State and informed Enion February 19, 2005. This proceeding is still pending.

*Adoption of guarantees for free access to LNGregasification services and rules for the regasification code.*WithResolution No. 167 of August 1, 2005, the Authority forElectricity and Gas published the criteria for access to LNGregasification services. The Decision also defines criteria forthe allocation of regasification capacity. In particular itestablishes that take-or-pay contracts entered into before 1998,as in the case of Eni, are awarded priority access limited to theminimum amount of volumes that have been regasified in the periodstarting from thermal year 2001-2002. Eni filed a claim againstthis decision with the Regional Administrative Court of Lombardythat rejected the claim. Subsequently, Eni filed a claim with ahigher degree administrative court.

*Tariffs criteria for the use of LNG terminals in the thirdregulatory period.*The Authority for Electricity and Gas hasset the criteria regulating the tariffs for the use of LNGterminals in the 3rd regulatory period (October2008-September 2012) with its ARG/gas 92/08 resolution.

The Regulatory Asset Base (RAB) is calculated with there-valuated historical cost methodology. The yearly adjustment ofrevenues and tariffs will follow the same methodologies appliedin the previous regulatory period, except for depreciation thatwill be adjusted on a yearly basis and excluded from the pricecap mechanism. The allowed rate of return (WACC) on RegulatoryAsset Base has been set equal to 7.6% in real terms pre tax.Furthermore, it established an additional remuneration, up to 3%above WACC, for new capital expenditures for a maximum of 16years. Operating costs will be adjusted every year taking intoaccount inflation and efficiency gains (X- factor) set by theAuthority at 0.5% in real terms.

The ARG/gas 92/08 resolution also established that theallocation of reference revenues between regasification capacityand the commodity component is fixed at 90:10 (compared to 80:20ratio in the second regulated period).

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*Gas not recorded in accounts on the natural gas transportnetworks in the 2004-2006 period.*The Italian Authority forElectricity and Gas with the Resolution VIS 8/09, has completedthe preliminary investigation on the gas not recorded in accountsstarted with Resolution VIS 41/08 "Preliminary investigationon the correct application of the provisions concerning gas notrecorded in accounts on the natural gas transport networks in the2004-2006 period". Based on the results of this preliminaryinvestigation, future actions to be implemented by Snam Rete Gaswere defined in order to improve the process of calculation ofnatural gas. The total amount to be recognized to the company,with regard to higher costs incurred for the purchase of fuel gasin the thermal years 2005-2006 and 2006-2007, was also set ateuro 45 million. The Authority also established to determine insubsequent resolutions the additional costs incurred by thecompany for the thermal years 2007-2008 and 2008-2009.

> 
*Distribution*

Distribution is the activity of delivering natural gas toresidential and commercial customers of urban centers through lowpressure networks. Distribution is considered a public serviceoperated in concession and is regulated on the basis of LawDecree No. 164/2000.

*Distribution tariffs.*With Resolution No. 159/2008, theAuthority for Electricity and Gas defined a new methodology fordetermining revenues for natural gas distribution activity.Starting from January 1, 2009 and for the duration of four-yearregulated period, i.e. until 2012, the resolution provides forthe recognition of total revenues for each regulated yearamounting to a value that the Authority will set at the time ofapproving the operators’ requests for distribution tariffsand defined as Total Revenue Constraint (TRC), representing themaximum remuneration recognized by the Authority to each operatorfor covering costs borne.

In previous years, revenues were determined by applyingtariffs set by the Authority to volumes actually distributed toselling companies in the relevant year. The resolution alsoprovides for any positive or negative difference between TRC andrevenues resulting from invoices for actually distributed volumesto be regulated through an equalization device making use ofcredit/debit cards lodged with the Electricity EqualizationExchange.

As a result of the new mechanism, revenues are no longerrelated to the seasonality of volumes distributed but areconstantly apportioned during the year. The introduction of thisnew mechanism does not cause a decline in total revenues on ayearly basis.

 

> 
***Refining and Marketing of Petroleum Products***

*Refining.*Under Decree No. 112, companies that seek toestablish refining operations in Italy or to expand the capacityof existing refining operations must obtain an operatingconcession from the relevant Region, while companies that seek tobuild or operate new plants that do not increase refiningcapacity must obtain an authorization from the relevant Region.Management expects no material delays in obtaining relevantconcessions for the upgrading of the Sannazzaro and Tarantorefineries as planned in the medium-term.

*Service stations.*Decree No. 32 of February 11, 1998,as amended by Legislative Decree No. 348 of September 8, 1999 andLaw Decree No. 383 of October 29, 1999, significantly changedItalian regulation of service stations. The decree replaces thesystem of concessions granted by the Ministry of Industry,regional and local authorities with an authorization granted bycity authorities. Legislative Decree No. 112/1998 confers thepower to grant concessions for the construction and operation ofservice stations on highways to Regions. Decree No. 32 alsorequires that contracts between license holders and servicestation operators have a duration of not less than six years andbe drafted in accordance with arrangements agreed by the relevanttrade group of license holders and the union representatives forthe service station operators. Decree No. 32 also provides for:(i) the testing of compatibility of existing service stationswith local planning and environmental regulations and with thoseconcerning traffic safety to be performed by city authorities;(ii) upon the closure of at least 7,000 service stations, theoption to extend by 50% the opening hours (currently 52 hours perweek) and a generally increased flexibility in scheduling openinghours; (iii) simplification of regulations concerning the sale ofnon-oil products and the permission to perform simple maintenanceand repair operations at service stations; and (iv) the openingup of the logistics segment by permitting third party access tounused storage capacity for petroleum products. With the goal ofrenewing the Italian distribution network, Law No. 57/2001provides that the Ministry of Productive Activities is to prepareguidelines for the modernization of the network, and the Regionsshall follow those guidelines in the preparation of regionalplans. The decree was issued on October 31, 2001 and establishedthe criteria for the closing down of incompatible stations, theapproval of the plan, the renewal of the network, the opening upof new stations and the regulations of the operations of servicestations on matters such as automation, working hours and non oilactivities.

*Petroleum product prices.* Petroleum product prices werecompletely deregulated in May 1994 and are now freely establishedby operators. Oil and gas companies periodically report theirrecommended prices to the Ministry of Productive Activities; suchrecommendations are considered by service station operators inestablishing retail prices for petroleum products.

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With a recommendation approved at its meeting of January 18,2007 and submitted to the Government and the Regions, the ItalianAntitrust Authority requested the elimination of localconstraints to the opening up of the fuel distribution outletsaimed at increasing competition and reducing retail prices.Specifically, the Authority urged the following measures in orderto enhance the level of competition in the sector of retailmarketing of fuels: (i) the development of the marketing of fuelsby large retailers (supermarkets, large chain-stores, etc.); (ii)the elimination of administrative constraints to the opening ofnew service stations; (iii) a liberalization of opening hours;and (iv) transparency for consumers, identifying any usefultools for proper information on actual prices imposed byoperators in each outlet. Currently, Eni is unable to forecast atime frame for this matter. Implementation of any of thesesuggested measures could enhance the level of competition in theretail marketing of fuels, leading to a reduction in retailmargins for all operators.

*Compulsory stocks.*According to Legislative Decree ofJanuary 31, 2001, No. 22 ("Decree 22/2001") enactingEuropean Directive No. 98/1993 (which regulates the obligation ofmember states to keep a minimum amount of stocks of crude oiland/or petroleum products) compulsory stocks, must be at leastequal to the quantities required by 90 days of consumption of theItalian market (net of oil products obtained by domesticallyproduced oil). In order to satisfy the agreement with theInternational Energy Agency (Law No. 883/1977), Decree 22/2001increased the level of compulsory stocks to reach at least 90days of net import, including a 10% deduction for minimumoperational requirements. Decree 22/2001 states that compulsorystocks are determined each year by a decree of the Minister ofProductive Activities based on domestic consumption data of theprevious year, defining also the amounts to be held by each oilcompany on a site-by-site basis.

At December 31, 2008 Eni owned 6.3 mmtonnes of oil productsinventories, of which 4.4 mmtonnes as "compulsorystocks", 1.5 mmtonnes related to operating inventories inrefineries and depots (including 0.2 mmtonnes of oil productscontained in facilities and pipelines) and 0.4 mmtonnes relatedto specialty products.

Eni’s compulsory stocks (at December 31, 2008) were heldin term of crude oil (30%), light and medium distillates (47%),fuel oil (19%) and other products (4%) and they were locatedthroughout the Italian territory both in refineries (72%) and instorage sites (28%).

 

> 
**Recent tax development**

The "Treaty of Friendship" between the Republic ofItaly and Libya was enacted by Italy’s upper house onFebruary 3, 2009 and is about to be published shortly. This lawunder Article No. 3 has introduced a supplemental tax rateapplicable to taxable income of such individual companies thatengage in the exploration and production of hydrocarbons, wherefixed assets, including both tangible and intangible assets andinvestments dedicated to oil and gas operations exceed 33% oftheir respective items in the balance sheet, also having a marketcapitalization in excess of euro 20 billion. This supplementaltax is due whenever taxes currently payable represent less than19% of taxable income and is to be determined as the lower of theamount of income taxes up to 19% of taxable income and the amountresulting from applying a certain set of decreasing rates tocompanies’ net equity as determined from individualfinancial statements. This supplemental tax rate is due for 2009and following years up to 2028. Eni believes that the parentcompany Eni Spa will likely fall within the scope of thissupplemental tax rate based on the criteria set by the law toidentify the persons subject to the new tax rate and theconditions regulating its enactment. According tomanagement’s estimates the new supplemental tax rate willcause the Company to incur additional tax payable amounting toapproximately euro 300 million for the full years 2009, 2010 and2011. In subsequent years this expense will amount toapproximately euro 180 million per year. The Company is planningto file recourse against this law.

> 
***Competition***

Like all Italian companies, Eni is subject to Italian and EUcompetition rules. EU competition rules are set forth in Articles81 and 82 of the Treaty of Rome as amended by the Treaty ofAmsterdam dated October 2, 1997 and entered into force on May 1,1999 ("Article 81" and "Article 82",respectively being the result of the new denomination of formerArticles 85 and 86) and EU Merger Control Regulation No. 4064 of1989 ("EU Regulation 4064"). Article 81 prohibitscollusion among competitors that may affect trade among memberstates and that has the object or effect of restrictingcompetition within the EU. Article 82 prohibits any abuse of adominant position within a substantial part of the EU that mayaffect trade among member states. EU Regulation 4064 sets certainlimits for cross-border transactions, above which enforcementauthority rests with the European Commission and below whichenforcement is carried out by national competition authorities,such as the Antitrust Authority in the case of Italy. On May 1,2004, a new regulation of the European Council came into force(No. 1/2003) which substitutes Regulation No. 17/1962 on theimplementation of the rules on competition laid down in Articles81 and 82 of the Treaty. In order to simplify the proceduresrequired of undertakings in case of concentration, the newregulation substitutes the obligation to inform the Commissionwith a declaration that such concentration does not infringe theTreaty. In addition, the burden of proving an infringement ofArticle 81(1) or of Article 82 of the Treaty shall rest on theparty or the authority alleging the infringement. The undertakingor association of undertakings 

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claiming the benefit of Article 81(3) of the Treaty shall bearthe burden of proving that the conditions of that paragraph arefulfilled. The regulation defines the functions of Authoritiesguaranteeing competition in Member States and the powers of theCommission and of national courts. The competition authorities ofthe Member States shall have the power to apply Articles 81 and82 of the Treaty in individual cases. For this purpose, acting ontheir own initiative or on a complaint, they may take thefollowing decisions: 

| • |   | requiring that an        infringement be brought to an end;                                                      |
|--------|--------|------------------------------------------------------------------------------------------------------------------|
| • |   | ordering interim measures;                                                                                       |
| • |   | accepting commitments; and                                                                                       |
| • |   | imposing fines, periodic        penalty payments or any other penalty provided for in        their national law. |

National courts shall have the power to apply Articles 81 and82 of the Treaty. Where the Commission, acting on a complaint oron its own initiative, finds that there is an infringement ofArticle 81 or of Article 82 of the Treaty, it may: (i) requirethe undertakings and associations of undertakings concerned tobring such infringement to an end; (ii) order interim measures;(iii) make commitments offered by undertakings to meet theconcerns expressed to them by the Commission binding on theundertakings; and (iv) find that Articles 81 and 82 of the Treatyare not applicable to an agreement for reasons of Communitypublic interest.

Eni is also subject to the competition rules established bythe Agreement on the European Economic Area (the "EEAAgreement"), which are analogous to the competition rules ofthe Treaty of Rome and apply to competition in the EuropeanEconomic Area (which consists of the EU and Norway, Iceland andLiechtenstein). These competition rules are enforced by theEuropean Commission and the European Free Trade Area SurveillanceAuthority.

In addition, Eni’s activities are subject to Law No. 287of October 10, 1990 (the "Antitrust Law"). Inaccordance with the EU competition rules, the Antitrust Lawprohibits collusion among competitors that restricts competitionwithin Italy and prohibits any abuse of a dominant positionwithin the Italian market or a significant part thereof. However,the Antitrust Authority may exempt for a limited periodagreements among companies that otherwise would be prohibited bythe Antitrust Law if such agreements have the effect of improvingmarket conditions and ultimately result in a benefit forconsumers.

 

**Property, Plant and Equipment**

Eni has freehold and leasehold interests in real estate innumerous countries throughout the world, but no one individualproperty is material to Eni as a whole. See "Exploration& Production" above for a description of Eni’sreserves and sources of crude oil and natural gas.

 

**Organizational Structure**

Eni SpA is the parent company of the Eni Group. As of December31, 2008, there were 283 fully consolidated subsidiaries and 80associates that were accounted for under the equity or costmethod. For a list of subsidiaries of the Company, see"Exibit 8 – List of Eni’s fully consolidatedsubsidiaries for year 2008".

 

 

**Item 4A. UNRESOLVED STAFF COMMENTS**

None.

**Item 5. OPERATING AND FINANCIAL REVIEW ANDPROSPECTS**

*This section is the Company’s analysis of itsfinancial performance and of significant trends that may affectits future performance. It should be read in conjunction with theKey Information presented in Item 3 and the ConsolidatedFinancial Statements and related Notes thereto included in Item18. The Consolidated Financial Statements are prepared inaccordance with International Financial Reporting Standards(IFRS) as issued by the IASB.*

*This section contains forward-looking statements which aresubject to risks and uncertainties. For a list of importantfactors that could cause actual results to differ materially fromthose expressed in the forward-looking statements, see thecautionary statement concerning forward-looking statements onpage ii.*

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**Executive Summary**

Eni reported net profit of euro 8,825 million in 2008,representing a decrease of 11.8% compared to 2007.

Operating profit in 2008 amounted to euro 18,641 million, down1.2% from 2007 mainly reflecting the lower operating profitreported by Eni’s downstream businesses as the Refining& Marketing, Petrochemicals and Gas & Power segmentsreported lower operating profit by euro 1,752 million, euro 896million and euro 194 million, respectively. These reductions werepartly offset by improved operating profit recorded by:

| (i)  |   | the Exploration &        Production segment which reported an increase in        operating profit of euro 2,627 million. This improvement        was mainly driven by higher hydrocarbon realizations in        dollar terms; and |
|------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii) |   | the Engineering &        Construction segment which reported an increase in        operating profit of euro 208 million. This improvement        mainly reflected favorable market trends.                                        |

Eni’s Group results for the year were reduced by higherfinance charges, up euro 681 million, and higher income taxes, upeuro 473 million. These negative factors were partly offset byhigher profit (up euro 130 million) from non consolidatedentities that are accounted for under the equity or the costmethod.

Net cash provided by operating activities amounted to euro21,801 million, including proceeds on advances received from thepartner Suez (euro 1,552 million) following the signing of anumber of long-term gas and electricity supply contracts, andcash from divestments (euro 1,160 million) were used to fund themajority of cash outflows relating to: (i) capital andexploratory expenditures totaling euro 14,562 million; (ii) theacquisition of assets and investments (euro 4,305 million whichinclude cash and finance debt acquired as part of the purchasedcompanies); and (iii) dividend distribution to Eni’sshareholders and Eni share repurchases for a total cash return toEni shareholders of euro 5,688 million, as well as minoritydividend payments and share repurchases relating mainly to thelisted subsidiaries Snam Rete Gas SpA and Saipem SpA (totalingeuro 288 million).

As of December 31, 2008 net borrowings amounted to euro 18,376million, representing a euro 2,049 million increase from 2007.This increase mainly reflected the large amount of capitalexpenditures and acquisitions executed in the year which was onlypartially funded with cash flows from operations.

On the basis of the results achieved, Eni’s managementproposed to the Annual Shareholders’ Meeting thedistribution of a dividend of euro 1.30 per share, of which euro0.65 had been paid as interim dividend in September 2008. Thisdividend is in line with 2007 (euro 1.30 per share) and wasapproved by the Annual Shareholders’ Meeting on April 30,2009.

Eni’s oil and gas production for the year (on anavailable for sale basis) increased by 3.8% to 1,748 KBOE/d. Thisperformance was mainly due to:

| (i)  |   | the contribution of assets        acquired in the Gulf of Mexico, Congo and Turkmenistan        (up 62 KBOE/d compared to 2007); and |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------|
| (ii) |   | continuing production        ramp-up in Angola, Congo, Egypt, Pakistan and Venezuela.                                                |

These positive factors were offset in part by:

| (i)   |   | mature field declines;                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii)  |   | planned and unplanned        facility downtime in the North Sea;                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| (iii) |   | hurricane-related impacts in        the Gulf of Mexico (down 11 KBOE/d); and                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (iv)  |   | lower entitlements in        certain Production Sharing Agreements (PSAs) and similar        contractual schemes (down 37 KBOE/d compared to 2007) due        to higher oil prices. Under such contracts, Eni is        entitled to fixed monetary amounts to recover the        expenses incurred for the development of the relevant        properties and as a consequence of higher oil prices, the        volumes that are necessary to cover the same amount of        expenses are lower. |

On October 31, 2008, the international partners of the NorthCaspian Sea Production Sharing Agreement (NCSPSA) consortium andthe Kazakh authorities signed the final agreement implementingthe new contractual and governance framework of the Kashaganproject, based on the Memorandum of Understanding signed onJanuary 14, 2008. For a more detailed discussion of this projectsee "Item 4 – Exploration & Production –Kazakhstan".

Worldwide gas sales in 2008 amounted to 104.23 BCM, up 5.3%from 2007 due to growth achieved in international markets (up8.53 BCM), particularly in the main European markets, and thecontribution of the acquisition of Distrigas that was completedin October 2008 (up 5.23 BCM). These increases were offset inpart by lower sales to the domestic market (down 3.26 BCM) as aresult of the economic downturn and stronger competitivepressure.

Capital expenditures in 2008 amounted to euro 14,562 million(euro 10,593 million in 2007), of which 84% related to theExploration & Production, Gas & Power and Refining &Marketing segments, and mainly regarded:

| (i) |   | development activities (euro        6,429 million) mainly in Kazakhstan, Egypt, Angola, Congo        and Italy; |
|-----|--------|-----------------------------------------------------------------------------------------------------------------|

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| (ii)  |   | exploration projects (euro        1,918 million) of which 93% was spent outside Italy,        primarily in the United States, Egypt, Nigeria, Angola        and Libya;                                                                                                                                                                 |
|-------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (iii) |   | the purchase of proved and        unproved property (euro 836 million) related mainly to        the extension of mineral rights in Libya following an        agreement signed in October 2007 with the state oil        company NOC and the purchase of a 34.81% interest in the        Abo project in Nigeria;                        |
| (iv)  |   | development and upgrading of        Eni’s natural gas transport and distribution        networks in Italy (euro 1,130 million and euro 233        million, respectively) and upgrading of natural gas        import pipelines to Italy (euro 233 million);                                                                        |
| (v)   |   | ongoing construction of        combined cycle power plants (euro 107 million);                                                                                                                                                                                                                                                         |
| (vi)  |   | the Refining & Marketing        division (euro 965 million) for projects aimed at        upgrading the conversion capacity and flexibility of        refineries, including construction of a new hydrocracking        unit at the Sannazzaro refinery, building of new service        stations and upgrading of existing ones; and |
| (vii) |   | upgrading of the fleet used        in the Engineering & Construction division (euro        2,027 million).                                                                                                                                                                                                                         |

In 2008 Eni successfully executed a number of strategicacquisitions and deals that are intended to strengthen itscompetitive position in its main markets. Total finance requirementsfor these acquisitions amounted to euro 4,305 million and mainlyrelated to the acquisition of a 57.243% stake in Distrigas NV,the completion of the acquisition of Burren Energy Plc, thepurchases of certain upstream properties and gas storage assets,mainly in Algeria, in the North Sea and in India, as well asother investments in non-consolidated entities.

In the 2009-2012 four-year period, Eni expects to investapproximately euro 48.8 billion in capital expenditures andexploration projects to implement its growth strategy. Forfurther details see "Item 5 – Management’sExpectations of Operations".

 

> 
***Trading Environment***

Whenever used in Item 5, "Margin" means thedifference between the average selling price and directacquisition cost of a finished product or raw material excludingother production costs (e.g. refining margin, margin ondistribution of natural gas and petroleum products or margin ofpetrochemicals products). Margin trends reflect the tradingenvironment and are, to a certain extent, a gauge of industryprofitability.

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

| Average price of Brent dated crude oil in U.S.        dollars (1) |   | 65.14 |   | 72.52 |   | 96.99 |
|-------------------------------------------------------------------|--------|-------|--------|-------|--------|-------|
| Average        price of Brent dated crude oil in euro (2)         |   | 51.86 |   | 52.90 |   | 65.93 |
| Average EUR/USD exchange rate (3)                                 |   | 1.256 |   | 1.371 |   | 1.471 |
| Average        European refining margin in U.S. dollars (4)       |   | 3.79  |   | 4.52  |   | 6.49  |
| Euribor - three month euro rate % (3)                             |   | 3.1   |   | 4.3   |   | 4.6   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

----

| (1) | i | Price per        barrel. Source: Platt’s Oilgram.                                                                                                                                                       |
|-----|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | Price per        barrel. Source: Eni’s calculations based on        Platt’s Oilgram data for Brent prices and the        EUR/USD exchange rate reported by the European Central        Bank (ECB). |
| (3) | i | Source: ECB.                                                                                                                                                                                                 |
| (4) | i | Price per        barrel. FOB Mediterranean Brent dated crude oil. Source:        Eni calculations based on Platt’s Oilgram data.                                                                        |

Eni’s results of operations and the year to yearcomparability of its financial results are affected by a numberof external factors which exist in the industry environment,including changes in oil, natural gas and refined productsprices, industry-wide movements in refining and petrochemicalmargins and fluctuations in exchange rates and interest rates.Changes in weather conditions from year to year can influencedemand for natural gas and some petroleum products, thusaffecting results of operations of the natural gas business and,to a lesser extent, of the refining and marketing business. See"Item 3 – Risk Factors".

In 2008, Eni’s results were achieved in a tradingenvironment characterized by a significant increase in Eni’soil and gas realizations (up 28.1% on average) on the backdrop ofa favorable oil scenario until the month of September.Subsequently Brent prices experienced a steep decline frommid-year levels as a consequence of the financial crisis and theglobal economic downturn that has reduced energy demand. Onaverage yearly Brent prices were up 33.7% from 2007. Managementexpects that oil prices will remain weak throughout the year 2009as the economic downturn is expected to continue impacting globaldemand for oil, products and natural gas. Based on current markettrends, management believes that there is still uncertainty aboutthe timing of a recovery in global energy demand and in Brentprices. See "Item 3 – Risk Factors" for adescription of sensitivity of Eni’s results of operations tochanges in crude oil prices. In 2009 weak energy demand isexpected to impact the Company’s gas sales in its downstreammarketing business, particularly on the Italian market where theeconomic slowdown is expected to weigh heavily on gas demand. See"Item 5 – Management’s Expectations ofOperations" below. 

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In 2008, margins on gas sales were affected by an unfavorabletrading environment also reflecting exchange rate movements. 

In 2008, refining activities were positively influenced by astrong margin environment (Brent refining margins were up 43.6%,to 6.49 $/BL). This positive trend was partly offset by anegative impact associated with narrowing differentials betweenlight and heavy crudes that reduced the profitability ofEni’s complex refineries. This negative trend has beencontinuing in the first quarter of 2009 as market availability ofheavy crudes has been impacted by OPEC cuts.

In 2008, a steep decline was registered in selling margins ofcommodity chemicals due to higher supply costs of oil-basedfeedstock that were not fully recovered in sales prices and weakdemand. In the first quarter of 2009, results of thepetrochemicals operations were negatively impacted by theeconomic downturn that affected demand for commodity chemicals.

In 2008, the market environment was particularly favorable inthe Engineering & Construction business as a result of thestrong order pattern experienced throughout the year on thebackdrop of the strong oil cycle. Management believes thatfalling oil prices, weak energy demand and tight financial marketswill reduce the investment plans of oil companies thus affectingresults of operations of oilfield contractors, even though with atime lag with respect to the oil companies’ investingdecisions taking into account existing orders. In the firstquarter 2009, Eni’s Engineering & Constructionbusiness reported positive results due to completion of orders inbacklog and revenues associated with multi-years orders.Management expects that assuming that the Company will not incurany material order delay or cancellation, full-year results ofthe Engineering & Construction business will be positive inthe full year 2009. In the medium-term, assuming a reduction inorders coming from oil companies, the results of the Engineering& Construction business will be supported by its ability tomanage complex projects and large presence in strategic countriesthat make the business less vulnerable to the oil cycle.

In 2008, Eni’s results were negatively affected by the7.3% appreciation of the euro against the dollar (based on theyearly average exchange rates).

 

> 
***Key Consolidated Financial Data***

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| Net sales from operations                                                                                 |   |             |   | 86,105 |   | 87,256 |   | 108,148 |
|-----------------------------------------------------------------------------------------------------------|--------|------------------|--------|--------|--------|--------|--------|---------|
| Operating        profit                                                                                   |   |             |   | 19,327 |   | 18,868 |   | 18,641  |
| Net profit attributable to Eni                                                                            |   |             |   | 9,217  |   | 10,011 |   | 8,825   |
| Net cash        provided by operating activities                                                          |   |             |   | 17,001 |   | 15,517 |   | 21,801  |
| Capital expenditures                                                                                      |   |             |   | 7,833  |   | 10,593 |   | 14,562  |
| Acquisitions        of investments and businesses                                                         |   |             |   | 95     |   | 9,665  |   | 4,019   |
| Shareholders’ equity including minority        interest at year end                                  |   |             |   | 41,199 |   | 42,867 |   | 48,510  |
| Net        borrowings at year end (1)                                                                     |   |             |   | 6,767  |   | 16,327 |   | 18,376  |
| Net profit per share attributable to Eni (basic        and diluted)                                       |   | (euro per share) |   | 2.49   |   | 2.73   |   | 2.43    |
| Dividend        per share                                                                                 |   | (euro per share) |   | 1.25   |   | 1.30   |   | 1.30    |
| Net borrowings to total shareholders’        equity ratio including minority interest (leverage) (1) |   |             |   | 0.16   |   | 0.38   |   | 0.38    |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

----

| (1) |    | For a        discussion of the usefulness of and a reconciliation of        these non-GAAP financial measures with the most directly        comparable GAAP financial measures see "Liquidity        and Capital Resources – Financial Conditions"        below. |
|-----|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

**Critical Accounting Estimates**

The Company’s Consolidated Financial Statements areprepared in accordance with IFRS as issued by the IASB. Theserequire the use of estimates and assumptions that affect theassets, liabilities, revenues and expenses reported in thefinancial statements, as well as amounts included in the notesthereto, including discussion and disclosure of contingentliabilities. Estimates made are based on complex or subjectivejudgments and past experience of other assumptions deemedreasonable in consideration of the information available at thetime. The accounting policies and areas that require the mostsignificant judgments and estimates to be used in the preparationof the Consolidated Financial Statements are in relation to theaccounting for oil and natural gas activities, specifically inthe determination of proved reserves, impairment of fixed assets,intangible assets and goodwill, asset retirement obligations,business combinations, pensions and other post-retirementbenefits, recognition of 

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environmental liabilities and recognition of revenues in theoilfield services construction and engineering businesses.Although the Company uses its best estimates and judgments,actual results could differ significantly from the estimates andassumptions used. A summary of significant estimates follows.

 

> 
***Oil and gas activities***

Engineering estimates of the Company’s oil and gasreserves are inherently uncertain. Proved reserves are theestimated volumes of crude oil, natural gas and gas condensates,liquids and associated substances which geological andengineering data demonstrate with reasonable certainty to berecoverable in future years from known reservoirs under existingeconomic and operating conditions. Although there areauthoritative guidelines regarding the engineering criteria thatmust be met before estimated oil and gas reserves can bedesignated as "proved", the accuracy of any reserveestimate is a function of the quality of available data andengineering and geological interpretation and judgment.

Field reserves will only be categorized as proved when all thecriteria for attribution of proved status have been met. At thisstage, all booked reserves will be classified as provedundeveloped. Volumes will subsequently be reclassified fromproved undeveloped to proved developed as a consequence ofdevelopment activity. The first proved developed bookings willoccur at the point of first oil or gas production. Majordevelopment projects typically take one to four years from thetime of initial booking to the start of production. Enireassesses its estimate of proved reserves periodically. Theestimated proved reserves of oil and natural gas may be subjectto future revision and upward and downward revision may be madeto the initial booking of reserves due to production, reservoirperformance, commercial factors, acquisition and divestmentactivity and additional reservoir development activity. Inparticular, changes in oil and natural gas prices could impactthe amount of Eni’s proved reserves as regards the initialestimate and, in the case of Production-sharing agreements andbuy-back contracts, the share of production and reserves to whichEni is entitled. Accordingly, the estimated reserves could bematerially different from the quantities of oil and natural gasthat ultimately will be recovered.

Oil and natural gas reserves have a direct impact on certainamounts reported in the Consolidated Financial Statements.Estimated proved reserves are used in determining depreciationand depletion expenses and impairment expense. Depreciation rateson oil and gas assets using the UOP basis are determined from theratio between the amount of hydrocarbons extracted in the quarterand proved developed reserves existing at the end of the quarterincreased by the amounts extracted during the quarter.

Assuming all other variables are held constant, an increase inestimated proved developed reserves for each field decreasesdepreciation, depletion and amortization expense. Conversely, adecrease in estimated proved developed reserves increasesdepreciation, depletion and amortization expense. In addition,estimated proved reserves are used to calculate future cash flowsfrom oil and gas properties, which serve as an indicator indetermining whether or not property impairment is to be carriedout. The larger the volume of estimated reserves, the lower thelikelihood of asset impairments.

 

> 
***Impairment of assets***

Eni assesses its tangible assets and intangible assets,including goodwill, for possible impairment if there are eventsor changes in circumstances that indicate the carrying values ofthe assets are not recoverable. Such indicators include changesin the Group’s business plans, changes in commodity pricesleading to unprofitable performance, a reduced utilization of theplants and, for oil and gas properties, significant downwardrevisions of estimated proved reserve quantities or significantincrease of the estimated development costs. Determination as towhether and how much an asset is impaired involves managementestimates on highly uncertain matters such as future commodityprices, the effects of inflation and technology improvements onoperating expenses, production profiles and the outlook forglobal or regional market supply and demand conditions for crudeoil, natural gas, commodity chemicals and refined products.

The amount of an impairment loss is determined by comparingthe book value of an asset with its recoverable amount. Therecoverable amount is the greater of fair value net of disposalcosts and value in use. The estimated value in use is based onthe present values of expected future cash flows net of disposalcosts. The expected future cash flows used for impairment reviewsare based on judgmental assessments of future production volumes,prices and costs, considering available information at the dateof review and are discounted by using a rate related to theactivity involved.

For oil and natural gas properties, the expected future cashflows are estimated principally based on developed andnon-developed proved reserves including, among other elements,production taxes and the costs to be incurred for the reservesyet to be developed. The estimated future level of production isbased on assumptions relating to future commodity prices, liftingand development costs, field decline rates, market demand andsupply, economic regulatory climates and other factors.

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Oil, natural gas and petroleum products prices used toquantify expected future cash flows are estimated based onforward prices prevailing in the marketplace for the first fouryears and management’s long-term planning assumptionsthereafter.

The estimate of the future amount of production is based onassumptions related to the commodity future prices, lifting anddevelopment costs, market demand and to other factors. Thediscount rate reflects the current market valuation of the timevalue of money and of the specific risks of the asset notreflected in the estimate of the future cash flows.

Goodwill and other intangible assets with an indefinite usefullife are not subject to amortization. The Company tests suchassets at the cash generating unit level for impairment on anannual basis and between annual tests if an event occurs orcircumstances change that would more likely than not reduce thefair value below its carrying amount. In particular, goodwillimpairment is based on the determination of the fair value ofeach cash generating unit to which goodwill can be attributed ona reasonable and consistent basis.

A cash generating unit is the smallest aggregate unit on whichthe Company, directly or indirectly, evaluates the return on thecapital expenditure. If the recoverable amount of a cashgenerating unit is lower than the carrying amount, goodwillattributed to that cash generating unit is impaired up to thatdifference; if the carrying amount of goodwill is less than theamount of impairment, assets of the cash generating unit areimpaired on a pro-rata basis for the residual difference.

 

> 
***Asset Retirement Obligations***

Obligations to remove tangible equipment and restore land orseabed require significant estimates in calculating the amount ofthe obligation and determining the amount required to be recordedpresently in the consolidated financial statements. Estimatingfuture asset retirement obligations is complex. It requiresmanagement to make estimates and judgments with respect toremoval obligations that will come to term many years into thefuture and contracts and regulations are often unclear as to whatconstitutes removal.

In addition, the ultimate financial impact of environmentallaws and regulations is not always clearly known as asset removaltechnologies and costs constantly evolve in the countries whereEni operates, as do political, environmental, safety and publicexpectations. The subjectivity of these estimates is alsoincreased by the accounting method used that requires entities torecord the fair value of a liability for an asset retirementobligation in the period when it is incurred (typically, at thetime the asset is installed at the production location).

When liabilities are initially recorded, the related fixedassets are increased by an equal corresponding amount. Theliabilities are increased with the passage of time (i.e. interestaccretion) and any change in the estimates following themodification of future cash flows and discount rate adopted. Therecognized asset retirement obligations are based on futureretirement cost estimates and incorporate many assumptions suchas: expected recoverable quantities of crude oil and natural gas,abandonment time, future inflation rates and the risk-free rateof interest adjusted for the Company’s credit costs.

 

> 
***Business Combinations***

Accounting for business combinations requires the allocationof the purchase price to the various assets and liabilities ofthe acquired business at their respective fair values. Anypositive residual difference is recognized as"Goodwill". Negative residual differences are creditedto the profit and loss account. Management uses all availableinformation to make these fair value determinations and, formajor business acquisitions, typically engages an independentappraisal firm to assist in the fair value determination of theacquired assets and liabilities.

 

> 
***Environmental liabilities***

Together with other companies in the industries in which itoperates, Eni is subject to numerous EU, national, regional andlocal environmental laws and regulations concerning its oil andgas operations, production and other activities. They includelegislations that implement international conventions orprotocols. Environmental costs are recognized when it becomesprobable that a liability has been incurred and the amount can bereasonably estimated. Management, considering the actions alreadytaken, insurance policies to cover environmental risks andprovision for risks accrued, does not expect any material adverseeffect on Eni’s consolidated results of operations andfinancial position as a result of such laws and regulations.However, there can be no assurance that there will not be amaterial adverse impact on Eni’s consolidated results ofoperations and financial position due to:

| (i)  |   | the possibility of an        unknown contamination;                                                                                                                                                               |
|------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii) |   | the results of the ongoing        surveys and other possible effects of statements required        by Decree No. 471/1999 of the Ministry of Environment        concerning the remediation of contaminated sites; |

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| (iii) |   | the possible effects of        future environmental legislations and rules;                                                                                                                                                                        |
|-------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (iv)  |   | the effects of possible        technological changes relating to future remediation; and                                                                                                                                                           |
| (v)   |   | the possibility of        litigation and the difficulty of determining Eni’s        liability, if any, as against other potentially        responsible parties with respect to such litigations and        the possible insurance recoveries. |

> 
 

***Employee benefits***

Defined benefit plans and other long-term benefits areevaluated with reference to uncertain events and based uponactuarial assumptions including among others discount rates,expected rates of return on plan assets, expected rates of salaryincreases, medical cost trends, estimated retirement dates andmortality rates. The significant assumptions used to account forpensions and other post-retirement benefits are determined asfollows:

| (i)   |   | discount and inflation rates        reflect the rates at which benefits could be effectively        settled, taking into account the duration of the        obligation. Indicators used in selecting the discount        rate include rates of annuity contracts and rates of        return on high quality fixed-income investments. The        inflation rates reflect market conditions observed        country by country;                                                            |
|-------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii)  |   | the future salary levels of        the individual employees are determined including an        estimate of future changes attributed to general price        levels (consistent with inflation rate assumptions),        productivity, seniority and promotion;                                                                                                                                                                                                                           |
| (iii) |   | healthcare cost trend        assumptions reflect an estimate of the actual future        changes in the cost of the healthcare related benefits        provided to the plan participants and are based on past        and current healthcare cost trends including healthcare        inflation, changes in healthcare utilization and changes        in health status of the participants;                                                                                                |
| (iv)  |   | demographic assumptions such        as mortality, disability and turnover reflect the best        estimate of these future events for individual employees        involved, based principally on available actuarial data;        and                                                                                                                                                                                                                                                     |
| (v)   |   | determination of the        expected rates of return on assets is made through        compound averaging. For each plan, the distribution of        investments among bonds, equities and cash and their        specific average expected rate of return is taken into        account. Differences between expected and actual costs        and between the expected return and the actual return on        plan assets routinely occur and are called actuarial        gains and losses. |

Eni applies the corridor method to amortize its actuariallosses and gains. This method amortizes on a pro-rata basis thenet cumulative unrecognized actuarial gains and losses at the endof the previous reporting period that exceed 10% of the greaterof: (i) the present value of the defined benefit obligation; and(ii) the fair value of plan assets, over the average expectedremaining working lives of the employees participating in theplan.

Additionally, obligations for other long-term benefits aredetermined by adopting actuarial assumptions. The effect ofchanges in actuarial assumptions or a change in thecharacteristics of the benefit are taken to profit or loss intheir entirety.

 

> 
***Contingencies***

In addition to accruing the estimated costs for environmentalliabilities, asset retirement obligations and employee benefits,Eni accrues for all contingencies that are both probable andestimable. These other contingencies are primarily related tolitigation and tax issues. Determining appropriate amounts foraccrual is a complex estimation process that includes subjectivejudgments.

 

> 
***Revenue recognition in the Engineering &    Construction segment***

Revenue recognition in the Engineering & Constructionsegment is based on the stage of completion of a contract asmeasured on the cost-to-cost basis applied to contractualrevenues. Use of the stage of completion method requiresestimates of future gross profit on a contract by contract basis.The future gross profit represents the profit remaining afterdeducting costs attributable to the contract from revenuesprovided for in the contract. The estimate of future gross profitis based on a complex estimation process that includesidentification of risks related to the geographical region,market conditions in that region and any assessment that isnecessary to estimate with sufficient precision the total futurecosts as well as the expected timetable. Requests for additionalincome, deriving from a change in the scope of work, are includedin the total amount of revenues when it is probable that thecustomer will approve the variation and the related amount.Claims deriving from additional costs incurred for reasonsattributable to the client are included in the total amount ofrevenues when it is probable that the counterparty will acceptthem.

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**2006-2008 Group Results of Operations**

> 
***Overview of the Profit and Loss Account for    Three Years Ended December 31, 2006, 2007 and 2008***

The table below sets forth a summary of Eni’s profit andloss account for the periods indicated. All line items includedin the table below are derived from the Consolidated FinancialStatements prepared in accordance with IFRS.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| Net sales from operations                                    |   | 86,105     |   |   | 87,256     |   |   | 108,148    |   |
|--------------------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|
| Other        income and revenues (1)                         |   | 783        |   |   | 827        |   |   | 720        |   |
|                                                         |   |            |        |   |            |        |   |            |        |
| Total revenues                                               |   | 86,888     |   |   | 88,083     |   |   | 108,868    |   |
| Operating        expenses                                    |   | (61,140    | )      |   | (61,979    | )      |   | (80,412    | )      |
| Depreciation, depletion, amortization and        impairments |   | (6,421     | )      |   | (7,236     | )      |   | (9,815     | )      |
|                                                         |   |            |        |   |            |        |   |            |        |
| **OPERATING        PROFIT**                                  |   | **19,327** |   |   | **18,868** |   |   | **18,641** |   |
| Finance income (expense)                                     |   | 161        |   |   | (83        | )      |   | (764       | )      |
| Income        from investments                               |   | 903        |   |   | 1,243      |   |   | 1,373      |   |
|                                                         |   |            |        |   |            |        |   |            |        |
| **PROFIT BEFORE INCOME TAXES**                               |   | **20,391** |   |   | **20,028** |   |   | **19,250** |   |
| Income        taxes                                          |   | (10,568    | )      |   | (9,219     | )      |   | (9,692     | )      |
|                                                         |   |            |        |   |            |        |   |            |        |
| **NET PROFIT**                                               |   | **9,823**  |   |   | **10,809** |   |   | **9,558**  |   |
| Attributable        to:                                      |   |       |   |   |       |   |   |       |   |
| **- Eni**                                                    |   | **9,217**  |   |   | **10,011** |   |   | **8,825**  |   |
| - minority        interest                                   |   | 606        |   |   | 798        |   |   | 733        |   |
|                                                         |   |            |        |   |            |        |   |            |        |

----

| (1) | i | Includes,        among other things, contract penalties, income from        contract cancellations, gains on disposal of mineral        rights and other fixed assets, compensation for damages        and indemnities and other income. |
|-----|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

The table below sets forth certain income statement items as apercentage of net sales from operations for the periodsindicated. 

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(%)** |
|--------|---------|

| Operating expenses                                           |   | 71.0     |   |   | 71.0     |   |   | 74.4     |   |
|--------------------------------------------------------------|--------|----------|--------|--------|----------|--------|--------|----------|--------|
| Depreciation,        depletion, amortization and impairments |   | 7.5      |   |   | 8.3      |   |   | 9.1      |   |
| **OPERATING PROFIT**                                         |   | **22.4** |   |   | **21.6** |   |   | **17.2** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

*2008 compared to 2007*. Net profit pertaining to Eni in2008 was euro 8,825 million, representing a decrease of euro1,186 million from 2007, down 11.8%. This decrease was affectedby the following negative factors.

| (i)   |   | Higher finance expenses (up        euro 681 million) were recorded mainly reflecting losses        of euro 577 million incurred on fair value valuation of        certain derivative financial instruments that do not meet        the formal criteria to be qualified as hedges under IFRS.        Additionally, higher finance charges on finance debt were        incurred as a result of increased average net borrowings        and higher interest rates on euro denominated finance        debt (Euribor up 0.3 percentage points) partially offset        by lower interest rates on dollar loans (Libor down 2.4        percentage points). |
|-------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (ii)  |   | An increase in income taxes        of euro 473 million mainly due to increased income taxes        currently payable recorded by subsidiaries in the        Exploration & Production division operating outside        Italy, partly offset by a positive adjustment to deferred        taxation associated with new tax rules effective from        January 1, 2008 applicable to Italian companies and        Libyan activities (for more details on these items see        "Taxation" below).                                                                                                                                       |
| (iii) |   | A decrease in operating        profit of euro 227 million, mainly due to the weaker        operating performance reported by Eni’s downstream        businesses, partly offset by an improved performance in        the Exploration & Production segment driven by        the strong pricing environment experienced until        September 2008.                                                                                                                                                                                                                                                                                      |

These negative factors were partly offset by higher profitfrom non consolidated entities that are accounted for under theequity or the cost method, up euro 130 million.

*2007 compared to 2006.* Net profit pertaining to Eni in2007 was euro 10,011 million with a euro 794 million increasefrom 2006 (8.6%), primarily due to:

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| (i) |   | lower income taxes (down        euro 1,349 million) mainly reflecting: |
|-----|--------|------------------------------------------------------------------------|

|   |   | - |   | an adjustment to deferred        tax assets and liabilities for Italian subsidiaries        amounting to euro 394 million relating to certain        amendments to the Italian tax regime, including a lower        statutory tax rate, enacted by the 2008 Budget Law, and |
|--------|--------|---|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   | - |   | the circumstance that in        2006 deferred tax liabilities were recorded due to        changes in the fiscal regimes of Algeria and the United        Kingdom and charges regarding disputes on certain tax        matters (totaling euro 347 million); |
|--------|--------|---|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (ii)  |   | an increase in net income        from investments of euro 340 million, mainly due to net        gains on the divestment of interests in certain        associates of the Engineering & Construction segment        and higher earnings from entities that are accounted for        under the equity or the cost method; and                                                                                                                                                                                                                                                                                                                                   |
|-------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (iii) |   | a gain of euro 83 million        deriving from a reduction in the provision accrued for        post-retirement benefits for Italian employees following        changes in applicable regulation (the so called        curtailment of the provision for post retirement        benefits). Effective January 1, 2007, Italian laws        modified Italian post-retirement benefits scheme from a        defined benefit plan to a defined contribution one.        Following this, the provision for Italian employees was        reassessed to take account of the exclusion of future        salaries and relevant increases from actuarial        calculations. |

These positive factors were partly offset by a lower operatingprofit (down euro 459 million) mainly in the Exploration &Production segment (euro 1,792 million) and higher net financecharges (euro 244 million).

 

> 
***Discontinued Operations***

Discontinued operations in 2008, 2007 and 2006 wereimmaterial.

 

> 
***Analysis of the Line Items of the Profit and Loss    Account***

***a) Total Revenues***

Eni’s total revenues were euro 108,868 million, euro88,083 million and euro 86,888 million in 2008, 2007 and 2006,respectively. Total revenues consist of net sales from operationsand other income and revenues. Eni’s net sales fromoperations amounted to euro 108,148 million, euro 87,256 millionand euro 86,105 million in 2008, 2007 and 2006, respectively, andits other income and revenues totaled euro 720 million, euro 827million and euro 783 million, respectively, in these periods.

> 
*Net sales from operations*

The table below sets forth, for the periods indicated, netsales from operations generated by each of Eni’s businesssegments including intra-group sales, together with consolidatednet sales from operations. 

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| Exploration & Production                              |   | 27,173     |   |   | 27,278     |   |   | 33,318      |   |
|-----------------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|-------------|--------|
| Gas &        Power                                    |   | 28,368     |   |   | 27,633     |   |   | 36,936      |   |
| Refining & Marketing                                  |   | 38,210     |   |   | 36,401     |   |   | 45,083      |   |
| Petrochemicals                                            |   | 6,823      |   |   | 6,934      |   |   | 6,303       |   |
| Engineering & Construction                            |   | 6,979      |   |   | 8,678      |   |   | 9,176       |   |
| Other        activities                                   |   | 823        |   |   | 205        |   |   | 185         |   |
| Corporate and financial companies                         |   | 1,174      |   |   | 1,313      |   |   | 1,331       |   |
| Impact of        unrealized intragroup profit elimination |   |       |   |   |       |   |   | 75          |   |
| Consolidation adjustment (1)                              |   | (23,445    | )      |   | (21,186    | )      |   | (24,259     | )      |
|                                                      |   |            |        |   |            |        |   |             |        |
| **NET        SALES FROM OPERATIONS**                      |   | **86,105** |   |   | **87,256** |   |   | **108,148** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

----

| (1) |   | Intra-group        sales are included in net sales from operations in order        to give a more meaningful indication about the volume of        the activities to which sales from operations by segment        may be related. The most substantial intra-group sales        are recorded by the Exploration & Production segment.        See Note 36 to the Consolidated Financial Statements for        a breakdown of intra-group sales by segment for the        reported years. |
|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

*2008 compared to 2007.* Eni’s net sales fromoperations for 2008 (euro 108,148 million) were up euro 20,892million from 2007, or 23.9%, primarily reflecting higherrealizations on oil, products and natural gas in dollar terms andhigher natural gas sales volumes due to the acquisition ofDistrigas. These positives were partially offset by the impact of7.3% appreciation of the euro versus the dollar on average duringthe period.

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Revenues generated by the Exploration & Productiondivision (euro 33,318 million) increased by euro 6,040 million,or 22.1%, mainly due to higher realizations of oil and gas indollar terms (oil up 24.2%, natural gas up 47.8%). Eni’sliquid realizations (84.05 $/BL) were affected by the settlementof certain commodity derivatives relating to the sale of 46 mmBBLin the year, with a negative impact of 4.13 $/BL (for a moredetailed explanation, see the discussion on results of theExploration & Production division below). Revenue increasesin 2008 were also driven by higher production volumes sold (up20.1 mmBOE, or 3.3%). These improvements were partially offset bythe appreciation of the euro against the dollar.

Revenues generated by the Gas & Power division (euro36,936 million) increased by euro 9,303 million, up 33.7%, mainlydue to higher average natural gas prices reflecting trends inenergy parameters to which gas prices are contractually indexed,as well as increased international sales due to the contributionof the acquisition of Distrigas and organic growth recorded inEuropean target markets, partly offset by lower volumes sold inItaly due to the impact of the economic downturn and competitivepressure.

Revenues generated by the Refining & Marketing division(euro 45,083 million) increased by euro 8,682 million, up 23.9%,mainly due to higher international prices for oil and productsand higher product volumes sold (up 1.1%) partly offset by theimpact of the appreciation of the euro over the dollar.

Revenues generated by the Petrochemical division (euro 6,303million) decreased by euro 631 million, down 9.1%, mainlyreflecting a decline in volumes sold (down 15%) due to weakerdemand.

Revenues generated by the Engineering & Constructiondivision (euro 9,176 million) increased by euro 498 million, up5.7%, due to increased activity levels.

*2007 compared to 2006.* Eni’s net sales fromoperations (revenues) for 2007 (euro 87,256 million) were up euro1,151 million, a 1.3% increase from 2006, primarily reflectinghigher activity levels in the Engineering & Constructiondivision and higher realizations on oil and natural gas in dollarterms, partially offset by the impact of the appreciation of theeuro versus the dollar (up 9.2%), a decline in hydrocarbonproduction sold and lower products volumes sold, as well as thenegative trends of energy parameters to which gas prices arecontractually indexed in the Gas & Power division.

Revenues generated by the Exploration & Productiondivision (euro 27,278 million) increased by euro 105 million, up0.4%, mainly due to higher oil realizations in dollars (up12.7%), partially offset by to the impact of the appreciation ofthe euro versus the dollar and lower hydrocarbon production sold(down 14.7 mmBOE, or 2.2%).

Revenues generated by the Gas & Power division (euro27,633 million) declined by euro 735 million, down 2.6%, mainlydue to lower average natural gas prices reflecting negativetrends in energy parameters to which gas prices are contractuallyindexed and a negative shift in the mix of volumes sold.

Revenues generated by the Refining & Marketing division(euro 36,401 million) declined by euro 1,809 million, down 4.7%,mainly due to the effect of the appreciation of the euro over thedollar and lower product volumes marketed (down 0.98 mmtonnes),partly offset by higher international prices for oil andproducts.

Revenues generated by the Petrochemical division (euro 6,934million) increased by euro 111 million from 2006, up 1.6%,reflecting mainly the fact that performance in 2006 was adverselyimpacted by the unplanned downtime of the Priolo craker anddownstream plants as a consequence of an accident that occurredat the nearby refinery in April 2006, resulting in a recovery inproduction volumes sold (up 4.5%). Commodity chemicals priceswere also up by 4% on average.

Revenues generated by the Engineering & Constructiondivision (euro 8,678 million) increased by euro 1,699 million, up24.3%, due to increased activity levels in the Offshore andOnshore construction businesses.

Revenues generated by the Other activities division decreasedby euro 618 million to euro 205 million, due to the intragroupdivestment of the Porto Torres plant for the production of basicpetrochemical products to Polimeri Europa, which occurred in2007.

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> 
***b) Operating Expenses***

The table below sets forth the components of Eni’soperating expenses for the periods indicated.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| Purchases, services and other    |   | 57,490     |   | 58,179     |   | 76,408     |
|----------------------------------|--------|------------|--------|------------|--------|------------|
| Payroll        and related costs |   | 3,650      |   | 3,800      |   | 4,004      |
| **Operating expenses**           |   | **61,140** |   | **61,979** |   | **80,412** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

*2008 compared to 2007*. Operating expenses for 2008(euro 80,412 million) were up euro 18,433 million from 2007, or29.7%, reflecting primarily higher purchase prices of natural gasas well as higher prices for refinery and petrochemical feedstockdue to market trends in oil commodities and risingdollar-denominated operating expenses in the Exploration &Production division due to full consolidation of acquired assetsand the impact of sector-specific inflation, mainly in the firstnine months of the year. Those increases were partly offset bythe appreciation of the euro over the dollar.

Payroll and related costs (euro 4,004 million) were up euro204 million, or 5.4%, mainly due to higher unit labor cost inItaly and an increase in the average number of employees outsideItaly that was recorded mainly in the Exploration &Production division, following the consolidation of acquiredassets, as well as increased personnel in the Engineering &Construction business due to higher volumes. In addition in 2007a non-recurring gain of euro 83 million was recorded inconnection with the curtailment of the provision forpost-retirement benefits relating to obligations towards Italianemployees. These increases were partly offset by exchange ratetranslation differences.

*2007 compared to 2006*. Operating expenses for 2007(euro 61,979 million) increased by euro 839 million from 2006, up1.4%, mainly due to higher purchase prices for refinery andpetrochemical feedstock, as well as rising dollar-denominatedoperating expenses in the Exploration & Production segment,partly offset by the appreciation of the euro against the dollar.Purchases, services and other include: (i) an expense of euro 91million relating to a provision against ongoing antitrustproceedings before the European authorities net of a gainderiving from the reversal of a previously accrued provisionsupon favorable developments in certain antitrust proceedings; and(ii) environmental charges (euro 327 million), recognizedparticularly by Syndial and the Refining & Marketing segment.

Payroll and related costs (euro 3,800 million) increased byeuro 150 million, up 4.1%, mainly due to higher unit labor costsand an increase in the average number of employees outside Italyin the Engineering & Construction segment related to higheractivity levels and in the Exploration & Production segmentdue to the acquisition of assets. These increases were offset inpart by exchange rate translation differences and a gain (euro 83million) deriving from the curtailment of the provision forpost-retirement benefits existing at year-end 2006 related toobligations towards Italian employees.

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> 
***c) Depreciation, Depletion, Amortization and    Impairments***

The table below sets forth a breakdown of depreciation,depletion, amortization and impairments by business segment forthe periods indicated.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| Exploration & Production (1)                              |   | 4,646     |   |   | 5,483     |   |   | 6,733     |   |
|---------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|
| Gas &        Power                                        |   | 687       |   |   | 687       |   |   | 742       |   |
| Refining & Marketing                                      |   | 434       |   |   | 433       |   |   | 430       |   |
| Petrochemicals                                                |   | 124       |   |   | 116       |   |   | 117       |   |
| Engineering & Construction                                |   | 195       |   |   | 248       |   |   | 335       |   |
| Other        activities                                       |   | 6         |   |   | 4         |   |   | 3         |   |
| Corporate and financial companies                             |   | 70        |   |   | 68        |   |   | 76        |   |
| Impact of        unrealized intragroup profit elimination (2) |   | (9        | )      |   | (10       | )      |   | (14       | )      |
|                                                          |   |           |        |   |           |        |   |           |        |
| **Total depreciation, depletion and        amortization**     |   | **6,153** |   |   | **7,029** |   |   | **8,422** |   |
| Impairments                                                   |   | 268       |   |   | 207       |   |   | 1,393     |   |
|                                                          |   |           |        |   |           |        |   |           |        |
|                                                          |   | **6,421** |   |   | **7,236** |   |   | **9,815** |   |
|                                                          |   |           |        |   |           |        |   |           |        |

----

| (1) | i | Exploratory        expenditures of euro 2,057 million, euro 1,778 million        and euro 1,075 million are included in these amounts        relative to the years 2008, 2007 and 2006, respectively. |
|-----|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | This item        concerned mainly intra-group sales of commodities,        services and capital goods recorded in the assets of the        purchasing business segment as of end of the period.       |

*2008 compared to 2007*. In 2008 depreciation, depletionand amortization charges (euro 8,422 million) increased by euro1,393 million, up 19.8%, mainly in the Exploration &Production segment (up euro 1,250 million). The higher chargesincurred in the Exploration & Production segment wereassociated with: (i) increased development amortization chargesreflecting consolidation of assets acquired and increasedexpenditures to develop new fields and to sustain productionperformance at mature fields; and (ii) higher explorationexpenditures that are expensed in full when incurred (euro 420million). These increases were partly offset by the appreciationof the euro against the dollar.

In 2008, impairments (euro 1,393 million) mainly regardedproved and unproved mineral properties in the Exploration &Production division due to changes in the regulatory andcontractual framework for certain properties, cost increases, aswell as a changed pricing environment. The value of number ofplants and equipment in the Refining & Marketing andPetrochemical divisions were impaired due to a downward revisionof the future profitability associated with worseningexpectations for the future pricing/margin environment. For moreinformation about the main assumptions used by the Company intesting the recoverability of the carrying amounts of itsproperty, plant and equipment see "Note 8 to theConsolidated Financial Statements".

*2007 compared to 2006*. In 2007 depreciation, depletionand amortization charges (euro 7,029 million) increased by euro876 million, or 14.2%, from 2006 mainly in the Exploration &Production segment (up euro 837 million) related to higherexploratory expenditures (euro 703 million), the consolidation ofactivities acquired in the Gulf of Mexico and Congo and theimpact on amortization charges of an estimated update of assetretirement obligations for certain Italian and U.S. fieldscarried out in the preparation of 2006 consolidated financialstatements, offset in part by exchange rate differences.

In 2007 impairment charges amounted to euro 207 million mainlyregarding mineral assets in the Exploration & Productionsegment and plants and equipment in the Refining & Marketingsegment.

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> 
***d) Operating Profit by Segment***

The table below sets forth Eni’s operating profit bybusiness segment for the periods indicated. 

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| Exploration & Production                    |   | 15,580     |   |   | 13,788     |   |   | 16,415     |   |
|-------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|
| Gas &        Power                          |   | 3,802      |   |   | 4,127      |   |   | 3,933      |   |
| Refining & Marketing                        |   | 319        |   |   | 729        |   |   | (1,023     | )      |
| Petrochemicals                                  |   | 172        |   |   | 74         |   |   | (822       | )      |
| Engineering & Construction                  |   | 505        |   |   | 837        |   |   | 1,045      |   |
| Other        activities                         |   | (622       | )      |   | (444       | )      |   | (346       | )      |
| Corporate and financial companies               |   | (296       | )      |   | (217       | )      |   | (686       | )      |
| Impact of        intragroup profits elimination |   | (133       | )      |   | (26        | )      |   | 125        |   |
|                                            |   |            |        |   |            |        |   |            |        |
| **Operating profit**                            |   | **19,327** |   |   | **18,868** |   |   | **18,641** |   |
|                                            |   |            |        |   |            |        |   |            |        |

The table below sets forth operating profit for each ofEni’s principal business segments as a percentage of eachsegment’s net sales from operations (including intragroupsales) for the periods presented.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(%)** |
|--------|---------|

| Exploration & Production   |   | 57.3     |   |   | 50.5     |   |   | 49.3     |   |
|--------------------------------|--------|----------|--------|--------|----------|--------|--------|----------|--------|
| Gas &        Power         |   | 13.4     |   |   | 14.9     |   |   | 10.6     |   |
| Refining & Marketing       |   | 0.8      |   |   | 2.0      |   |   | (2.3     | )      |
| Petrochemicals                 |   | 2.5      |   |   | 1.1      |   |   | (13.0    | )      |
| Engineering & Construction |   | 7.2      |   |   | 9.6      |   |   | 11.4     |   |
|                           |   |          |        |   |          |        |   |          |        |
| **Group**                      |   | **22.4** |   |   | **21.6** |   |   | **17.2** |   |
|                           |   |          |        |   |          |        |   |          |        |

*Exploration & Production.* Operating profit in 2008amounted to euro 16,415 million, up euro 2,627 million from 2007,or 19.1%, reflecting higher realizations of oil and gas in dollarterms (oil up 24.2%; natural gas up 47.8%) and increasedproduction sales volumes (up 20.1 mmBOE) due to the contributionof assets acquired in the Gulf of Mexico, Congo and Turkmenistan.These increases were partly offset by: (i) the recognition ofsignificantly higher asset impairments (euro 810 million) due tochanges in the regulatory and contractual framework for certainproperties, cost increases, as well as a changed pricingenvironment; (ii) a negative impact on the translation to euro ofthe operating profit reported by subsidiaries whose functionalcurrency is the U.S. dollar as the euro appreciated on average by7.3%, with an estimated negative impact of euro 1,200 million;(iii) rising operating costs reflecting the impact ofsector-specific inflation and higher amortization anddepreciation charges, due to the consolidation of acquired assetsand higher costs incurred to develop new fields and to sustainproduction performance at mature fields; and (iv) increasedexploration expenses (euro 420 million on a constant exchangerate basis) in connection with higher geological and geophysicalexpenses and increased exploratory drilling expenditures that areexpensed in full as incurred.

Liquids and gas realizations for the year increased on averageby 28.1% in dollar terms driven by the strong market environmentof the first nine months of the year. Average gas realizationswere supported by a favorable trading environment and also abetter sales mix reflecting higher volumes marketed on the basisof spot prices on the U.S. market. Eni’s liquidsrealizations for the full year amounted to 84.05 $/BL (up 24.2%)which benefited from narrowing differentials between heavy andlight crude recorded in the year and were reduced byapproximately 4.13 $/BL due to the settlement of certaincommodity derivatives relating to the sale of 46 mmBBL in theyear, as follows:

| • |   | in the first three quarters        of the year liquid realizations were reduced on average        by 6.02 $/BL from the sale of 34.5 mmBBL; and                                                                 |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | in the fourth quarter liquid        realizations were increased by 1.36 $/BL from the sale of        11.5 mmBBL. The positive contribution of these        derivatives was confirmed in the first quarter 2009. |

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These derivatives were entered into in 2007 to hedge futurecash flows in the 2008-2011 period from the commodity risks onthe sale of approximately 2% of Eni’s proved reserves as of2006 year-end (125.7 mmBBL of which 79.7 million remained as ofDecember 31, 2008) associated with certain asset purchases in theGulf of Mexico and Congo that were executed in 2007.

Liquid realizations and the impact of commodity derivativeswere as follows:

|   | **Full Year** |
|--------|---------------|

|   |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|
|   |   |          |   |          |

| Sales volumes                                                |   | (mmBBL) |   | 366.7  |   | 364.3 |   |
|--------------------------------------------------------------|--------|---------|--------|--------|--------|-------|--------|
| Sales        volumes hedged by derivatives (cash flow hedge) |   |    |   |   |   | 46.0  |   |
| Total price per barrel, excluding derivatives                |   | ($/BL)  |   | 67.7   |   | 88.17 |   |
| Realized        gains (losses) on derivatives                |   |    |   |   |   | (4.1  | )      |
| Total average price per barrel                               |   |    |   | 67.7   |   | 84.05 |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Operating profit in 2007 amounted to euro 13,788 million, downeuro 1,792 million from 2006, or 11.5%, reflecting: (i) anegative impact due to the appreciation of the euro over thedollar (approximately euro 1,400 million), resulting in adecrease in revenues partly offset by lower operating expenseswhen translated into euro; (ii) lower production volumessold (down 14.7 mmBOE) due to disruptions in Nigeria andVenezuela’s expropriation of the Dación oilfield assets;(iii) increased exploration expenses (euro 840 million on aconstant basis) in connection with higher geological andgeophysical expenses and increased exploratory drillingexpenditures that are expensed in full as incurred; and (iv)rising operating costs reflecting the impact of sector-specificinflation and higher amortization and depreciation charges. Thesenegatives were partly offset by higher realizations in dollars(oil up 12.7%, natural gas up 2.2%).

*Gas & Power*. Operating profit in 2008 amounted toeuro 3,933 million, representing a euro 194 million declinecompared to 2007, down 4.7%. This decrease reflected thefollowing trends: (i) lower results from marketing operations inItaly as sales volumes of gas declined by 3.26 BCM due to theimpact of lower gas demand and competitive pressures; (ii) gasselling margins were lower as they were affected by a rapidrecovery in the U.S. dollar vs. the euro exchange rate in thelast part of the year. The Company’s cost of gas suppliesare linked to the current U.S. dollar vs. the euro exchange rateon a monthly basis, while gas selling prices are indexed to theU.S. dollar over a longer time period. As a result of this, inthe last part of the year, gas purchase prices were affected bythe recovery in the dollar leading to relatively higher purchasecosts, while selling prices reflected the stronger euro recordedin the previous months; and (iii) the fact that certainprovisions accrued in previous reporting periods were partiallyreversed through the 2007 profit and loss statement due tofavorable developments in Italy’s regulatory framework.Those provisions were originally accrued due to theimplementation of Resolution No. 248/2004 and following ones bythe Italian Authority for Electricity and Gas regarding theindexation mechanism of the raw material cost in supply contractsto resellers and residential customers. These decreases werepartly offset by an increase in operating results from regulatedbusinesses in Italy.

Operating profit in 2007 amounted to euro 4,127 million, aeuro 325 million increase compared to 2006, up 8.5%, due to: (i)a positive development with Italy’s regulatory framework ongas pricing to residential clients, reflecting a more favorableindexation mechanism of the raw material cost component asestablished by the Authority for Electricity and Gas withResolution No. 79/2007, changing the regime in force in the firsthalf of 2006 as established by Resolution No. 248/2004.Additionally, Eni fulfilled obligations provided by thisresolution to renegotiate wholesale contracts based on the sameindexation mechanism resulting in the partial reversal ofprovisions accrued in 2005 and in the first half of 2006 withrespect to expected charges for these renegotiations;(ii) higher supply costs incurred in 2006 caused by aclimatic emergency during the 2005-2006 winter; and (iii) anincrease in operating result from transportation activities inItaly.

*Refining & Marketing.* The Refining & Marketingsegment reported operating loss of euro 1,023 million, a euro1,752 million decrease compared to 2007, mainly due to aninventory holding loss amounting to euro 1,199 million recognizedin the 2008 profit and loss reflecting the impact of fallingprices of crude oil and products on the year-end valuation ofinventories according to the average-cost method of inventoryaccounting. In addition, impairment losses were recordedamounting to euro 299 million (down euro 241 million from 2007)as the recoverable amounts of certain refining plants and servicestations were lower than their carrying amounts due todeteriorating profitability prospects on the backdrop of loweredexpectations for the future trading environment. In 2007 aninventory holding gain of euro 658 million was recorded inconnection with the impact of increasing prices of oil andrefined products. Inventory holding gains or losses represent thedifference between the cost of sales of the volumes sold duringthe period calculated using the cost of supplies incurred duringthe same period and the cost of sales calculated using theweighted average cost method.

In 2008, reported operating benefited from a positiveunderlying performance of the refining business reflecting afavorable trading environment, partly offset by lower throughputsdue to planned and unplanned refinery 

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downtime and higher refinery expenses associated withutilities and compliance with certain environmental regulationsabout carbon dioxide emissions. Marketing activities in Italyreported higher operating results due to a recovery in retailmargins that were supported by a number of marketing initiativesand increased sales volumes as a result of an increased marketshare. The increase in wholesale business was due to highermargins.

Operating profit in 2007 amounted to euro 729 million, a euro410 million increase compared to 2006, mainly due to: (i) aninventory holding gain amounting to euro 658 million recognizedin 2007 profit and loss reflecting the impact of rising prices ofcrude oil and products on the valuation of year-end inventoriesusing the average-cost method of inventory accounting. In 2006 aninventory holding loss of euro 215 million was recorded inconnection with the impact of declining prices of oil and refinedproducts. Inventory holding gains or losses represent thedifference between the cost of sales of the volumes sold duringthe period calculated using the cost of supplies incurred duringthe same period and the cost of sales calculated using theweighted average cost method; and (ii) a provision accrued in2006 against a fine imposed by the Italian Antitrust Authorityfor anti-competitive activities in the field of supplies of jetfuel (euro 109 million).

On the negative side, the refining business delivered a weakeroperating performance on the backdrop of an unfavorable tradingenvironment for Eni’s complex refineries, reflecting reduceddiscounts on sour crudes, lowering margins from any of thecompany’s secondary products (such as base lubricants andbitumen) as the prices for these products did not increase inproportion to the costs of the feedstock used to produce them andthe appreciation of the euro over the dollar. Marketingactivities in Italy also reported a lower operating profit mainlydue to: (i) lower retail margins; and (ii) a decline in wholesalebusiness result due to lower margins and volumes marketed (down1.8%), the latter also reflecting unusually mild winter weatherin the first quarter of 2007 causing lower sales of home-heatingfuels.

*Petrochemicals*. In 2008 the Petrochemical segmentreported an operating loss amounting to euro 822 million, a euro896 million decrease compared to 2007, due to: (i) a steepdecline in selling margins of commodity chemicals, reflectinghigher supply costs of oil-based feedstock which were not fullytransferred to final selling prices; (ii) lower demand onend-markets particularly in the fourth quarter of the year as theeconomic downturn worsened and (iii) an inventory holding loss(euro 166 million). In addition, impairment losses of euro 278million were recorded as the recoverable amounts of certainpetrochemicals plants were lower than their carrying amounts dueto deteriorating profitability prospects on the backdrop oflowered expectations for the future unfavorable tradingenvironment.

Operating profit in 2007 amounted to euro 74 million, a euro98 million decrease compared to 2006, down 57%, due to lowerselling margins of commodity chemicals, particularly the marginon cracker and on aromatic products (paraxilene), reflecting asharp increase in the cost of oil-based feedstock which was notfully transferred to final selling prices. This negative waspartly offset by: (i) higher production and sales volumescompared to 2006; when an accident occurred at the Priolorefinery which heavily impacted performance; and (ii) lower assetimpairments (euro 50 million) and risk provisions (euro 31million). In addition a lower inventory holding gain was recorded(down euro 54 million).

*Engineering & Construction.* Operating profit in2008 amounted to euro 1,045 million, a euro 208 million increase(24.9%) compared to 2007. This increase related to an improvedoperating performance recorded in all business areas. Inparticular, Onshore and Offshore businesses benefited fromimproved margins, Offshore and Onshore activities reflectedhigher tariffs and higher activity levels.

Operating profit in 2007 amounted to euro 837 million, a euro332 million increase (65.7%) compared to 2006. This increaserelated to an improved operating performance recorded in allbusiness areas, particularly in the Offshore and Onshoreconstruction businesses due to higher activity levels andimproved margins.

*Other activities.* This reporting segment includes theresults of operations of Eni’s subsidiary Syndial which runsminor petrochemical activities and reclamation anddecommissioning activities pertaining to certain businesses whichEni exited in past years.

Other activities reported an operating loss of euro 346million for 2008, representing an improvement of euro 98 million,or 22.1%, compared to an operating loss recorded in 2007 (euro444 million) mainly due to impairment losses, as well as lowerenvironmental charges (euro 109 million).

Other activities reported an operating loss of euro 444million for 2007, representing an improvement of euro 178million, or 28.6%, compared to the loss recorded in 2006 (euro622 million) mainly due to lower provisions for risks and lowerasset impairments (for a cumulative positive effect of euro 78million) and to a gain recognized upon settlement of certaincontractual issues with Dow Chemical. This was partly offset byhigher environmental charges (euro 84 million).

*Corporate and financial companies.* These activitiesinclude expenses incurred in connection with corporate activitiesincluding the central treasury department and financialsubsidiaries that makes available a range of 

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financial services to the Group, including supporting thefinancing of Eni’s projects around the world, as well asresults from operations of certain Eni’s minor subsidiariesthat provide a range of services including training, businesssupport, real estate and general purposes services togroup’s companies.The aggregate Corporate and financial companies reported anoperating loss of euro 686 million for 2008, representing adecline of euro 469 million, compared to the loss recorded in2007 (euro 217 million), mainly reflecting a contribution of euro200 million to the solidarity fund pursuant to Italian Law DecreeNo. 112/2008 to be used to subsidize the gas bills forresidential uses of less affluent citizens and higherenvironmental provisions.

The aggregate Corporate and financial companies reported anoperating loss of euro 217 million for 2007, representing animprovement of euro 79 million, or 26.7%, compared to the lossrecorded in 2006 (euro 296 million), mainly reflecting loweroperating costs and lower provisions for redundancy incentives.

 

> 
***e) Net Finance Expense***

The table below sets forth a breakdown of Eni’s netfinancial expense for the periods indicated:

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| Gain (loss) on derivative financial instruments    |   | 383     |   |   | 26       |   |   | (551       | )      |
|----------------------------------------------------|--------|---------|--------|--------|----------|--------|--------|------------|--------|
| Exchange        differences, net                   |   | (152    | )      |   | (51      | )      |   | 206        |   |
| Interest income                                    |   | 194     |   |   | 236      |   |   | 87         |   |
| Finance        expense on short and long-term debt |   | (462    | )      |   | (703     | )      |   | (993       | )      |
| Finance expense due to passage of time             |   | (116    | )      |   | (186     | )      |   | (249       | )      |
| Income        from equity instruments              |   |    |   |   | 188      |   |   | 241        |   |
| Other finance income (expense), net                |   | 198     |   |   | 227      |   |   | 259        |   |
|                                               |   | **45**  |   |   | **(263** | **)**  |   | **(1,000** | **)**  |
| Finance expense capitalized                        |   | 116     |   |   | 180      |   |   | 236        |   |
|                                               |   |         |        |   |          |        |   |            |        |
|                                               |   | **161** |   |   | **(83**  | **)**  |   | **(764**   | **)**  |
|                                               |   |         |        |   |          |        |   |            |        |

*2008 compared to 2007*. In 2008 net finance expenseswere recorded amounting to euro 764 million increasing by euro681 million from 2007. This was mainly due to a net loss of euro551 million (as compared to a net gain of euro 26 million in2007) recognized in connection with fair value valuation throughprofit and loss of certain derivatives instruments oncommodities, interest and exchange rates that do not qualify forhedge accounting under IFRS. These transactions do not qualifyfor hedge accounting under IFRS due to the fact that Eni hedgesits exposure to commodity prices and interest and foreignexchange rates based on the overall exposure of the group tocommodity prices and foreign exchange and interest rates (ratherthan on a transaction-by-transaction basis which would berequired for hedge accounting). In addition, increased financecharges were incurred as average net borrowings increased, andinterest rates on euro-denominated finance debt were up (Euriborup 0.3 percentage points) partially offset by lower interestrates on dollar loans (Libor down 2.4 percentage points). A gainfrom an equity instrument amounting to euro 241 million wasrecorded (euro 188 million in 2007) relating to the contractualremuneration of 9.4% on the 20% interest in OAO Gazprom Neftaccording to the contractual arrangements between Eni andGazprom.

*2007 compared to 2006*. In 2007, net finance expense(euro 83 million) increased by euro 244 million from 2006 when anet finance income of euro 161 million was recorded. This changewas mainly due to:

| (i) |   | the recognition of lower        gains on the fair value evaluation of certain financial        derivatives instruments which do not meet the formal        criteria to be assessed as hedges under IFRS, including        the ineffective portion of the change in fair value of        certain commodity derivatives designed as cash flow        hedges resulting in a loss of euro 52 million in        connection with trends in oil prices as of the date of        the evaluation.        Eni entered into these instruments to hedge the exposure        to variability in future cash flows deriving from        marketing an amount of Eni’s proved reserves equal        to 2% of proved reserves as of December 31, 2006        (corresponding to approximately 125.7 mmBOE). These        hedging transactions were undertaken in connection with        the acquisitions executed in 2007 of proved and unproved        properties in Congo and in the Gulf of Mexico. Eni put in        place certain forward sale contracts at a fixed price and        call and put options with the same date of exercise.        These options can be exercised in presence of crude oil        market prices higher or lower compared with preset        contractual prices. The effective portion of the change        in fair value of these hedges was directly recognized in        equity and amounted to a loss of approximately euro 1.3        billion net of the related tax benefit with a        corresponding decrease in other current and non-current        liabilities; and |
|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (ii) |   | the increase in net finance        expenses due to the increase registered in average net        borrowings, as well as the impact of higher interest        rates on euro (Euribor up 1.2 percentage points) and        dollar loans (Libor up 0.1 percentage points). |
|------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

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These negatives were partly offset by a net gain of euro 188million recognized in connection with the fair value valuationrecorded in the profit and loss account of both a 20% interest inOAO Gazprom Neft that Eni acquired on April 4, 2007 followingfinalization of a bid within the Yukos liquidation procedure, andthe related call option granted by Eni to Gazprom related to thisinterest. This call option is exercisable within 24 monthsstarting from the acquisition date, at a price of $3.7 billionequaling the bid price, as modified by subtracting dividendsreceived and adding possible share capital increases, acontractual remuneration of 9.4% on the capital employed andadditional financing costs. The net gain recognized through theprofit and loss equaled the remuneration of the capital employedby Eni in the transaction according to the contractualarrangements between the two partners. This accounting treatmentis in accordance with the fair value option provided by IAS 39.Eni elected this accounting treatment to eliminate a recognitioninconsistency that would otherwise arise from measuring the 20%interest in OAO Gazprom Neft and the related call option ondifferent bases. In fact, the call option granted to Gazprom ismeasured at fair value through profit or loss being a derivativeinstrument. Fair value evaluation of the 20% interest in OAOGazprom Neft was based on quoted market prices as this entity iscurrently listed on the London Stock Exchange.

 

> 
***f) Income (Expenses) from Investments***

*2008 compared to 2007*. Net income from investments in2008 was euro 1,373 million and was mainly related to: (i)Eni’s share of profit of entities accounted for with theequity method (euro 640 million), in particular in the Gas &Power and Exploration & Production divisions; (ii) net gainson the divestment of interest in Gaztransport et Technigaz SAS(euro 185 million) in the Engineering & Construction divisionand of the interest in Agip España by the Refining &Marketing division (euro 15 million); and (iii) dividendsreceived by entities accounted for at cost (euro 510 million),mainly related to Nigeria LNG Ltd.

*2007 compared to 2006*. Net income from investments in2007 was euro 1,243 million and was mainly related to: (i)Eni’s share of earning of equity-accounted affiliates (euro773 million), particularly in the Gas & Power, Refining &Marketing and Engineering & Construction segments; (ii) netgains on the divestment of interests in Haldor Topsøe AS andCamom Group (totaling euro 290 million) in the Engineering &Construction segment; and (iii) dividends received by affiliatesaccounted for at cost (euro 170 million). The euro 340 millionincrease in net income from investments from 2006 was dueessentially to higher gains on disposals of interests in theEngineering & Construction segment and higher dividendsdistributed in particular by Nigeria LNG, whose effects wereoffset in part by lower results of operations of affiliates.

 

> 
***g) Income Tax Expense***

*2008 compared to 2007.* In 2008, income taxes amountedto euro 9,692 million, up euro 473 million, or 5.1%, mainlyreflecting increased income taxes currently payable recorded bysubsidiaries in the Exploration & Production segmentoperating outside Italy due to higher taxable profit.

The higher taxes currently payable were partly offset by anadjustment to deferred tax relating to:

| • |   | a net gain amounting to euro        176 million which was recorded in connection with new tax        rules in Italy that changed the tax treatment of        inventories. Law Decree No. 112 of June 25, 2008        (Converted in to Law No. 133/2008) requires that from        2008 Italian energy companies state inventories of        hydrocarbons at the weighted-average cost for tax        purposes as opposed to the previous LIFO valuation and to        recognize a one-off tax calculated by applying a special        rate of 16% on the difference between the two amounts.        This provision triggered utilization of deferred tax        liabilities recognized till 2008 that were accrued by        applying the statutory tax rate to the higher carrying        amounts of year-end inventories of oil, gas and refined        products stated at the weighted-average cost with respect        to their tax base (euro 528 million) partly offset by the        recognition of a one-off tax amounting to euro 229        million. This one-off tax will be paid in three annual        installments of same amount, due from 2009 onwards.        Deferred taxation was accrued on hydrocarbons inventories        based on the applicable statutory tax rate of 33% as        enacted in June 2008 compared with 27.5% of the previous        tax regime representing an expense of euro 123 million; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | application of the statutory        tax rate of 33% pursuant to Law Decree No. 112/2008        replacing the previously applicable tax rate of 27.5% on        certain deferred tax assets of Italian subsidiaries        resulting in a gain of euro 94 million;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| • |   | application of the Italian        Budget Law for 2008 that provided an increase in limits        whereby carrying amounts of assets and liabilities of        consolidated subsidiaries can be recognized for tax        purposes by paying a one-off tax calculated by applying a        special rate of 6% resulting in a net positive impact on        profit and loss of euro 290 million; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |

| • |   | enactment of a renewed tax        framework in Libya regarding oil companies operating in        accordance with production sharing schemes. Based on the        new provisions, the tax base of the Company’s Libyan        oil properties has been reassessed resulting in the        partial utilization of previously accrued deferred tax        liabilities (euro 173 million). |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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These positives were partly offset by the fact that in 2007Eni made use of an option provided in the annual Budget Lawwhereby the Company aligned the carrying amounts of certain fixedassets to their tax base by paying a one-off tax and recordingthrough the profit and loss account excess deferred taxationresulting in a net positive impact of euro 773 million.

In 2009 management expects the Group effective tax-rate to beapproximately 52-53%, representing an increase from 2008 as aresult of the recently enacted supplemental tax rate for theparent company which provides for a four percentage pointadditional rate to be applied to profit before income taxeseffective from January 1, 2009 (see "Item 3 – RiskFactors"). In addition, the Group does not expect any gainsin deferred taxation for amounts comparable to those recorded in2008. This guidance on tax rate is based on the Group full yearassumption of a Brent price of U.S. dollar 43 per barrel incalculating the tax burden associated with the Company’sPSAs (see "Management expectations of operations"below).

*2007 compared to 2006*. Income taxes were euro 9,219million, down euro 1,349 million, or 12.8%, mainly reflecting anadjustment to deferred tax assets and liabilities for Italiansubsidiaries relating to certain amendments to the Italian taxregime, including a lower statutory tax rate, enacted by the 2008Budget Law (euro 394 million), as well as deferred taxliabilities recorded in 2006 due to changes in the fiscal regimesof Algeria and the United Kingdom and charges regarding disputeson certain tax matters (totaling euro 347 million).

The adjustment to deferred tax assets and liabilities forItalian subsidiaries were recognized in connection with certainamendments to the Italian tax regime enacted by the 2008 BudgetLaw. These included a lower statutory tax rate (IRES from 33% to27.5%, IRAP from 4.25% to 3.9%) effective January 1, 2008, and anoption regarding the increase of the tax bases of certaintangible and other assets to their carrying amounts by paying aspecial tax with a rate lower than the statutory tax rate. TheGroup tax rate (46%) declined by 5.8 percentage points from 2006(51.8%) reflecting: (i) a lower share of profit before taxesgenerated by the Exploration & Production division;(ii) the abovementioned adjustment to deferred tax assetsand liabilities for Italian subsidiaries; and (iii) therecognition of certain gains on divestment of certain interestswhich are subject to lower taxation. These positives were partlyoffset by a higher tax rate recorded in the upstream division.

 

> 
***h) Minority Interest***

*2008 compared to 2007*. Minority interest was euro 733million, down euro 65 million from 2007, or 8.1%, and concernedprimarily Saipem SpA (euro 407 million) and Snam Rete Gas SpA(euro 254 million).

*2007 compared to 2006.* Minority interest was euro 798million, up euro 192 million from 2006, or 31.7%, and concernedprimarily Saipem SpA (euro 514 million) and Snam Rete Gas SpA(euro 268 million). This increase in minority interest mainlyreflected the improvement in Saipem’s results of operationsand the mentioned gain on disposal of equity interest in certainaffiliates.

 

 

**Liquidity and Capital Resources**

Eni’s cash requirements for working capital, sharebuybacks, dividends to shareholders, capital expenditures andacquisitions over 2006, 2007 and 2008 were financed primarily bya combination of funds generated from operations, borrowings anddivestments of non-strategic assets. The Group continuallymonitors the balance between cash flow from operating activitiesand net expenditures targeting a sound and well-balancedfinancing structure.

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The following table summarizes the Group cash flows and theprincipal components of Eni’s change in cash and cashequivalent for the periods indicated.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| **Net profit**                                                                                                      |   | **9,823**  |   |   | **10,809** |   |   | **9,558**  |   |
|---------------------------------------------------------------------------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|
| *Adjustments        to reconcile to cash generated from operating profit        before changes in working capital:* |   |       |   |   |       |   |   |       |   |
| - depreciation, depletion and amortization and        other non monetary items                                      |   | 5,753      |   |   | 6,346      |   |   | 11,388     |   |
| - net        gains on disposal of assets                                                                            |   | (59        | )      |   | (309       | )      |   | (219       | )      |
| - dividends, interest, income taxes and other        changes                                                        |   | 10,435     |   |   | 8,850      |   |   | 9,080      |   |
|                                                                                                                |   |            |        |   |            |        |   |            |        |
| **Cash generated from operating profit before        changes in working capital**                                   |   | **25,952** |   |   | **25,696** |   |   | **29,807** |   |
| Changes in        working capital related to operations                                                             |   | (1,024     | )      |   | (1,667     | )      |   | 2,212      |   |
| Dividends received, taxes paid, interest (paid)        received during the year                                     |   | (7,927     | )      |   | (8,512     | )      |   | (10,218    | )      |
|                                                                                                                |   |            |        |   |            |        |   |            |        |
| **Net cash provided by operating activities**                                                                       |   | **17,001** |   |   | **15,517** |   |   | **21,801** |   |
| Capital        expenditures                                                                                         |   | (7,833     | )      |   | (10,593    | )      |   | (14,562    | )      |
| Acquisitions of investments and businesses                                                                          |   | (95        | )      |   | (9,665     | )      |   | (4,019     | )      |
| Disposals                                                                                                           |   | 328        |   |   | 659        |   |   | 979        |   |
| Other cash flow related to investing activities                                                                     |   | 577        |   |   | (514       | )      |   | (267       | )      |
| Changes in        short and long-term finance debt                                                                  |   | (682       | )      |   | 8,761      |   |   | 980        |   |
| Dividends paid and changes in minority interest        and reserves                                                 |   | (6,443     | )      |   | (5,836     | )      |   | (6,005     | )      |
| Effect of        changes in consolidation and exchange differences                                                  |   | (201       | )      |   | (200       | )      |   | 918        |   |
|                                                                                                                |   |            |        |   |            |        |   |            |        |
| **Change in cash and cash equivalents for the        year**                                                         |   | **2,652**  |   |   | **(1,871** | **)**  |   | **(175**   | **)**  |
|                                                                                                                |   |            |        |   |            |        |   |            |        |
| Cash and cash equivalents at the beginning of        the year                                                       |   | 1,333      |   |   | 3,985      |   |   | 2,114      |   |
| Cash and        cash equivalents at year end                                                                        |   | 3,985      |   |   | 2,114      |   |   | 1,939      |   |
|                                                                                                                |   |            |        |   |            |        |   |            |        |

The table below sets forth the principal components ofEni’s change in net borrowings (1) for theperiods indicated.

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| **Net cash provided by operating activities**                                       |   | **17,001** |   |   | **15,517** |   |   | **21,801** |   |
|-------------------------------------------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|
| Capital        expenditures                                                         |   | (7,833     | )      |   | (10,593    | )      |   | (14,562    | )      |
| Acquisitions of investments and businesses                                          |   | (95        | )      |   | (9,665     | )      |   | (4,019     | )      |
| Disposals                                                                           |   | 328        |   |   | 659        |   |   | 979        |   |
| Other cash flow related to capital expenditures,        investments and divestments |   | 361        |   |   | (35        | )      |   | (267       | )      |
| Net        borrowings (1) of acquired companies                                     |   |       |   |   | (244       | )      |   | (286       | )      |
| Net borrowings (1) of divested        companies                                     |   | 1          |   |   |       |   |   | 181        |   |
| Exchange        differences on net borrowings and other changes                     |   | 388        |   |   | 637        |   |   | 129        |   |
| Dividends paid and changes in minority interest        and reserves                 |   | (6,443     | )      |   | (5,836     | )      |   | (6,005     | )      |
|                                                                                |   |            |        |   |            |        |   |            |        |
| **Change in net borrowings**(1)                                                     |   | **3,708**  |   |   | **(9,560** | **)**  |   | **(2,049** | **)**  |
|                                                                                |   |            |        |   |            |        |   |            |        |
| Net borrowings (1) at the beginning        of the year                              |   | 10,475     |   |   | 6,767      |   |   | 16,327     |   |
| Net        borrowings (1) at year end                                               |   | 6,767      |   |   | 16,327     |   |   | 18,376     |   |
|                                                                                |   |            |        |   |            |        |   |            |        |

----

| (1) | i | Net        borrowings is a non-GAAP financial measure. For a        discussion of the usefulness of net borrowings and its        reconciliation with the most directly comparable GAAP        financial measures see "Financial Condition"        below. |
|-----|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

> 
 

***Analysis of Certain Components of Eni’s Change    in Net Borrowings:***

***a) Cash Generated from Operating Profit before    Changes in Working Capital***

Net cash generated from operating profit before changes inworking capital totaled euro 29,807 million in 2008 (euro 25,696million in 2007), up euro 4,111 million from 2007.

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Net profit for 2008 was adjusted to take into accountdepreciation, depletion and amortization and other non-monetaryitems (euro 11,388 million), which primarily regardeddepreciation, depletion and amortization of tangible andintangible assets (euro 8,422 million), non-monetary chargesrelating to environmental and risk provisions, impairments ofproperty, plant and equipment and investments (euro 2,966million). Adjustments to net profit also included income taxes(euro 9,692 million) and interest expense (euro 809 million).

Net profit for 2007 was adjusted to take into accountdepreciation, depletion and amortization and other non-monetaryitems (euro 6,346 million), which primarily regardeddepreciation, depletion and amortization of tangible andintangible assets (euro 7,029 million), non-monetary chargesrelating to environmental and risk provisions, impairments ofproperty, plant and equipment and investments (euro 207 million).Adjustments to net profit also included income taxes and interestexpense (euro 8,850 million).

 

> 
***b) Changes in Working Capital related to Operations***

In 2008, changes in working capital added positive flowsamounting to euro 2,212 million as a result of increased currentliabilities and trade payables, as well as additions to the riskprovision. These positives were partly offset by cash outflowsassociated with increased trade receivables.

In 2007, changes in working capital were negative amounting toeuro 1,667 million mainly due to: (i) an increase in the carryingamount of inventories in connection with the evaluation ofinventories of refined products under the weighted-average costmethod of accounting; and (ii) increased trade receivables. Thesecash outflows were partly offset by increased trade payables.

 

> 
***c) Investing Activities***

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(euro        million)** |
|--------|---------------------------|

| Exploration & Production                          |   | 5,203     |   |   | 6,625      |   |   | 9,545      |   |
|-------------------------------------------------------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|
| Gas &        Power                                |   | 1,174     |   |   | 1,366      |   |   | 1,794      |   |
| Refining & Marketing                              |   | 645       |   |   | 979        |   |   | 965        |   |
| Petrochemicals                                        |   | 99        |   |   | 145        |   |   | 212        |   |
| Engineering & Construction                        |   | 591       |   |   | 1,410      |   |   | 2,027      |   |
| Other        activities                               |   | 72        |   |   | 59         |   |   | 52         |   |
| Corporate and financial companies                     |   | 88        |   |   | 108        |   |   | 95         |   |
| Impact of        unrealized profit in inventory       |   | (39       | )      |   | (99        | )      |   | (128       | )      |
|                                                  |   |           |        |   |            |        |   |            |        |
| **Capital expenditures**                              |   | **7,833** |   |   | **10,593** |   |   | **14,562** |   |
| **Acquisitions        of investments and businesses** |   | **95**    |   |   | **9,665**  |   |   | **4,019**  |   |
|                                                  |   |           |        |   |            |        |   |            |        |
|                                                  |   | **7,928** |   |   | **20,258** |   |   | **18,581** |   |
| **Disposals**                                         |   | **(328**  | **)**  |   | **(659**   | **)**  |   | **(979**   | **)**  |
|                                                  |   |           |        |   |            |        |   |            |        |
| **NET INVESTMENT**                                    |   | **7,600** |   |   | **19,599** |   |   | **17,602** |   |
|                                                  |   |           |        |   |            |        |   |            |        |

Capital expenditures totaled euro 14,562 million and euro10,593 million respectively in 2008 and in 2007.

In 2008, 84% of capital expenditures related to theExploration & Production (euro 9,545 million), Gas& Power (euro 1,794 million) and Refining &Marketing (euro 965 million) segments.

For a discussion of capital expenditures by business segmentand a description of year-on-year changes see "CapitalExpenditures by Segment" below.

Acquisitions of investments and businesses totaled euro 4,019million in 2008 and euro 9,665 million in 2007. Main acquisitionsexecuted in the year are outlined in "Item 4 –Significant business and portfolio developments for theyear".

Disposals amounted to euro 979 million in 2008 and euro 659million in 2007.

In 2008, disposals primarily related to the Engineering &Construction segment, in connection with the divestment of the30% stake in GTT (Gaztransport et Technigaz SAS) (euro 300million) and the sale of Agip España by the Refining &Marketing segment (euro 153 million).

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In 2007, disposals primarily related to: (i) the Engineering& Construction segment, in connection with the divestment ofinterests in Haldor Topsøe AS and Camom Group (totaling euro 378million); (ii) disposal of mineral assets and other minor assetsin the Exploration & Production segment (euro 182 million);and (iii) minor assets in the Refining & Marketing segment(euro 53 million).

 

> 
***d) Dividends paid and Changes in Minority Interests    and Reserves***

In 2008, dividends paid and changes in minority interests andreserves (euro 6,005 million) related mainly to the dividenddistribution to Eni shareholders for euro 4,910 million (of whicheuro 2,551 million related to the balance for the fiscal year2007 and euro 2,359 million as an interim dividend for fiscalyear 2008) and the distribution of dividend to minority interestby Snam Rete Gas SpA and Saipem SpA (euro 288 million) and otherconsolidated subsidiaries (euro 9 million) and the buy-backprogram (for euro 778 million by Eni SpA and for euro 58 millionby Saipem SpA).

In 2007, dividends paid and changes in minority interests andreserves (euro 5,836 million) related mainly to the dividenddistribution to Eni shareholders for euro 4,583 million (of whicheuro 2,384 million related to the balance for the fiscal year2006 and euro 2,199 million as an interim dividend for fiscalyear 2007) and the distribution of dividend to minority interestby Snam Rete Gas SpA and Saipem SpA (euro 282 million) and otherconsolidated subsidiaries (euro 7 million) and the buy-backprogram (for euro 680 million by Eni SpA and for euro 358 millionby Snam Rete Gas SpA and Saipem SpA).

 

> 
***Financial Condition***

In assessing its capital structure, Eni uses net borrowingsand leverage (as described below), both of which are"non-GAAP" financial measures. Non-GAAP financialmeasures are measures that either exclude or include amounts thatare not excluded or included in the comparable measurescalculated and presented in accordance with generally acceptedaccounting principles, in Eni’s case IFRS issued by the IASBand IFRS issued by the IASB as adopted by the European Union. Enicalculates net borrowings as total finance debt (short-term andlong-term debt) derived from its Consolidated FinancialStatements prepared in accordance with IFRS less: cash, cashequivalents and certain very liquid investments not related tooperations including, among others, non-operating financingreceivables and securities not related to operations.Non-operating financing receivables consist mainly of depositswith banks and other financing institutions and deposits inescrow. Securities not related to operations consist primarily ofgovernment bonds and securities from financing institutions.These assets are generally intended to absorb temporary surplusesof cash as part of the Company’s ordinary management offinancing activities.

Management believes that net borrowings is a useful measure ofEni’s financial condition as it provides insight about thesoundness of Eni’s capital structure and the means wherebyEni’s operating assets are financed. In addition, managementutilizes the ratio of net borrowings to total shareholders’equity including minority interest (leverage) to assessEni’s capital structure, to analyze whether the ratiobetween finance debt and shareholders’ equity is wellbalanced according to industry standards and to trackmanagement’s short-term and medium-term targets. Managementconstantly monitors trends in net borrowings and trends inleverage in order to optimize the use of internally-generatedfunds vs. funds from third parties. The measure calculated inaccordance with IFRS that is most directly comparable to netborrowings is total debt (short-term and long-term debt). Themost directly comparable leverage measure, derived from IFRSreported amounts, is the ratio of total debt toshareholders’ equity (including minority interest).Eni’s presentation and calculation of net borrowings andleverage may not be comparable to that of other companies.

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The tables below set forth the calculations of net borrowingsand leverage for the periods indicated and their reconciliationto the most directly comparable GAAP measure.

|   | **As of December 31,** |
|--------|------------------------|
|   |                        |

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   |   | **Short-term** |   | **Long-term** |   | **Total** |   | **Short-term** |   | **Long-term** |   | **Total** |   | **Short-term** |   | **Long-term** |   | **Total** |
|--------|--------|----------------|--------|---------------|--------|-----------|--------|----------------|--------|---------------|--------|-----------|--------|----------------|--------|---------------|--------|-----------|
|   |   |                |   |               |   |           |   |                |   |               |   |           |   |                |   |               |   |           |

|   | **(euro        million)** |
|--------|---------------------------|

| **Total debt (short-term and long-term debt)** |   | **4,290** |   |   | **7,409** |   |   | **11,699** |   |   | **8,500** |   |   | **11,330** |   |   | **19,830** |   |   | **6,908** |   |   | **13,929** |   |   | **20,837** |   |
|------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|
| Cash and        cash equivalents               |   | (3,985    | )      |   |      |   |   | (3,985     | )      |   | (2,114    | )      |   |       |   |   | (2,114     | )      |   | (1,939    | )      |   |       |   |   | (1,939     | )      |
| Securities not related to operations           |   | (552      | )      |   |      |   |   | (552       | )      |   | (174      | )      |   |       |   |   | (174       | )      |   | (185      | )      |   |       |   |   | (185       | )      |
| Non-operating        financing receivables     |   | (143      | )      |   | (252      | )      |   | (395       | )      |   | (990      | )      |   | (225       | )      |   | (1,215     | )      |   | (337      | )      |   |       |   |   | (337       | )      |
| **Net borrowings**                             |   | **(390**  | **)**  |   | **7,157** |   |   | **6,767**  |   |   | **5,222** |   |   | **11,105** |   |   | **16,327** |   |   | **4,447** |   |   | **13,929** |   |   | **18,376** |   |

|   |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |
|--------|--------|--|--|--------|--|--|--------|--|--|--------|--|--|--------|--|--|--------|--|--|--------|--|--|--------|--|--|--------|--|--|

 

|   | **As of December 31,** |
|--------|------------------------|
|   |                        |

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

| Shareholders’ equity including minority        interest as per Eni’s Consolidated Financial        Statements prepared in accordance with IFRS                             |   | (euro million) |   | 41,199  |   |   | 42,867  |   |   | 48,510  |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------|--------|---------|--------|--------|---------|--------|--------|---------|--------|
| *Ratio        of total debt to total shareholders’ equity        including minority interest*                                                                                   |   |           |   | *0.28*  |   |   | *0.46*  |   |   | *0.43*  |   |
| *Less: ratio of cash, cash equivalents and        certain liquid investments not related to operations to        total shareholders’ equity including minority        interest* |   |           |   | *(0.12* | *)*    |   | *(0.08* | *)*    |   | *(0.05* | *)*    |
| *Ratio        of net borrowing to total shareholders’ equity        including minority interest (leverage)*                                                                     |   |           |   | *0.16*  |   |   | *0.38*  |   |   | *0.38*  |   |
|                                                                                                                                                                                 |   |           |   |         |        |   |         |        |   |         |        |

> 
*Net borrowings*

In 2008, net borrowings amounted to euro 18,376 million,representing a euro 2,049 million increase from 2007. Thisincrease was mainly due to the large amount of capitalexpenditures and acquisitions executed in the year which was onlypartially funded with cash flows from operations. Total debt ofeuro 20,837 million consisted of euro 6,908 million short-termdebt (including the portion of long-term debt due within twelvemonths equal to euro 549 million) and euro 13,929 million oflong-term debt.

Total debt included bonds for euro 6,843 million (includingaccrued interest and discount on issuance). Bonds maturing in thenext 18 months amounted to euro 412 million (including accruedinterest and discount). Bonds issued in 2008 amounted to euro1,812 million (including accrued interest and discount). Totaldebt was denominated in the following currencies: euro (77%),U.S. dollar (11%), pound sterling (10%) and 2% in othercurrencies.

In 2007, net borrowings amounted to euro 16,327 million, aeuro 9,560 million increase over 2006, up 141%, reflecting thelarge amount of capital expenditures and acquisitions executed inthe year which was only partially funded with cash flows fromoperations. Total debt of euro 19,830 million consisted of euro8,500 million short-term debt (including the portion of long-termdebt due within twelve months equal to euro 737 million) and euro11,330 million of long-term debt.

Total debt included bonds for euro 5,386 million (includingaccrued interest and discount on issuance). Bonds maturing in thenext 18 months amounted to euro 584 million (including accruedinterest and discount). Bonds issued in 2007 amounted to euro1,118 million (including accrued interest and discount). Totaldebt was denominated in the following currencies: euro (78%),U.S. dollar (13%), pound sterling (8%) and 2% in othercurrencies.

> 
*Short-term Debt*

As of December 31, 2008, short-term debt of euro 6,908 million(including the portion of long-term debt due within twelvemonths) decreased by euro 1,592 million over 2007. The weightedaverage interest rate of Eni’s short-term debt was 4.2% and4.9% for the years ended December 31, 2008 and 2007,respectively.

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As of December 31, 2008, Eni had maintained committed anduncommitted unused borrowing facilities of euro 3,313 million andeuro 7,696 million, respectively (euro 5,006 million and euro6,298 million at December 31, 2007). These facilities were underinterest rates that reflected market conditions. Changes inunutilized facilities were not significant.

As of December 31, 2007, short-term debt of euro 8,500 million(including the portion of long-term debt due within twelvemonths) increased by euro 4,210 million over 2006. The weightedaverage interest rate of Eni’s short-term debt was 3.9% and4.9% for the years ended December 31, 2006 and 2007,respectively.

As of December 31, 2007, Eni had maintained committed anduncommitted unused borrowing facilities of euro 5,006 million andeuro 6,298 million, respectively (euro 5,896 million and euro6,523 million at December 31, 2006). These facilities were underinterest rates that reflected market conditions. Changes inunutilized facilities were not significant.

> 
*Long-term Debt*

As of December 31, 2008, long-term debt of euro 13,929 millionincreased by euro 2,599 million over 2007.

At December 31, 2007 and 2008, the amount of short andlong-term debt subject to restrictive covenants was euro 1,429million and euro 1,323 million, respectively. Furthermore, SaipemSpA entered into certain borrowing facilities for euro 75 millionwith a number of financial institutions subordinated to themaintenance of certain performance indicators based on theconsolidated financial statements of Saipem. Eni and Saipem arein compliance with the covenants contained in their respectivefinancing arrangements. Bonds of euro 6,843 million consisted ofbonds issued within the Euro Medium Term Notes Program for atotal of euro 6,391 million and other bonds for a total of euro452 million.

 

> 
***Capital Expenditures by Segment***

*Exploration & Production.*In 2008, capitalexpenditures of the Exploration & Production segment amountedto euro 9,545 million, representing an increase of euro 2,920million, or 44.1%, from 2007 mainly due to the development of oiland gas reserves. Significant expenditures were directed mainlyoutside Italy, in particular Kazakhstan, Egypt, Angola, Congo andthe United States. Development expenditures in Italy concerned awell drilling program and facility upgrading in Val d’Agrias well as sidetrack and infilling activities in mature fields.About 93% of exploration expenditures were directed outsideItaly, in particular to the United States, Egypt, Nigeria, Angolaand Libya. In Italy, exploration activities were directed mainlyto the offshore of Sicily. Acquisition of proved and unprovedproperty concerned mainly the extension of Eni’s mineralrights in Libya, following the agreement signed in October 2007with NOC, the National Oil Corporation (effective from January 1,2008), and the acquisition of a 34.81% stake in ABO project inNigeria.

In 2007, capital expenditures of the Exploration &Production segment amounted to euro 6,625 million, representingan increase of euro 1,422 million, or 27.3%, from 2006 due todevelopment of oil and gas reserves. This amount of expenditureswas also affected by industry-wide cost trends regarding oilfieldservices and equipment. Main projects were executed mainlyoutside Italy, in particular Kazakhstan, Angola, Egypt and Congo.Development expenditures in Italy concerned in particular a welldrilling program and facility upgrading in Val d’Agri andsidetrack and infilling interventions in mature fields.Significant expenditures were directed toward exploratoryprojects. About 94% of these expenditures were also directedoutside Italy, in particular the Gulf of Mexico, Egypt, Brazil,Norway and Nigeria. In Italy, exploration activities weredirected mainly to the offshore of Sicily. Acquisition of provedand unproved property concerned mainly a 70% interest in theNikaitchuq oilfield in Alaska, in which Eni reached a 100%ownership.

*Gas & Power.* In 2008, capital expenditures in theGas & Power segment totaled euro 1,794 million and relatedessentially to: (i) developing and upgrading Eni’s transportnetwork in Italy (euro 1,130 million); (ii) the upgrading plan ofinternational pipelines (euro 233 million); (iii) developing andupgrading Eni’s natural gas distribution network in Italy(euro 233 million); and (iv) ongoing construction of combinedcycle power plants (euro 107 million), in particular at theFerrara site.

In 2007, capital expenditures in the Gas & Power segmenttotaled euro 1,366 million and related essentially to: (i)developing and upgrading Eni’s primary transport network inItaly (euro 691 million); (ii) the upgrading plan ofinternational pipelines (euro 253 million); (iii) developing andupgrading Eni’s natural gas distribution network in Italy(euro 195 million); and (iv) ongoing construction of combinedcycle power plants (euro 175 million), in particular at theFerrara site.

*Refining & Marketing.* In 2008, capital expendituresin the Refining & Marketing segment amounted to euro 965million and related mainly to: (i) refining, supply and logistics(euro 630 million) in Italy, with projects designed to improvethe conversion rate and flexibility of refineries, in particularongoing construction of a new 

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hydrocracker at the Sannazzaro refinery, and expenditures onhealth, safety and environmental upgrades; (ii) upgrade andrestructuring of the retail network in Italy (euro 183 million);and (iii) upgrade of the retail network and purchase of servicestations in the rest of Europe (euro 115 million). Expenditureson health, safety and the environment amounted to euro 166million.

In 2007, capital expenditures in the Refining & Marketingsegment amounted to euro 979 million and regarded mainly: (i)refining, supply and logistics (euro 675 million) in Italy, withprojects designed to improve the conversion rate and flexibilityof refineries, in particular the start-up of construction of anew hydrocracking unit at the Sannazzaro refinery, andexpenditures on health, safety and environment upgrades; (ii)upgrade and restructuring of the retail network in Italy (euro176 million); and (iii) upgrade of the retail network in the restof Europe (euro 106 million). Expenditures on health, safety andthe environment amounted to euro 141 million.

*Petrochemicals.* In 2008, capital expenditures in thePetrochemical segment amounted to euro 212 million (euro 145million in 2007) and related mainly to extraordinary maintenance(euro 84 million), plant upgrades (euro 51 million),environmental protection, safety and environmental regulationcompliance (euro 41 million), upkeeping and rationalization (euro24 million).

In 2007, capital expenditures in the Petrochemical segmentamounted to euro 145 million regarded mainly plant upgrades (euro47 million), environmental protection, safety and environmentalregulation compliance (euro 39 million), extraordinarymaintenance (euro 29 million) and upkeeping (euro 28 million).

*Engineering & Construction.* In 2008, capitalexpenditures in the Engineering & Construction division (euro2,027 million) mainly related to the start up of the constructionof the deepwater field development ship FDS 2 as well as theongoing construction of the pipelayer, the semisubmersibleplatforms Scarabeo 8 and 9 and the deepwater drilling ship Saipem12000. In 2008, the construction of the FPSO vessel Gimboa and ofthe jack-up Perro Negro 7 has been completed.

In 2007, capital expenditures in the Engineering &Construction segment (euro 1,410 million) mainly related to: (i)ongoing construction of the new semisubmersible platform Scarabeo8, a new pipelayer and a new deepwater drilling ship Saipem12000; and (ii) the conversion of two tanker ships into FPSOvessels that will operate in Brazil on the Golfinho 2 field andin Angola.

 

 

**Recent Developments**

The table below sets forth certain indicators of the tradingenvironment for the periods indicated:

|   |   | **Three months        ended March 31,** |   | **One month        ended April 30,** |
|--------|--------|-----------------------------------------|--------|--------------------------------------|
|   |   |                                         |   |                                      |

|   |   | **2008** |   | **2009** |   | **2008** |   | **2009** |
|--------|--------|----------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |   |          |

| Average price of Brent dated crude oil in U.S.        dollars (1) |   | 96.90 |   | 44.40 |   | 108.97 |   | 50.34 |
|-------------------------------------------------------------------|--------|-------|--------|-------|--------|--------|--------|-------|
| Average        price of Brent dated crude oil in euro (2)         |   | 64.60 |   | 34.10 |   | 69.19  |   | 38.17 |
| Average EUR/USD exchange rate (3)                                 |   | 1.500 |   | 1.302 |   | 1.575  |   | 1.319 |
| Average        European refining margin in U.S. dollars (4)       |   | 3.81  |   | 5.34  |   | 8.34   |   | 4.06  |
| EURIBOR - three month euro rate % (3)                             |   | 4.5   |   | 2.0   |   | 4.78   |   | 1.42  |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

----

| (1) |  i | Price per        barrel. Source: Platt’s Oilgram.                                                                                                                                                       |
|-----|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i       | Price per        barrel. Source: Eni’s calculations based on        Platt’s Oilgram data for Brent prices and the        EUR/USD exchange rate reported by the European Central        Bank (ECB). |
| (3) | i       | Source: ECB.                                                                                                                                                                                                 |
| (4) | i       | Price per        barrel. FOB Mediterranean Brent dated crude oil. Source:        Eni calculations based on Platt’s Oilgram data.                                                                        |

 

> 
***Eni’s Results of Operations for the First    Quarter 2009***

Net profit for the first quarter of 2009 was down 42.7%compared to the first quarter of 2008. Reported operating profitwas down 35.8% as a result of lower profit in the Exploration& Production and Gas & Power segments due to lower oilprices and falling gas demand amidst the current economicdownturn. The Company also reported lower profit fromequity-accounted entities. This decrease in net profit was alsodue to a higher tax rate (up 2.7 percentage points from 45.6% to48.3%).

Eni’s results were positively influenced by thedepreciation (down 13.2%) of the euro vs. the dollar. The tradingenvironment was characterized by lower oil realizations in thequarter declining by 50.9% in dollar terms, driven by fallingBrent prices (down 54.2% from the first quarter of 2008). Naturalgas realizations increased by 

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3.8% due to the time lag between movements in oil prices andtheir effect on gas prices. Gas marketing margins increased froma the first quarter of 2008 due to favorable trends in energyparameters used in determining purchase and selling prices ofnatural gas.

Realized refining margins were slightly impacted by thefavorable trading environment as measured by movements in therelative prices of products compared to the cost of the oilfeedstock (the margin on Brent was 5.34 $/BL, up 40.2% from thefirst quarter of 2008), mainly due to narrowing differentialsbetween light and heavy oil that penalized Eni’s results oncomplex cycles. Retail marketing margins were lower. Sellingmargins of commodity chemicals were sharply due to higher costsof oil-based feedstock that were not fully recovered in salesprices.

At March 31, 2009 net borrowings declined by 10.1% fromDecember 31, 2008, due to cash inflows provided by operatingactivities, offset in part by financing requirements for capitalexpenditures.

In the first quarter of 2009, hydrocarbon production decreasedby 0.9% compared with the first quarter of 2008 mainly due toOPEC production cuts, unplanned facility downtime in Nigeria andmature field declines (for further detailed information see"Item 4 – Exploration & Production"). Thesenegatives were partially offset by continuing production ramp-upin Angola, Congo, Egypt and Venezuela. Lower oil prices resultedin higher volume entitlements in Eni’s Production SharingAgreements (PSAs) and similar contractual schemes.

Natural gas sales were up 4.7% as compared to the firstquarter of 2008 reflecting contribution from the Distrigasacquisition. This increase was partly offset by significantlylower gas sales on the Italian market due to the economicdownturn.

 

> 
***Significant Transactions***

On April 7, 2009 Gazprom exercised its call option to purchasethe 20% interest in OAO Gazprom Neft held by Eni followingagreements between the two partners. The 20% interest in GazpromNeft was acquired by Eni on April 4, 2007 as part of a bidprocedure for the assets of bankrupt Russian company Yukos. Theexercise price of the call option is equal to the bid price (U.S.$3.7 billion) as adjusted by subtracting dividends distributedand adding the contractual yearly remuneration of 9.4% on thecapital employed and additional financing expenses. On April 24,2009 Eni collected from Gazprom the cash consideration for theexercise of the call option amounting to U.S. $4.2 billion. Termsof the call option granted to Gazprom to purchase a 51% interestin the share capital of OOO SeverEnergia, which owns 100% of thethree abovementioned Russian companies engaging in gasdevelopment, are currently under review by Eni, Enel and Gazprom.

On March 19, 2009, a mandatory tender offer to the minorityshareholders of Distrigas was completed. Shareholdersrepresenting a 41.61% of the share capital of Distrigas tendered292,390 shares on Eni’s offer. Publigaz Scrl tendered itsentire interest (31.25%). The transaction has been accounted forin Eni financial statements as at March 31, 2009. On April 8,2009 Eni paid to those shareholders cash consideration amountingto euro 1,991 million. Following the tender offer, Eni owned98.86% of the share capital of Distrigas. The squeeze-out on theresidual 1.14% was completed in early May. Consequently Eni holdsall the shares of Distrigas except for one share belonging to theBelgian State with special powers. Distrigas shares have beendelisted from Euronext Brussels. For further details on thistransaction see "Item 4 – Significant business andPortfolio Developments".

On February 12, 2009, Eni’s Board of Directors approvedthe divestment of 100% of Italgas SpA and Stoccaggi Gas ItaliaSpA (Stogit) to Snam Rete Gas (50.03% owned by Eni) for totalcash consideration of euro 4,720 million (euro 3,070 million andeuro 1,650 million, respectively). The transaction will befinanced by Snam Rete Gas through: (i) a rights issue for up toeuro 3.5 billion (Eni has already committed to subscribe itsshare of the rights issue); and (ii) new medium to long-termfinancing for euro 1.3 billion. The main effects expected onEni’s consolidated financial statements when the transactioncloses will be: (i) a decrease of euro 1.5 billion in netborrowings and a corresponding increase in total equity as aconsequence of the pro-quota subscription of the Snam Rete Gascapital increase by the minority shareholders; and (ii) adecrease in Eni’s net profit equal to 45% of the aggregatenet profit of Italgas and Stogit, with a corresponding increasein net profit attributable to minority shareholders. From anindustrial perspective the transaction, expected to close in July2009, will create significant synergies in the regulatedbusinesses segment and maximize the value of Italgas and Stogitdue to the higher visibility of regulated businesses as a part ofSnam Rete Gas. For further details on this transaction see"Item 4 – Significant business and PortfolioDevelopments".

By the end of May 2009, based on the approval of the full yeardividend proposal made by the Company’s Annual GeneralShareholders Meeting on April 30, 2009, Eni expects to pay thebalance of the dividend for fiscal year 2008 amounting to euro0.65 per share. Total cash out is estimated at euro 2.36 billion.

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**Management’s Expectations of Operations**

Management expects that the macroeconomic environment willremain challenging throughout the whole of 2009. Key managementassumptions for the main external variables are an average Brentprice of 43 $/BL for the full year 2009 and a decline in Europeandemand for natural gas and fuels. The Brent assumption has beenused by management for planning purposes and does not intend tofurnish a forecast for what will be the likely Brent market pricefor the year. In this environment, management plans to achievethe following volumes targets.

| • |   | Hydrocarbon production: the        Company projects that its oil and gas production will        grow with respect to 2008 (actual production on        available-for-sale basis was 1,748 KBOE/d in 2008) when        excluding the impact of OPEC cuts to production levels in        certain of the Company’s countries of operations.        The Company anticipates a partial downward revision of        its growth rate compared to its initial plans for a 3%        growth rate for 2009 due to lower than anticipated gas        demand, rescheduling of certain projects in order to        capture the expected downturn in costs and the impact of        unplanned facility downtime, particularly in West Africa. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | Worldwide natural gas sales:        the Company projects that its natural gas sales will        increase from 2008 (actual sales volumes in 2008 were        104.23 BCM) reflecting the full contribution of the        Distrigas acquisition. In addition, the Company intends        to leverage on a number of marketing initiatives to gain        market share in the main European countries of operations        aiming at counteracting the effects of lowering gas        demand. Sales in Italy are expected to decline sharply        from the previous year due to the economic downturn and        competitive pressures.                                                                                               |
| • |   | Refining throughputs on        Eni’s account: the Company projects that refinery        throughputs will increase slightly from 2008 (actual        throughputs in 2008 were 35.84 mmtonnes) reflecting        improved performance at certain plants.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| • |   | Retail sales of refined        products in Italy and the rest of Europe: the Company        projects that sales of refined products at its outlets in        Italy and Europe will decline from 2008 (12.03 mmtonnes        in 2008, excluding the impact of the divestment of        marketing activities in the Iberian Peninsula that was        executed late in 2008) due to weak demand in the main        European markets on the backdrop of the economic        slowdown.                                                                                                                                                                                                                                                   |

Over the next four years, the Company plans to invest euro48.8 billion in its businesses to support continued organicgrowth; approximately 67%, 17%, 8% and 6% of planned capitalexpenditures will be directed to the Exploration &Production, Gas & Power, Engineering & Construction andRefining & Marketing segments, respectively. The main plannedprojects are as follows: (i) development of reserves ofhydrocarbons mainly in Kazakhstan, Norway, Libya, Italy, Angola,Congo, Egypt, Nigeria and the U.S. and; (ii) exploration projectsto be executed mainly in the U.S., Libya, Italy, Angola,Indonesia, Nigeria, Norway, and Egypt; (iii) upgrading ofnational pipelines for transporting natural gas, as well asupgrading of Italian distribution networks; (iv) developmentof infrastructures to store natural gas in order to supportseasonal upswings in natural gas demand; (v) upgrading of thefleet of construction vessels and offshore drilling rigs, as wellas logistic centers and other support facilities in theEngineering & Construction segment; (vi) refinery upgrading,mainly targeting an increase in conversion capacity andflexibility of Eni’s main refineries; and (vii) upgrading ofEni’s networks of service stations for marketing petroleumproducts.

Eni’s capital expenditure program has remained broadlyunchanged with respect to the previous industrial plan for thefollowing reasons: (i) management believes that it has adoptedprudent price assumptions in making investment decisions andthese assumptions remain intact also in the current economicdownturn; and (ii) management estimates that a high numberof development projects in the Company’s Exploration &Production business deliver positive returns at current oilprices. Additionally, the Company capital plans present a highexposure to the regulated activities in the Italian gas sector(14% of the total investment program) which bear preset rates ofreturn and are marginally influenced by market conditions.Management also expects that the current economic downturn willcause a reduction in expenditures required to develop reserves,including oilfield service rates and purchase costs of materialsand support equipment, when compared to costs incurred during theupward phase of the oil cycle. In the event of a furtherdeterioration in the macroeconomic environment, the Companybelieves that its capital plans retain an adequate level offlexibility to enable rescheduling of a number of projects asapproximately 50% of the planned capital expenditures are yet tobe committed. A capital project becomes committed when itreceives the appropriate level of internal sanction and relevantcontracts with third parties are awarded.

In making its capital expenditure projections for the nextfour years, management has assumed that the Company will be ableto deliver approximately euro 5 billion of savings on plannedexpenditures benefiting from the expected reduction in oilfieldservice and materials costs and other cost control initiatives onongoing projects. See "Item 3 – Risk Factors".

Management intends to pursue strict capital discipline whenassessing individual capital projects. Management uses along-term reference oil price of 57 $/BL from 2013 onwards, inreal terms that is adjusted to take account of expectedinflation. The internal rate of return of each project iscompared to the relevant hurdle rate, differentiated by businesssegment and country of operation. These hurdle rates arecalculated by taking into account: (i) the weighted average costof capital to the Group; (ii) a country risk premium whichreflects the specific level of risk 

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associated with each country of operation in terms ofmacroeconomic, business and socio-political current conditionsand outlook; and (iii) a premium for the business risk.

In the foreseeable future, management is strongly focused onpreserving a solid balance sheet and an adequate level ofliquidity taking into account macroeconomic uncertainties andtight financial markets. By this means, management expects tomaintain its current credit rating. For planning purposes,management assessed the Company’s cash flows against ascenario of Brent prices at 43 $/BL for the year 2009 increasingslightly in the next three years up to 55 $/BL in 2012 andconcluded that cash flows from operations would be sufficient tofund planned capital expenditures and dividend payments, while atsame time achieving a ratio of net borrowings to total equity"leverage" that management regards as consistent withthe priority of preserving the Company’s credit rating.Particularly, for the year 2009, management expects a decrease incapital expenditures as compared to 2008 (euro 14.56 billion in2008). On the basis of the Company’s projections of cashflow at a price of $43 per Brent barrel for the full year,management expects that the Group’s leverage at year-end2009 will record a slight increase from 2008 year-end (0.38).Nevertheless, management believes that, based upon itsunderstanding of the criteria used for credit ratings,the Groupprojected leverage at year-end 2009 will be adequate to supportthe Company’s current credit rating. For planning purposes,management assumed an average exchange rate of approximately 1.30U.S. dollars per euro in the 2009-2012 period. Given thesensitivity of Eni’s results of operations to movements inthe euro versus the U.S. dollar exchange rate, trends in thecurrency market represent a factor of risk and uncertainty. See"Item 3 – Risk Factors".

In the next four-year period management intends to pursue adividend policy designed to ensure competitive dividend yields toEni’s shareholders. For fiscal year 2008, Eni is paying adividend per share of euro 1.30, of which euro 0.65 per share waspaid in September 2008 as an interim dividend with the balance ofeuro 0.65 per share to be paid late in May 2009. In future years,management expects to continue paying interim dividends for eachfiscal year, with the balance for the full year dividend paid inthe following year. The euro 1.3 dividend for 2008 represents ayield of 7.6% as measured against the Eni share price recorded inthe month of December 2008 on the Italian stock exchange. See"Item 8 – Dividend Policy" for more details onEni’s dividend policy and the uncertainties and constraintsto which it is subject.

Based on management’s assumptions for oil prices in thenext four years, management plans to achieve an averageproduction growth rate of 3.5% in the 2009-2012 period. Oil priceassumptions are particularly significant when assessing theCompany’s future production performance considering theentitlement mechanism under Eni’s PSAs and similarcontractual schemes. For the current year, the Company estimatesthat production entitlements in its PSAs would decrease onaverage by approximately 1,000 BBL/d for each $1 increase in oilprices compared to Eni’s assumptions for oil prices. Thissensitivity analysis relates to the existing Eni portfolio andmight vary in the future.

In the next four years, Eni expects its core natural gasbusiness in Italy to face increasing competitive pressure as aresult of: (i) the current economic downturn that hassignificantly impacted management’s growth expectations ofthe Italian gas market for the year 2009 and possibly beyond asthere is limited visibility on time and strength of the recovery;also future growth rates for European gas demand have beensubject to downward revisions (see "Item 4 – Gas &Power"); (ii) an expected increase in supplies of naturalgas to the Italian market as new import capacity comes on line inconnection with already started-up projects and completion ofongoing projects designed to upgrade import infrastructures toItaly. Specifically, the Company expects additional importcapacity to supply up to 10 BCM in 2009 as Eni’s upgrades ofits main TTPC and TAG pipelines from Algeria and Russiarespectively reach full operations. In addition, Eni iscompleting another leg of expansion at the TAG pipeline and isplanning to upgrade its pipeline from Libya. A competitor hascommenced commissioning operations at a new LNG terminal in theAdriatic Sea. Overall the Company expects that import capacitywill increase by 25 BCM by 2012 of which 90% will be available by2010; and (iii) the need on the part of Eni to comply with themandatory ceilings provided for by Italian regulation by sellingnatural gas volumes available under take-or-pay purchasecontracts to certain Italian natural gas importers who resellthose volumes on the Italian natural gas market (see "Item 4– Regulation of the Italian Natural Gas Market" and"Item 3 – Risk Factors"). As a result of thesemarket trends and developments, management expects thatcompetition will increase in the future putting further pressureon selling margins. Eni’s sales volumes in Italy areprojected to decline from the 53 BCM level achieved in 2008 toapproximately 50 BCM in 2012. Worldwide gas sales are projectedto reach 124 BCM by 2012 leveraging on the Company’sexpansion in European markets on the backdrop of the expectedsynergies arising from the integration of Distrigas (see"Item 4 – Gas & Power"). This planned growthwill make for reduced growth expectations in the Italian naturalgas market.

Management intends to implement a number of marketing actionsdesigned to support the Company’s selling margins in theItalian market in spite of rising competitive pressure.Specifically, management plans to preserve profitability of theCompany’s gas operations in Italy by focusing on the mostprofitable customer segments. Tailored marketing policies will bedeployed to retain and develop the main customers throughout allmarket segments. These policies include the offer of pricingformulas and services that are designed to best satisfy thecustomers’ needs. Also the Company intends to strengthen itsmarket position in the residential sector by leveraging on thedevelopment of the combined offer of gas and electricity (thedual offer). Streamlining business support activities andreducing marketing and general and administrative costs will alsodrive margin improvements.

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For a discussion of certain risks relating to the impact ofthe evolution of Italian regulation of the natural gas sector onEni’s take-or-pay contracts see "Item 3 – RiskFactors – Liberalization of the Italian Natural GasMarket".

The expectations described above are subject to risks,uncertainties and assumptions associated with the oil and gasindustry, and economic, monetary and political developments inItaly and globally that are difficult to predict. There are anumber of factors that could cause actual results anddevelopments to differ materially, including, but not limited to,crude oil and natural gas prices; demand for oil and gas in Italyand other markets; developments in electricity generation; pricefluctuations; drilling and production results; refining marginsand marketing margins; currency exchange rates; general economicconditions; political and economic policies and climates incountries and regions where Eni operates; regulatorydevelopments; the risk of doing business in developing countries;governmental approvals; global political events and actions,including war, terrorism and sanctions; project delays; materialdifferences from reserves estimates; inability to find anddevelop reserves; technological development; technicaldifficulties; market competition; the actions of field partners,including the inability of joint venture partners to fund theirshare of operating or developments activities; industrial actionsby workers; environmental risks, including adverse weather andnatural disasters; and other changes to business conditions.

 

> 
***Off-Balance Sheet Arrangements***

Eni has entered into certain off-balance sheet arrangements,including guarantees, commitments and risks, as described in Note29 to the Consolidated Financial Statements. Eni’s principalfinancial obligations, including commitments under take-or-pay orship-or-pay clauses, are described under "ContractualObligations" below. See the Glossary for a definition oftake-or-pay or ship-or-pay clauses.

Off-balance sheet arrangements comprise those arrangementsthat may potentially impact Eni’s liquidity, capitalresources and results of operations, even though sucharrangements are not recorded as liabilities under generallyaccepted accounting principles. Although off-balance sheetarrangements serve a variety of Eni’s business purposes, Eniis not dependent on these arrangements to maintain its liquidityand capital resources; nor is management aware of anycircumstances that are reasonably likely to cause the off-balancesheet arrangements to have a material adverse effect on thecompany’s financial condition, results of operations,liquidity or capital resources.

Eni has provided various forms of guarantees on behalf ofnon-consolidated subsidiaries and affiliated companies, mainlyrelating to guarantees for loans, lines of credit and performanceunder contracts. In addition, Eni has provided guarantees on thebehalf of consolidated companies, primarily relating toperformance under contracts. The aggregate amount of theseguarantees is euro 20.6 billion, euro 7.1 billion of which relateto non-consolidated entities. In addition, Eni has commitmentsand contingencies relating to purchases of assets an other risksfor a total of euro 1.9 billion. See "Item 4 –Acquisition of Distrigas". These arrangements are describedin Note 29 to the Consolidated Financial Statements.

 

 

 

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> 
***Contractual Obligations***

The following table summarizes the principal financialobligations which are described in "Item 18 – FinancialStatements – Notes 16, 21, 22, 29 and 31".

Amounts in the table refer to expected payments by periodunder contractual obligations commitments shown an undiscountedbasis as of the balance sheet date.

|   | **Maturity        year** |
|--------|--------------------------|
|   |                          |

|   | **Total** |   | **2009** |   | **2010** |   | **2011** |   | **2012** |   | **2013** |   | **2014 and thereafter** |
|--------|-----------|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|--------|-------------------------|
|   |           |   |          |   |          |   |          |   |          |   |          |   |                         |

|   | **(euro        million)** |
|--------|---------------------------|

| **Total debt**                                                                                                         |   | **20,837**  |   | **6,908**  |   | **3,630**  |   | **797**    |   | **2,687**  |   | **1,981**  |   | **4,834**   |
|------------------------------------------------------------------------------------------------------------------------|--------|-------------|--------|------------|--------|------------|--------|------------|--------|------------|--------|------------|--------|-------------|
|      Long-term        debt                                                                    |   | 14,478      |   | 549        |   | 3,630      |   | 797        |   | 2,687      |   | 1,981      |   | 4,834       |
|      Short-term debt                                                                          |   | 6,359       |   | 6,359      |   |       |   |       |   |       |   |       |   |        |
| **Interest        payments on debt**                                                                                   |   | **2,893**   |   | **502**    |   | **469**    |   | **412**    |   | **383**    |   | **336**    |   | **791**     |
| **Noncancelable operating lease obligations**(1)                                                                       |   | **4,287**   |   | **618**    |   | **1,025**  |   | **697**    |   | **468**    |   | **395**    |   | **1,084**   |
| **Asset        retirement obligations**(2)                                                                             |   | **9,469**   |   | **269**    |   | **35**     |   | **61**     |   | **18**     |   | **256**    |   | **8,830**   |
| **Environmental liabilities**                                                                                          |   | **1,988**   |   | **396**    |   | **421**    |   | **284**    |   | **223**    |   | **221**    |   | **443**     |
| **Purchase        obligations**(3)                                                                                     |   | **259,973** |   | **17,938** |   | **13,777** |   | **14,326** |   | **14,405** |   | **14,112** |   | **185,415** |
|      Natural gas to be        purchased in connection with take-or-pay contracts (4)          |   | 248,329     |   | 15,694     |   | 13,041     |   | 13,574     |   | 13,610     |   | 13,343     |   | 179,067     |
|      Natural        gas to be transported in connection with ship-or-pay        contracts (4) |   | 5,849       |   | 539        |   | 537        |   | 545        |   | 549        |   | 528        |   | 3,151       |
|      Other take-or-pay        and ship-or-pay obligations                                     |   | 1,455       |   | 139        |   | 135        |   | 126        |   | 111        |   | 106        |   | 838         |
|      Other        purchase obligations (5)                                                    |   | 4,340       |   | 1,566      |   | 64         |   | 81         |   | 135        |   | 135        |   | 2,359       |
| **Other commitments**                                                                                                  |   | **180**     |   | **8**      |   | **5**      |   | **5**      |   | **5**      |   | **5**      |   | **152**     |
|      *of        which:*                                                                       |   |        |   |       |   |       |   |       |   |       |   |       |   |        |
|      *- Memorandum of        intent relating to Val d’Agri*                              |   | *180*       |   | *8*        |   | *5*        |   | *5*        |   | *5*        |   | *5*        |   | *152*       |
| **TOTAL**                                                                                                              |   | **299,627** |   | **26,639** |   | **19,362** |   | **16,582** |   | **18,189** |   | **17,306** |   | **201,549** |

|   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

----

| (1) | i | Operating        leases primarily regarded assets for drilling activities,        time charter and long-term rentals of vessels, lands,        service stations and office buildings. Such leases did        not include renewal options. There are no significant        restrictions provided by these operating leases which        limit the ability of the Company to pay dividends, use        assets or to take on new borrowings.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|-----|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | Represents        the estimated future costs for the decommisioning of oil        and natural gas production facilities at the end of the        producing lives of fields, well-plugging, abandonment and        site restoration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| (3) | i | Represents        any agreement to purchase goods or services that is        enforceable and legally binding and that specifies all        significant terms.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| (4) | i | Such        arrangements include non-cancelable, long-term        contractual obligations to secure access to supply and        transport of natural gas, which include take-or-pay        clauses whereby the Company obligations consist of        off-taking minimum quantities of product or service or        paying the corresponding cash amount that entitles the        Company to off-take the product in future years. Future        obligations in connection with these contracts were        calculated by applying the forecasted prices of energy or        services included in the four-year business plan approved        by the Company’s Board of Directors and on the basis        of the long-term market scenarios used by Eni for        planning purposes to minimum take and minimum ship        quantities. See "Item 4 – Gas & Power        – Natural Gas Purchases" and "Item 3        – Risk Factors – Liberalization of the Italian        Natural Gas Market" for a discussion of nature and        importance of Eni’s take-or-pay contracts and the        related risks from the evolving regulatory environment        that could negatively impact Eni’s results. |
| (5) | i | Mainly refers        to arrangements to purchase capacity entitlements at        certain re-gasification facilities in the U.S.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

The table below summarizes Eni’s capital expenditurecommitments for property, plant and equipment and capitalprojects at 31 December 2008. Capital expenditures are consideredto be committed when the project has received the appropriatelevel of internal management approval. Such costs are included inthe amounts shown.

|   | **Total** |   | **2009** |   | **2010** |   | **2011** |   | **2012** |   | **2013 and subsequent        years** |
|--------|-----------|--------|----------|--------|----------|--------|----------|--------|----------|--------|--------------------------------------|
|   |           |   |          |   |          |   |          |   |          |   |                                      |

|   | **(euro        million)** |
|--------|---------------------------|

| **Capital expenditure commitments**                              |       |   |       |   |      |   |      |   |      |   |       |
|------------------------------------------------------------------|------------|--------|------------|--------|-----------|--------|-----------|--------|-----------|--------|------------|
|      Committed        on major projects | 23,159     |   | 4,938      |   | 3,831     |   | 2,697     |   | 1,837     |   | 9,856      |
|      Other committed        projects    | 24,910     |   | 5,147      |   | 4,342     |   | 3,186     |   | 2,389     |   | 9,846      |
|                                                             |            |   |            |   |           |   |           |   |           |   |            |
| **TOTAL**                                                        | **48,069** |   | **10,085** |   | **8,173** |   | **5,883** |   | **4,226** |   | **19,702** |
|                                                             |            |   |            |   |           |   |           |   |           |   |            |

> 
 

***Liquidity Risk***

Liquidity risk is the risk that suitable sources of fundingfor the Group may not be available, or the Group is unable tosell its assets on the market place as to be unable to meetshort-term finance requirements and to settle obligations. Such asituation would negatively impact the Group results as it wouldresult in the Company incurring higher borrowing expenses to meetits obligations or under the worst of conditions the inability ofthe Company to continue as a going concern. As part of itsfinancial planning process, Eni manages the liquidity risk bytargeting 

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such a capital structure as to allow the Company to maintain alevel of liquidity adequate to the Group’s needs optimizingthe opportunity cost of maintaining liquidity reserves alsoachieving an efficient balance in terms of maturity andcomposition of finance debt. The Group capital structure is setaccording to the Company’s industrial targets and within thelimits established by the Company’s Board of Directors whoare responsible for prescribing the maximum ratio of debt tototal equity and minimum ratio of medium and long-term debt tototal debt as well as fixed rate medium and long-term debt tototal medium and long-term debt. In spite of the difficult andongoing credit market conditions resulting in higher spreads toborrowers, the Company has succeeded in maintaining access to awide range of funding at competitive rates through the capitalmarkets and banks. The actions implemented as part of Eni’sfinancial planning have enabled the Group to maintain access tothe credit market particularly via the issue of commercial paperalso targeting to increase the flexibility of funding facilities.The above mentioned actions aimed at ensuring availability ofsuitable sources of funding to fulfill short-term commitments anddue obligations also preserving the necessary financialflexibility to support the Group’s development plans. Indoing so, the Group has pursued an efficient balance of financedebt in terms of maturity and composition leveraging on thestructure of its lines of credit particularly the committed ones.

At present, the Group believes it has access to sufficientfunding and has also both committed and uncommitted borrowingfacilities to meet currently foreseeable borrowing requirements.

As of December 31, 2008, Eni maintained short-term committedand uncommitted unused borrowing facilities of euro 11,009million, of which euro 3,313 million were committed, andlong-term committed unused borrowing facilities of euro 1,850million. These facilities were under interest rates thatreflected market conditions. Fees charged for unused facilitieswere not significant.

Eni has in place a program for the issuance of Euro MediumTerm Notes up to euro 10 billion, of which euro 6,391 millionwere drawn as of the balance sheet date.

The Group has debt ratings of AA- and A-1+ respectively forthe long and short-term debt assigned by Standard &Poor’s and Aa2 and P-1 assigned by Moody’s; the outlookis stable for both. A security is not a recommendation to buy,sell or hold securities. A security rating may be subject torevision or withdrawal at any time by the assigning ratingorganization. Each rating should be evaluated independently ofany other rating.

 

> 
***Working Capital***

Management believes that, taking into account unutilizedcredit facilities, Eni’s credit rating and access to capitalmarkets, Eni has sufficient working capital for its foreseeablerequirements.

> 
***Credit Risk***

Credit risk is the potential exposure of the Group to lossesin case counterparties fail to perform or pay amounts due. TheGroup manages credit risk differently depending on whether itarises from exposure to financial counterparties or to customersrelating to outstanding receivables. Individual business unitsare responsible for managing credit risk arising in the normalcourse of the business. The Group has established formal creditsystems and processes to ensure that before trading with a newcounterpart can start, its creditworthiness is assessed. Alsocredit litigation and receivable collection activities areassessed. The monitoring activity of credit risk exposure isperformed at the Group level according to certain guidelines andmeasurement techniques that establish counterparty limits andsystems to monitor exposure against limits and report regularlyon those exposures. Specifically, credit risk exposure tomulti-business clients and exposures higher than the limit set ateuro 4 million are closely monitored. Monitoring activities donot include retail clients and public administrations. Theassessment methodology assigns a score to individual clientsbased on publicly available financial data and capital,profitability and liquidity ratios. Based on these scores,counterparties are assigned an internal credit rating andclassified based on their risk category. The Group riskcategories are comparable to those prepared by external creditrating agencies. The Group’s internal ratings are alsobenchmarked against ratings prepared by such agencies. Withregard to risk arising from financial counterparties, Eni hasestablished guidelines prior to entering into cash management andderivative contracts to assess the counterparty’s financialsoundness and rating in view of optimizing the risk profile offinancial activities while pursuing operational targets. Maximumlimits of risk exposure are set in terms of maximum amounts ofcredit exposures for categories of counterparties as defined bythe Company’s Board of Directors taking into account thecredit ratings provided by credit rating agencies. Credit riskarising from financial counterparties is managed by the Groupcentral finance departments, including Eni’s subsidiary EniTrading & Shipping which specifically engages in commodityderivatives transactions.

Those are the sole Group entities entitled to be party to afinancial transactions due to the Group centralized financemodel. Eligible financial counterparties are closely monitored tocheck exposures against limits assigned to each counterparty on adaily basis. Exceptional market conditions have forced the Groupto adopt contingency plans and under certain circumstances tosuspend eligibility to be a Group financial counterparty.

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Actions implemented also have been intended to limitincentrations of credit risk by maximizing counterpartydiversification and turnover. Counterparties have been alsoselected on a more stringent criteria particularly intransactions on derivatives instruments and with maturity longerthan a three-month period. Eni has not experienced materialnon-performance by any counterparty. As of December 31, 2007 and2008, Eni had no significant concentrations of credit risk.

 

> 
***Market Risk***

In the normal course of its operations, Eni is exposed tomarket risks deriving from fluctuations in commodity prices andchanges in the euro vs. other currencies exchange rates,particularly the U.S. dollar, and in interest rates. For anin-depth analysis of market risks exposure and policies used byEni to manage its exposure to market risk see "Item 11 -Qualitative and Quantitative Disclosures About Market Risk".

 

> 
***Research and Development***

For a description of Eni’s research and developmentoperations in 2008, see "Item 4 – Research andDevelopment".

 

 

 

**Item 6. DIRECTORS, SENIOR MANAGEMENT ANDEMPLOYEES**

**Directors and Senior Management**

In accordance with Article 17.3 of Eni’s By-laws, theBoard of Directors is made up of 3 to 9 members. The Board ofDirectors currently in office was elected by the ordinaryshareholders’ meeting held on June 10, 2008, thatestablished the number of Directors at nine for a three financialyear term. The Board will therefore expire at the date of theShareholders’ Meeting approving Eni’s financialstatements for year ended December 31, 2010. The table below sets forth the names of the Board of Directorsmembers appointed, their positions, the year when each wasinitially appointed as a Director and their ages

| **Name**             |   | **Position** |   | **Year first appointed to Board of Directors** |   | **Age** |
|----------------------|--------|--------------|--------|------------------------------------------------|--------|---------|
|                      |   |              |   |                                                |   |         |
| Roberto Poli         |   | Chairman     |   | 2002                                           |   | 71      |
| Paolo Scaroni        |   | CEO          |   | 2005                                           |   | 63      |
| Alberto Clô     |   | Director     |   | 1999                                           |   | 62      |
| Paolo Andrea Colombo |   | Director     |   | 2008                                           |   | 49      |
| Paolo Marchioni      |   | Director     |   | 2008                                           |   | 40      |
| Marco Reboa          |   | Director     |   | 2005                                           |   | 54      |
| Mario Resca          |   | Director     |   | 2002                                           |   | 64      |
| Pierluigi Scibetta   |   | Director     |   | 2005                                           |   | 50      |
| Francesco Taranto    |   | Director     |   | 2008                                           |   | 69      |
|                      |   |              |   |                                                |   |         |

Roberto Poli, Paolo Scaroni, Paolo Andrea Colombo, PaoloMarchioni, Mario Resca and Pierluigi Scibetta were candidatesincluded in the list of the Ministry for Economy and Finance.Alberto Clô, Marco Reboa and Francesco Taranto were candidatesincluded in the list presented by institutional investors.

While it remains a significant shareholder, the Ministry ofEconomy and Finance intends to continue to participate in thenomination and election of Eni’s Board of Directors in orderto protect its investment as a shareholder.

On the basis of Italian laws regulating the special powers ofthe State (see "Item 10 – Limitations on Voting andShareholdings"), the Minister of Economy and Finance inagreement with the Minister of Economic Development may appointanother member of the Board of Directors, without voting rights,in addition to those appointed by the Shareholders’ Meeting.On the occasion of the last Board appointment, the Minister forEconomy and Finance opted not to exercise that power. 

Moreover, according to Italian law and jurisprudence, untilthe Ministry of Economy and Finance remains a relevantshareholder, Eni’s accounts will be subject to the review ofthe Italian Court of Accountants ("Corte dei Conti") inorder to protect the financial interest of the State. AMagistrate appointed by the Court of Accounts consequentlyattends Eni’s Board of Directors, Board of StatutoryAuditors and Internal Control Committee meetings (without anyvoting right) and Eni has the obligation to send to the Court ofAccountants its financial 

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statements together with the reports of the Board ofDirectors, the Board of Statutory Auditors and its externalauditors. The Magistrate delegated to control is currently LucioTodaro Marescotti (alternate Amedeo Federici).

The table below sets forth the composition of Eni’ssenior management, including the CEO who is also General Managerof the Eni SpA, the Chief Operating Officers of Eni’s threedivisions, and those senior managers who attended on a permanentbasis the meetings of Eni’s Management Committee and othersenior managers who report to the CEO. This table indicates theirpositions within Eni, the year they were appointed to suchpositions, their total years of service at Eni and their ages.Chief Operating Officers are appointed by the Board of Directors,upon proposal of the CEO in agreement with the Chairman. Othermembers of Eni’s senior management are appointed byEni’s CEO and may be removed without cause.

| **Name**                |   | **Management        position**                                                                |   | **Year first appointed        to current         position** |   | **Total number        of year of service at Eni** |   | **Age** |
|-------------------------|--------|-----------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------|--------|---------------------------------------------------|--------|---------|
|                         |   |                                                                                               |   |                                                             |   |                                                   |   |         |
| Paolo Scaroni           |   | Chief Operating Officer of        Eni                                                         |   | 2005                                                        |   | 4                                                 |   | 63      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Claudio Descalzi (*)    |   | Chief Operating Officer for        the Exploration & Production Division                  |   | 2008                                                        |   | 28                                                |   | 54      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Domenico Dispenza       |   | Chief Operating Officer for        the Gas & Power Division                               |   | 2005                                                        |   | 35                                                |   | 63      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Angelo Caridi           |   | Chief Operating Officer for        the Refining & Marketing Division                      |   | 2007                                                        |   | 39                                                |   | 62      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Alessandro Bernini (**) |   | Chief Financial Officer                                                                       |   | 2008                                                        |   | 13                                                |   | 49      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Salvatore Sardo         |   | Chief Corporate Operations        Officer                                                     |   | 2005                                                        |   | 4                                                 |   | 57      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Massimo Mantovani       |   | The Group Senior Executive        Vice President         for Legal Affairs                    |   | 2006                                                        |   | 16                                                |   | 46      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Rita Marino             |   | The Group Senior Executive        Vice President         for Internal Audit                   |   | 2008                                                        |   | 4                                                 |   | 45      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Leonardo Maugeri        |   | The Group Senior Executive        Vice President         for Strategies and Development       |   | 2000                                                        |   | 14                                                |   | 44      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Stefano Lucchini        |   | The Group Senior Executive        Vice President         for Public Affairs and Communication |   | 2005                                                        |   | 4                                                 |   | 47      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Roberto Ulissi          |   | The Group Senior Executive        Vice President         for Corporate Affairs and Governance |   | 2006                                                        |   | 3                                                 |   | 47      |
|                    |   |                                                                                          |   |                                                        |   |                                              |   |    |
| Raffaella Leone         |   | Executive Assistant to the        Chief Executive Officer                                     |   | 2005                                                        |   | 4                                                 |   | 47      |
|                         |   |                                                                                               |   |                                                             |   |                                                   |   |         |

----

| (*)  | i | Appointed by        the Board of Directors on July 30, 2008. |
|------|---|--------------------------------------------------------------|
| (**) | i | Appointed on        August 1, 2008.                          |

The biographies of Eni’s directors and senior managersare set out below.

Roberto Poli was appointed Chairman of Eni SpA in May 2002. Heis currently President of Poli e Associati SpA, a consulting firmspecialized in corporate finance, mergers, acquisitions andreorganizations. From 1966 to 1998 he was Professor of BusinessFinance at the Università Cattolica of Milan. He is a partner ofa leading firm for corporate finance and legal affairs. He isdirector in important companies such as Fininvest SpA, MondadoriSpA, Merloni Termosanitari SpA, Coesia SpA, Maire Technimont SpAand Perennius Capital Partners SGR SpA. He has been an advisorfor extraordinary finance operations for some of the mostimportant companies in Italy. He has also been Chairman ofRizzoli-Corriere della Sera SpA and Publitalia SpA.

Paolo Scaroni was appointed CEO of Eni SpA in June 2005. Heobtained an economics degree from Milan’s Bocconi Universityin 1969 and an MBA from Columbia Business School in 1973. For ayear following business school, he was an associate at McKinsey& Co. From 1973 until 1985, he held a series of positionswith Saint Gobain, culminating with his appointment as Presidentof the Saint Gobain flat glass division. From 1985 to 1996 he wasDeputy Chairman and CEO of Techint. During his time at Techint,he was also Vice President of Falck and executive Vice Presidentof SIV, a joint venture between Techint and Pilkington plc. Hejoined Pilkington in 1996 and was group CEO until May 2002. FromMay 2002 to May 2005 he was CEO of Enel, Italy’s leadingelectricity utility. Paolo Scaroni is a member of the Board ofAssicurazioni Generali SpA, of LSEG plc (London Stock ExchangeGroup), of Veolia Environment (Paris), of the Board of Overseersof Columbia Business School (New York) and of the Board ofFondazione Teatro alla Scala. He was Chairman of Alliance Unichemplc (UK) from 2005 to July 2006. In November 2007 he was made amember of the Légion d’honneur of France.

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Alberto Clô graduated in Political Science. He is AssociateProfessor of Industrial Economics at the University of Bolognaand from 1995 to 1996 he was Minister of Industry and interimMinister of Foreign Trade ad interim in 1995 and 1996. During theItalian presidency of the European Union he was Chairman of theCouncil of Ministers of Industry and Energy of the EuropeanUnion. In 1996 he was awarded the title of Cavaliere di GranCroce al Merito of the Republic of Italy. Until December 31, 2007he was director of ASM Brescia SpA. Currently he is non-executivedirector of Atlantia SpA, Italcementi SpA and De Longhi SpA. Hehas been an independent Director of Eni SpA since May 1999.

Paolo Andrea Colombo graduated in Business Economics from theBocconi University and qualified as a professional accountant andauditor in 1985. He is professor of Accounting and FinancialReporting at the Bocconi University, Milan. He is partner ofBorghesi Colombo & Associati, a consultancy firm specializedin corporate finance, mergers and acquisitions, strategy andcorporate governance. He is a member of the Board of Directors ofMediaset, Interbanca, Ceresio Sim and Versace, and member of theBoard of Statutory Auditors of Interbanca, Aviva Vita, Sirti, A.Moratti Sapa, Humanitas Mirasole, Credit Agricole AssicurazioniItalia. In Eni, he was member of the Board of StatutoryAuditors/Audit Committee (2002-2005) and Chairman of the sameBoard for a three year period until June 2008. He has beenChairman of Eni’s audit committee since May 2005. He hasbeen an independent Director of Eni since June 2008. 

Paolo Marchioni is a qualified lawyer specialising in penaland administrative law. He acts as a consultant to governmentagencies and business organizations on business, corporate,administrative and local government law. He was Mayor of Baveno(Verbania) from April 1995 to June 2004 and Chairman of theAssembly of Mayors of Con.Ser.Vco from September 1995 to June1999. He served in various positions within government agencies.From October 2001 to April 2004 he was a director of Cim SpA ofNovara (merchandise interport center), from December 2002 toDecember 2005 a director and executive committee member ofFinpiemonte SpA and from June 2005 to June 2008 director ofConsip SpA. He has been an independent Director of Eni since June2008.

Marco Reboa graduated in Business Administration from theBocconi University, Milan. He is a chartered accountant andpublic auditor. He is Professor of law at the Libero IstitutoUniversitario Carlo Cattaneo in Castellanza and author of essayson corporate governance, economic and legal issues. He is theeditor of "Rivista dei Dottori Commercialisti" and is aprofessional advisor in Milan. He is a member of the Board ofDirectors of Seat PG SpA, Interpump Group SpA, IMMSI SpA andIntesa Private Banking SpA. He is Chairman of the Board ofStatutory Auditors of Luxottica Group SpA and Mediobanca SpA. Heis an auditor of Gruppo Lactalis Italia SpA and Egidio GalbaniSpA. He has been an independent Director of Eni SpA since May2005.

Mario Resca graduated in Economics from the BocconiUniversity, Milan. He is Chairman of Italia Zuccheri SpA(formerly Eridania SpA), Casinò di Campione SpA and Confimprese.He is Director of Mondadori SpA, ARFIN SpA (insurances) andFinance Leasing SpA. He is Vice Chairman and venture partner ofMcDonald’s Development Italia, Inc and advisor of BritishTelecom Italia. As a graduate he worked for the Chase ManhattanBank. In 1974 he was appointed director of Biondi Finanziaria(Fiat Group) and from 1976 to 1991 he was partner of EgonZehnder. In this period he was appointed director of LancômeItalia and of companies belonging to the Rizzoli-Corriere dellaSera Group and Versace Group. He was Chairman of the AmericanChamber of Commerce. He also served as Chairman of Sambonet SpA,Kenwood Italia SpA and was a founding partner of Eric Salmon& Partners. In 2008, he was appointed General Directorof Italian Museums by the Government. He has been an independentDirector of Eni SpA since 2002.

Pierluigi Scibetta graduated in Economics from the UniversityLa Sapienza, Rome. He is a chartered accountant and auditor andhas been appointed director and auditor of a number of publicbodies and companies. In 2003 he was appointed director of theIstituto Superiore per la Previdenza e la Sicurezza sul Lavoro -ISPESL (the State Agency for Employee Safety) and of Gestore delMercato Elettrico SpA. He lectures in Environmental Economics atthe University of Perugia. He has been an independent Director ofEni SpA since May 2005.

Francesco Taranto graduated in Economics from the CatholicUniversity of Milan. He began working in 1959, in a stockbrokerage in Milan; from 1965 to 1982 he worked at Banco diNapoli, as deputy director of the stock market and securitiesoffice. He was director of securities funds at Eurogest from 1982to 1984, general director and chief executive officer ofInterbancaria Gestioni from 1984 to 1987. After moving to thePrime group (1987 to 2000), he was chief executive officer of theparent company. He has also been a member of the steering councilof Assogestioni and of the corporate governance committee forlisted companies formed by Borsa Italiana. He was a director ofEnel SpA from October 2000 to June 2008, and is currently amember of the Board of directors of Banca Carige, Cassa diRisparmio di Firenze, Unicredit Xelion Banca, Pioneer GlobalAsset Management (Unicredito group) and Kedrios. He has been anindependent Director of Eni since June 2008.

Claudio Descalzi graduated in Physics from the University ofMilan and attended specialist courses in Petroleum Engineering inFrance and USA. He joined the Eni Group in 1981 as oil & gasfield petroleum engineering and project manager. He served invarious managing positions in the Exploration & ProductionDivision. In 2006 he was appointed Deputy Chief Operating Officerof the Exploration & Production Division and

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Chairman of Assomineraria. In 2008 he was appointed ChiefOperating Officer of Eni’s Exploration & ProductionDivision.

Domenico Dispenza graduated in Aeronautical Engineering fromthe Politecnico of Milan and obtained a Master’s Degree inAdvanced Technologies. He joined Snam’s study department in1974. He served in various managing positions in Eni Groupcompanies engaged in natural gas activities. In 2004 he waselected Chairman and CEO of Snam Rete Gas SpA and in 2006 he wasappointed Chief Operating Officer of Eni’s Gas & PowerDivision.

Angelo Caridi graduated in Civil Engineering from thePolitecnico of Turin. He joined Snamprogetti in 1970. He servedin various managing positions within Eni’s Group companies.In 2002 he was appointed Managing Director and CEO ofSnamprogetti in 2005. In August 2007 he was appointed ChiefOperating Officer of Eni’s Refining & MarketingDivision. He is non-executive director of Saipem SpA.

Alessandro Bernini started his career in 1979 at the auditingfirm Neutra Revisioni Sas. In 1981, he joined Ernst & Youngand in 1995 he was appointed Partner. On September 1, 1996 hejoined the Eni Group in the quality of Chief Financial Officer ofSaipem SpA, and was appointed Group Chief Financial Officer forSaipem Group. He has been appointed Chief Financial Officer ofthe Eni Group in August 2008.

Massimo Mantovani is an attorney at law and worked as a legalcounsel for international activities before joining Snam’slegal office in 1993. He was responsible for legal affairs atEni’s Gas & Power Division until he was appointedEni’s Senior Vice President for legal affairs in 2005.

Rita Marino has a degree cum laude in Economics from theLUISS and worked in Stet and then in Telecom Italia where shespent most her professional career, carrying out severalmanagerial assignments in the Planning and Control Department.She has also achieved a well-established experience in the Merger& Acquisition Department, managing several and importantcorporate transactions. In March 2003 she started working forEnel where she was Head of the Strategy, Control and ProcurementProcesses Area and Corporate Procurement. She was also ChiefOperating Officer in a company of the Enel Group and member ofthe board of several companies of Telecom Italia Group and EnelGroup. She has been Chief of theInternalAuditing Department since July 1, 2005 when she joined Eni.

Stefano Lucchini graduated in Economics from the LUISS in Romeand joined the study department of Montedison. After a period inthe United States, where he was assistant to the Chairman of theEnergy and Commerce Commission of the U.S. Congress, he was headof communications at Montedison USA. In 1993 he returned to Italyand was head of the investor relations department for theFerruzzi and Montedison Group. He was then Director for externalrelations at Enel and later at Confindustria and Banca Intesa. Hejoined Eni as Senior Executive Vice President for Public Affairsand Communication in 2005. He is also a professor at the Schoolfor Journalism of the Università Cattolica in Milan.

Leonardo Maugeri has two degrees and a research doctorate,after extensive academic experience acquired in Italy and abroad,joined the Eni Group in 1994, holding various positions mainly ascounsel for strategic decisions before being appointed as SeniorExecutive Vice President for Strategies and DevelopmentDepartment. Maugeri is also a director of Polimeri Europa SpA,Italgas and the Fondazione Mattei. He is member of the EnergyAdvisory Board and the World Economic Laboratory of theMassachusetts Institute of Technology (MIT), as well as theInternational Councillor Board of the Center for Strategic andInternational Studies (CSIS - Washington, D.C.), the EnergyAdvisory Board of Accenture, the Foreign Policy Association (NewYork) and the Rand Business Forum (Los Angeles).

Salvatore Sardo graduated in Economics from the University ofTurin and started his career as an auditor for Coopers &Lybrand. He later joined Telecom Italia where, after theprivatization of the company, he was responsible foradministration and control. He was Chairman of Pagine Gialle from1998 to 2001 and returned to Telecom Italia as manager of theGroup’s real estate and general services. From 2003 he wasprocurement and security manager at Enel until 2005 when hejoined Eni to become Senior Vice President for Human Resources& Business Services. In 2008 he has been appointed ChiefCorporate Operations Officer of Eni.

Roberto Ulissi is an attorney at law. After some years at theBanca d’Italia as an in-house legal counsel he becameDirector General of the Ministry of Economy and Finance, head ofthe "Banking and Finance System and Legal AffairsDepartment". He was Director of state-owned companies, suchas Telecom Italia, Ferrovie dello Stato, Alitalia, Fincantieri,and Government representative in the Bank of Italy’sgoverning council. He was member of several national and Europeancommittees as a representative of the Italian Ministry of Economyincluding, at a national level, the Commission for the Reform ofCorporate Law and, at an EU level, the Financial Services PolicyGroup, the Banking Advisory Committee, the European BankingCommittee, the European Securities Committee, and the FinancialServices Committee. He has also been special professor of bankinglaw at the University of Cassino. He is a Grande Ufficiale dellaRepubblica Italiana. Since 2006 he has been appointed SeniorExecutive Vice President for Corporate Affairs and GovernanceDepartment at Eni and a member of the board of Eni InternationalBV. He also holds the position of Company Secretary on the Boardof Directors of Eni.

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Raffaella Leone worked for Techint SpA, Pilkington Plc andEnel SpA before joining Eni in 2005 as Executive Assistant to theCEO. She is Vice President of Eni Foundation and member of theBoard of Fondazione Eni Enrico Mattei, as well as member of theBoard of other Eni companies.

 

**Board Practices**

Eni’s governance structure follows the traditional modeldefined by the Italian Civil Code and the Eni’s CorporateGovernance Code (adopted in line the provisions of the BorsaItaliana Corporate Governance Code) with managerial functionsentrusted to the Board of Directors, as the central body of thecorporate governance system, for the purpose of achieving theCompany’s purpose.

Monitoring functions are entrusted to the Board of StatutoryAuditors while accounting control and the audit of the financialstatements is entrusted to external auditors appointed by theShareholders’ Meeting.

According to Eni’s By-laws, the Board of Directorsdelegates specific powers to the CEO who is responsible for themanagement of the Company, with the exception of those powersthat cannot be delegated according with current legislation andof those retained exclusively by the Board of Directors on thematter regarding major strategic, operational and organizationaldecisions. Furthermore, the Board of Director has delegated theChairman powers for researching and promoting integrated projectsand strategic international agreements.

Eni’s governance model, therefore, states a clearseparation between the role of the Chairman, and that of the CEO.According to Article 25 of Eni’s By-laws, the Chairman andthe CEO represent the Company. In accordance with Article 27 ofEni’s By-laws, the Chairman also chairs theShareholders’ Meeting, calls and chairs meetings of theBoard of Directors and controls the application of decisions madeby the Board. The Board of Directors has also establishedcommittees with consulting and advisory functions.

The Board of Directors also appointed three Chief OperatingOfficers responsible for the three operational divisions of EniSpA and – in accordance with internationally-acceptedprinciples of corporate governance – set up internalcommittees of the Board with advisory and consultative powers.

> 
*Duties and Responsibilities*

A review of the Board’s power is represented below. Thefollowing duties and responsibilities are in addition to thosethat cannot be delegated under applicable laws.

| 1. |   | Establishes the Company and        Group Corporate Governance system and rules. In        particular, after consulting the Internal Control        Committee, the Board approves the rules that ensure the        substantial and procedural transparency and correctness        of the transactions carried out with related parties and        those in which a Director holds an interest, on his        behalf or on behalf of third parties. The Board adopts a        procedure for the management and disclosure to third        parties of documents and information concerning the        Company, having special regard to price sensitive        information. |
|----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2. |   | Establishes among its        members one or more committees with advisory and        consulting tasks, appoints their members, establishes        their responsibilities, determines their compensation and        approves their regulations.                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 3. |   | Confers and revokes the        powers of the CEO and the Chairman; establishes terms,        limits and operating methods of the exercise of such        powers and determines the compensation related to the        powers, on the basis of proposals from the Compensation        Committee and after consulting the Board of Statutory        Auditors. The Board may issue instructions to the CEO and        the Chairman and reserve to itself any operations that        pertain to its powers.                                                                                                                                                                  |
| 4. |   | Establishes the guidelines        of the organizational, administrative and accounting        structure of the parent Company, including the internal        control system, the main subsidiaries and the Group;        evaluates the adequacy of the organizational,        administrative and accounting structure designed by the        CEO in particular with regard to the management of        conflicts of interest.                                                                                                                                                                                                                                            |

| 5. |   | Establishes, in particular,        based on the recommendations of the Internal Control        Committee, the guidelines of the internal control system,        in order to ensure the identification, measurement,        management and monitoring of the main risks faced by the        Company and its subsidiaries. It evaluates adequacy,        effectiveness and effective functioning of the internal        control system managed by the Chief Executive Officer on        an annual basis. |
|----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 6. |   | Establishes, based on the        recommendation of the Chief Executive Officer, Company        and Group strategic guidelines and targets, including        Sustainability policies. It reviews and approves the        Company’s and Group’s strategic, operational        and financial plans and the strategic agreements to be        entered into by the Company. It examines and approves the        Company’s non-profit activities plan and approves        unplanned expenditures that amount to more than euro        500,000. |
|----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 7. |   | Examines and approves annual        budgets for Eni’s Divisions and the Company, as well        as the Group’s consolidated budget.                                                                                                                                                                                                                                                                                                                                                                                                           |

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| 8. |   | Examines and approves the        Company’s and Group’s interim financial report        and quarterly consolidates accounts, as per current        regulations. Examines and approves the sustainability        report, submitted also to the Shareholders’ Meeting.                                                                                                                                                                                                             |
|----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 9. |   | Receives from Board members        with delegated powers, at every Board meeting or at least        every two months, reports informing the Board of        activities carried out in exercising the delegated powers        as well as updates on activities carried out by the Group        and on atypical or unusual transactions or transactions        with related parties that were not previously submitted        to the evaluation and approval of the Board. In        particular, |

|   |   | it receives a half-year        report on the changes of approved capital projects        indicated under 12 (b) and 12 (c) below on the basis of        criteria defined by the Board itself. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10. |   | Receives half-year updates        on the Board Committees’ activities.                                                                                                                                                                                                                                                                                                   |
|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 11. |   | Evaluates the general        performance of the Company and the Group, on the basis of        information received from Board members with delegated        powers, with particular attention to situations of        conflicts of interest and compares results achieved as        contained in the annual report and interim and quarterly        reports, with the budget. |

| 12. |   | Evaluates and approves any        transaction executed by the Company and its subsidiaries        that have a significant impact on the company’s        results of operations and liquidity. Particular attention        is paid to situations in which Board members hold an        interest on their own behalf or on behalf of third        parties, and to related parties transactions. The Board        ensures the principle of not interfering in the decision        making process of the Group listed subsidiaries and        subsidiaries subject to unbundling regulation. It also        ensures the confidentiality of trade relations between        said subsidiaries and Eni or third parties for the        protection of the subsidiaries’ interests.        Transactions with a significant impact on the        Company’s results of operations and liquidity        include the following: |
|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   | (a) |   | acquisition and disposal of        investments, businesses and individual properties,        contributions in kind, business combinations, mergers and        de-mergers, winding-up of businesses, in each case        exceeding euro 100 million, notwithstanding Article 23.2        of the By-laws; |
|--------|--------|-----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   | (b) |   | capital expenditures        exceeding euro 300 million, or less if of particular        strategic importance or particularly risky;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|--------|--------|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | (c) |   | any exploration initiatives        and portfolio operations in the E&P sector in new        areas;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|   |   | (d) |   | sale and purchase contracts        relating to goods and services other than capital goods,        for an amount exceeding euro 1 billion or a duration        exceeding twenty years or gas supply contracts for at        least 3 billion cubic meter per year for a ten-year term;                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   |   | (e) |   | financing to entities other        than subsidiaries: (i) for amounts exceeding euro 200        million, if the amount is proportionate to the interest        held or, (ii) in any case, if in favor of non-related        companies or the amount is not proportionate to the        interest held; and                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   |   | (f) |   | issuing by the Company of        personal and real guarantees to entities other than        subsidiaries: (i) for amounts exceeding euro 200 million,        if in the interest of the Company or of Eni subsidiaries,        or associates, as long as the guarantee is proportionate        to the interest held or, (ii) in any case, if the        guarantees are issued in the interest of associates and        the amount is not proportionate to the interest held. In        order to issue the guarantees indicated in section (i) of        letter f), if the amount ranges between euro 100 million        and euro 200 million, the Board confers powers to the CEO        and the Chairman, to be exercised jointly in case of        urgency. |

| 13. |   | Appoints and revokes, on        recommendation of the CEO and in agreement with the        Chairman, the General Managers of Divisions and        attributes powers to them. In case of the Chief Executive        Officer’s appointment as General Manager, the        Chairman makes the proposal.                                                                                                                                                                                                                        |
|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 14. |   | Appoints and revokes, on        recommendation of the CEO and in agreement with the        Chairman, and with the approval of the Board of Statutory        Auditors, the Manager charged with preparing the        Company’s financial reports as per Legislative        Decree No. 58/1998. Moreover the Board of Directors        verifies the adequacy of his powers and resources in        order to fulfill this task and the observance of relevant        administrative and accounting procedures prepared by him. |
| 15. |   | Appoints and revokes, on        recommendation of the CEO and in agreement with the        Chairman, after consulting the Internal Control        Committee, the person in charge of internal control and        the Internal Audit Manager, determining his/her        compensation in line with the Company’s remuneration        policies, and approves the guidelines set for those        activities.                                                                                                                  |

| 16. |   | Ensures a person is        identified as responsible for handling the relationships        with the Shareholders.                                                                                                                                                                                                                                                                                                                                         |
|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17. |   | Establishes, on the basis of        the proposals received from the Compensation Committee,        the criteria for top management compensation and        implements the stock incentive plans approved by the        Shareholders’ Meeting.                                                                                                                                                                                                        |
| 18. |   | Examines and decides on        proposals submitted by the CEO with respect to voting        powers and to the appointment of members of the        management and control bodies of the main subsidiaries.        With specific regard to the shareholders’ meetings        of listed companies of the Eni’s Group, the Board        ensures the observance of the Corporate Governance Rules        regarding the Shareholders’ Meetings. |
| 19. |   | Prepares the proposals to be        submitted to the Shareholders’ Meeting.                                                                                                                                                                                                                                                                                                                                                                          |
| 20. |   | Examines and resolves on        other matters that the CEO deems appropriate to submit to        the Board because of their importance and sensitivity.                                                                                                                                                                                                                                                                                                   |

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Pursuant to Article 23.2 of the By-laws, the Board resolveson: mergers by incorporation and proportional demergers of atleast 90% of directly owned subsidiaries; establishment andwinding up of branches; amendments to the By-laws in order tocomply with applicable legislation.

During the fiscal year the Board can approve the distributionof interim dividends to shareholders, as per Article 29.3 ofEni’s By-laws.

In its meeting of June 11, 2008, the Board of Directorsapproved internal rules for the calling and functioning of itsmeetings.

In 2008, the Board of Directors met 19 times (of which 15ordinary meetings and 4 extraordinary meetings) for an averageduration of 2 hours and 40 minutes. The average attendance rateto Board meetings was 98.66%, the attendance rate of independentnon-executive Board members was 98.54%. The attendance rate forthe Board currently in office was 98% both for the delegatedDirector and the independent delegated Director. The EniCorporate Governance Code (the Eni Code) provides thatindependent Directors may hold meetings attended exclusively bynon-executive independent members. This power was exercised inthe meeting of February 22, 2009. 

The market is informed, with advance notice normally beforethe closing of the year, of the dates of meetings convened forthe approval or review of annual, semi-annual, full-yearpreliminary accounts and quarterly accounts, as well asresolution and proposal of interim dividends and final dividends,and related ex-dividend and payment dates. The financial calendaris available on Eni’s website.

In line with international best practices and as provided forby the Eni Code and the Borsa Italiana Code, the Board ofDirectors performs its self assessment ("Board review")of size, composition and functioning and of the activities of theBoard and Board committees, with the support of a specializedconsulting firm.

> 
*Appointment*

See "Item 10 – Limitations on Voting andShareholdings – Minority protection provisions".

> 
*Directors’ independence and integrity requirements*

Legislative Decree No. 58 of February 24, 1998 (TUF), asamended by Legislative Decree No. 303 of December 29, 2006 statesthat at least one member, or two members if the Board is composedby more than seven members must possess the independencerequirements provided for Statutory Auditors of listed companies,as per Article 148, paragraph 3, of same rule.

Article 17.3 of Eni’s By-laws states that at least onemember, if the Board is made up by up to five members, or threeBoard members, in case the Board is made up by more than fivemembers, shall have those independence requirements. This ruleactually increases the number of independent Directors inEni’s Board, as compared to what is required by the law. Inaddition Eni’s By-laws provide for a mechanism that supportsEni’s voting system by ensuring in any case the presence ofthe minimum number of independent directors in the Board.Eni’s Code contemplates further independence requirements,in line with those provided by the Corporate Governance Codepromoted by Borsa Italiana. 

The TUF, as implemented in Article 17.3 of Eni’s By-laws,provides that the persons acting as Directors and Chief OperatingOfficers of listed companies shall possess the integrityrequirements prescribed to members of control entities of listedcompanies. Directors must comply with additional specificrequirements.

In accordance with Article 17.3 of Eni’s By-laws, theBoard periodically evaluates independence and integrity ofDirectors and the absence of reasons for ineligibility andincompatibility. The Eni Code also provides for the Board ofStatutory Auditors to verify the proper application of criteriaand procedures adopted by the Board to evaluate the independenceof its members.

In accordance with Article 17.3 of Eni’s By-laws, shouldthe independence and integrity requirements be impaired or ceaseor should other reasons of ineligibility arise, the Boarddeclares the termination of office of the member lacking saidrequirements and provides for his substitution or, alternatively,allows any impaired director to eliminate any reasons forincompatibility within a fixed deadline. Board members areexpected to inform the Company if they lose their independenceand integrity requirements or of any reasons for ineligibility orincompatibility that might arise.

On February 26, 2009 as part of the periodic assessment ofeach Board member’s requirements provided by the law andEni’s By-laws, the Board of Directors has verified that allits members possess the integrity requirement, on the basis ofindividual statements received. In addition, the Board hasdeclared seven out of its nine members as independent, inaccordance with applicable laws, Eni’s By-laws and the EniCode, with specific reference to non 

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executive directors: Alberto Clô, Paolo Andrea Colombo, PaoloMarchioni, Marco Reboa, Mario Resca, Pierliugi Scibetta andFrancesco Taranto. 

The Board of Statutory Auditors verified in its meeting ofMarch 3, 2009, the proper application of criteria and proceduresadopted by the Board to evaluate the independence of its members.

> 
*Admissible positions in other companies*

In its meeting of June 11, 2008, the Board of Directorsexpressed its opinion on the matter of the admissible number ofpositions held by Directors in other companies, as required bythe Eni Code, confirming the opinion of the preceding Board, asfollows:

| • |   | an executive director should        not hold: (i) the position of executive director in any        other Italian or foreign listed company, or in any        finance, banking or insurance company or any company with        a net equity exceeding euro 10 billion; and (ii) the        position of non-executive director or statutory auditor        (or member of any other advisory committee) in more than        three of said companies; and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | a non-executive director,        should not hold further positions than the one held in        Eni, as: (i) executive director in more than one of the        companies mentioned above and non-executive director or        statutory auditor (or member of any other control body)        in more than three of the mentioned companies, or as        (ii) non-executive director or statutory auditor in        more than six of the mentioned companies. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

All the positions held in Eni’s subsidiaries are excludedfor the purposes described above.

In case a director exceeds said limits in terms of positionsheld, he should timely inform the Board, who shall judge thesituation taking into account the interest of the Company andcall upon the interested director to make a decision on thematter. In any case, before accepting the office of director orstatutory auditor (or member of any other control entity) of acompany not related to Eni, the executive director informs theBoard of Directors that evaluates its compatibility with hisoffice at Eni and the interests of Eni. This rule applies also tothe Chief Operating Officers of Eni’s divisions.

The Board’s resolution on this matter is published onEni’s website in the Corporate Governance section.

On the basis of available information, at the Board’smeeting of February 26, 2009, the Board of Directors verifiedthat the number of positions held in other companies by eachBoard member complies with the above mentioned limits.

> 
*Transaction in which a director has an interest and    related parties transactions*

As requested by the Eni Code, in accordance with the BorsaItaliana Code, the Board of Directors, with the opinion ofInternal Control Committee, has adopted on February 12, 2009, theinternal guidelines on transactions in which a Director (or aStatutory Audit) has an interest and on transactions with relatedparties4, with the aim to ensure the observance oftransparency and fairness principles requested by the applicablelaws and regulations for the above mentioned transactions. 

In particular in its guidelines the Board:

| • |   | identified, based on        predetermined criteria, main transactions with related        parties ("relevant transactions"), as such        reserved to its sole responsibility;                                                                                                                                                                                     |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | reserved a special role to        independent directors, by engaging the Internal Control        Committee in the assessment and decision making process        of these transactions. The Committee plays also a        relevant role in transactions that are not reserved to        the Board; and                                                                          |
| • |   | strengthened an in-depth        process of review and assessment of all transactions with        related parties, irrespective of allocation of        decision-making powers, in order to guarantee        transparency and substantial and procedural fairness. The        same kind of transparency must be observed also in the        subsequent decision making process. |

Therefore, these guidelines define Eni’s Group policy onthese matters (for detailed information on 2008 operations, see"Item 7.B – Related party transactions").

As provided for by the Eni Code, these guidelines alsoregulate the transactions in which a Director and StatutoryAuditor has an interest, providing, in particular that:

| • |   | Eni’s directors and        statutory auditors shall disclose periodically any        personal interest with respect to the parent company in        Eni and its subsidiaries and shall timely inform the        Board of Directors and the Board of Statutory Auditors on        transactions in which they have an interest that may be        irrelevant to the Company’s purposes; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

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| (4) | i | Until the        approval of said guidelines, relevant transactions with        related parties (excluding standard ones) – as        identified according to IAS 24 and according to the        specific internal financial reporting regulation of July        4, 2006 and of December 20, 2007 – have been        submitted to the Board of Directors, even if their amount        was lower than the threshold defined for its competence. |
|-----|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| • |   | directors who disclosed        above mentioned interests should usually not take part in        discussions and decisions on such transactions, also        leaving the meeting when the decision is made; and                                                         |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | in any case, all        transactions in which a director or a statutory auditor        has an interest are considered material to the Company        and are subject to the strengthened review process with        express opinion of the Internal Control Committee. |

> 
 

***Board Committees***

The Board has instituted, as provided for by the Eni Code,three internal committees with advisory and consulting tasks: (a)the Internal Control Committee, (b) the Compensation Committeeand (c) the Oil-Gas Energy Committee. Their composition, tasksand functioning are defined by the Board of Directors, withspecific regulations, in respect of the criteria established bythe Eni Code. 

The committees provided by the Eni Code (the Internal ControlCommittee and the Compensation Committee) are made up of at leastthree members and in no case by a number higher than the majorityof Board members. All committees must be composed exclusively ofnon executive directors, the majority of whom are independent.

In its meeting of June 11, 2008, the Board appointed thefollowing non executive directors, all of them independent, asmembers of the Committees:

| • |   | Internal Control Committee:        Marco Reboa (Chairman) Paolo Marchioni, Pierluigi        Scibetta and Francesco Taranto.                 |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | Compensation Committee:        Mario Resca (Chairman), Alberto Clô, Paolo Andrea        Colombo and Francesco Taranto.                 |
| • |   | Oil-Gas Energy Committee:        Alberto Clô (Chairman), Paolo Andrea Colombo, Marco        Reboa, Mario Resca and Pierluigi Scibetta. |

> 
*Internal Control Committee*

The Internal Control Committee was established in Eni in 1994and is entrusted with advisory and consulting tasks in respect ofthe Board in the matter of internal control system. It iscomposed exclusively of independent directors, provided with theprofessional qualification required by the Eni Code5and reports to the Board at least every six months at the date ofthe approval of the annual and semi-annual financial statementson the activity performed as well as on the adequacy of theinternal control system. The Committee performs the following main tasks:

| • |   | assesses in conjunction with        the Manager charged with preparing financial reports and        the External Auditors the proper use of accounting        principles and their homogeneity for the preparation of        the consolidated financial statements;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | on request of the CEO,        expresses opinions on specific aspects concerning        identification of main Company risks and designing,        implementing and managing the internal control system;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| • |   | monitors the activities of        the internal audit function and therefore examines the        integrated audit plan, the annual budget, the periodical        Internal Audit reports on activities performed and their        outcomes;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| • |   | in order to express its        opinion on the adequacy of the internal control system,        assesses: (i) the outcomes of internal audit reports and        the evidence deriving from monitoring activities on        improvement actions on control systems planned after the        audits are performed; (ii) evidence resulting from        periodic reports on monitoring activities on the        Company’s internal control system over financial        reporting; (iii) reports from the Board of Statutory        Auditors and individual Statutory Auditors also for what        concerns investigation activities performed by the        internal control department on whistleblowing, also in        anonymous form; (iv) evidence from reports and management        letters of External Auditors6; (v) reports of        the Watch Structure also in its capacity of Guarantor of        the Code of Ethics; (vi) evidence from reports of the        Manager charged with preparing financial reports and of        the Manager responsible for internal audit; and (vii) as        well as review and investigations from third parties; and |
| • |   | performs any other task        attribute to it by the Board of Directors, in particular        expresses an opinion on the internal guidelines for the        substantial and procedural correctness of transactions        with related parties, playing a relevant role in the        analysis and in the final decision process of said        transactions, as well as those where a director has an        interest of his or third parties behalf.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |

In 2008, the Internal Control Committee convened 18 times,with an average attendance rate of 92%, and reviewed thefollowing items: (i) the 2007 audit activities report and the2008 audit plan and its periodic progress; (ii) the 2007 auditactivities report and 2008 audit plan prepared by the internalaudit functions of Saipem and Stogit functions; (iii) outcomes ofplanned and unplanned Eni’s internal audit activities, aswell as results of monitoring activities on progresses made byoperating units in implementing planned remedial actions in orderto eliminate 

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| (5) | i | Unlike the        Code of Borsa Italiana, the Eni Code requires that at        least two (and not only one) Board members have adequate        expertise in accounting and financial matters.                              |
|-----|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (6) | i | Eni entrusted        to the Board of Statutory Auditors the role of Audit        Committee under the SOA and therefore of assessing the        proposals of external auditors and the monitoring of        their activity. |

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deficiencies highlighted by internal audit activities withspecial attention to specific issues; (iv) outcomes fromEni’s internal auditing interventions as specificallyrequired by Eni’s control bodies; (v) the periodic reportsconcerning complaints collected; (vi) the report on Eni’sinternal control system prepared by the Manager delegated for theinternal control and the compliance with the independencerequirements of this Manager; (vii) the future role, tasks andresponsibilities of the Manager delegated for the internalcontrol and of Eni’s Internal Audit function and theguidelines approved by the Board of Directors concerning internalaudit activities; (viii) updating of the Eni’s InternalAudit operating handbook; (ix) disclosures of information ornotification regarding certain inquiries conducted by bothItalian or foreign judicial and administrative authorities withreference to crimes or other kind of infringements which involveEni and all its subsidiaries, in Italy or abroad, and theirdirectors and employees; (x) disclosures on the developmentof pending litigation; (xi) the essential features of the 2007Eni’s financial statements, on a consolidated and individualbasis, through meetings with top level representatives ofEni’s and its subsidiaries’ administrative functions,and with Chairmen (or others members) of Boards of Statutoryauditors and responsible partners from independent auditcompanies for each subsidiary; accounting treatment adopted forspecific transactions; the draft 2008 interim consolidated reportprepared on the basis of the EU transparency directive andrelevant opinion of external auditors confirming the complianceof this report with IAS 34; (xii) procedures and systemsused for evaluating, classifying and reporting hydrocarbonreserves; (xiii) the essential features of Eni’s AnnualReport on Form 20-F, progress on implementation of SOA activitiesand updating on programs and controls for 2008 to prevent anddetect frauds; (xiv) the report on the administrative andaccounting setup of the Manager responsible for the preparationof the Company’s financial report and the report on theinternal control system over financial reporting; (xv) theimplementation plan regarding Article 36 of Consob Decision No.16191/2007; (xvi) the report on the internal control system, thatwas included in the Corporate Governance section of the 2007Annual Report; (xvii) guidelines on financial statementsauditing, the report on audit reports for 2007 prepared byexternal auditors, auditing strategies for 2007 and 2008; (xviii)updating of Eni’s Model 231 and the periodic reportpresented on activities performed by the Company Watch Structure,also by meetings with its members as provided for the new versionof Model 231 (the Company’s internal control structure)approved by Eni’s Board of Directors in March 2008; (xix)update on Eni’s guideline for management and control offinancial risk; (xx) information on Circular No. 330 of October14, 2008 concerning Group’s procedures for the procurementof works, goods and services; the main aspects of aCompany’s project of process reengineering (BPR) concerninggroup procurement and updating of the procedures for reviewingsuppliers selection following detection of illegal behaviors;(xxi) periodic report in the procedure for the ascertainmentof alleged illicit behavior on the part of Eni employees, as perCircular No. 301 of December 14, 2007; (xxii) information ofCircular No. 305 of December 20, 2007 concerning disseminationand reception of laws and regulations; (xxiii) review of thedraft report of directors under Article 2433-bis of the CivilCode on interim dividends for 2008; (xxiv) information on thedevelopment plan of Eni Trading & Shipping activities; and(xxv) logical-operational flows of Eni communication activities.

> 
*Compensation Committee*

The Committee is entrusted with proposing tasks on the mattersof compensation of the Chairman and the CEO as well as the BoardCommittees members, and examining the indication of the CEO, onthe following: (i) long-term incentive plans includingstock-based compensation; (ii) criteria for the compensation ofthe managers with strategic responsibilities; and (iii) thesetting of objectives and the assessment of results ofperformance and incentive plans.

In 2008, the Compensation Committee met 4 times with a 100%attendance, and accomplished the following: (i) examined the 2007results and the objectives for 2008 in view of defining annualand long-term incentives; (ii) reviewed the bonuses of theChairman and CEO based on 2007 performance; (iii) reviewed thebenchmarks for the managers with strategic responsibilitiesremuneration and the criteria of the annual remuneration policy;(iv) remuneration and rules applying to the CEO and GeneralManager Paolo Scaroni and remuneration for the powers delegatedto the Chairman; and (v) the implementation of the long-termincentive plans for the year 2008 and relevant grants to the CEO.

> 
*Board of Statutory Auditors*

In line with Italian legislation, as specified in Article 28of Eni’s By-laws, the Board of Statutory Auditors consistsof five effective members (and two alternate) who must complywith specific expertise and integrity requirements. 

The following table sets forth the names, positions and yearof appointment of the members of the Board of Statutory Auditorselected by the Ordinary Shareholders’ Meeting held on June10, 2008 for a three year term, until the Shareholders’Meeting approval of financial statements for year ended atDecember 31, 2010. 

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| **Name**                |   | **Position**      |   | **Year first appointed to Board        of Statutory Auditors** |
|-------------------------|--------|-------------------|--------|----------------------------------------------------------------|
|                         |   |                   |   |                                                                |
| Ugo Marinelli           |   | Chairman          |   | 2008                                                           |
| Roberto Ferranti        |   | Auditor           |   | 2008                                                           |
| Luigi Mandolesi         |   | Auditor           |   | 2008                                                           |
| Tiziano Onesti          |   | Auditor           |   | 2008                                                           |
| Giorgio Silva           |   | Auditor           |   | 1999                                                           |
| Francesco Bilotti       |   | Alternate Auditor |   | 2005                                                           |
| Pietro Alberico Mazzola |   | Alternate Auditor |   | 2005                                                           |
|                         |   |                   |   |                                                                |

Roberto Ferranti, Luigi Mandolesi, Tiziano Onesti andFrancesco Bilotti were candidates in the list presented by theMinistry of Economy and Finance; Ugo Marinelli, Giorgio Silva andPietro Alberico Mazzola were candidates in the list presented byinstitutional investors coordinated by institutional investors.

> 
*Tasks*

The Board of Statutory Auditors, in accordance with the TUFprovisions, monitors: (i) the compliance with the laws and withEni’s By-laws; (ii) the observance of the principles ofcorrect administration; (iii) the adequacy of the Company’sorganizational structure, for matters within the scope of itsauthority, of the internal control system and of theadministrative and accounting system as well as the reliabilityof the latter in fairly representing the Company’stransactions; (iv) the actual implementation of corporategovernance rules foreseen by the Borsa Italiana Code to which theCompany adheres; and (v) the adequacy of instructions conveyed bythe Company to its subsidiaries to ensure fulfillment ofreporting obligations provided by applicable laws.

Moreover, according to the TUF and the Eni Code, the Board ofStatutory Auditors oversight the appointment, retention and workof the Company’s principal external auditors: to this extentthe Board of Statutory Audit (i) submit to theShareholders’ Meeting called for its approval, a motivatedproposal for the appointment of the principal external auditorsand for their fees and (ii) monitors the independence of theprincipal external auditors, verifying both the compliance withthe provisions of applicable laws and regulations governing thematter, and the nature and extent of services other than theaudit services provided to Eni Group companies (also throughentities belonging to the auditors’ network). 

As provided for Article 23.3 of Eni’s By-laws, the Boardof Statutory Auditors is timely informed, at least on a quarterlybasis, by the Board of Directors, on the activities and on themost relevant operations regarding the operational, economic andfinancial management of the Company and of its subsidiaries.

Statutory Auditors are required to attend theShareholders’ Meeting and the meetings of the Board ofDirectors and must promptly notify Consob, the public****Authorityresponsible for regulating the Italian securities market ofirregularities found in the performance of their oversightactivity. 

In 2008, the Board of Statutory Auditors met 22 times. Averageduration of meetings was 3 hours and 30 minutes. In 2008attendance rate was 95% of its members and 93% at Board ofDirectors’ meetings. The current Board showed attendancerate of 98.4% of members in its own meetings and 92.8% at Boardof Directors’ meetings.

> 
*Board of Statutory Auditors as Audit Committee*

The Board of Directors, in its meeting of March 22, 2005, inaccordance with the provision of the U.S. Securities ExchangeCommission (SEC) for non-U.S. private issuers (SEC rule 10A-3),identified in the Board of Statutory Auditors the body that,meeting the requirements provided for the above mentioned rule,starting from June 1, 2005, performs, to the extent permitted byItalian legal or listing requirements, the functions assigned bySEC rules and the Sarbanes-Oxley Act (SOA) to the Audit Committeeof U.S. registrant. 

On June 15, 2005, the Board of Statutory Auditors approved itschart for carrying out the tasks attributed to the auditcommittee under mentioned U.S. laws and regulations7.This charter is published on Eni’s website.

The key functions performed by the Board of Statutory Auditorsacting as an audit committee as provided for by SEC rules are asfollows:

| • |   | evaluating the proposals        presented by the external auditors for their appointment        and making its promted recommendation to the        Shareholders’ Meeting about the proposal for the        appointment or the retention of the external auditor; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

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| (7) |   | The chart was        amended on March 30, 2007, taking into account changes        introduced by Legislative Decree No. 303 of 2006 on        Article 159, paragraph 1 of TUF, and by the Eni’s        Code, as well as to take into account the variations        adopted inthe organization structure, in respect to the        one existing on June 15, 2005, when the previous chart        was approved. |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| • |   | performing the activities of        oversight of the work of the external auditor engaged for        the audit or performing other audit, review or attest        services;                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | making recommendations to        the Board of Directors on the resolution of disagreements        between management and the auditor regarding financial        reporting;                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| • |   | approving the procedures        for: (a) the receipt, retention, and treatment of        complaints received by the Company regarding accounting,        internal accounting controls, or auditing matters; and        (b) the confidential, anonymous submission by employees        of the Company of concerns regarding questionable        accounting or auditing matters;                                                                                                                                                                                                                                             |
| • |   | approving the procedures for        the pre-approval of admissible non-audit services,        analytically identified, and examine the information on        the execution of the authorized services;                                                                                                                                                                                                                                                                                                                                                                                                                     |
| • |   | evaluating any request to        have recourse to the external auditor engaged for the        audit for admissible non audit services and expresses its        opinion to the Board of Directors;                                                                                                                                                                                                                                                                                                                                                                                                                          |
| • |   | examining the periodical        communications from the external auditor relating to: (a)        all critical accounting policies and practices to be        used; (b) all alternative treatments of financial        information within generally accepted accounting        principles that have been discussed with management        officials of the Company, ramifications of the use of        such alternative disclosures and treatments, and the        treatment preferred by the external auditor; and (c)        other material written communication between the external        auditor and the management; |

| • |   | examining complaints        received by the CEO and the CFO concerning any        significant deficiency in the design or operation of        internal controls which are reasonably likely to        adversely affect the Company’s ability to record,        process, summarize and report financial information and        any material weakness in internal controls; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | examining complaints        received by the CEO and the CFO concerning any fraud that        involves management or other employees who have a        significant role in the Company’s internal controls. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

> 
*Appointment, requirements and other duties*

Like the Directors and in accordance with applicableregulations, the Statutory Auditors are appointed by means of alist vote as provided for by Eni’s By-laws. At least twoAuditors and one alternate are elected from lists presented byminorities and the Chairman of the Board of Statutory Auditorsshall be elected from a list other than the one obtaining themajority of votes (for a detailed description of the procedure,see "Item 10 – Minority protection provisions"). 

As stressed in the Code, the Statutory Auditors shall act withautonomy and independence also towards the shareholders whoelected them and, in accordance with the TUF, they shall possessthe independence, expertise and integrity requirements prescribedby a regulation of the Minister of Justice. As for theprofessional qualifications of the candidates, Article 28 ofEni’s By-laws, in line with the said Decree of the Ministerof Justice, foresees that the professional requirements can alsobe acquired with at least three years of professional experienceor by teaching business law, business administration and finance,as well as at least a three year experience in a managerialposition in geological or engineering businesses. Eni’sAuditors are all chartered auditors. 

Statutory Auditors declared consequently to possessindependence, integrity and expertise requirements as foreseen bythe applicable law. In compliance with the Eni Code prescriptionsdesigned to ensure that auditors are independent subsequently totheir appointment based also on the Code provisions for the samematter in the case of directors, the Board of Statutory Auditorsin its meeting of January 21, 2009 verified that all its memberspossess such requirements (independence, integrity and expertise)and the Board of Directors in its meeting of February 26, 2009verified this certification.

With reference to positions held in other companies, untilcoming into force of new Consob regulation on this matter,Eni’s By-laws prohibited the appointment as statutoryauditor of persons that were already statutory auditors ormembers of the supervisory board or members of the managementcontrol committee of at least five companies in regulated marketsother than listed subsidiaries of Eni SpA. In light of that,appointed Auditors communicated to the Company their positions inother entities and subsequently the Board of Statutory Auditorsverified compliance with the said limit as provided by Eni’sBy-laws. As of June 30, 2008, accordingly with the By-lawsprovisions, Statutory Auditors may assume positions in governingor controlling bodies in companies other than Eni within thelimits set by the mentioned Consob regulation. In September 2008Eni’s Statutory Auditors communicated to Consob theircompliance with said limits. 

> 
*External Auditors*

As provided for by Italian law, the auditing of financialstatements is entrusted to external auditors registered on theregister held by Consob. The external auditor is appointed andits fee is determined by the Shareholders’ Meeting onreasoned proposal of the Board of Statutory Auditors.

Eni’s external auditor, PricewaterhouseCoopers SpA, wasappointed for the first time on June 1, 2001 and was reappointedby the ordinary Shareholders’ Meeting on May 28, 2004, for aterm of three financial years. The 

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Shareholders’ Meeting of May 24, 2007 resolved to renewthe appointment for the 2007-2009 period in accordance withLegislative Decree No. 303/2006, as it did not yet complete themaximum nine financial year engagement allowed by the law.

At the end of this engagement, PricewaterhouseCoopers SpA willcease to act as Eni’s external auditors.

In 2008, Eni’s External Auditors met with Eni StatutoryAuditors in order to discuss: (i) critical accounting policiesand practices applied for the purpose of a proper representationof Eni’s results of operations and financial condition; (ii)alternative accounting treatments provided for by generallyaccepted accounting principles concerning material itemsdiscussed with management, including ramifications of the use of,the impact deriving from the application of said alternativedisclosures and treatments and relevant information, as well asthe treatments preferred by external auditors; and (iii) thecontents of any other material written communication betweenexternal auditors, and management.

For a description of the special powers of the State, see"Item 10 – Memorandum and Articles of Association– Limitations on Voting and Shareholdings – SpecialPowers of the State" below.

**Compensation**

Board members’ emoluments are determined by theShareholders’ Meeting, while the emoluments of the Chairmanand CEO, in relation to the powers entrusted to them, aredetermined by the Board of Directors considering relevantproposals made by the Compensation Committee and afterconsultation with the Board of Statutory Auditors.

Main elements of the compensation of the Chairman, the CEO,other Board members and Eni’s three General Managers aredescribed below.

CHAIRMANThe compensation of the Chairman of the Board of Directors hasbeen resolved by Eni’s Shareholders’ Meeting andincludes:

| (a) |   | a base salary of euro        265,000 and reimbursement of out of pocket expenses; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) |   | a bonus which amount is        determined in accordance with the performance of Eni        shares in the reference year as compared with the        performance of the seven largest international oil        companies for market capitalization, taking account of        the dividend paid. This bonus will amount to euro 80,000        or euro 40,000, depending on whether the performance of        Eni shares is rated first or second, or third or fourth        in the reference year, respectively. No bonus is paid in        case Eni scores a position lower than the fourth one. In        2007, Eni rated seventh and in 2008 the bonus was not        paid. |

With regard to the powers delegated to the Chairman, the Boardof Directors determined further compensation, as follows:

| (a) |   | an annual emolument of euro        500,000; and                                                                                                                                                                                                                                                                                                                                                                                                                               |
|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) |   | an annual performance bonus        based on the achievements of the Company’s target        determined in the same way as for the CEO (see below). In        2008, based on 2007 Eni’s results, a bonus equal to        115% of the target level was determined, within an        interval ranging from 85% to 130% of said target level.        The target level of the bonus is 60% of the annual        emolument. In 2008, this bonus amounted to euro 345,000. |

Compensation of the Chairman also includes an insuranceagainst death or permanent inability caused by injury or sicknessin the exercise of his duties or under certain othercircumstances as stipulated collectively for all managers ofItalian companies producing goods and services. In particular, aspecific insurance policy has been underwritten which guaranteeseuro 500,000 to survivors.

CEOCompensation for the CEO has been resolved by the Board ofDirectors of Eni in connection with his position both as CEO andas General Manager of the parent company Eni SpA.

As General Manager of Eni SpA, his terms of employment areregulated by the "Contratto collettivo nazionale di lavoroper i dirigenti di aziende produttrici di beni e servizi"(the Italian national collective contract for managers ofcompanies producing goods and services), as well as by anyinternal agreement stipulated by the representatives of managersand Eni SpA.

The CEO compensation includes the following items:

| (a) |   | an annual fixed amount of        euro 1,430,000, including a base salary of euro 1,000,000        for the services as General Manager and an emolument of        euro 430,000 for the services as CEO; |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| (b) |   | an annual performance bonus        based on the achievement of the Company targets. These        targets are approved by the Board of Directors on        proposal of the Compensation Committee and defined        consistently with the targets of the strategic plan and        yearly budget. In 2007, said targets included a set level        of cash flow from operations (with a 30% weight),        divisional operating performances (30%), strategic        projects (20%) and corporate efficiency (20%). Results        achieved have been assessed assuming a constant trading        environment and have been verified by the Compensation        Committee and approved by the Board of Directors. The        target and maximum amount of this bonus corresponds        respectively to 77% and 100% of the fixed amount under a)        above. In 2008, based on 2007 Eni’s results, a bonus        equal to 115% of the target level was determined, within        an interval ranging from 85% to 130% and a bonus of euro        1,267,000 was paid; |
|-----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (c) |   | a long-term incentive under        the incentive scheme as approved in March 2006 by the        Board of Directors as proposed by the Compensation        Committee. This incentive scheme provides: (i) a deferred        monetary incentive, linked to the achievement of certain        Company’s financial performance annual targets; and        (ii) stock option awards linked to the achievement        of certain performance targets of the Eni share measured        in terms of total shareholder return that considers both        the stock appreciation and the dividend (see below for a        more detailed description of Eni’s long-term        incentive schemes applicable to top and senior managers).        Under this scheme the CEO received:                                                                                                                                                                                                                                                                                         |

|   |   | (i) |   | an annual award of a        deferred monetary bonus with a target level corresponding        to 55% of the fixed amount under a) above. In 2008, this        award amounted to euro 1,022,500 that will be paid after        three years in connection with the achievement of certain        preset Company annual targets in terms of EBITDA        (earnings before interest, taxes, depreciation and        amortization); and |
|--------|--------|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   | (ii) |   | an annual award of stock        options for 2008 for a face value corresponding to 10        times the fixed amounts under section a) above. In 2008,        a total of 573,000 options were awarded with a vesting        period of three years and an exercise price of euro        22.540 corresponding to the arithmetic average of        official prices registered on the Mercato Telematico        Azionario in the month preceding the award; |
|--------|--------|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) |   | severance payments as        regulated by Italian laws, which consist of a lump sum to        be paid to the employee upon retirement. To this end, the        Company recognizes yearly accruals computed by dividing        the total remuneration earned as General Manager (base        salary, bonuses and stock compensation) by 13.5. The        amounts accrued are revaluated yearly at a fixed rate of        1.5% plus the 75% of the yearly official consumer price        index increase; |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) |   | as an integration to the        severance payment described above, should the employment        contract of Mr. Scaroni as General Manager of Eni SpA be        terminated upon expiry of the term of his office as CEO        or upon earlier termination of such office, he will be        entitled to receive a payment of euro 3,200,000 plus an        amount corresponding to the average performance bonus        earned in the three-year period 2008-2010, in lieu of        notice thus waiving both parties from any obligation        related to notice. This amount will not be paid if the        termination of office meets the requirement of due cause        as per Article 2119 of the Italian Civil Code, in case of        death and in case of resignation from office other than        as the result of a reduction in the powers currently        attributed to the CEO. Furthermore, upon expiry of the        contract as employee of Eni, the CEO in his capacity as        General Manager of the parent company is entitled to        receive an indemnity that is accrued along the service        period by taking into account social security        contribution rates and post-retirement benefit        computations applied to the CEO annual emolument and 50%        of the maximum bonuses earned as a Director. Taking into        account that the CEO has been appointed on June 11, 2008,        a provision of euro 134,139.23 has accrued in 2008. A sum        of euro 644,179.60 corresponding to the global amount        accrued over the preceding three-year period of office        was paid; |
|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (f) |   | competition clause: the CEO        agrees not to be engaged, on his own account and        directly, in any business that may be in competition with        the businesses of Eni, as per its By-laws, in Italy,        Europe and North America for a year after termination of        office. Based on this arrangement, Eni will pay a fee        corresponding to euro 2,219,000. As a consequence of any        breach of this clause, the CEO would lose the right to        such fee and reimburse any amount already paid, and shall        pay to Eni damages in an amount agreed among the parties        to correspond to twice such non-competition fee;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| (g) |   | the pension scheme        corresponds to the scheme applied to Eni managers and        provided by INPS (the Italian state social security        entity) to all Italian workers. In addition, the CEO is        included in an additional pension scheme under the form        of an Eni Group pension fund agreed collectively by Eni        and Eni managers which provides integration, in the form        of a lump sum payment or perpetuity, to the pension paid        by the State. This integration is proportional to        contributions to the fund made by both the manager and        the Company in equal amounts. The integration is awarded        to the manager when eligible for the payment of the        pension from the State, provided that a minimum time        period has elapsed according to the Fund By-laws. An        agreement signed on March 20, 2006, established that the        Company’s and the manager’s payment to this        Fund amounts to 3.5% of total emoluments earned by the        CEO in his position as General Manager (i.e. the        aggregate of the annual salary and bonuses up to a        maximum of euro 200,000);                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| (h) |   | like all other Eni managers,        Mr. Scaroni is entitled to participate in a health        insurance fund financed by Eni managers and Eni which        provides reimbursement of certain medical expenses on the        basis of rules and parameters as provided by the        Fund’s By-laws; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| (i) |   | insurance against death or        permanent inability caused by injury or disease in the        exercise of his duties or under certain other        circumstances as stipulated collectively for all managers        of Italian manufacturing                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

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|   |   | companies. In particular a        specific insurance policy has been underwritten on behalf        of Mr. Scaroni which guarantees euro 7.5 million to        beneficiaries in case of death or disability, however        determined. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

MEMBERS OF THE BOARD OF DIRECTORSThe compensation of members of the Board of Directors has beendetermined by Eni’s Shareholders’ Meeting and includes:

| (a) |   | an annual emolument of euro        115,000 and reimbursement of out of pocket expenses; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) |   | a bonus determined in        accordance with the performance of the Eni share in a        given year as compared with the performance of the seven        largest international oil companies for market        capitalization, taking account of the dividend paid. Said        bonus amounts to euro 20,000 or euro 10,000 depending on        whether the performance of Eni shares is rated first or        second, or third or fourth in the reference year,        respectively. In 2007, Eni rated seventh and in 2008 the        bonus was not paid. |

The Board of Directors in the meeting of June 11, 2008, asproposed by the Compensation Committee and advised by the Boardof Statutory Auditors, confirmed the additional element ofremuneration for the Board members holding positions inBoard’s committees, with the exclusion of the Chairman andCEO. Said fee amounts to euro 30,000, and euro 20,000 for theposition of chairman of a committee and of member of a committee,respectively. This amount decreases to euro 27,000 and euro18,000 in case a member holds positions in more than onecommittee.

GENERAL MANAGERSThe terms of employment of the General Managers of Eni’sDivisions are regulated by the "Contratto collettivonazionale di lavoro per i dirigenti di aziende produttrici dibeni e servizi" (the Italian national collective contractfor managers of companies producing goods and services), as wellas by any internal agreement stipulated by the representatives ofmanagers and Eni SpA. The General Managers of Divisions may beappointed as members of the Board of Directors of Enisubsidiaries and affiliates; compensation deriving from suchappointments as provided for by Article 2389 of the Italian CivilCode is to be repaid to Eni as it is included in theirremuneration under section a) below.

Their remuneration includes:

| (a) |   | a base salary, defined        considering the position held and their specific        responsibilities, with reference to appropriate market        levels as benchmarked against national and international        companies of comparable size, complexity and scope in the        oil and gas, industrial and service sectors. Base        salaries are reviewed and adjusted on a yearly basis        considering individual performance and career        progression; |
|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) |   | a performance bonus paid        yearly, based on the achievement of specific financial,        operational and strategic targets and of individual        performance goals pertaining to each business units        defined consistently with the Company’s targets in        the strategic plan and yearly budget. The target level of        the bonus corresponds to 60% of the base salary;                                                                       |

| (c) |   | long-term incentives in the        form of a deferred monetary bonus and stock options        according to the same scheme as the CEO. Under this        scheme the three General Managers have received: |
|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   | (i)  |   | a yearly award of a deferred        monetary bonus at target level of 40% of the base salary.        In 2008, based on 2007 Eni results, the basic deferred        bonus awarded was equal to 130% of the target level,        within an interval ranging from 70% to 130%; and                                                                                                      |
|--------|--------|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | (ii) |   | a yearly award of stock        options for a face value corresponding to 4.5 times the        base salary. Options awarded in 2008 have a vesting        period of three years and an exercise price of euro        22.540 corresponding to the arithmetic average of        official prices registered on the Mercato Telematico        Azionario in the month preceding the award; |

| (d) |   | a severance payment as        regulated by Italian laws, which consists of a lump sum        to be paid to the employee upon retirement. To this end,        the Company recognizes yearly accruals computed by        dividing the yearly remuneration (base salary, bonuses        and stock compensation) by 13.5. These amounts are        revaluated yearly at the rate of 1.5% plus the 75% of the        official yearly consumer price index increase; |
|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (e) |   | the pension scheme        corresponds to the scheme applied to Eni managers and        provided by INPS to all Italian workers. In addition, the        General Managers are included in the additional pension        scheme of Eni managers which provides an integration to        the public pension. For further details see section g) of        the description of compensation of the CEO;                                                             |
| (f) |   | like all other Eni managers,        they are entitled to participate in a health insurance        Fund financed by Eni managers and Eni which provides        reimbursement of certain medical expenses on the basis of        rules and parameters as provided for by the Fund’s        By-laws. For further details see section h) of the        description of compensation of the CEO; and                                                            |
| (g) |   | an insurance against death        or permanent inability caused by injury or disease in the        exercise of his duties or under certain other        circumstances as stipulated collectively for all managers        of Italian manufacturing companies.                                                                                                                                                                                                   |

With the exception of the CEO as described above, none of theDirectors of Eni has service contracts with the company or any ofits subsidiaries providing for benefits upon termination ofemployment.

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Remuneration earned for 2008 by members of the Board ofDirectors, including the CEO and the Chairman, the three ChiefOperating Officers and Eni’s senior managers attending on apermanent basis the meetings of the Steering Committee of Eni(total amount) is reported in the table below. Emoluments earnedby the Statutory Auditors of Eni are also included.

Below is a description of each column of the following table:

| • |   | "Emoluments for service        at Eni SpA" include emoluments paid to non-executive        and executive directors for service rendered, fixed fees        paid to Directors attending the Board’s Committees,        and fees paid to Statutory Auditors. Emoluments earned by        the Chairman and the CEO include also the portion awarded        for the powers entrusted to them by the Board;                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | "Non cash        benefits" comprise amounts referring to all fringe        benefits, including insurance policies;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| • |   | "Bonuses and other        incentives" include: (i) performance bonuses awarded        in the year to Directors and the Chairman of the Board        based on the performance of the Eni share; (ii)        performance bonuses awarded in the year to both the        Chairman and the CEO in connection with the power        entrusted to them by the Board, based on the achievement        of specific company targets; and (iii) performance        bonuses awarded in the year to the CEO, in his position        as General Manager of the parent company, the General        Managers of Eni’s divisions and other managers with        strategic responsibilities based on the achievement of        specific financial, operational and strategic targets and        of individual performance targets pertaining to their        respective business or functional units; |

| • |   | "Salaries and other        elements" report base salaries paid to the CEO, the        General Mangers of Eni’s Divisions and other        managers with strategic responsibilities, and indemnities        paid upon termination of the employment contract. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

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| **Name** |                | **Position** |   | **Emoluments for service at Eni SpA** |   | **Non-cash benefits** |   | **Bonus and other incentives**(a) |   | **Salaries and other        elements** |   | **Total** |
|----------|---------------------|--------------|--------|---------------------------------------|--------|-----------------------|--------|-----------------------------------|--------|----------------------------------------|--------|-----------|
|          |                |              |   |                                       |   |                       |   |                                   |   |                                        |   |           |
|     | **(thousand euro)** |

| **Board of Directors**                                        |   |                                |   |      |   |   |   |      |      |   |       |      |   |       |
|---------------------------------------------------------------|--------|-------------------------------------|--------|-----------|--------|--------|--------|-----------|-----------|--------|------------|-----------|--------|------------|
| Roberto        Poli                                           |   | Chairman                            |   | 768       |   | 18     |   | 345       |      |   |       |      |   | 1,131      |
| Paolo Scaroni                                                 |   | CEO                                 |   | 430       |   | 17     |   | 1,267     |      |   | 1,363      |  (b) |   | 3,077      |
| Alberto        Clô                                       |   | Director                            |   | 157       |   |   |   |      |      |   |       |      |   | 157        |
| Paolo Andrea Colombo (c)                                      |   | Director                            |   | 64        |   |   |   |      |      |   |       |      |   | 64         |
| Renzo        Costi (d)                                        |   | Director                            |   | 85        |   |   |   |      |      |   |       |      |   | 85         |
| Dario Fruscio (e)                                             |   | Director                            |   | 19        |   |   |   |      |      |   |       |      |   | 19         |
| Paolo        Marchioni                                        |   | Director                            |   | 64        |   |   |   |      |      |   |       |      |   | 64         |
| Marco Pinto (d)                                               |   | Director                            |   | 85        |   |   |   |      |      |   |       |      |   | 85         |
| Marco        Reboa                                            |   | Director                            |   | 157       |   |   |   |      |      |   |       |      |   | 157        |
| Mario Resca                                                   |   | Director                            |   | 143       |   |   |   |      |      |   |       |      |   | 143        |
| Pierluigi        Scibetta                                     |   | Director                            |   | 149       |   |   |   |      |      |   |       |      |   | 149        |
| Francesco Taranto                                             |   | Director                            |   | 64        |   |   |   |      |      |   |       |      |   | 64         |
| **Board        of Statutory Auditors**                        |   |                                |   |      |   |   |   |      |      |   |       |      |   |       |
| Paolo Andrea Colombo (d)                                      |   | Chairman                            |   | 51        |   |   |   |      |      |   | 33         |  (f) |   | 84         |
| Ugo        Marinelli                                          |   | Chairman                            |   | 64        |   |   |   |      |      |   |       |      |   | 64         |
| Filippo Duodo (d)                                             |   | Auditor                             |   | 35        |   |   |   |      |      |   | 71         |  (g) |   | 106        |
| Roberto        Ferranti                                       |   | Auditor                             |   | 44        |   |   |   |      |      |   |       |      |   | 44         |
| Edoardo Grisolia (d) (h)                                      |   | Auditor                             |   | 35        |   |   |   |      |      |   |       |      |   | 35         |
| Luigi        Mandolesi                                        |   | Auditor                             |   | 44        |   |   |   |      |      |   |       |      |   | 44         |
| Tiziano Onesti                                                |   | Auditor                             |   | 44        |   |   |   |      |      |   | 40         |  (i) |   | 84         |
| Riccardo        Perotta (d)                                   |   | Auditor                             |   | 35        |   |   |   |      |      |   | 32         |  (l) |   | 67         |
| Giorgio Silva                                                 |   | Auditor                             |   | 80        |   |   |   |      |      |   | 24         |  (m) |   | 104        |
| **Chief        Operating Officers**                           |   |                                |   |      |   |   |   |      |      |   |       |      |   |       |
| Stefano Cao (n)                                               |   | Exploration & Production        |   |      |   | 1      |   | 2,294     |  (o) |   | 3,825      |  (p) |   | 6,120      |
| Claudio        Descalzi (q)                                   |   | Exploration        & Production |   |      |   | 1      |   |      |      |   | 268        |      |   | 269        |
| Domenico Dispenza                                             |   | Gas & Power                     |   |      |   | 1      |   | 856       |  (r) |   | 710        |      |   | 1,567      |
| Angelo        Caridi                                          |   | Refining        & Marketing     |   |      |   | 2      |   | 268       |      |   | 565        |      |   | 835        |
| **Other managers with strategic        responsibilities** (s) |   |                                |   |      |   | 12     |   | 3,137     |      |   | 6,475      |  (t) |   | 9,624      |
|                                                          |   |                                |   | **2,617** |   | **52** |   | **8,167** |      |   | **13,406** |      |   | **24,242** |

|  |   |  |   |  |   |  |   |  |  |   |  |
|--|--------|--|--------|--|--------|--|--------|--|--|--------|--|

----

| (a) | i | Based on        performance achieved in 2007.                                                                                                                                                                                                                                                                                                                                |
|-----|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | i | Including the        base salary of euro 1 million paid to the CEO, in his        quality of General Manager, indemnities and other        elements for a total amount of euro 363,000 accrued along        the service period (from 2005 to 2008), net of the        indemnities described under the paragraph        "post-retirement benefit of the directors". |
| (c) | i | Chairman of        the Board of Statutory Auditors until June 9, 2008.                                                                                                                                                                                                                                                                                                       |
| (d) | i | In office        until the Shareholders’ Meeting approving financial        statements for the year ending December 31, 2007.                                                                                                                                                                                                                                           |
| (e) | i | On January        30, 2008 Dario Fruscio resigned from the Board of        Directors.                                                                                                                                                                                                                                                                                        |
| (f) | i | Includes the        compensation obtained as Chairman of the Board of        Statutory Auditors of Saipem and EniServizi.                                                                                                                                                                                                                                                    |
| (g) | i | Includes the        compensation obtained as Statutory Auditor in        Snamprogetti SpA and in Polimeri Europa and as Chairman        of the Board of Statutory Auditors of CEPAV Uno and CEPAV        Due.                                                                                                                                                                |
| (h) | i | Compensation        for the service is paid to the Ministry for Economy and        Finance.                                                                                                                                                                                                                                                                                  |
| (i) | i | Includes the        compensation obtained as Chairman of the Board of        Statutory Auditors of AGI and Servizi Aerei.                                                                                                                                                                                                                                                    |
| (l) | i | Includes the        compensation obtained as Chairman of the Board of        Statutory Auditors of Snam Rete Gas SpA.                                                                                                                                                                                                                                                        |
| (m) | i | Includes the        compensation obtained as Statutory Auditor in        Snamprogetti SpA and as Chairman of the Board of        Statutory Auditors of TSKJ Italia Srl.                                                                                                                                                                                                      |
| (n) | i | In office        until July 31, 2008.                                                                                                                                                                                                                                                                                                                                        |
| (o) | i | Includes the        pro-quota portion of deferred bonus awarded for the        2006-2008 three-year period.                                                                                                                                                                                                                                                                  |
| (p) | i | Includes        indemnities paid upon termination.                                                                                                                                                                                                                                                                                                                           |
| (q) | i | Appointed on        August 1, 2008.                                                                                                                                                                                                                                                                                                                                          |
| (r) | i | Includes        long-term incentives awarded by Snam Rete Gas in 2005,        for the position of Chairman of Snam Rete Gas held until        December 23, 2005.                                                                                                                                                                                                             |
| (s) | i | Managers, who        during the year with the CEO and the General Managers of        Eni divisions, have been member of the Eni Directors        Committee (8 managers).                                                                                                                                                                                                     |
| (t) | i | Includes        indemnities paid upon termination.                                                                                                                                                                                                                                                                                                                           |

For the year ended December 31, 2008, the overallcompensation of persons responsible of key positions in planning,direction and control functions of Eni Group companies, includingexecutive and non-executive directors, Chief Operating Officersand Eni’s senior managers amounted to euro 25 million. Thebreak-down is as follows:

|   | **2008**           |
|--------|--------------------|
|   |                    |
|   | **(euro million)** |

| Fees and salaries                      |   | 17     |
|----------------------------------------|--------|--------|
| Post        employment benefits        |   | 1      |
| Other long-term benefits               |   | 3      |
| Fair value        stock grants/options |   | 4      |
|                                   |   | **25** |

|   |  |
|--------|--|

The above amounts include salaries, fees forattending meetings, lump-sum amounts paid in lieu of expensereimbursements, stock-based compensation and other deferredincentive bonuses, health and pension contributions and amountsaccrued to the reserve for employee termination indemnities,which is used to pay severance pay as required by Italian law toemployees upon termination of employment. The members of theBoard of Directors in 

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their capacity as such are not entitled toreceive such severance pay. At December 31, 2008, the totalamount accrued to the reserve for employee terminationindemnities with respect to members of the Board of Directors whowere also employees of Eni, the three general managers andEni’s senior managers was euro 1,548 thousand. Thebreak-down of this amount is presented in the table below:

| **Name** | **(euro thousand)** |
|----------|---------------------|

|   |  |
|--------|--|

| Paolo Scaroni           |   | CEO and Chief Operating Officer of Eni                 |   | 164 |
|-------------------------|--------|--------------------------------------------------------|--------|-----|
| Claudio        Descalzi |   | Chief        Operating Officer of the E&P Division |   | 299 |
| Domenico Dispenza       |   | Chief Operating Officer of the G&P Division        |   | 418 |
| Angelo        Caridi    |   | Chief        Operating Officer of the R&M Division |   | 148 |
| Senior managers (a)     |   |                                                   |   | 519 |

|   |  |
|--------|--|

|   |   |   |   | **1,548** |
|--------|--------|--------|--------|-----------|

|   |  |
|--------|--|

----

| (a) | i | No. 7        managers. |
|-----|---|------------------------|

> 
******

***Long-term Incentive Schemes***

In March 2006, the Board of Directors approved a new long-termincentive scheme for the managers of Eni and its subsidiaries(excluding listed subsidiaries), as proposed by the CompensationCommittee. This new scheme is designed to motivate moreeffectively and retain managers, linking incentives to targetsand performance achieved in a tighter way than previousincentives schemes. This new incentive scheme applies to the2006-2008 three year period and is composed of a deferredmonetary bonus, linked to the achievement of certain businessgrowth and operating efficiency targets, and stock option grantsbased on the achievement of certain targets of total shareholderreturn. This scheme has a structure intended to balance monetaryand stock-based components of the remuneration, as well as tolink economic and operating performance to share performance inthe long-term.

> 
*Deferred monetary bonus*

This leg of the long-term incentive scheme provides a basicbonus paid after three years according to a variable amount equalto a percentage ranging from 0 to 170% of the amount establishedfor the target performance in relation to the performancesachieved in a three-year period as approved by the Board ofDirectors. Performances are measured in terms of achievement ofpreset annual EBITDA targets, as assessed by comparing actualresults with set targets under a constant trading environment.

The following table sets out the basic bonus awarded in theyear 2008 to the CEO and to the Chief Operating Officers ofEni’s Divisions, and the total amount awarded to Eni’ssenior managers.

| **Name** | **Deferred bonus awarded** |
|----------|----------------------------|
|     |                            |
|     | **(euro thousand)**        |

| Paolo Scaroni              |   | CEO and Chief Operating Officerof Eni                        |   | 1,023 |      |
|----------------------------|--------|--------------------------------------------------------------|--------|-------|-----------|
| Stefano        Cao (a)     |   | Chief        Operating Officerof the E&P        Division |   | 494   |      |
| Claudio Descalzi (b)       |   | Chief Operating Officerof        the E&P Division        |   | 215   |      |
| Domenico        Dispenza   |   | Chief        Operating Officerof the G&P        Division |   | 385   |      |
| Angelo Caridi              |   | Chief Operating Officerof        the R&M Division        |   | 312   |      |
| Senior        managers (c) |   |                                                         |   | 1,732 |  (d) |

|   |  |
|--------|--|

----

| (a) | i | Position held        until July 31, 2008.                                                                                                             |
|-----|---|-------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | i | Appointed on        August 1, 2008.                                                                                                                   |
| (c) | i | No. 8        managers.                                                                                                                                |
| (d) | i | Including the        deferred bonus granted by Saipem to a manager with        strategic responsibilities, appointed in Eni on August 1,        2008. |

> 
 

***Stock Options***

Eni can award share options to managers holding strategicpositions or positions of significant responsibility for theachievement of the Company’s results. This incentive schemeis designed to ensure that managers’ interests are alignedwith those of shareholders and to stimulate entrepreneurialbehavior on part of managers. Differently from previous schemes,the 2006-2008 stock option plan introduced a performancecondition upon which grants can be exercised. At the end of eachvesting period with a three-year duration, the Board of Directorsdetermines the number of exercisable options, in a percentageranging from 0% to 100% of the total amount awarded for each year

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of the scheme, depending on the performance of Eni sharesmeasured in terms of annual Total Shareholders Return as comparedto that achieved by a panel of major international oil companiesin terms of market capitalization. Options can be exercised for athree year period. Under this plan, the Board resolved to makeavailable 7,415,000 options pertaining to 2008 with a strikeprice equal to euro 22.540 and 6,128,500 options pertaining to2007 with a strike price equal to euro 27.451.

At December 31, 2008, a total of 23,557,425 options wereoutstanding for the purchase of an equal amount of ordinaryshares nominal value euro 1 of Eni SpA, carrying an averagestrike price of euro 23.540. The weighted average remainingcontractual life of options outstanding at December 31, 2007 and2008 was 4 years and 7 months and 5 years and 7 monthsrespectively.

The following is a summary of stock option activity for theyears 2007 and 2008:

|   | **2007** |   | **2008** |
|--------|----------|--------|----------|
|   |          |   |          |

|   | **Number of shares** |   | **Weighted average        exercise price         (euro)** |   | **Market price**        (a)**(euro)** |   | **Number of shares** |   | **Weighted average        exercise price        (euro)** |   | **Market price**        (a)**(euro)** |
|--------|----------------------|--------|-----------------------------------------------------------|--------|---------------------------------------|--------|----------------------|--------|----------------------------------------------------------|--------|---------------------------------------|
|   |                      |   |                                                           |   |                                       |   |                      |   |                                                          |   |                                       |

| **Options as of January 1**                        |   | **15,290,400** |   |   | **21.022** |   | **25.520** |   | **17,699,625** |   |   | **23.822** |   | **25.120** |
|----------------------------------------------------|--------|----------------|--------|--------|------------|--------|------------|--------|----------------|--------|--------|------------|--------|------------|
| New        options granted                         |   | 6,128,500      |   |   | 27.451     |   | 27.447     |   | 7,415,000      |   |   | 22.540     |   | 22.538     |
| Options exercised in the period                    |   | (3,028,200     | )      |   | 16.906     |   | 25.338     |   | (582,100       | )      |   | 17.054     |   | 24.328     |
| Options        cancelled in the period             |   | (691,075       | )      |   | 24.346     |   | 24.790     |   | (975,100       | )      |   | 24.931     |   | 19.942     |
| **Options outstanding as of December 31**          |   | **17,699,625** |   |   | **23.822** |   | **25.120** |   | **23,557,425** |   |   | **23.540** |   | **16.556** |
| **of        which exercisable at Decembe**r **31** |   | **2,292,125**  |   |   | **18.440** |   | **25.120** |   | **5,184,250**  |   |   | **21.263** |   | **16.556** |

|   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

----

| (a) |   | Market price        relating to new rights assigned, rights exercised in the        period and rights cancelled in the period corresponds to        the average market value (arithmetic average of official        prices recorded on Mercato Telematico Azionario in the        month preceding: (i) the date of assignment; (ii) the        date of the recording in the securities account of the        managers to whom the options have been assigned; (iii)        the date of the unilateral termination of employment for        rights cancelled). Market price of shares referring to        options as of the beginning and the end of the year, is        the price recorded at December 31. |
|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

The fair value of stock options granted during the years endedDecember 31, 2007 and 2008 of euro 2.98 and euro 2.60,respectively, was calculated applying the Black-Scholes methodand using the following assumptions:

|   |   |   | **2007** |   | **2008** |
|--------|--------|--------|----------|--------|----------|
|   |   |   |          |   |          |

| Risk-free interest rate   |   | (%)    |   | 4.7  |   | 4.9  |
|---------------------------|--------|--------|--------|------|--------|------|
| Expected        life      |   | (year) |   | 6    |   | 6    |
| Expected volatility       |   | (%)    |   | 16.3 |   | 19.2 |
| Expected        dividends |   | (%)    |   | 4.9  |   | 6.1  |

|   |   |   |  |   |  |
|--------|--------|--------|--|--------|--|

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The following table presents the amount of stock optionsawarded to Eni’s CEO, the three Chief Operating Officers andEni’s senior managers.

  

|    |    | **CEO and COO of Eni** |    | **COO of         E&P Division** |    | **COO of         E&P Division** |    | **COO of         G&P Division** |    | **COO of         R&M Division** |    | **Senior managers** (a) |
|--------------|--------------|------------------------|--------------|-------------------------------------|--------------|-------------------------------------|--------------|-------------------------------------|--------------|-------------------------------------|--------------|------------------------------|
|    |    |                        |    |                                     |    |                                     |    |                                     |    |                                     |    |                              |
|    |    | Paolo Scaroni (b)      |    | Stefano Cao (c)                     |    | Claudio Descalzi (d)                |    | Domenico Dispenza                   |    | Angelo Caridi                       |    |                    |
|    |    |                        |    |                                     |         |                                     |    |                                     |    |                                     |    |                              |

| Options outstanding at the beginning of the        period: |   |   |   |      |   |    |   |    |   |    |   |    |      |   |    |   |    |      |   |      |   |    |      |
|------------------------------------------------------------|--------|--------|--------|-----------|--------|---------|--------|---------|--------|---------|--------|---------|-----------|--------|---------|--------|---------|-----------|--------|-----------|--------|---------|-----------|
| - number        of options                                 |   |   |   | 1,953,000 |   | 406,500 |   | 178,500 |   | 232,500 |   | 269,500 |  (e) |   | 30,500  |   | 122,000 |  (f) |   | 1,353,000 |   | 110,000 |  (g) |
| - average exercise price                                   |   | (euro) |   | 24.165    |   | 24.655  |   | 24.713  |   | 25.159  |   | 3.988   |      |   | 22.509  |   | 21.098  |      |   | 23.985    |   | 18.953  |      |
| - average        maturity in months                        |   |   |   | 63        |   | 62      |   | 62      |   | 60      |   | 61      |      |   | 67      |   | 60      |      |   | 61        |   | 56      |      |
| Options granted during the period:                         |   |   |   |      |   |    |   |    |   |    |   |    |      |   |    |   |    |      |   |      |   |    |      |
| - number        of options                                 |   |   |   | 634,500   |   | -       |   | 85,500  |   | 147,500 |   |    |      |   | 120,000 |   | -       |      |   | 584,000   |   | -       |      |
| - average exercise price                                   |   | (euro) |   | 22.540    |   | -       |   | 22.540  |   | 22.540  |   |    |      |   | 22.540  |   | -       |      |   | 22.540    |   | -       |      |
| - average        maturity in months                        |   |   |   | 72        |   | -       |   | 72      |   | 72      |   |    |      |   | 72      |   | -       |      |   | 72        |   | -       |      |
| Options exercised at the end of the period:                |   |   |   |      |   |    |   |    |   |    |   |    |      |   |    |   |    |      |   |      |   |    |      |
| - number        of options                                 |   |   |   | -         |   | -       |   | -       |   | -       |   | 127,500 |  (e) |   | -       |   | -       |      |   | 68,500    |   | 29,500  |  (g) |
| - average exercise price                                   |   | (euro) |   | -         |   | -       |   | -       |   | -       |   | 3.530   |      |   | -       |   | -       |      |   | 16.576    |   | 11.881  |      |
| - average        market price at date of exercise          |   | (euro) |   | -         |   | -       |   | -       |   | -       |   | 4.095   |      |   | -       |   | -       |      |   | 23.996    |   | 24.541  |      |
| Options expired during the period:                         |   |   |   |      |   |    |   |    |   |    |   |    |      |   |    |   |    |      |   |      |   |    |      |
| - number        of options                                 |   |   |   |      |   | 206,375 |   | -       |   | -       |   | -       |      |   | -       |   | -       |      |   | 167,550   |   | -       |      |
| Options outstanding at the end of the period:              |   |   |   |      |   |    |   |    |   |    |   |    |      |   |    |   |    |      |   |      |   |    |      |
| - number        of options                                 |   |   |   | 2,587,500 |   | 200,125 |   | 264,000 |   | 380,000 |   | 142,000 |  (e) |   | 150,500 |   | 122,000 |  (f) |   | 1,700,950 |   | 80,500  |  (g) |
| - average exercise price                                   |   | (euro) |   | 23.767    |   | 24.060  |   | 24.009  |   | 24.142  |   | 4.399   |      |   | 22.534  |   | 21.098  |      |   | 23.670    |   | 21.545  |      |
| - average        maturity in months                        |   |   |   | 55        |   | 51      |   | 55      |   | 56      |   | 54      |      |   | 65      |   | 48      |      |   | 55        |   | 48      |      |

|    |    |  |    |  |   |  |    |  |    |  |    |  |
|--------------|--------------|--|--------------|--|--------|--|--------------|--|--------------|--|--------------|--|

----

| (a) | i      | No. 8        managers.                                                                                                                                                                                                                                                                                                                                |
|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) |   | The        assignment to the CEO have been integrated by a monetary        incentive to be paid after three-year in relation to the        performance of Eni shares, and is equal to 96,000 options        granted in 2006, with a strike price of euro 23.100 and        80,500 options granted in 2007, with a strike price of        euro 27.451. |
| (c) | i      | In office        until July 31, 2008.                                                                                                                                                                                                                                                                                                                 |
| (d) | i      | Appointed on        August 1, 2008.                                                                                                                                                                                                                                                                                                                   |
| (e) | i      | Options on        Snam Rete Gas shares: assigned by the company to Domenico        Dispenza who held the position of Chairman of Snam Rete        Gas until December 23, 2005.                                                                                                                                                                        |
| (f) | i      | Options on        Saipem shares: assigned by the company to Angelo Caridi        who held the position of CEO of Snamprogetti until August        2, 2007.                                                                                                                                                                                            |
| (g) | i      | Options on        Saipem shares.                                                                                                                                                                                                                                                                                                                      |

********Employees**

At December 31, 2008, Eni’s employees totaled 78,880,with an increase of 3,018 employees from December 31, 2007, up4%, reflecting a 2,965 increase in employees hired and workingoutside Italy and an increase of 53 employees hired in Italy.

Employees hired in Italy were 39,480 (50.1% of all Groupemployees). Of these, 35,929 were working in Italy, 3,381 outsideItaly and 170 on board of vessels, with a 53 unit increase from2007.

The process of improvement in the quality mix of employeescontinued in 2008 with the hiring of 2,517 persons, of which 781,were with fixed-term contracts. A total of 1,736 persons werehired with open-end and with apprenticeship contracts, most ofthem with university qualifications (1,048 persons) and 650persons with a high school diploma. During the year 2,549 personsleft their job at Eni, of these 1,903 had an open-end contractand 646 had a fixed-term contract.

Employees hired and working outside Italy were 38,400 (49.9%of all Group employees), with a 2,965 persons increase, of theseapproximately 1,800 employees were hired with fixed-termcontracts in the Engineering & Construction segment duemainly to new contracts in the Caspian area (Kazakhstan, Kashaganproject) and Peru/Venezuela (drilling projects), and 1,642persons in the Exploration & Production segment, mainlyfollowing the purchase of Burren and First Calgary Petroleums(1,150 persons). In the Gas & Power segment, the acquisitionof Distrigas concerned 135 persons and in the Refining &Marketing segment, Agip España (850 persons) and Galp Energiawere sold.

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| **Employees        at year end** |   | **2006** |   | **2007** |   | **2008** |
|----------------------------------|--------|----------|--------|----------|--------|----------|
|                             |   |          |   |          |   |          |

|   | **(units)** |
|--------|-------------|

| Exploration & Production      |   | 8,336      |   | 9,334      |   | 11,194     |
|-----------------------------------|--------|------------|--------|------------|--------|------------|
| Gas &        Power            |   | 12,074     |   | 11,582     |   | 11,389     |
| Refining & Marketing          |   | 9,437      |   | 9,428      |   | 8,327      |
| Petrochemicals                    |   | 6,025      |   | 6,534      |   | 6,274      |
| Engineering & Construction    |   | 30,902     |   | 33,111     |   | 35,629     |
| Other        activities           |   | 2,219      |   | 1,172      |   | 1,070      |
| Corporate and financial companies |   | 4,579      |   | 4,701      |   | 4,997      |
|                              |   |            |   |            |   |            |
|                              |   | **73,572** |   | **75,862** |   | **78,880** |
|                              |   |            |   |            |   |            |

The table below sets forth Eni’s employees at December31, 2006, 2007 and 2008 in Italy and outside Italy:

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(units)** |
|--------|-------------|

| Exploration & Production      |   | Italy                |   | 5,273      |   | 5,535      |   | 5,771      |
|-----------------------------------|--------|----------------------|--------|------------|--------|------------|--------|------------|
|                              |   | Outside        Italy |   | 3,063      |   | 3,799      |   | 5,423      |
|                              |   |                 |   | 8,336      |   | 9,334      |   | 11,194     |
| Gas &        Power            |   | Italy                |   | 9,602      |   | 9,114      |   | 8,810      |
|                              |   | Outside Italy        |   | 2,472      |   | 2,468      |   | 2,579      |
|                              |   |                 |   | 12,074     |   | 11,582     |   | 11,389     |
| Refining & Marketing          |   | Italy                |   | 7,196      |   | 7,101      |   | 6,641      |
|                              |   | Outside        Italy |   | 2,241      |   | 2,327      |   | 1,686      |
|                              |   |                 |   | 9,437      |   | 9,428      |   | 8,327      |
| Petrochemicals                    |   | Italy                |   | 4,948      |   | 5,476      |   | 5,230      |
|                              |   | Outside Italy        |   | 1,077      |   | 1,058      |   | 1,044      |
|                              |   |                 |   | 6,025      |   | 6,534      |   | 6,274      |
| Engineering & Construction    |   | Italy                |   | 6,164      |   | 6,618      |   | 7,316      |
|                              |   | Outside        Italy |   | 24,738     |   | 26,493     |   | 28,313     |
|                              |   |                 |   | 30,902     |   | 33,111     |   | 35,629     |
| Other        activities           |   | Italy                |   | 2,219      |   | 1,172      |   | 1,070      |
|                              |   | Outside Italy        |   | -          |   | -          |   | -          |
|                              |   |                 |   | 2,219      |   | 1,172      |   | 1,070      |
| Corporate and financial companies |   | Italy                |   | 4,363      |   | 4,411      |   | 4,642      |
|                              |   | Outside        Italy |   | 216        |   | 290        |   | 355        |
|                              |   |                 |   | 4,579      |   | 4,701      |   | 4,997      |
| **Total**                         |   | Italy                |   | 39,765     |   | 39,427     |   | 39,480     |
| **Total**                         |   | Outside Italy        |   | 33,807     |   | 36,435     |   | 39,400     |
|                              |   |                 |   | **73,572** |   | **75,862** |   | **78,880** |
| of which senior managers          |   |                 |   | 1,603      |   | 1,585      |   | 1,658      |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

**Share Ownership**

As of April 30, 2009, the cumulative number of shares owned bythe Eni’s directors, statutory auditors and senior managers,including the three Chief Operating Officers, was 242,769 equalto approximately 0.006% of Eni’s share capital outstandingas of the same data. In this time frame, no further options topurchase Eni shares were granted by the Company to those persons(see tables in the section "Stock Option Plans"). Eniissues only ordinary shares, each bearing one-vote right;therefore shares held by those persons have no different votingrights. The break-down of share ownership for each of thosepersons is provided below.

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| **Name** | **Position** | **Number of shares owned** |
|----------|--------------|----------------------------|
|     |         |                            |

| **Board of Directors**          |   |                                                   |   | -      |
|---------------------------------|--------|--------------------------------------------------------|--------|--------|
| Roberto        Poli             |   | Chairman                                               |   | 58,549 |
| Paolo Scaroni                   |   | CEO and COO of Eni                                     |   | -      |
| Alberto        Clô         |   | Director                                               |   | -      |
| Paolo Andrea Colombo            |   | Director                                               |   | 1,650  |
| Paolo        Marchioni          |   | Director                                               |   | -      |
| Marco Reboa                     |   | Director                                               |   | -      |
| Mario        Resca              |   | Director                                               |   | -      |
| Pierluigi Scibetta              |   | Director                                               |   | -      |
| Francesco        Taranto        |   | Director                                               |   | 500    |
| **Chief Executive Officers**    |   |                                                   |   |   |
| Claudio        Descalzi         |   | Chief        Operating Officer of the E&P Division |   | 24,455 |
| Domenico Dispenza               |   | Chief Operating Officer of the G&P Division        |   | 99,715 |
| Angelo Caridi                   |   | Chief        Operating Officer of the R&M Division |   | 40,595 |
| **Board of Statutory Auditors** |   |                                                   |   | 1,000  |
| **Senior        managers**      |   |                                                   |   | 16,305 |

|   |   |  |
|--------|--------|--|

 

 

**Item 7. MAJOR SHAREHOLDERS AND RELATED PARTYTRANSACTIONS**

**Major Shareholders**

As of May 4, 2009, the following persons were known by Eni toown more than 2% of any class of Eni SpA’s votingsecurities. At such date, the total amount of Eni SpA’svoting securities owned by these shareholders was:

| **Title        of class**        |   | **Number of shares owned** |   | **Percent of class** |
|----------------------------------|--------|----------------------------|--------|----------------------|
|                                  |   |                            |   |                      |
| Ministry of Economy and Finance  |   | 813,443,277                |   | 20.3                 |
| Cassa        Depositi e Prestiti |   | 400,288,338                |   | 10.0                 |
| BNP Paribas Group                |   | 93,822,428                 |   | 2.3                  |
|                                  |   |                            |   |                      |

The Ministry of Economy and Finance, in agreement with theMinistry of Economic Development, retains certain special powersover Eni. See "Item 10 – Additional Information –Memorandum and Articles of Association – Limitations onVoting and Shareholdings – Special Powers of theState". For a discussion of the Eni share buy-back programsee "Item 16E – Purchases of Equity Securities by theIssuer and Affiliated Purchasers". As of May 4, 2009 therewere 44,072,282 ADRs, each representing two Eni ordinary sharesoutstanding corresponding to 2.2% of Eni’s share capital.See "Item 9 – The Offer and the Listing".

 

**Related Party Transactions**

In the ordinary course of its business, Eni enters intotransactions concerning the exchange of goods, provision ofservices and financing with non consolidated subsidiaries andaffiliates as well other companies owned or controlled by theItalian Government. All such transactions are conducted on anarm’s length basis and in the interest of Eni companies.

Amounts and types of trade and financial transactions withrelated parties and their impact on consolidated earnings andcash flow, and on the Group’s assets and financial conditionare reported in Note 37 to the Consolidated Financial Statements.

 

 

**Item 8. FINANCIAL INFORMATION**

**Consolidated Statements and Other Financial Information**

See Item 18 – Financial Statements.

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> 
***Legal Proceedings***

Eni is a party to a number of civil actions and administrativearbitral and other judicial proceedings arising in the ordinarycourse of business. Based on information available to date, andtaking into account the existing risk provisions, Eni believesthat the foregoing will not have an adverse effect on Eni’sConsolidated Financial Statements. The following is a descriptionof the most significant proceedings currently pending. Unlessotherwise indicated below, no provisions have been made for theselegal proceedings as Eni believes that negative outcomes are notprobable or because the amount of the provision cannot beestimated reliably.

> 
 

**Environment**

> 
*Criminal proceedings*

ENI SPA*Subsidence.* The Court of Rovigo conducted investigationsconcerning a subsidence phenomenon allegedly caused byhydrocarbon exploration and extraction activities in the Ravennaand North Adriatic area both on land and in the sea. Eniappointed an independent and interdisciplinary scientificcommission, composed of prominent and highly qualifiedinternational experts of subsidence caused by hydrocarbonexploration and extraction activities, with the aim of verifyingthe magnitude and effects and any actions appropriate to reduceor to neutralize any subsidence phenomenon in the area. Thiscommission produced a study which excludes the possibility of anyrisk to human health or damage to the environment. The study alsostates that worldwide there are no instances of accidents of harmto public safety caused by subsidence induced by hydrocarbonproduction. It also shows that Eni employs the most advancedtechniques for monitoring, measuring and controlling the soil.This proceeding is in the first level hearing stage. The VenetoRegion, other local bodies and two private entities have beenacting as plaintiffs. Eni was admitted as a defendant. The Courtdecided that the proceeding must be heard by the Court ofRavenna.

*Alleged damage*. In 2002, the public prosecutor of Gelacommenced a criminal investigation to ascertain alleged damagecaused by emissions of the Gela plant, owned by Polimeri EuropaSpA, Syndial SpA (formerly EniChem SpA) and Raffineria di GelaSpA. The judge for the preliminary hearing dismissed theaccusation of adulteration of food products, while the proceedingfor the other allegations regarding pollution and environmentaldamage remains underway. The trial ended in acquittal with regardto the general manager and officer pro tempore of the refinery.The sentence of the Gela Tribunal stated that the charges werelacking factual basis.

*Alleged negligent fire in the refinery of Gela.*In June2002, in connection with a fire at the refinery of Gela, acriminal investigation began concerning alleged negligent fire,environmental crimes and crimes against natural beauty. Firstdegree proceedings ended with an acquittal sentence. In November2007, the public prosecutors of Gela and of Caltanissetta filedan appeal against this decision.

*Investigation of the quality of ground water in the area ofthe refinery of Gela.* In 2002, the public prosecutor of Gelacommenced a criminal investigation concerning the refinery ofGela to ascertain the quality of ground water in the area of therefinery. Eni is charged of having breached environmental rulesconcerning the pollution of water and soil and of illegaldisposal of liquid and solid waste materials. The preliminaryhearing phase was closed for one employee who would stand trial,while the preliminary hearing phase is ongoing for otherdefendants. During the hearings the judge admitted as plaintiffsthree environmental associations.

*Alleged negligent fire (Priolo).* The public prosecutorof Siracusa commenced an investigation regarding certain Enimanagers who were previously in charge of conducting operationsat the Priolo refinery (Eni divested this asset in 2002) toascertain whether they acted with negligence in connection with afire that occurred at the Priolo plants on April 30 and May 1-2,2006. After preliminary investigations and based on the outcomeof preliminary hearing the public prosecutor requested theopening of a proceeding against the mentioned managers fornegligent behavior. 

*Groundwater at the Priolo site.* The Public Prosecutorof Siracusa (Sicily) has started an investigation in order toascertain the level of contamination of the groundwater at thePriolo site. The Company has been notified that a number of itsexecutive officers are being investigated who were in charge atthe time of the events subject to probe, including chiefexecutive officers and plant general managers of theCompany’s subsidiaries AgipPetroli SpA (now merged into theparent company), Syndial and Polimeri Europa. Probes on technicalissues are ongoing as required by the Prosecutor.

ENIPOWER SPA*Alleged unauthorized waste management activities.* In 2004,the public prosecutor of Rovigo commenced an investigation foralleged crimes related to unauthorized waste managementactivities in Loreo relating to the samples of soil used duringthe construction of the new EniPower power station in Mantova.The prosecutor requested the CEO of EniPower and the managingdirector of the Mantova plant at the time of the alleged crime tostand trial.

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*Air emissions.* The public prosecutor of Mantovacommenced an investigation against two managers of the Mantovaplant in connection with air emissions by the new power plant.

SYNDIAL SPA*Porto Torres.* In March 2009, the Public Prosecutor ofSassari (Sardinia) resolved to commence a criminal trial againsta number of executive officers and managing directors ofcompanies engaging in petrochemicals operations at the site ofPorto Torres, including the manager responsible for plantoperations of the Company’s fully-owned subsidiary Syndial.The charge involves environmental damage and poisoning of waterand stuff destined to feeding. A preliminary hearing is scheduledin July 2009.

 

> 
*Civil and administrative proceedings*

SYNDIAL SPA (FORMER ENICHEM SPA)*Alleged pollution caused by the activity of the Mantova plant.*In 1992, the Ministry of Environment summoned EniChem SpA (nowSyndial SpA) and Edison SpA before the Court of Brescia. TheMinistry requested, primarily, environmental remediation for thealleged pollution caused by the activity of the Mantova plantfrom 1976 until 1990, and provisionally, in case there was nopossibility to remediate, the payment of environmental damages.Edison agreed on a settlement with the Ministry whereby Edisonquantified compensation for environmental damage freeing from anyobligation Syndial, which purchased the plant in 1989. Partiesare working through a possible settlement of the matter.

*Summon before the Court of Venice for environmental damagesallegedly caused to the lagoon of Venice by the Porto Margheraplants.* On December 13, 2002, EniChem SpA (now Syndial SpA),jointly with Ambiente SpA (now merged into Syndial SpA) andEuropean Vinyls Corporation Italia SpA, was summoned before theCourt of Venice by the Province of Venice. The province requestedcompensation for environmental damages that were not quantified,allegedly caused to the lagoon of Venice by the Porto Margheraplants, which were already the subject of two previous criminalproceedings against employees and managers of the defendants. EVCItalia and Ineos presented an action to be indemnified byEni’s Group companies in case the alleged pollution isproved. The environmental damage has been assessed by anindependent consultant who filed his advice to be discussed in ahearing set in October 2009.

*Claim of environmental damages, allegedly caused byindustrial activities in the area of Crotone, commenced by thePresident of the Regional Council of Calabria.*On April 14,2003, the President of the Regional Council of Calabria, asDelegated Commissioner for Environmental Emergency in theCalabria Region, commenced an action against EniChem SpA (nowSyndial SpA) with reference to environmental damages forapproximately euro 129 million and damages for euro 250 million(plus interest and compensation) in connection with loss ofincome and damage to property allegedly caused by industrialactivities in the area of Crotone. In addition, the Province ofCrotone is acting as plaintiff, claiming damage for euro 300million. With a decision in May 2007, the Court of Milan declaredthe invalidity of the power of proxy conferred to the DelegatedCommissioner to act on behalf of the Calabria Region with thenotice served to Syndial SpA and decided the liquidation ofexpenses born by the defendant. The Province of Crotone appealedthis decision. The second instance court accepted this appeal andSyndial repealed this determination. On October 21, 2004, Syndialwas convened before the Court of Milan by the Calabria Regionwhich is seeking to obtain a condemnation of Syndial for a damagepayment, should the office of the Delegated Commissioner forEnvironmental Emergency in the Calabria Region cease during thisproceeding. The Calabria Region requested a damage paymentamounting to euro 800 million as already requested by theDelegated Commissioner for Environmental Emergency in theCalabria Region in the proceeding commenced in 2003. This newproceeding is in the preliminary investigation stage. Thisproceeding was unified with the one opened by the Ministry of theEnvironment. Syndial filed a new project for the environmentalremediation of the site to be approved by the Ministry and thebody of public administrations and entities involved in thematter that expressed a first partial consent in January 2009.The environmental provision was consequently increased. In 2006,the Council of Ministers, Ministry for the Environment and theDelegated Commissioner for Environmental Emergency in theCalabria Region represented by the State Lawyer requested Syndialto appear before the Court of Milan to obtain the ascertainment,quantification and payment of damage (in the form of land, airand water pollution and therefore of the general condition of thepopulation) caused by the operations of Pertusola Sud SpA in theMunicipality of Crotone and in surrounding municipalities. Thelocal authorities requested the ascertainment of Syndial’sresponsibility as concerns expenses borne and to be borne for thecleanup and reclamation of sites, currently quantified at euro129 million. This proceeding concerns the same matter and damageclaim as the proceedings commenced by the Delegated Commissionerfor Environmental Emergency in the Calabria Region and theCalabria Region against Syndial in 2003 and 2004, respectively.

*Summon for alleged environmental damage caused by DDTpollution in the Lake Maggiore.*With a temporarily executivedecision dated July 3, 2008 the District Court of Turin sentencedthe subsidiary Syndial SpA (former EniChem) to compensate forenvironmental damages that were allegedly caused when EniChemmanaged an industrial plant at Pieve Vergonte during the1990-1996 period. Specifically, the Court sentenced Syndial topay the Italian Ministry of the Environment compensationamounting to euro 1,833.5 million, plus legal interests that 

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accrue from the filing of the decision. Syndial and Enitechnical-legal consultants have considered the decision and theamount of the compensation to be without factual and legal basisand have concluded that a negative outcome of this proceeding isunlikely. Particularly, Eni and its subsidiary deem the amount ofthe environmental damage to be absolutely ill-founded as thesentence has been considered to lack sufficient elements tosupport such a material amount of the liability charged to Eniand its subsidiary with respect to the volume of pollutantsascertained by the Italian Environmental Minister. As nodevelopment of the proceeding has occurred since the filing ofthe Court’s decision, management has confirmed its stance ofmaking no provision for this proceeding in accordance withaccounting principles. Syndial will appeal against the ruling onPieve Vergonte site of the District Court of Turin as soon aspossible. Another administrative proceeding is ongoing regardinga ministerial decree enacted by the Italian Ministry for theEnvironment. The decree provides that Syndial executes thefollowing tasks: (i) the upgrading of a hydraulic barrier toprotect the site; and (ii) the design of a project for theenvironmental remediation of Lake Maggiore. The AdministrativeCourt of Piemonte rejected Syndial’s opposition against theoutlined environmental measures requested by the Ministry of theEnvironment. However, the Court judged the prescriptions of theMinistry regarding the remediation of the site to be plainfindings of an environmental enquiry to ascertain the state ofthe lake. Syndial has filed an appeal against the decision of theCourt before an upper degree body, also requesting suspension ofthe effectiveness of the decision. The appeal has been put onhold considering that a plan to ascertain the environmentalstatus of the site is going to be approved by all interestedparties, including the Ministry and local municipalities.

*Action commenced by the Municipality of Carrara for theremediation and reestablishment of previous environmentalconditions at the Avenza site and payment of environmentaldamage.* The Municipality of Carrara commenced an actionbefore the Court of Genova requesting Syndial SpA to remediateand restore previous environmental conditions at the Avenza siteand the payment of certain environmental damage which cannot becleaned up as well as further damages of various types (e.g.damage to the natural beauty of this site). This request isrelated to an accident that occurred in 1984, as a consequence ofwhich EniChem Agricoltura SpA (later merged into Syndial SpA), atthe time owner of the site, carried out safety and remediationworks. The Ministry of the Environment joined the action andrequested environmental damage payment – from a minimum ofeuro 53.5 million to a maximum of euro 93.3 million – to bebroken down among the various companies that ran the plant in thepast. Syndial summoned Rumianca SpA, Sir Finanziaria SpA andSogemo SpA, who ran the plant in previous years, in order to beguaranteed. A report produced by an independent expert appointedby the judge was filed with the Court. The findings of thisreport quantify the residual environmental damage at euro 15million. With a sentence of March 2008, the Court of Genovarejected all claims made by the Municipality of Carrara and theMinistry of environment. Both plaintiffs filed an appeal againstthis decision in June 2008, requesting to all defendantscumulative damage amounting to euro 189.9 million. Syndial filedin the appeal hearing, disputing the plaintiffs’ claims.

*Ministry for the Environment Augusta harbor.* TheItalian Ministry for the Environment with various administrativeacts ordered companies running plants in the petrochemical siteof Priolo to perform safety and environmental remediation worksin the Augusta harbor. Companies involved include Enisubsidiaries Polimeri Europa and Syndial. Pollution has beendetected in this area primarily due to a high mercuryconcentration which is allegedly attributed to the industrialactivity of the Priolo petrochemical site. Polimeri Europaopposed said administrative actions, objecting in particular tothe way in which remediation works have been designed andinformation on concentration of pollutants has been gathered. TheRegional Administrative Court of Catania with its decision ofJuly 2007 annulled the decision made by the Service Conference ofthe Ministry of the Environment concerning Priolo and the Augustaharbor. The Ministry and the municipalities of Augusta andMelilli filed a claim with an Administrative Court of the SicilyRegion which accepted the claim. In January 2008 the RegionalCourt of Catania accepted two further claims on this matter,remitting to the European Union Court of Justice the correctapplication of the debated community principle on the matter ofenvironmental responsibility. In June 2008 the Ministry for theEnvironment and the Municipalities of Melilli and Augusta filedand appeal against the decision of the Regional Court of Cataniawith the Administrative Justice Council. Syndial challenged theadministrative acts of December 20, 2007 and March 6, 2008, alsorequesting the Court of Justice of the EU to decide on thecorrect application of the debated community principle. A reviewof the issue made by an independent consultant has been filedshowing evidence supporting the thesis of the plaintiffs. The proceedings are still pending beforethe Administrative Court of Lazio.

ENI SPA*Reorganization procedure of the airlines companies VolareGroup, Volare Airlines and Air Europe.*On March 2009 Eni wasnotified a bankruptcy claw-back as part of a reorganizationprocedure filed by the airlines companies Volare Group, VolareAirlines and Air Europe which commenced under the provisions ofMinistry of Production Activities, on November 30, 2004. Therequest regarded the override of all the payments made by thoseentities to Eni and its subsidiary Sofid in the year previous tothe insolvency declaration from November 30, 2003 to November 29,2004, for a total estimated amount of euro 46 million.

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> 
**Other judicial or arbitration proceedings**

SYNDIAL SPA (FORMER ENICHEM SPA)*Serfactoring: disposal of receivables.* In 1991,Agrifactoring SpA commenced proceedings against Serfactoring SpA,a company 49% owned by Sofid SpA and which is controlled by EniSpA. The claim relates to an amount receivable of euro 182million for fertilizer sales (plus interest and compensation forinflation), originally owed by Federconsorzi to EniChemAgricoltura SpA (later Agricoltura SpA - in liquidation), andTerni Industrie Chimiche SpA (merged into Agricoltura SpA - inliquidation), that has been merged into EniChem SpA (now SyndialSpA). Such receivables were transferred by Agricoltura and TerniIndustrie Chimiche to Serfactoring, which appointed Agrifactoringas its agent to collect payments. Agrifactoring guaranteed to paythe amount of such receivables to Serfactoring, regardless ofwhether or not it received payment on the due date. Followingpayment by Agrifactoring to Serfactoring, Agrifactoring wasplaced in liquidation and the liquidator of Agrifactoringcommenced proceedings in 1991 against Serfactoring to recoversuch payments (equal to euro 182 million) made to Serfactoringbased on the claim that the foregoing guarantee became invalidwhen Federconsorzi was itself placed in liquidation. Agricolturaand Terni Industrie Chimiche brought counterclaims againstAgrifactoring (in liquidation) for damages amounting to euro 97million relating to acts carried out by Agrifactoring SpA asagent. The amount of these counterclaims has subsequently beenreduced to euro 46 million following partial payment of theoriginal receivables by the liquidator of Federconsorzi andvarious setoffs. These proceedings, which have all been joined,were decided with a partial judgment, deposited on February 24,2004; the request of Agrifactoring has been rejected and thecompany has been ordered to pay the sum requested by Serfactoringand damages in favor of Agricoltura, to be determined followingthe decision. A final verdict on this issue is pending.Agrifactoring appealed this partial decision, requesting inparticular the annulment of the first step judgment, thereimbursement of euro 180 million from Serfactoring along withthe rejection of all its claims and the payment of all proceedingexpenses. On June 2008, the trial was decided with a partialjudgment that, reforming the previous judgment of the Court ofRome, granted the requests of Agrifactoring and condemnedSerfactoring to reimburse to Agrifactoring in liquidation theamount of the receivables due from Federconsorzi and notcollected as Federconsorzi went bankrupt. The Court resolved toappoint an independent accounting consultant to quantify theamount paid by Agrifactoring to Serfactoring and amounts paid byFederconsorzi to Agrifactoring. The hearing has been rescheduledto February 2010 in order to allow the Court to review theindependent accounting consultant’s advice. Syndial andSerfactoring have appealed the sentence with the Supreme Court ofAppeal. Agrifactoring has presented a counter-recourse. Eniaccrued a provision with respect to this proceeding.

ENI SPA*Fintermica.*Fintermica presented a claim against Eniconcerning the management of the Jacorossi joint venture withreference to an alleged abuse of key roles played by Eni SpA inthe joint venture, thus damaging the other partner’sinterest and the alleged dilatory behavior of Syndial in sellingits interest in the joint venture to Fintermica. The partiesdecided to commence arbitration on the matter. The examiningphase is ongoing and an independent assessment of this matter isbeing executed. The Board of Arbitrators issued a decision onNovember 26, 2008 condemning Eni and Syndial to compensateFintermica for the damages suffered amounting to euro 5 millionincluding monetary revaluation and accrued interest as of April3, 2001.

SNAMPROGETTI SPA*CEPAV Uno and CEPAV Due.*Eni holds interests in the CEPAVUno (50.36%) and CEPAV Due (52%) consortia that in 1991 signedtwo contracts with TAV SpA for the construction of two railwaytracks for high speed/high capacity trains from Milan to Bologna(under construction) and from Milan to Verona (in the designphase). With regard to the project for the construction of theline from Milan to Bologna, an Addendum to the contract betweenCEPAV Uno and TAV was signed on June 27, 2003, redefining certainterms and conditions of the contract. Subsequently, the CEPAV Unoconsortium requested a time extension for the completion of worksand a claim amounting to euro 800 million. CEPAV Uno and TAVfailed to solve this dispute amicably. CEPAV Uno opened anarbitration procedure as provided for under terms of the contracton April 27, 2006. With regard to the project for theconstruction of a high-speed railway from Milan to Verona, inDecember 2004, CEPAV Due presented the final project, prepared inaccordance with Law No. 443/2001 on the basis of the preliminaryproject approved by an Italian governmental authority (CIPE). Asconcerns the arbitration procedure requested by CEPAV Due againstTAV for the recognition of costs incurred by the Consortium inthe 1991-2000 ten-year period plus suffered damage, in January2007, the arbitration committee determined the Consortium’sright to recover the costs incurred in connection with the designactivities performed. A technical independent survey is underwayto assess the amount of compensation to be awarded to theConsortium as requested by the arbitration committee. TAVappealed the arbitration committee’s determination. In April2007, the Consortium filed with the second instance court of Romean appeal against Law Decree No. 7 of December 31, 2007, thatrevoked the concessions awarded to TAV resulting in the annulmentof arrangements signed between TAV and the Consortium to buildthe high-speed railway section from Milan to Verona. The EuropeanCourt of Justice was requested to judge on this matter. In themeantime, TAV decided to not request the reimbursement ofadvances paid to the Consortium. Subsequently, Law 133/2008re-established the concessions awarded to TAV resulting in thecontinuation of the arrangements between the consortium CEPAV Dueand a new entity in charge of managing the Italian railwaysystem.

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> 
**Antitrust, EU Proceedings, Actions of the Authority for    Electricity and Gas and of Other Regulatory Authorities**

*Antitrust*

ENI SPA*Abuse of dominant position of Snam alleged by the ItalianAntitrust Authority.* In March 1999, the Italian AntitrustAuthority concluded its investigation started in 1997 and: (i)found that Snam SpA (merged in Eni SpA in 2002) abused itsdominant position in the market for the transportation andprimary distribution of natural gas relating to thetransportation and distribution tariffs applied to third partiesand the access of third parties to infrastructure; (ii) finedSnam for euro 2 million; and (iii) ordered a review of thepractices relating to such abuses. Snam believes it has compliedwith existing legislation and appealed the decision with theRegional Administrative Court of Lazio requesting its suspension.On May 26, 1999, stating that these decisions are against Law No.9/1991 and the European Directive 98/30/EC, this Court grantedthe suspension of the decision. The Authority did not appeal thisdecision. The decision on the merit of this dispute is stillpending before the same Administrative Court.

*Formal assessment commenced by the Commission of theEuropean Communities for the evaluation of alleged participationto activities limiting competition in the field of paraffin.*On April 28, 2005, the Commission of the European Communitiescommenced a formal assessment to evaluate the allegedparticipation of Eni and its subsidiaries in activities limitingcompetition in the field of paraffin. The alleged violation ofcompetition is for: (i) the determination of and increase inprices; (ii) the subdivision of customers; and (iii) exchange oftrade secrets, such as production capacity and sales volumes.After, the Commission requested information on Eni’sactivities in the field of paraffin and certain documentationacquired by the Commission during an inspection. Eni filed therequested information. On October 2008, the Commission of theEuropean Communities issued the final decision on the mattercondemning Eni to the payment of a sanction amounting to euro29,120,000. Eni has filed for recourse against this decision thatis fully covered by the accrued risk provision.

*Ascertainment by the European Commission of the level ofcompetition in the European natural gas market.* As part ofits activities to ascertain the level of competition in theEuropean natural gas market, with DecisionNo. C (2006)1920/1 of May 5, 2006, the EuropeanCommission informed Eni that the Group companies were subject toan inquiry under Article 20, paragraph 4 of the EuropeanRegulation No. 1/2003 of the Council in order to verify thepossible existence of any business conducts breaching Europeanrules in terms of competition and intended to prevent access tothe Italian natural gas wholesale market and to subdivide themarket among few operators in the activity of supply andtransport of natural gas. Similar actions have been performed bythe Commission also against the main operators in natural gas inGermany, France, Austria and Belgium. In April 2007, the EuropeanCommission made public its decision to start a further stage ofinquiry, as the elements collected supported its suspicion thatEni adopted behaviors leading to "capacity hoarding andstrategic, in its view, underinvestment in the transmissionsystem leading to the foreclosure of competitors and harm forcompetition and customers in one or more supply markets inItaly". On March 9, 2009 Eni received a Statement ofObjections related to a proceeding under Article No. 82 of the EUTreaty and Article No. 54 of the SEE agreement with reference toan alleged unjustifiable refusal of access to the TAG andTENP/Transitgas gas pipelines, that are interconnected with theItalian gas transport system through actions intended to"capacity hoarding, capacity degradation and strategiclimitation of investment" with the effect of "hinderingthe development of a real competition in the downstream marketand [...] harming the consumers". The European Commissionenvisages the possible imposition of a fine and of structuralremedies. The Company is currently assessing the reasoningunderlying the Commission’s objections in order to ascertainwhether the challenged actions are supported by evidence and maybe qualified as infringement of the European competition rules.The Company will file its defensive memories within theproceeding. In addition, and following the aforementionedassessment, the Company may consider whether to voluntarily filea set of remedies to settle the proceeding as provided by ArticleNo. 9 of the European Regulation No. 1/2003. Taking into accountthe numerous elements to be considered in determining the amountof the fine, the complex checks to carry out with respect to theStatement of Objections, and also the circumstance that theCommission’s approval of the possible remedies, presented byEni pursuant to European Regulation No. 1/2003, would settle thematter without imposing a fine, management believes that theliability is contingent upon the future events described andcannot be measured with reasonable reliability.

*TTPC.*In April 2006, Eni filed a claim before theRegional Administrative Court of Lazio against the decision ofthe Italian Antitrust Authority of February 15, 2006 stating thatEni’s behavior pertaining to implementations of plans forthe upgrading of the TTPC pipeline for importing natural gas fromAlgeria represented an abuse of dominant position under Article82 of the European Treaty and fined Eni. The initial fineamounted to euro 390 million and was reduced to euro 290 millionin consideration of Eni’s commitment to perform actionsfavoring competition including the upgrade of the gasline. Eniaccrued a provision with respect to this proceeding. With adecision filed on November 29, 2006, the Regional AdministrativeCourt of Lazio partially accepted Eni’s claim, annullingsuch part of the Authority’s decision where the fine wasquantified. Eni is waiting for the filing of the motivations ofthe Court decision to ascertain the impact of said decision.Pending this development, the payment of the fine has beenvoluntarily suspended. In 2007, the Regional Administrative Courtof Lazio accepted in part Eni’s claim and cancelled thequantification of the fine based on the AntitrustAuthority’s inadequate evaluation of the 

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circumstances presented by Eni. Eni filed an appeal with theCouncil of State, as did the Antitrust Authority and TTPC.Pending the final outcome, Eni awaits for the determination ofthe amount of the fine to be paid.

*Italian natural gas market.*On May 7, 2009, the ItalianAntitrust Authority started a preliminary investigation againstthe Company and its fully-owned subsidiary Italgas and otheroperators engaging in the gas retail market in Italy. Theinvestigation targets an alleged abuse of dominant position inthe gas retail market in Italy associated with commercialpractices intended to make it difficult for retail clients tochange the supplier and the retrieval of data on volumes.

POLIMERI EUROPA SPA AND SYNDIAL SPA*Inquiries in relation to alleged anti-competitive agreementsin the area of elastomers.* In December 2002, inquiries werecommenced concerning alleged anti-competitive agreements in thefield of elastomers. These inquiries were commenced concurrentlyby European and U.S. authorities. At present, proceedings arepending before the European Commission regarding the CR and NBRproducts. In March 2007, the Commission sent to Eni, PolimeriEuropa and Syndial a statement of objections, thus opening thesecond phase of this proceeding. In December 2007, the EuropeanCommission dismissed Syndial’s position on CR and imposed onEni and Polimeri a fine amounting to euro 132.16 million. The twocompanies have filed an appeal with the EU Court of FirstInstance against this decision and, at the same time, paid thefine in March 2008. Investigations relating to other elastomersproducts resulted in the ascertainment of Eni having infringedEuropean competition laws in the field of synthetic rubberproduction (BR and ESBR). On November 29, 2006, the Commissionfined Eni and its subsidiary Polimeri Europa for an amount ofeuro 272.25 million. Eni and its subsidiary filed claims againstthis decision before the European Court of First Instance inFebruary 2007. The Commission filed a counter appeal. Pending theoutcome, Polimeri Europa presented a bank guarantee for euro 200million and paid the residual amount of the fine. In August 2007,Eni submitted a request for a negative ascertainment with theCourt of Milan aimed at proving the non-existence of allegeddamages suffered by tire manufacturers. With regard to NBR, aninquiry is underway also in the U.S., where class actions havealso been commenced. On the federal level, the class action wasabandoned by the plaintiffs. However, the federal judge has yetto acknowledge this abandonment. With regard to other productsunder investigation in the U.S., settlements were reached withboth relevant U.S. antitrust authorities and the plaintiffsacting through a class action. Eni recorded a provision for thesematters.

 

> 
**Regulation**

TOSCANA ENERGIA CLIENTI SPAEni’s subsidiary Toscana Energia Clienti SpA started anaction against a customer regarding alleged lack of measurementof gas consumption due to inability to access a measurementfacility at the customer’s site, also in connection with theapplication of Resolution No. 229/2001 of the Italian Authorityfor Electricity and Gas. This customer has annual consumption inexcess of 5,000 CM. The defendant has filed a counter-claim inrelation to this proceeding. In the hearing of November 12, 2008the judge resolved to partially accept the Eni’s subsidiaryreasons and to limit compensation to be paid to the defendant toonly euro 1,475 with interests amounting to euro 90. The sum waspaid while the defendant is evaluating the opportunity to appealthe sentence.

DISTRIBUIDORA DE GAS CUYANA SA*Formal investigation of the agency entrusted with theregulations for the natural gas market in Argentina.*****Enargasstarted a formal investigation on some operators, among themDistribuidora de Gas Cuyana SA, a company controlled by Eni.Enargas stated that the company improperly applied conversionfactors to volumes of natural gas invoiced to customers andrequested the company to apply the conversion factors imposed bylocal regulations from the date of the default notification(March 31, 2004) without prejudice to any damage payment andfines that may be decided after closing the investigation. InApril 2004 the company filed a defensive memorandum. On April 28,2006, the company formally requested the acquisition of documentsfrom Enargas in order to have access to the documents on whichthe allegations are based.

 

> 
**Tax Proceedings**

ENI SPA*Dispute for the omitted payment of the municipal tax relatedto oil platforms located in territorial waters in the AdriaticSea.* With a formal assessment presented by the Municipalityof Pineto (Teramo) in December 1999, Eni SpA has been accused ofnot having paid a municipal tax on real estate for the periodfrom 1993 to 1998 on four oil platforms located in the AdriaticSea which constitute municipal waters in front of the coast ofPineto. Eni was requested to pay a total of approximately euro 17million including interest and a fine. Eni filed a claim againstthis request stating that the sea where the platforms are locatedis not part of the municipal territory and the tax application asrequested by the municipality lacked objective fundamentals. Theclaim has been accepted in the first two degrees of judgment atthe Provincial and Regional Tax Commissions. However, the Courtoverturned both judgments, declaring that a municipality canconsider requesting a tax on real estate in the sea facing itsterritory and with the decision of February 2005 sent theproceeding to another section of the Regional Tax Commission inorder 

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to judge on the matters of the proceeding. This commissionnominated a Board of Consultants, in order to make all theaccounting/technical verifications necessary for the judgment. OnDecember 28, 2005, the Municipality of Pineto presented the samerequest for the same platforms for the years 1999 to 2004. Thetotal amount requested from Eni is euro 24 million includinginterest and penalties. Eni filed a claim against this requestwhich was accepted by the first degree judge with a decision ofDecember 4, 2007. Similar formal assessments related to Eni oiland gas offshore platforms were presented by the Municipalitiesof Falconara Marittima and Pedaso. The total amounts of thoseclaims were approximately euro 6 million. The company filedappeal or is planning to appeal.

AGIP KARACHAGANAK BV*Claims concerning unpaid taxes and relevant payment ofinterest and penalties*. In July 2004, relevant KazakhAuthorities informed Agip Karachaganak BV and Agip KarachaganakPetroleum Operating Co BV, shareholder and operator of theKarachaganak contract, respectively, on the final outcome of 2000to 2003 tax audits. Both companies counterclaimed against theassessment and a preliminary agreement was reached on November18, 2004. Final assessments have now been issued by the KazakhAuthorities, and payment has been made. The final amount assessedand paid was $39 million net to Eni; this figure included taxesand interest. The companies continue to dispute the assessmentsand reserve the right to challenge their findings further.

 

> 
**Court Inquiries**

*EniPower.* In June 2004, the Milan Public Prosecutorcommenced inquiries into contracts awarded by Eni’ssubsidiary EniPower and on supplies from other companies toEniPower. These inquiries were widely covered by the media. Itemerged that illicit payments were made by EniPower suppliers toa manager of EniPower who was immediately dismissed. The Courtpresented EniPower (commissioning entity) and Snamprogetti(contractor of engineering and procurement services) with noticesof process in accordance with existing laws regulating theadministrative responsibility of companies (Legislative DecreeNo. 231/2001). In its meeting of August 10, 2004, Eni’sBoard of Directors examined the aforementioned situation andEni’s CEO approved the creation of a task force in charge ofverifying the compliance with Group procedures regarding theterms and conditions for the signing of supply contracts byEniPower and Snamprogetti and the subsequent execution of works.The Board also advised divisions and departments of Eni tocooperate fully in every respect with the Court. From theinquiries performed, no default in the organization emerged, nordeficiency in internal control systems. External experts haveperformed inquiries with regard to certain specific aspects. Inaccordance with its transparency and firmness guidelines, Eniwill take the necessary steps in acting as plaintiff in theexpected legal action in order to recover any damage that couldhave been caused to Eni by the illicit behavior of its suppliersand of their and Eni employees. In the meantime, preliminaryinvestigations have found that both EniPower and Snamprogetti arenot to be considered defendants in accordance with existing lawsregulating the administrative responsibility of companies(Legislative Decree No. 231/2001). In August 2007, Eni wasnotified that the Public Prosecutor requested the dismissal ofEniPower SpA and Snamprogetti SpA, while the proceeding continuesagainst former employees of these companies and employees andmanagers of the suppliers under the provisions of LegislativeDecree No. 231/2001. Eni SpA, EniPower and Snamprogetti presentedthemselves as plaintiffs.

*Trading.*An investigation is pending regarding twoformer Eni managers who were allegedly bribed by third parties tofavor the closing of certain transactions with two oil producttrading companies. Within such investigation, on March 10, 2005,the public prosecutor of Rome notified Eni of two judicialmeasures for the seizure of documentation concerning Eni’stransactions with the said companies. Eni is acting as plaintiffin this proceeding. The judge for preliminary hearings rejectedmost of the dismissal request, forcing the public prosecutor tocontinue with the criminal case.

*TSKJ Consortium Investigations of the SEC and otherAuthorities.* The U.S. Securities and Exchange Commission(SEC), the U.S. Department of Justice (DoJ), and otherauthorities are investigating alleged improper payments made bythe TSKJ Consortium to certain Nigerian public officials inrelation to the construction of natural gas liquefactionfacilities at Bonny Island in Nigeria. Snamprogetti NetherlandsBV had a 25% participation in the TSKJ companies, with theremaining participations held by subsidiaries of Halliburton/KBR,Technip, and JGC. Snamprogetti SpA, the holding company ofSnamprogetti Netherlands BV, was a wholly owned subsidiary of Eniuntil February 2006, when an agreement was entered into for thesale of Snamprogetti to Saipem SpA and Snamprogetti was mergedinto Saipem as of October 1, 2008. Eni holds a 43% participationin Saipem. In connection with the sale of Snamprogetti to Saipem,Eni agreed to indemnify Saipem for a variety of matters,including potential losses resulting from the investigations intothe TSKJ matter. In February 2009, KBR and its former parentcompany, Halliburton, announced that they had reached asettlement with the SEC and DoJ with respect to the TSKJ matteras well as other unspecified matters. In connection with thesettlement, KBR pleaded guilty to Foreign Corrupt Practices Act(FCPA) charges stemming from the TSKJ matter. KBR and Halliburtonalso agreed to pay a substantial fine and entered into civilsettlements with the SEC. We understand that the DoJ and the SECbelieve that representatives of the other members of the TSKJConsortium were involved in the conduct that gave rise to theFCPA charges against KBR. Since June 2004, Eni andSaipem/Snamprogetti have been in discussions with, and haveprovided information in response to requests by, variousregulators, including the SEC, the DoJ and the PublicProsecutor’s office of Milan, in connection with theinvestigations.

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*Gas Metering.* On May 28, 2007, a seizure order (inrespect to certain documentation) was served upon Eni and otherGroup companies as part of a proceeding brought by the PublicProsecutor at the Courts of Milan. The order was also served uponfive top managers of the Group companies in addition to thirdparty companies and their top managers. The investigation allegesbehavior which breaches Italian criminal law, starting from 2003,regarding the use of instruments for measuring gas, the relatedpayments of excise duties and the billing of clients as well asrelations with the Supervisory Authorities. The allegationregards, interalia, the offense contemplated by LegislativeDecree of June 8, 2001, No. 231, which establishes the liabilityof the legal entity for crimes committed by its employee in theinterests of such legal entity, or to its advantage. Accordingly,notice of the commencement of investigations was served upon EniGroup companies (Eni, Snam Rete Gas and Italgas) as well as thirdparty companies. The Group companies are cooperating with theSupervising Authorities in the investigations.

*Agip KCO NV.* In November 2007, the public prosecutor ofKazakhstan informed Agip KCO of the start of an inquiry for analleged fraud in the award of a contract to the OverseasInternational Constructors GmbH in 2005.

 

> 
**Settled Proceedings**

ENI SPA*Inquiry of the Italian Authority for Electricity and Gasregarding information to clients about the right to pay amountsdue for natural gas sales in installments.*With Decision No.228/2007, the Italian Authority for Electricity and Gas commenceda formal inquiry regarding information to clients about the rightto pay amounts due for the natural gas sales in installments inorder to possibly put a stop to the alleged infringement of theclients’ rights and to impose a fine. In April 2008, theAuthority concluded its inquiry and fined the Company by euro 3.2million.

SYNDIAL SPA (FORMER ENICHEM SPA)*Criminal action commenced by the public prosecutor ofBrindisi.*In 2000, the public prosecutor of Brindisicommenced a criminal action against 68 persons who are employeesor former employees of companies that owned and managed plantsfor the manufacture of dichloroethane, vinyl chloride monomer andvinyl polychloride from the early 1960s to date, some of whichwere managed by EniChem from 1983 to 1993. At the end of thepreliminary investigation the public prosecutor asked for thedismissal of the case in respect of the employees and themanagers of EniChem. Plaintiffs presented oppositions, but theprosecutor confirmed the request to dismiss the case with adecision of June 2008, the public prosecutor dismissed theaccusation as unfounded and requested the closing of theproceeding.

AGIP KCO NVIn December 2007 the Kazakh tax authority filed a notice of taxassessment for fiscal years 2004 to 2006 to Agip KCO, operator ofthe Kashagan contract. Allegedly unpaid taxes, including interestand penalties, amounted to approximately U.S. $235 million net toEni and related to unpaid amounts and inapplicable deductions onvalue added tax and the default in applying certain withholdingtaxes on payments to foreign suppliers. The same notice alsoinformed the companies party to the Kashagan contract thatfurther assessments were pending on non-deductible costs for U.S.$188 million net Eni and higher taxable income on Kazakh branchesfor U.S. $48 million net to Eni. The further assessments weresubsequently issued, the company filed an appeal and a settlementwas reached in October 2008 with the following outcome: theunpaid taxes net to Eni were agreed at U.S. $24 million (U.S.$235 million assessed). An adjustment to deductible costs wasagreed at U.S. $38 million net to Eni (U.S. $188 millionassessed) and it was further agreed that there would be no incometaxable on Kazakh branches (U.S. $48 million assessed).

 

> 
***Dividends***

Eni’s dividend policy in future periods, and thesustainability of the current amount of dividends over the nextfour-year period, will depend upon a number of factors includingfuture levels of profitability and cash flow provided byoperating activities, a sound balance sheet structure, capitalexpenditures and development plans, in light of the "RiskFactors" set out in Item 3. The parent Company’s netprofit and, therefore, the amounts of earnings available for thepayment of dividends will also depend on the level of dividendsreceived from Eni’s subsidiaries. However, subject to suchfactors, in the next four-year period management intends topursue a dividend policy designed to ensure competitive dividendyields to Eni’s shareholders. On April 30, 2009, Eni’sShareholders' Meeting approved a dividend, for fiscal year 2008,of euro 1.30 per share, of which euro 0.65 per share was paid inSeptember 2008 as an interim dividend with the balance of euro0.65 per share to be paid late in May 2009. Total cash outlay forthe 2008 dividend is expected at approximately euro 4.7 billion(including the euro 2.36 billion already paid in September 2008).In future years, management expects to continue paying interimdividends for each fiscal year, with the balance to the full yeardividend to be paid in each following year.

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**Significant Changes**

See "Item 5 – Recent developments" for adiscussion of significant events occurred after 2008 year-end upto the latest practicable date, including a review of Eni’sperformance in the first quarter of 2009, the exercise by Gazpromof the call option to purchase the 20% interest in the Russiancompany OAO Gazprom Neft held by Eni, the divestment of 100% ofItalgas SpA and Stoccaggi Gas Italia SpA to Snam Rete Gas and thefinalization of the mandatory tender offer on the minorityshareholders of Distrigas.

 

 

**Item 9. THE OFFER AND THE LISTING**

**Offer and Listing Details**

The principal trading market for the ordinary shares of EniSpA ("Eni"), nominal value euro 1.00 each (the"Shares"), is the Mercato Telematico Azionario or MTA("Telematico"), the Italian regulated electronic sharemarket, which is the principal trading market for shares inItaly. The Shares are traded on the Blue Chip segment ofTelematico, which includes shares of the companies whose marketcapitalization amounts to more than euro 1,000 million. AmericanDepositary Receipts ("ADRs"), each representing twoshares, are listed on the New York Stock Exchange. The ratio haschanged from one ADR per five Shares to one ADR per two Shares,effective January 10, 2006.

The table below sets forth the reported high and low referenceprices of Shares on Telematico and of ADRs on the New York StockExchange, respectively. Due to the ratio change, the historicalprices of ADRs have been adjusted by an adjustment factor of 2.5.See "Item 3 – Key Information – ExchangeRates" regarding applicable exchange rates during theperiods indicated below.

|   | **Telematico** |   | **New York        Stock Exchange** |
|--------|----------------|--------|------------------------------------|
|   |                |   |                                    |

|   | **High** |   | **Low** |   | **High** |   | **Low** |
|--------|----------|--------|---------|--------|----------|--------|---------|
|   |          |   |         |   |          |   |         |

|   | **(euro per share)** |   | **(U.S. $ per ADR)** |
|--------|----------------------|--------|----------------------|

| 2003                                  |   | 15.746 |   | 11.881 |   | 37.992 |   | 26.460 |
|---------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|
| 2004                                  |   | 18.748 |   | 14.723 |   | 50.580 |   | 36.940 |
| 2005                                  |   | 24.960 |   | 17.930 |   | 60.540 |   | 47.400 |
| 2006                                  |   | 25.730 |   | 21.820 |   | 67.690 |   | 54.650 |
| 2007                                  |   | 28.330 |   | 22.760 |   | 78.290 |   | 60.220 |
| 2008                                  |   | 26.930 |   | 13.798 |   | 84.140 |   | 37.220 |
|                                  |   |   |   |   |   |   |   |   |
| **2007**                              |   |   |   |   |   |   |   |   |
| First quarter                         |   | 25.720 |   | 22.760 |   | 66.720 |   | 60.220 |
| Second        quarter                 |   | 27.150 |   | 24.130 |   | 72.840 |   | 64.710 |
| Third quarter                         |   | 28.330 |   | 23.310 |   | 78.290 |   | 63.160 |
| Fourth        quarter                 |   | 26.680 |   | 23.320 |   | 75.660 |   | 67.220 |
|                                  |   |   |   |   |   |   |   |   |
| **2008**                              |   |   |   |   |   |   |   |   |
| First quarter                         |   | 25.580 |   | 20.870 |   | 75.130 |   | 61.790 |
| Second        quarter                 |   | 26.930 |   | 21.820 |   | 84.140 |   | 68.570 |
| Third quarter                         |   | 23.450 |   | 18.263 |   | 73.930 |   | 51.410 |
| Fourth        quarter                 |   | 19.350 |   | 13.798 |   | 52.600 |   | 37.220 |
|                                  |   |   |   |   |   |   |   |   |
| **2009**                              |   |   |   |   |   |   |   |   |
| First quarter                         |   | 17.830 |   | 12.300 |   | 49.440 |   | 31.070 |
| January        2009                   |   | 17.830 |   | 16.210 |   | 49.440 |   | 42.390 |
| February 2009                         |   | 17.630 |   | 15.740 |   | 45.690 |   | 39.200 |
| March 2009                            |   | 15.240 |   | 12.300 |   | 41.380 |   | 31.070 |
| April 2009                            |   | 16.450 |   | 14.510 |   | 43.010 |   | 37.240 |
| May 2009        (through May 4, 2009) |   | 16.930 |   | 16.930 |   | 45.550 |   | 44.040 |

|   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|

JPMorgan Chase Bank NA (the "Depositary") functionsas depositary bank issuing ADRs pursuant to the Deposit Agreementamong Eni, the Depositary and the beneficial owners("Beneficial Owners") and registered holders from timeto time of ADRs issued thereunder.

At May 4, 2009 there were 44,072,282 ADRs outstanding,representing 88,144,564 ordinary shares or 2.2% of all Eni’sshares outstanding, held by 107 holders of record (including theDepository Trust Company) in the United 

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States of America, 105 of which are U.S. residents. Sincecertain of such ADRs are held by nominees, the number of holdersmay not be representative of the number of Beneficial Owners inthe United States or elsewhere.

The Shares are included in the S&P/MIB, the primaryItalian stock exchange index that measures the performance of the40 leading companies in leading industries listed on the marketsorganized and managed by Borsa Italiana SpA ("BorsaItaliana"). The constituents of the S&P/MIB are selectedaccording to the following criteria: sector representation,market capitalization of free-float shares and liquidity. SinceSeptember 20, 2004 S&P/MIB is the principal indicator used totrack the performance of the Italian stock market and is thebasis for future and option contracts traded in the ItalianDerivatives Market ("IDEM") managed by Borsa Italiana.Eni’s Shares are the largest component of the S&P/MIB,with a weighting of approximately 14.7%. as established byStandard & Poor’s and Borsa Italiana after the quarterlyrebalancing for S&P/MIB effective March 23, 2009.

Trading in the Telematico is allowed in any quantity of sharesor other financial instruments. Where necessary, Borsa Italianamay specify a minimum lot for each financial instrument. SinceMarch 28, 2000, a three-day rolling cash settlement has beenapplied to all trades of equity securities in Italy, instead ofthe previous five-day settlement. Starting from May 15, 2000, theShares have been also trading on a special market, named AfterHours trading market or TAH ("After Hours"), after theclosure of the day time of Telematico under special rules. Inaddition, future and option contracts on the Shares are traded onIDEM and securitized derivatives based on the Shares are tradedon the Italian Securitized Derivatives Market("SeDeX"). IDEM facilitates the trading of future andoption contracts on index and shares issued by companies thatmeet certain required capitalization and liquidity thresholds.SeDeX is the Borsa Italiana electronic regulated market where itis possible to trade securitized derivatives (covered warrantsand certificates). Outside Regulated Markets, block trading ispermitted for orders that meet certain minimum size requirementsand must be notified to Consob and Borsa Italiana.

 

 

**Markets**

Telematico is organized and administered by Borsa Italianasubject to the supervision and control of the CommissioneNazionale per le Società e la Borsa (the National Commission forCompanies and the Stock Exchange or "Consob"), thepublic authority charged, interalia, with regulating the Italiansecurities market to ensure the transparency and regularity ofthe dealings and protect investors. Borsa Italiana is a jointstock company (Società per Azioni) that was established tomanage the Italian regulated financial markets (includingTelematico) as part of the implementation in Italy of the EUInvestment Services Directive ("ISD"). Borsa Italianahas issued rules governing the organization and management of theItalian Regulated Markets it regulates, which are Telematico(shares, convertible bonds, pre-emptive rights, warrants, andFunds), After Hours, Mercato Expandi (small companies), ETFplus(Exchange Traded Funds and Exchange Traded Commodities market),IDEM (index and stock derivatives market), SeDeX (coveredwarrants and certificates), and MOT (bond market), as well as theadmission to listing on and trading on these markets. BorsaItaliana is part of the London Stock Exchange Group, followingthe agreement signed in June 2007.

For the purposes of the automatic control of the regularity oftrading on Telematico, the following price variation limits shallapply to contracts concluded on shares making up the S&P/MIB:(i) ± 7.5% (or such other amount established by Borsa Italiana)with respect to the static price (the static price shall be theprevious day’s reference price, in the opening auction, orthe auction price, in the continuous trading phase); and (ii) ±3.5% (or such other amount established by Borsa Italiana) withrespect to the dynamic price (the price of the last contractconcluded during the continuous trading phase). The referenceprice is the closing-auction price. Where the price of a contractthat is being concluded exceeds one of the price variation limitsreferred to above, trading in that security will be automaticallysuspended and a volatility auction phase begun for a certainperiod of time. 

Effective November 1, 2007, following the nationalimplementation of the EU Markets in Financial InstrumentsDirective (2004/39/EC) ("MiFID"), the so called’concentration rule’ has been superseded. The MiFID,that replaces the ISD, establishes the legal framework governinginvestment services and financial markets in Europe. With the newregulatory regime of MiFID, orders can be routed not only toRegulated Markets but also to either Multilateral TradingFacilities ("MTF"s) or Systematic Internalisers. An MTFis a multilateral system, operated by an investment firm or amarket operator, which brings together multiple third-partybuying and selling interests in financial instruments – inthe system and in accordance with non-discretionary rules –in a way that results in a contract. A Systematic Internaliser isan investment firm or a bank which deals on own account byexecuting client orders outside a Regulated Market or an MTF.

Italian exchanges and securities are primarily regulated byLegislative Decree No. 58 of February 24, 1998 ("Decree No.58"). According to Decree No. 58, the provision ofinvestment services and activities to the public on aprofessional basis is reserved to banks and investment firms("intermediaries"), which are firms authorized toprovide investment services or activities. In addition, banks andinvestment firms organized in a member nation of the EU arepermitted to operate in Italy provided that the intent of thebank or investment firm to operate in Italy is communicated toConsob by the competent authority of the member state. Non-EUbanks and non-EU investment 

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firms may operate in Italy subject to the specificauthorization of Consob, in agreement with the Bank of Italy.Pursuant to Decree No. 58, Consob shall be responsible for thetransparency and correctness of conduct of intermediaries and theBank of Italy shall be responsible for risk containment, assetstability and the sound and prudent management of intermediaries.The Bank of Italy, in agreement with Consob, also regulates theoperation of the clearing and settlement service for transactionsinvolving financial instruments. The regulations and measures ofgeneral application adopted by Consob and the Bank of Italy areavailable on the website of Consob (www.consob.it) or Bank ofItaly (www.bancaditalia.it).

 

 

**Item 10. ADDITIONAL INFORMATION**

**Memorandum and Articles of Association**

The full text of the memorandum and articles of association ofEni is attached as an exhibit to this annual report. See"Exhibit 1".

Eni is incorporated under the name "Eni SpA"resulting from the transformation of Ente Nazionale Idrocarburi,a public law agency, established by Law No. 136 of February 10,1953. The Company’s purpose is the direct and/or indirectmanagement, by way of shareholdings in companies, agencies orbusinesses, of activities in the field of hydrocarbons andnatural vapors, such as exploration and development ofhydrocarbon fields, construction and operation of pipelines fortransporting the same, processing, transformation, storage,utilization and trade of hydrocarbons and natural vapors, all incompliance with concessions required by law.

The Company also has the purpose of direct and/or indirectmanagement, by way of shareholdings in companies, agencies orbusinesses, of activities in the fields of chemicals, nuclearfuels, geothermy and renewable energy sources, in the sector ofengineering and construction of industrial plants, in the miningsector, in the metallurgy sector, in the textile machinerysector, in the water sector, including derivation, drinkingwater, purification, distribution and reuse of waters; in thesector of environmental protection and treatment and disposal ofwaste, as well as in every other business activity that isinstrumental, supplemental or complementary with theaforementioned activities.

The Company also has the purpose of managing the technical andfinancial co-ordination of subsidiaries and affiliated companiesas well as providing financial assistance on their behalf.

The Company may perform any operations necessary or useful forthe achievement of its purpose; by way of example, it mayinitiate operations involving real estate, moveable goods, tradeand commerce, industry, finance and banking asset and liabilityoperations, as well as any action that is in any way connectedwith the Company purpose with the exception of public fundraising and the performance of investment services as regulatedby Decree No. 58 of February 24, 1998.

The Company may take shareholdings and interests in othercompanies or businesses with objects similar, comparable orcomplementary to its own or those of companies in which it hasholdings, either in Italy or abroad, and it may provide real andor personal bonds for its own and others’ obligations,especially guarantees.

 

> 
***Directors***

The Board of Directors is invested with the fullest powers forordinary and extraordinary management of the Company and, inparticular, the Board has the power to perform all acts it deemsadvisable for the implementation and achievement of the Companypurpose, except for the acts that the law or Eni’s By-lawsreserve to the Shareholders’ Meeting. The Board of Directorshas appointed a Chief Executive Officer and delegated to him allnecessary powers for the administration of the Company, with theexception of those powers that cannot be delegated in accordancewith current legislation and those retained exclusively by theBoard on Directors on the matters regarding major strategic,operational and organizational decisions.

For a complete description of the powers of the Board, the CEOand the Chairman, appointments, role of the Board and rules andprocedures of the meetings of the Board see "Item 6 –Board Practices".

There are no provisions as to retirement based on age-limitrequirements, or requirement of share ownership for adirector’s qualification in Eni’s By-laws.

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> 
***Stock ownership limitation and voting rights    restrictions***

*General*

There are no limitations imposed by Italian law or by theEni’s By-laws on the rights of non-residents of Italy orforeign persons to hold or vote the shares other than thelimitations described below (which are equally applicable toresidents and non-residents of Italy).

In accordance with Article 6 of Eni’s By-laws and inaccordance with the special provision of Article 3 of Law DecreeNo. 332/1994 as converted into Law No. 474/1994 ("Law No.474 of 1994"), no shareholder can directly or indirectly owna shareholding higher than 3% of Eni’s share capital. Thislimitation does not apply to shares held by the State, the PublicEntities or entities controlled by them. The law states inaddition that this limitation is waived in case of a public offerto buy Eni’s shares whereby the bidder will hold at leastthe 75% of share capital giving the right to vote on theappointment or revocation of the Board of Directors.

Such maximum limit at 3% is calculated taking into account theaggregate shareholding of a controlling entity, whether anindividual or a legal entity (each a "person"); itsdirectly or indirectly controlled entities, as well as entitiescontrolled by the same controlling entity; affiliated entities,as well as relatives within the second degree by blood ormarriage (except for a legally separated spouse). 

Control exists with reference also to entities other thancompanies in the cases envisaged by in the cases envisaged byArticle 2359, paragraphs 1 and 2 of the Civil Code. Affiliationexists as set forth in applicable Italian legislation, as well asbetween entities that, directly or indirectly, through controlledentities (other than those managing investment funds) are bound,even with third parties, by agreements relating to the exerciseof voting rights or the transfer of shares or interests inthird-party companies or other agreements relating to third-partycompanies as specified by applicable Italian legislation if suchagreements relate to at least 10% of the voting share capital ofa listed company or 20% of the voting share capital of anon-listed company. For purposes of calculating the 3% limit,shares held through a fiduciary nominee or a broker are takeninto account.

Any voting rights attributable to shares held or controlled inexcess of such 3% limit cannot be exercised, and the votingrights of each entity to whom such limit on shareholding appliesare reduced proportionately, unless otherwise jointly disposed ofin advance by the parties involved. In the event that sharesexceeding this limit are voted, any shareholders’ resolutionadopted pursuant to such a vote may be challenged if the majorityrequired to approve such resolution would not have been reachedwithout the vote of the shares exceeding such maximum limit.Shares not entitled to be voted are nevertheless counted for thepurpose of determining the quorum at a Shareholders’Meeting.

For other limitations that may affect voting rights, see"– Reporting Requirements and Restrictions onAcquisitions of Shares".

> 
*Special Powers of the Italian State*

Under Italian laws, the Italian State, acting through theMinister of Economy and Finance in agreement with the Minister ofEconomic Development (the "Ministers"), holds certainspecial powers in connection with any transfer of a controllinginterest in certain State-owned companies operating in publicservice sectors, including Eni. The law places no limit on theduration of such special powers. Such powers are to be exercisedin accordance with specific criteria provided for by theregulation and EU principles.

Article 6.2 of Eni’s By-laws, in accordance with thespecial law referred to as Law No. 474 of 1994, attribute to theMinister of Economy and Finance, in agreement with the Ministerof Economic Development, the following special powers to be usedin compliance with the criteria indicated in the Decree of thePresident of the Council of Ministers of June 10, 2004 and,synthetically:

| (a) |   | opposition with respect to        the acquisition of material shareholdings representing 3%        of the Eni’s share capital having the right to vote        at ordinary Shareholders’ Meeting by entities        subject to such ownership limitations pursuant to Article        6.1. Such opposition is required to be duly motivated and        expressed within 10 days of the date of the notice to be        filed by the Board of Directors at the time a request is        made for registration in the Shareholders’ register,        when the transaction is considered prejudicial to vital        interests of the State. Until the ten-day term as        expired, the voting rights and the non-asset linked        rights connected with the shares representing the        material shareholding should not be exercised. If the        opposition power is exercised, by a duly motivated act in        connection with the prejudice that may be caused by the        operation to the vital interests of the Italian State,        the purchaser can not exercise the voting rights and the        other non-asset linked rights connected with the shares        representing the material shareholding and must sell the        relevant shares within one year. If the purchase fails to        comply, the law court, upon request of the Minister of        Economy and Finance, will order the sale of the shares        representing a material shareholding according to the        procedures set forth in Article 2359-ter of the Civil        Code; |
|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| (b) |   | opposition with respect to        the subscription of shareholders’ agreements or        other arrangements (as defined by Article 122 of the TUF)        whereby 3% or more of the share capital of Eni having the        right to vote at ordinary Shareholders’ Meetings is        involved. In exercising this opposition power, the public        authority responsible for regulating Italian securities        and exchanges (Consob) communicates to the Minister of        Economy and Finance any significant shareholders’        agreement notified in accordance with Article 122 of the        TUF. The opposition power may be exercised within ten        days as of the date of the notice by Consob. Until the        ten-day term is not lapsed, the voting right and the        other non-asset linked rights connected with the shares        held by the shareholders who have subscribed the above        mentioned agreements can not be exercised. If the        opposition power is exercised through a duly motivated        act in consideration of the prejudice that may be caused        by said agreements to the vital interests of the Italian        State, the shareholders agreements shall be null and        void. If in the shareholders’ meetings the        shareholders who have signed shareholders’        agreements behave as if those agreements disciplined by        Article 122 of the TUF were still in effect, the        resolutions approved with their vote, if determining for        the approval, can be sued; |
|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) |   | veto power – duly        motivated in connection with the prejudice to the        interests of the State – with respect to        Shareholders’ Meeting resolutions to wind-up the        company, to transfer the enterprise, to merger or to        demerger, to transfer the headquarters of the company        abroad, to change the company objects or to amend the        By-laws canceling or modifying any of the special powers        described in this section (with reference to letters a),        b), c) and the following letter d); and |
|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (d) |   | appointment of a Board        member without voting right in the Board resolutions.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

The acts whereby these special powers are exercised may besubject to a lawsuit by the legitimate subjects before theRegional Administrative Court of Lazio within 60 days.

These powers have been limited after some decisions of theEuropean Court of Justice. The European Court, on March 23, 2009,declared that Italian Regulation that defined the criteria forexercising such special powers (DPCM of June 10, 2004) violatedthe provisions of Articles 43 (former Article 52, right ofestablishment) and 56 (free movement of capitals) of the EuropeanTreaty. Management can not foresee developments on this matter:only the Government is responsible for the amendment of the abovementioned regulation.

Law No. 266 of December 23, 2005 (Budget Law for 2006) inArticle 1, paragraphs 381 to 384, in order to promote the processof privatization and the diffusion among the public ofshareholdings in companies in which the State holds significantstakes, introduced the option to include in the By-laws of suchlisted companies, like Eni, provisions for the issuance ofshares, or securities bearing the same characteristics as shares,which give to the special meeting of their relevant holders, theright to request the issuance on their behalf of new shares, alsoat par value, or securities bearing the right to vote at bothordinary and extraordinary Shareholders’ Meeting. Theintroduction of these norms in Eni’s By-laws would entailthe cancellation of the 3% threshold to individual shareholdingsas contained in the mentioned Article 6.1 of Eni’s By-laws.To date, Eni’s By-laws doesn’t contain this provision.

> 
*Minority protection provisions*

In order to allow for the presence of representatives electedby minority shareholders, under Italian laws, listed companiessuch as Eni. must provide for the election of directors andstatutory auditors through the "voto di lista" (votinglist) system, to ensure that minority shareholders of a companyare represented on its Board of Directors and Board of StatutoryAuditors. Accordingly, Eni’s By-laws require that themembers of the Board of Directors having decisional powers andthe Board of Statutory Auditors have to be elected on the basisof candidate lists presented either by one or more shareholders,representing, alone or in aggregate, at least 1% of theEni’s share capital having the right to vote at ordinaryshareholders’ meetings, or by the Board of Directors.

Each shareholder can present or participate in presenting andvoting for only one list. Entities controlling a shareholder andcompanies controlled by a common entity are forbidden frompresenting or otherwise concurring to the presentation ofadditional lists and from voting them, also through broker orfiduciaries.

Such candidate lists, in which the independent candidates areclearly identified, must be deposited at the Eni’sregistered office and published in at least three Italiannewspapers having general circulation in Italy (two of which mustbe business dailies). Publication of the candidate list presentedby the Board of Directors shall occur at least 20 days before thefirst call (as defined below) of the Shareholders’ Meeting.Such term is reduced to 10 days in the case of candidate listsproposed by shareholders. Each shareholder may present orparticipate in the presentation of only one candidate list andeach candidate may appear on only one list.

Lists must be also be filed with Borsa Italiana and publishedon Eni’s website. 

All candidates must posses the honorability requirements asprovided for by the applicable legislation. Filing a list is apre-requisite for its validity together with filing of aprofessional curriculum of each candidate and statements in whicheach candidate accepts his candidature and attests the lack ofsituations of ineligibility or incompatibility and the possessionof the honorability and, in case, the independence requirements.

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After the votes are cast, appointments take place byextracting seven tenths of directors from the majority list inthe order in which they are listed and the remaining directorsfrom the other lists that must not be directly or indirectlyconnected with the shareholders that filed or voted the list thatcollected the majority of votes. The list vote is applied onlywhen the whole Board is re-elected. In case of appointment ofdirectors that for whatever reason have not been voted accordingto the described procedure, the Shareholders’ Meetingdecides with the majorities set by the law, so that thecomposition of the Board complies with the law and Eni’sBy-laws.

As per Article 6, paragraph 2, letter d) of Eni’sBy-laws, the Minister for Economy and Finance, in agreement withthe Minister of Economic Development, may appoint one member ofthe Board without voting rights in addition to those appointed bythe Shareholders’ Meeting. The Ministers chose not toappoint such member (see "Special Powers of the ItalianState").

According to Article 28.2 of Eni’s By-laws in accordancewith the law, the Shareholders’ Meeting shall elect Chairmanof the Board of Statutory Auditors a member elected from a listother than the one obtaining the majority of votes.

Several provisions of Italian legislation are intended toincrease the protection of minority shareholders. In particular:(i) shareholders’ meetings must be called also upon requestof holders of at least 10% of the outstanding shares (Article2367 Civil Code); (ii) the attendance quorum required for a validshareholder meeting at an extraordinary meeting is at least 50%of the outstanding shares on first call, while on second call theattendance quorum is more than 1/3 of the shares outstanding andon third and following calls the attendance quorum is at least1/5 of the shares outstanding. On first, second and third call,resolutions shall be approved by a majority of 2/3 of the sharesrepresented at the Shareholders’ Meeting (Articles 2368-2369Civil Code); (iii) in addition to the general action against theBoard of Directors approved by the Shareholders’ Meeting,shareholders’ actions against the Board of Directors and theStatutory Auditors may be initiated by shareholders holding atleast 2.5% of the outstanding shares (Articles 2393, 2393-bis and2407 Civil Code); (iv) a single shareholder may sue the directorsfor individual damages (Article 2395 Civil Code) or complain tothe Board of Statutory Auditors about directors’ misconduct;if the complaint is filed by shareholders representing at least2% of the share capital of a listed company, the StatutoryAuditors are required to investigate with no delay and report tothe Shareholders’ Meeting (Article 2408 Civil Code); and (v)shareholders holding at least 5% of the outstanding share mayreport to the Court directors’ serious misconduct. The Courtmay order the inspection of the management, adopt interimmeasures and replace directors with a judicial Commissioner(Article 2409 Civil Code). The companies’ By-laws mayfurther lower the thresholds in (iii), (iv) and (v) and increasethe voting quorums under (ii).

> 
*Reporting requirements and restrictions on acquisitions    of shares*

*Holdings in listed companies.* Under law and ConsobRegulation8, as modified following the implementationof Directive 2004/109/EC (the Transparency Directive9)any direct or indirect holding in the voting shares of a listedissuer in excess of 2%, 5%, 15%, 20%, 25%, 30%, 35%, 40%, 45%,50%, 66,6%, 75%, 90% and 95% must be promptly disclosed to theinvestee company and to Consob.

The same disclosure requirements refer to holdings which fallbelow one of the specified threshold.

As specified in new Article 117-bis of Consob Regulation,these obligations apply also to treasury-shares owned directly orthrough its subsidiary companies by a listed issuer.

Due declarations shall be made within five trading days of thedate of the transaction triggering the obligation to notify,regardless of the date on which it is to take effect, using thespecific forms attached to the above mentioned Regulation. In theevent the same relevant participation is directly or indirectlyheld by two or more entities, the obligation to notify may besatisfied by one of such person, provided that completeness ofinformation is guaranteed.

The relevant thresholds noted above shall be calculatedincluding: (i) shares owned by the reporting person, even if thevoting rights belong or are assigned to third parties, or aresuspended, as well as shares of which the voting rights belong orare assigned to him; and (ii) shares held through thirdparties (and shares whose voting rights are assigned to suchthird parties) such as nominees, trustees or subsidiarycompanies.

Article 119 of Consob Decision No. 11971/1999, provide alsofor specific disclosure requirements (with partially differentthresholds), connected to the potential holdings (such asholdings of derivatives or other equity-linked securities), sothat, in calculating the defined threshold, potential holdingsshall not be aggregated with actual holding.

 

----

| (8) | i      | Article 119        of Consob Decision No. 11971/1999 and subsequently        amendments.                                                                                                                                                                                                                                 |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (9) |   | Directive        2004/109/EC of the European Parliament and of the Council        of December 15, 2004 on the harmonisation of transparency        requirements in relation to information about issuers        whose securities are admitted to trading on a regulated        market and amending Directive 2001/34/EC. |

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The obligation to notify also applies to any direct orindirect participation owned through ADRs.

Voting rights attached to listed shares which have not beennotified pursuant the above mentioned disclosure requirements maynot be exercised. Any resolution or act adopted in violation ofsuch limitation, with the contribution of those undisclosedshares, could be voided if challenged in Court, under the CivilCode, by shareholders or by Consob itself. 

Moreover, based on reasoned investor protection and/or marketefficiency aims, Consob is entitled to fix the first relevantthreshold to a measure lower than 2%, by its decree (as providedfor Law Decree No. 5 of February 2, 2009, converted into Law No.33 of April 9, 2009). This faculty may be exercised only fordefinite period of time, with regard to public companies withhigh capitalization level. 

*Holdings in unlisted companies.*Under law and ConsobRegulation (Article 125 of the mentioned decision), listedissuers holding more than 10% of the voting capital of an Italianor foreign unlisted company or a "*società aresponsabilità limitata*" as regulated in Italian CivilCode (Articles 2462-2483), shall inform the investee company,within seven days from reaching such threshold (applying, forcalculating this thresholds, the some rules established forholding in listed companies).

In the same way, the non-listed company must be notified aboutany subsequent reduction of such participation below the 10%threshold.

Listed companies are also required to notify Consob of theirparticipation exceeding 10% of the voting share capital ofnon-listed companies or "*società a responsabilitàlimitata*" owned at the closing date of the financialyear, within 30 days from the date of approval of the draftannual report.

> 
*Cross-holdings rules*

In addition to the rules of Article 2359-bis of the Italiancivil code governing the acquisition of shares of the parentcompany by a controlled subsidiary, Decree No. 58/1998 regulatesadditional cross-ownership matters as follows.

Cross-ownership between listed and non-listed companies maynot exceed 2% of the shares of the listed company or 10% of theshares of the non-listed company (applying, for calculating theseownership thresholds, the same rules established for holdings inlisted companies).

The company that last exceed the limit of 2% or 10% interestin a listed or unlisted company respectively, may not exercisethe voting rights on the shares held in excess of such thresholdsand must sell such shares within the following 12 months. In theevent of failure to make the disposal within such time limit, thesuspension of voting rights shall apply to the entireshareholding, and any resolution or act adopted with thecontribution of relevant shares, could be challenged under theCivil Code.

If anyone holds an interest exceeding 2% of the share capitalof a listed company, such listed company or any entitycontrolling such listed company may not acquire an interestexceeding 2% of the share capital of a listed company controlledby said holder. If the foregoing limit is exceeded, the holderwho last exceeded the foregoing limit (or both the holders, if itis not possible to ascertain which holder exceeded such limitlast) may not exercise the voting right related to the sharesexceeding the foregoing limit. In the event of non-compliance,the voting rights attached to the shares in excess of the limitspecified shall be suspended and any resolution or act adoptedwith the contribution of relevant shares, could be challengedunder the Civil Code.

Described limitations are not applicable in case of a tenderoffer for acquiring at least 60% of the ordinary shares of alisted company. For a description of the limitation oncross-ownership between a company and its subsidiaries, see"Purchase by Eni SpA of its Own Shares".

> 
*Shareholders’ agreements*

Under Decree No. 58/1998, any agreement, in whatever form,intended to regulate the exercise of voting rights in a listedcompany or in the companies controlling a listed company,together with any of its subsequent amendments, renewal ortermination, must be: (i) notified to Consob, within five daysfrom its execution; (ii) disclosed to the public through thepublication, in summary form, in the daily press, within ten daysfrom its execution; and (iii) deposited in the Companies’Register of the place where such listed company has itsregistered office within 15 days from its conclusion.

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The same requirements also apply to agreements, in whateverform, that: (a) impose an obligation of consultation prior to theexercise of voting rights in a listed company and in itscontrolling companies; (b) set limits on the transfer of therelated shares or of other financial instruments that entitleholders to buy or subscribe for them; (c) provide for thepurchase of the shares or of above mentioned financialinstruments; (d) have as their object or 

effect the exercise, jointly or otherwise, of dominantinfluence on such companies; and d-*bis*) which aim toencourage or frustrate a takeover bid or equity swap, includingcommitments relating to non-participation in a takeover bid.

In the event of non-compliance with said requirements, theagreements shall be null and void, the voting rights connected tothe relevant shares may not be exercised and any resolution oract adopted with the contribution of such shares could bechallenged under the Civil Code.

If the parties have agreed upon the duration of the agreement,such duration cannot exceed three years. In case of agreementsconcluded for an indeterminate period, each party may withdraw ongiving six months’ notice.

> 
*Antitrust rules*

In accordance with Law No. 287 of October 10, 1990, any mergeror acquisition of sole or joint control over a company that wouldcreate or strengthen a dominant position in the domestic marketin a manner that eliminates or significantly reduces competitionis prohibited and mergers and acquisition of specified dimensionmust be subject to preventive authorization of Italian AntitrustAuthority10. However, if the acquiring party and thecompany to be acquired operate in more than one EU member stateand together exceed certain revenue thresholds, the antitrustapproval of the acquisition falls within the exclusivejurisdiction of the European Commission.

> 
*Shareholders’ meetings*

The Shareholders’ Meeting could be "ordinary"or "extraordinary". In particular, an ordinary meetingappoints and revokes directors and statutory auditors, approvesfinancial statements within 120 days from the end of each fiscalyear (December 31) and vote on other issues that can be definedin the By-laws, while an extraordinary meeting approvesamendments in By-laws and extraordinary transactions, such ascapital increases and mergers.

The notice of a Shareholders’ Meeting may specify twomeeting dates ("calls") for ordinary meetings and threecalls, in case of listed companies, for extraordinaryshareholders’ meetings. Shareholders’ meetings areusually held at the Company registered office unless otherwiseresolved by the Board of Directors, provided however they areheld in Italy.

Meetings are called by Eni’s Board of Directors whenrequired or deemed necessary, or on request of shareholdersrepresenting at least 10% of outstanding shares, who must providean agenda of the matters to be discussed to the Chairman of theBoard of Directors. Meetings may also be called, by the Board ofStatutory Auditors or by two auditors, provided that such callhas been notified in advance. Shareholders representing at leastone fortieth of Eni’s share capital, both on an individualand a cumulative basis, may ask, within five days as of the dateof publication of the Shareholders’ Meeting notice, to addother items in the agenda. The request shall contain the mattersto be proposed to the Shareholders’ Meeting. Said facultymay not be exercised on the matters upon which, pursuant to theapplicable legislation, the Shareholders’ Meeting resolveson the basis of a proposal of the Board of Directors or on thebasis of a project or report of the Board. The integrationsaccepted by the Board shall be published, through a specificnotice, at least ten days before the Shareholders’ Meetingdate.

The attendance quorum for an ordinary meeting on first call isat least 50% of the outstanding ordinary shares, while on secondcall there is no attendance quorum requirement. At a duly calledordinary meeting, in both first and second calls, resolutions maybe approved by a simple majority of the shares represented at themeeting.

The attendance quorum required for a valid shareholder meetingat an extraordinary meeting is at least 50% of the company’sshare capital on first call, or more than 1/3 or at least 1/5 ofthe company’s share capital, on second call and third call,respectively. On first, second and third call, resolutions may beapproved by a majority of 2/3 of the shares represented at theShareholders’ Meeting.

With the aim of facilitating the attendance of shareholders,according to law and Article 13 of the By-laws, calls formeetings are published, at least 30 days before the date fixedfor the meeting on first call, in the Official Gazette of theItalian Republic or in the "Il Sole 24 Ore","Corriere della Sera" and "Financial Times"newspapers. The notice is filed with Borsa Italiana and publishedon the Company website, also. The reports and proposals of theBoard of Directors for any item on the agenda of the meetingtogether with the financial statements to be submitted to theshareholders’ approval, must be deposited at theshareholders’ disposal at the Company’s registeredoffice and at Borsa Italiana’s, during the 15 days beforethe Shareholders’ Meeting.

 

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| (10) |   | Autorità        garante per la concorrenza ed il mercato (AGCM -        www.agcm.it). |
|------|--------|--------------------------------------------------------------------------------------------|

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The shareholders are entitled to attend and vote at ordinaryand extraordinary shareholders’ meetings. Each holder isentitled to cast one vote for each share held. Votes may be castpersonally, by proxy or by mail, in accordance with applicableregulations.

Admission to the Shareholders’ Meeting is granted toshareholders who deliver the notification of attendance issued byfinancial intermediaries, under applicable laws, at least twobusiness days prior to the date of the meeting on first call. Thecommunication can be withdrawn, through the financialintermediaries, in which case shareholders lose the right toparticipate. Shareholders may attend the meeting by proxy.Directors, Statutory Auditors, and employees of Eni or of theirsubsidiary companies, as well as the External Auditors of Eni,and its subsidiary companies, may not be appointed proxies. Anyone proxy may not represent more than 200 shareholders. A proxymay be appointed only for a single meeting, including the first,second and third call thereof, unless the proxy is general orgiven by a company, association, foundation, other entities orinstitutions to its employees. Rules relating to proxiessolicitation are established by Decree No. 58/1998 and therelated Consob Decision No. 11971/1999. Accordingly whereby: (i)proxies may be solicited, collected or exercised by banks,investment firms and shareholders’ associations; (ii)proxies may be granted only in respect of shareholders’meetings that have been called; and (iii) proxies may be limitedto voting on particular proposals.

Decree No. 58 provisions also allow companies to implementvote by mail procedures.

Eni’s By-laws allow vote by mail and the collection ofproxies in Articles 13 and 14. Vote by mail can be revoked byexpress communication sent to the Company at least one day beforethe meeting. Persons that intend to attend the meeting as legalor voluntary representatives of other shareholders must presentthe documentation confirming their power to the proper office ofthe Company according to the dates and forms indicated in thecall for the meeting. In addition, as provided by Article 14 ofEni’s By-laws, in order to simplify the collection ofproxies issued by shareholders that are also employees of Eni andGroup companies and members of associations of shareholders thatcomply with current regulations, Eni provides areas forcommunicating and collecting proxies to said associations in waysto be agreed from time to time with their legal representatives.

There are no limitations arising under Italian law or theEni’s By-laws on the right of non-resident or foreignpersons to hold or vote the shares other than limitations thatapply generally to all shareholders.

Meetings are conducted according to the "Eni’sShareholders’ Meeting Regulation" as approved by theordinary Shareholders’ Meeting of Eni on December 4, 1998and amended by the ordinary Shareholders’ Meeting held onMay 28, 2004 in order to adequate its provisions to new rulesintroduced in the Civil Code on this matter.

During shareholders’ meetings, the Board of Directorsprovides wide disclosure on items examined and shareholders canrequest information on issues in the agenda. Information isprovided within the limits of confidentiality, taking account ofapplicable rules regulating price sensitive information.

> 
*Subscription rights*

New shares may be issued pursuant to a resolution ofshareholders at an extraordinary meeting. Under the Italian law,shareholders have a pre-emptive right to subscribe for new issuesof shares and corporate bonds convertible into shares inproportion to their respective shareholdings. Subject to certainconditions, principally designated to prevent dilution of therights of shareholders, this right may be waived or limited byresolution taken by an extraordinary Shareholders’ Meetingby the affirmative vote of more than 50% of the sharesoutstanding. Such percentage applies to all calls of the meeting.The preemptive right is waived by the law in specific cases, suchas non-cash contributions.

> 
*Liquidation rights*

Under the Italian law, subject to the satisfaction of theclaims of all other creditors, shareholders are entitled to thedistribution of the remaining liquidated assets of Eni inproportion to the nominal value of their shares. Holders ofsavings shares and preferred shares, if foreseen by the By-laws,in the event such shares are issued by Eni, would be entitled toa preferred right to distribution from liquidation up to theirnominal value. Thereafter, if there are surplus assets, ordinaryshareholders rank equally in the distribution of such assets.Shares rank pari passu among ordinary shareholders in aliquidation.

 

 

**Material Contracts**

None.

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**Documents on Display**

It is possible to read and copy documents referred to in thisannual report on Form 20-F that have been filed with the SEC atthe SEC’s public reference room located at 100 F Street, NE,Room 1580, Washington, DC 20549 and at the SEC’s otherpublic reference rooms in New York City and Chicago. Please callthe SEC at 1-800-SEC-0330 for further information on the publicreference rooms and their copy charges. The SEC filings are alsoavailable to the public from commercial document retrievalservices and in the website maintained by the SEC at www.sec.gov.It is also possible to read and copy documents referred to inthis annual report on Form 20-F at the New York Stock Exchange,20 Broad Street, 17th floor, New York.

 

 

**Exchange Controls**

There are no exchange controls in Italy. Residents andnon-residents of Italy may effect any investments, divestmentsand other transactions that entail a transfer of assets to orfrom Italy, subject only to the reporting, record-keeping anddisclosure requirements described below. In particular, residentsof Italy may hold foreign currency and foreign securities of anykind, within and outside Italy, while non-residents may invest inItalian securities without restriction and may export from Italycash, instruments of credit or payment and securities, whether inforeign currency or euro, representing interest, dividends, otherasset distributions and the proceeds of dispositions.

Updated reporting and record-keeping requirements arecontained in the Italian legislation which implements an EUdirective regarding the free movement of capital. Suchlegislation requires that transfers into or out of Italy of cashor securities in excess of euro 12.5 thousand be reported inwriting to the Ufficio Italiano Cambi (the Italian ExchangeOffice) by residents or non-residents that effect such transfersdirectly, or by banks, securities dealers or Poste Italiane SpA(Italian Mail) that effect such transactions on their behalf. Inaddition, banks, securities dealers or Poste Italiane SpAeffecting such transactions on behalf of residents ornon-residents of Italy are required to maintain records of suchtransactions for five years, which records may be inspected atany time by Italian tax and judicial authorities.

Non-compliance with these reporting and record-keepingrequirements may result in administrative fines or, in the caseof false reporting and in certain cases of incomplete reporting,criminal penalties. The Ufficio Italiano Cambi will maintainreports for a period of ten years and may use them, directly orthrough other government offices, to police money laundering, taxevasion and any other crime or violation.

 

 

**Taxation**

*The information set forth below is a summary only, andItalian, the United States and other tax laws may change fromtime to time. Holders of shares and ADRs should consult withtheir professional advisors as to the tax consequences of theirownership and disposition of the shares and ADRs, including, inparticular, the effect of tax laws of any other jurisdiction.*

 

> 
***Italian Taxation***

The following is a summary of the material Italian taxconsequences of the ownership and disposition of shares or ADRsas at the date hereof and does not purport to be a completeanalysis of all potential tax effects relevant to the ownershipor disposition of shares or ADRs.

> 
*Income tax*

Dividends, in respect of 2008 profits, received by Italianresident individuals in relation to interest exceeding 2% of thevoting rights or 5% of the share capital ("substantialinterest") are included in the taxable income subject topersonal income tax to the extent of 49.72% of their amount.Personal income tax applies at progressive rates ranging from 23%to 43% plus local surtaxes. Dividends received by Italianresident individuals in relation to non-substantial interest notrelated to the conduct of a business are subject to a substitutetax of 12.5% withheld at the source by the dividend paying agent.This being the case, the dividend is not to be included in theindividual’s tax return. If the non-substantial interest isrelated to the conduct of a business, dividends received inrespect of 2008 profits are included in the taxable businessincome to the extent of 49.72% of their amount.

Despite the above statement, dividends are included in thetaxable income at 40% to the extent they relate to un-distributedprofit of 2007 and previous years.

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Dividends received by Italian pension funds are included inthe overall result of the pension funds subject to an 11%substitute tax. Dividends received by Italian collectiveinvestment funds are included in the overall result of thecollective investment funds subject to a 12.5% substitute tax.Dividends received by Italian real estate investment funds arenot subject to tax in the hands of the real estate investmentfunds (under certain circumstances a 1% tax on net asset value isapplied). Entities exempt from IRES (company income tax) aresubject to the substitute tax at the rate of 27%.

Dividends paid to non-Italian residents are subject to thesame substitute tax levied at source by the dividend paying agentat the rate of 27%, provided that the interest is not connectedto an Italian permanent establishment. Up to four-ninths of thesubstitute tax withheld might be recovered by the non-residentshareholder from the Italian Tax Authorities upon provision ofevidence of full payment of income tax on such dividend inhis/her country of residence in an amount at least equal to thetotal refund claimed.

Dividends are subject to the 1.375% substitute tax introducedby Financial Bill for 2008 where the conditions in Article 27,paragraph 3-ter, Presidential Decree No. 600 of 1973 are met,i.e. dividends are paid to companies and entities subject to acorporate income tax in a European Union member state or inNorway. 

The substitute tax may also be reduced under the tax treaty inforce between Italy and the country of residence of theBeneficial Owner of the dividend. Italy has executed income taxtreaties with approximately 70 foreign countries, including allEU member states, Argentina, Australia, Brazil, Canada, Japan,New Zealand, Norway, Switzerland, the United States and somecountries in Africa, the Middle East and the Far East. Generallyspeaking, it should be noted that tax treaties are not applicablewhere the holder is a tax-exempt entity or, with few exceptions,a partnership or a trust.

In order to obtain the treaty benefit (reduced substitute taxrate) at the same time of payment, the Beneficial Owner must filean application to the dividend paying agent chosen by theDepositary stating the existence of the conditions for theapplicability of the treaty benefit, together with acertification issued by the foreign Tax Authorities stating thatthe shareholder is a resident of that country for treatypurposes.

Under the tax treaty between the United States and Italy,dividends derived and beneficially owned by a U.S. resident whoholds less than 10% of the Company’s shares are subject toan Italian withholding or substitute tax at a reduced rate of15%, provided that the interest is not effectively connected witha permanent establishment in Italy through which the U.S.resident carries on a business or a fixed establishment in Italythrough which such U.S. resident performs independent personalservices (for further details please refer to the relevantprovisions set forth in the Italy-U.S. Tax Treaty). In theabsence of such conditions, the dividend paying agent will deductfrom the gross amount of the dividend the substitute tax at thestatutory rate of 27%. The threshold holding will be increased to25% following a new tax treaty that has been ratified.

Based on the certification procedure required by the ItalianTax Authorities, to benefit from the direct application of the15% substitute tax the U.S. shareholder must provide the dividendpaying agent with a certificate obtained from the U.S. InternalRevenue Service (the "IRS") with respect to eachdividend payment. The request for that certificate must include astatement, signed under penalties for perjury, to the effect thatthe shareholder is a U.S. resident individual or corporation, anddoes not maintain a permanent establishment in Italy, and mustset forth other required information. The normal time forprocessing requests for certification by the IRS is normallyabout six to eight weeks.

Where the Beneficial Owner has not provided the abovementioned documentation, the dividend paying agent will deductfrom the gross amount of the dividend the substitute tax at thestatutory rate of 27%. The U.S. recipient will then be entitledto claim from the Italian Tax Authorities the difference("treaty refund") between the domestic rate and thetreaty one by filing specific forms (certificate) with theItalian Tax Authorities.

According to the Italian tax law as reflected in the DepositAgreement, the Company is not involved: (i) in withholdingamounts due by holders of ADRs to relevant taxing authorities inconnection with any distributions relating to ADRs; or (ii) inthe procedures through which certain holders of ADRs may obtaintax rebates, credits, refunds or other similar benefits. Pursuantto the Deposit Agreement, the custodian and the Depositary haveundertaken to use reasonable efforts to make and maintainarrangements to enable persons that are considered to be residentin United States for purposes of applicable law to receive anyrebates or tax credits (pursuant to treaty or otherwise) relatingto distributions on the ADRs to which such persons are entitled.In addition, the Depositary has agreed to establish procedures toenable all holders to take advantage of any rebates or taxcredits (pursuant to treaty or otherwise) relating todistributions on the ADRs to which such holders are entitled andto provide, at least annually, a written notice, in a formpreviously agreed to by the Company, to the holders of ADRs ofany necessary actions to be undertaken by such Holders.

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> 
*Capital gains tax*

This paragraph applies with respect to capital gains out ofthe scope of a business activity carried out in Italy.

Gains realized by Italian resident individuals upon the saleof substantial interest is included in the taxable base subjectto personal income tax to the extent of 49.72% of their amount,while gains realized upon the sale of non substantial interest issubject to a substitute tax at a 12.5% rate.

For gains deriving from the sale of non substantial interest,two different systems may be applied at the option of theshareholder as an alternative to the filing of the tax return:

| • |   | the so-called        "administered savings" tax regime (risparmio        amministrato), based on which intermediaries acting as        shares depositaries shall apply a substitute tax (12.5%)        on each gain, on a cash basis. If the sale of shares        generated a loss, said loss may be carried forward up to        the fourth following year; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | the so-called        "portfolio management" tax regime (risparmio        gestito) which is applicable when the shares form part of        a portfolio managed by an Italian asset management        company. The accrued net profit of the portfolio is        subject to a 12.5% substitute tax to be applied by the        portfolio.                           |

Gains realized by non-residents from non substantial interestin listed companies are deemed not to be realized in Italy andconsequently are not subject to the capital gains tax.

On the contrary, gains realized by non-residents fromsubstantial interest even in listed companies are deemed to berealized in Italy and consequently they are subject to thecapital gains tax.

However double taxation treaties may eliminate the capitalgains tax. Under the income tax convention between the UnitedStates and Italy, a U.S. resident will not be subject to thecapital gains tax unless the shares or ADRs form part of thebusiness property of a permanent establishment of the holder inItaly or pertain to a fixed establishment available to ashareholder in Italy for the purposes of performing independentpersonal services. U.S. residents who sell shares may be requiredto produce appropriate documentation establishing that theabove-mentioned conditions of non-taxability pursuant to theconvention have been satisfied.

> 
*Inheritance and gift tax*

Pursuant to Law Decree No. 262 of October 3, 2006, convertedwith amendments by Law No. 286 of November 24, 2006 effectivefrom November 29, 2006, and Law No. 296 of December 27, 2006, thetransfers of any valuable assets (including shares) as a resultof death or donation (or other transfers for no consideration)and the creation of liens on such assets for a specific purposeare taxed as follows:

| (a) |   | 4 per cent: if the transfer        is made to spouses and direct descendants or ancestors;        in this case, the transfer is subject to tax on the value        exceeding euro 1,000,000 (per beneficiary);        |
|-----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) |   | 6 per cent: if the transfer        if made to brothers and sisters; in this case, the        transfer is subject to the tax on the value exceeding        euro 100,000 (per beneficiary);                             |
| (c) |   | 6 per cent: if the transfer        is made to relatives up to the fourth degree, to persons        related by direct affinity as well as to persons related        by collateral affinity up to the third degree; and |
| (d) |   | 8 per cent: in all other        cases.                                                                                                                                                                                |

If the transfer is made in favor of persons with severedisabilities, the tax applies on the value exceeding euro1,500,000. Moreover, an anti-avoidance rule is provided for byLaw No. 383 of October 18, 2001 for any gift of assets (includingshares) which, if sold for consideration, would give rise tocapital gains subject to a substitute tax (imposta sostitutiva)provided for by Decree No. 461 of November 21, 1997. Inparticular, if the donee sells the shares for considerationwithin five years from the receipt thereof as a gift, the doneeis required to pay a relevant substitute tax on capital gains asif the gift had never taken place.

 

> 
***United States Taxation***

The following is a summary of certain U.S. federal income taxconsequences to U.S. Holders (as defined below) of the ownershipand disposition of Shares or ADRs. This summary is addressed toU.S. Holders that hold Shares or ADRs as capital assets, and doesnot purport to address all material tax consequences of theownership of Shares or ADRs. The summary does not address specialclasses of investors, such as tax-exempt entities, dealers insecurities, traders in securities that elect to mark to market,certain insurance companies, broker-dealers, investors liable foralternative minimum tax, investors that actually orconstructively own 10% or more of Eni SpA’s Shares,investors that hold Shares or ADRs as part of a straddle or ahedging or conversion transaction and investors whose"functional currency" is not the U.S. dollar.

This summary is based on the tax laws of the United States(including the Internal Revenue Code of 1986, as amended, (the"Code") its legislative history, existing and proposedregulations thereunder, published rulings and court decisions) asin effect on the date hereof, and which are subject to change (orchanges in interpretation), 

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possibly with retroactive effect. The summary is based in parton representations of the Depositary and assumes that eachobligation in the Deposit Agreement and any related agreementwill be performed in accordance with its terms. U.S. Holdersshould consult their own tax advisors to determine the U.S.federal, state and local and foreign tax consequences to them ofthe ownership and disposition of Shares or ADRs.

As used in this section, the term "U.S. Holder"means a beneficial owner of Shares or ADRs who or that is:(i) a citizen or resident of the United States; (ii) adomestic corporation; (iii) an estate the income of which issubject to the United States federal income tax without regard toits source; or (iv) a trust if a court within the United Statesis able to exercise primary supervision over the administrationof the trust and one or more United States persons have theauthority to control all substantial decisions of the trust.

The discussion does not address any aspects of the UnitedStates taxation other than federal income taxation. Inparticular, U.S. Holders are urged to confirm their eligibilityfor benefits under the income tax convention between the UnitedStates and Italy with their advisors and to discuss with theiradvisors any possible consequences of their failure to qualifyfor such benefits.

In general, and taking into account the earlier assumptions,for the United States federal income tax purposes, U.S. Holderswho own ADRs evidencing ADRs will be treated as owners of theunderlying Shares. Exchanges of Shares for ADRs and ADRs forshares generally will not be subject to the United States federalincome tax.

> 
*Dividends*

Subject to the passive foreign investment company, or PFIC,rules discussed below, distributions paid on the shares generallywill be treated as dividends for U.S. federal income tax purposesto the extent paid out of Eni SpA’s current or accumulatedearnings and profits as determined for U.S. federal income taxpurposes, but will not be eligible for the dividendsreceived-deduction generally allowed to corporations. To theextent that a distribution exceeds Eni SpA’s earnings andprofits, it will be treated, first, as a non-taxable return ofcapital to the extent of the U.S. Holder’s tax basis in theshares or ADRs, and thereafter as capital gain. A U.S. Holderwill be subject to U.S. federal taxation, on the date of actualor constructive receipt by the U.S. Holder (in the case ofShares) or by the Depositary (in the case of ADRs) with respectto the gross amount of any dividends, including any Italian taxwithheld therefrom, without regard to whether any portion of suchtax may be refunded to the U.S. Holder by the Italian taxauthorities. If you are a non-corporate U.S. Holder, dividendspaid to you in taxable years beginning before January 1, 2011that constitute qualified dividend income will be taxable to youat a maximum tax rate of 15% provided that you hold the Shares orADRs for more than 60 days during the 121-day period beginning 60days before the ex-dividend date and meet other holding periodrequirements. Dividends we pay with respect to the shares or ADRsgenerally will be qualified dividend income. The amount of thedividend distribution that you must include in your income as aU.S. Holder will be the U.S. dollar value of the euro paymentsmade, determined at the spot euro/U.S. dollar rate on the datethe dividend distribution is includible in your income,regardless of whether the payment is in fact converted into U.S.dollars. Generally, any gain or loss resulting from currencyexchange fluctuations during the period from the date you includethe dividend payment in income to the date you convert thepayment into U.S. dollars will be treated as ordinary income orloss and will not be eligible for the special tax rate applicableto qualified dividend income. The gain or loss generally will beincome or loss from sources within the United States for foreigntax credit limitation purposes.

Subject to certain conditions and limitations, Italian taxwithheld from dividends will be treated as a foreign income taxeligible for credit against the U.S. Holder’s U.S. federalincome tax liability. Special rules apply in determining theforeign tax credit limitation with respect to dividends that aresubject to the maximum 15% tax rate. To the extent a refund ofthe tax withheld is available to a U.S. Holder under Italian lawor under the income tax convention, the amount of tax withheldthat is refundable will not be eligible for credit against yourUnited States federal income tax liability. See "ItalianTaxation – Income Tax" above, for the procedures forobtaining a tax refund. Dividends paid on the Shares will betreated as income from sources outside the United States. Forforeign tax credit purposes, dividends will be income fromsources outside the United States and will, depending on yourcircumstances, generally be either "passive" or"general" income for purposes of computing the foreigntax credit allowable to you.

> 
*Sale or exchange of shares*

Subject to the PFIC rules discussed below, a U.S. Holdergenerally will recognize gain or loss for U.S. federal income taxpurposes on the sale or exchange of Shares or ADRs equal to thedifference between the U.S. Holder’s adjusted basis in theshares or ADRs (determined in U.S. dollars), as the case may be,and the amount realized on the sale or exchange (or if the amountrealized is denominated in a foreign currency its U.S. dollarequivalent, determined at the spot rate on the date ofdisposition). Generally, such gain or loss will be treated ascapital gain or loss if the Shares or ADRs are held as capitalassets and will be a long-term capital gain or loss if the sharesor ADRs have been held for more than one year on the date of suchsale or exchange. Long-term capital gain of a non-corporate U.S.Holder that is recognized in taxable years beginning beforeJanuary 1, 2011 is generally subject to a 

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maximum tax rate of 15%. In addition, any such gain or lossrealized by a U.S. Holder generally will be treated as U.S.source income or loss for U.S. foreign tax credit purposes.

> 
*PFIC rules*

Eni SpA believes that shares and ADRs should not be treated asstock of a PFIC for United States federal income tax purposes,but this conclusion is a factual determination that is madeannually and thus may be subject to change. If Eni SpA were to betreated as a PFIC, unless a U.S. holder elects to be taxedannually on a mark-to-market basis with respect to the shares orADRs, gain realized on the sale or other disposition of yourshares or ADRs would in general not be treated as capital gain.Instead, if you are a U.S. holder, you would be treated as if youhad realized such gain and certain "excessdistributions" ratably over your holding period for theshares or ADRs and would be taxed at the highest tax rate ineffect for each such year to which the gain was allocated,together with an interest charge in respect of the taxattributable to each such year. With certain exceptions, yourshares or ADRs will be treated as stock in a PFIC if Eni SpA werea PFIC at any time during your holding period in your shares orADRs. Dividends that you receive from Eni SpA will not beeligible for the special tax rates applicable to qualifieddividend income if Eni SpA is treated as a PFIC with respect toyou either in the taxable year of the distribution or thepreceding taxable year, but instead will be taxable at ratesapplicable to ordinary income.

 

 

**Item 11. QUALITATIVE AND QUANTITATIVEDISCLOSURES ABOUT MARKET RISK**

Market risk is the possibility that the exposure tofluctuations in currency exchange rates, interest rates orcommodity prices will adversely affect the value of theGroup’s financial assets, liabilities or expected futurecash flows. Eni’s financial performance is particularlysensitive to changes in the price of crude oil and movements inthe euro/U.S. $ exchange rate. Overall, a rise in the price ofcrude oil has a positive effect on Eni’s results fromoperations and liquidity due to increased revenues from oil andgas production. Conversely, a decline in crude oil prices reducesEni’s results from operations and liquidity.

The impact of changes in crude oil prices on theCompany’s downstream gas and refining and marketingbusinesses and petrochemical operations depends upon the speed atwhich the prices of finished products adjust to reflect changesin crude oil prices. In addition, the Group’s activitiesare, to various degrees, sensitive to fluctuations in theeuro/U.S. $ exchange rate as commodities are generally pricedinternationally in U.S. dollars or linked to dollar denominatedproducts as in the case of gas prices. Overall, an appreciationof the euro against the dollar reduces the Group’s resultsfrom operations and liquidity, and vice versa.

Please refer to Note 29 to the Consolidated FinancialStatements for a qualitative and quantitative discussion of theCompany’s exposure to market risks. Please also refer toNotes 7 and 20 to the Consolidated Financial Statements fordetails of the different derivatives owned by the Company inthese markets.

As part of its financing and cash management activities, theCompany uses derivative instruments to manage its exposure tochanges in interest rates and foreign exchange rates. Theseinstruments are principally interest rate and currency swaps. TheCompany also enters into commodity derivatives as part of itsordinary commercial and trading activities and, from time totime, to hedge the exposure to variability in future cash flowsdue to movements in commodity prices, in view of pursuingacquisitions of oil and gas reserves as part of theCompany’s ordinary asset portfolio management or otherstrategic initiatives.

These instruments and their accounting treatment are detailedin Notes 7 and 25 to the Financial Statements.

 

 

**Item 12. DESCRIPTION OF SECURITIES OTHERTHAN EQUITY SECURITIES**

Not applicable.

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**PART II**

**Item 13. DEFAULTS, DIVIDEND ARREARAGES ANDDELINQUENCIES**

None.

 

 

**Item 14. MATERIAL MODIFICATIONS TO THERIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS**

None.

 

 

**Item 15. CONTROLS AND PROCEDURES**

> 
*Disclosure controls and procedures*

In designing and evaluating the Company’s disclosurecontrols and procedures (as defined in Rules 13a-15(e) and15d-15(e) under the Securities Exchange Act of 1934 (the"Exchange Act")), the Company’s management,including the Chief Executive Officer and the Chief FinancialOfficer, recognized that any controls and procedures, no matterhow well designed and operated, can provide only reasonableassurance of achieving the desired control objectives, and theCompany’s management necessarily was required to apply itsjudgment in evaluating the cost benefit relationship of possiblecontrols and procedures. Because of the inherent limitations inall control systems, no evaluation of controls can provideabsolute assurance that all control issues and instances offraud, if any, within the Company have been detected.

It should be noted that the Company has investments in certainnon-consolidated entities. As the Company does not control ormanage these entities, its disclosure controls and procedureswith respect to such entities are necessarily more limited thanthose it maintains with respect to its consolidated subsidiaries.

The Company’s management, with the participation of theprincipal executive officer and principal financial officer, hasevaluated the effectiveness of the design and operation of itsdisclosure controls and procedures pursuant to Rule 13a-14(c)under the Exchange Act as of the end of the period covered bythis Annual Report on Form 20-F. Based on that evaluation, theprincipal executive officer and principal financial officer haveconcluded that these disclosure controls and procedures areeffective.

> 
*Management’s Annual Report on Internal Control    over Financial Reporting*

The Company’s management is responsible for establishingand maintaining adequate internal control over financialreporting as defined in Exchange Act Rules 13a-15(f). Because ofits inherent limitations, internal control over financialreporting may not prevent or detect misstatements and even whendetermined to be effective can only provide reasonable assurancewith respect to financial statement preparation and presentation.Also, the effectiveness of an internal control system may changeover time.

The Internal Control Committee assists the Board of Directorsin setting out the main principles for the internal controlsystem so as to appropriately identify and adequately evaluate,manage, and monitor the main risks related to the Company and itssubsidiaries, by laying down the compatibility criteria betweensaid risks and sound corporate management. In addition thisCommittee assesses, at least annually, the adequacy,effectiveness, and actual operations of the internal controlsystem.

The Company’s management, including the Chief ExecutiveOfficer and the Chief Financial Officer, conducted an evaluationof the effectiveness of its internal control over financialreporting based on the Internal Control - Integrated Frameworkissued by the Committee of Sponsoring Organizations of theTreadway Commission ("COSO"). Based on the results ofthis evaluation, the Group’s management concluded that itsinternal control over financial reporting was effective as ofDecember 31, 2008.

The effectiveness of the Company’s internal control overfinancial reporting as of December 31, 2008, has been audited byPricewaterhouseCoopers SpA, an independent registered publicaccounting firm, as stated in its report that is included onpages F-1 and F-2 of this Annual Report on Form 20-F.

> 
*Changes in Internal Control over Financial Reporting*

There have not been changes in the Company’s internalcontrol over financial reporting that occurred during the periodcovered by this Form 20-F that have materially affected, or arereasonably likely to materially affect, the Company’sinternal control over financial reporting.

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**Item 16A. Board of Statutory AuditorsFinancial Expert**

Eni’s Board of Statutory Auditors has determined thatfive members of Eni’s Board of Statutory Auditors, qualifyas "audit committee financial expert", as defined inItem 16A of Form 20-F. These five members are: Ugo Marinelli, whois the Chairman of the Board, and Roberto Ferranti, LuigiMandolesi, Tiziano Onesti and Giorgio Silva. All members areindependent.

 

 

**Item 16B. Code of Ethics**

Eni adopted a code of ethics that applies to all Eni’semployees including Eni’s principal executive officer,principal financial officer and principal accounting officer. Enipublished its code of ethics on Eni’s website. It isaccessible at www.eni.it, under the section Sustainability –Corporate Governance and Corporate Ethics – Code of Ethics.A copy of this code of ethics is included as an exhibit to thisAnnual Report on Form 20-F.

Eni’s code of ethics contains ethical guidelines,describes corporate values and requires standards of businessconduct and moral integrity. The ethical guidelines are designedto deter wrongdoing and to promote honest and ethical conduct,compliance with applicable laws and regulations and internalreporting of violations of the guidelines. The code affirms theprinciples of accounting transparency and internal control andendorses human rights and the issue of the sustainability of thebusiness model.

 

 

**Item 16C. Principal Accountant Fees andServices**

PricewaterhouseCoopers SpA has served as Eni principalindependent public auditor for fiscal years 2006, 2007 and 2008for which audited Consolidated Financial Statements appear inthis Annual Report on Form 20-F.

The following table shows total fees paid by Eni, itsconsolidated and non-consolidated subsidiaries and Eni’sshare of fees incurred by joint ventures for services provided byEni public auditor PricewaterhouseCoopers and its member firms,with respect to the years indicated:

|   | **Year ended December 31,** |
|--------|-----------------------------|

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   | **(thousand euro)** |
|--------|---------------------|

| Audit fees                |   | 22,240     |   | 26,383     |   | 27,962     |
|---------------------------|--------|------------|--------|------------|--------|------------|
| Audit-related        fees |   | 166        |   | 169        |   | 152        |
| Tax fees                  |   | 303        |   | 81         |   | 46         |
| All other        fees     |   | 6          |   | 120        |   | 1          |
| **Total**                 |   | **22,715** |   | **26,753** |   | **28,161** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Audit Fees include professional services rendered by theprincipal accountant for the audit of the registrant’sannual financial statements or services that are normallyprovided by the accountant in connection with statutory andregulatory filings or engagements, including the audit on theCompany’s internal control over financial reporting.

Audit Related Fees include assurance and related services bythe principal accountant that are reasonably related to theperformance of the audit or review of the registrant’sfinancial statements and are not reported as Audit Fees in thisItem. The fees disclosed in this category mainly include auditsof pension and benefit plans, merger and acquisition duediligence, audit and consultancy services rendered in connectionwith acquisition deals, certification services not provided forby law and regulations and consultations concerning financialaccounting and reporting standards.

Tax Fees include professional services rendered by theprincipal accountant for tax compliance, tax advice, and taxplanning. The fees disclosed in this category mainly include feesbilled for the assistance with compliance and reporting of incomeand value added taxes, assistance with assessment of new orchanging tax regimes, tax consultancy in connection with mergerand acquisition deals, services rendered in connection with taxrefunds, assistance rendered on occasion of tax inspections andin connection with tax claims and recourses and assistance withassessing relevant rules, regulations and facts going into Enicorrespondence with tax authorities.

All Other Fees include products and services provided by theprincipal accountant, other than the services reported in AuditFees, Audit-Related Fees and Tax Fees of this Item and consistsprimarily of fees billed for consultancy services related to ITand secretarial services that are permissible under applicablerules and regulations.

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> 
*Pre-approval policies and procedures of the Internal    Control Committee*

The Board of Statutory Auditors has adopted a pre-approvalpolicy for audit and non-audit services that set forth theprocedures and the conditions pursuant to which services proposedto be performed by the principal auditors may be pre-approved.Such policy is applied to entities within the Eni Group which areeither controlled or jointly-controlled (directly or indirectly)by Eni SpA. According to this policy, permissible services withinthe other audit services category are pre-approved by the Boardof Statutory Auditors. The Board of Statutory Auditors approvalis required on a case by case basis for those requests regarding:(i) audit-related services; and (ii) non-audit services to beperformed by the external auditors which are permissible underapplicable rules and regulations. In such cases, theCompany’s internal audit department is charged withperforming an initial assessment of each request to be submittedto the Board of Statutory Auditors for approval. The internalaudit department periodically reports to Eni’s Board ofStatutory Auditors on the status of both pre-approved servicesand services approved on a case-by-case basis rendered by theexternal auditors.

During 2008, no audit-related fees, tax fees or othernon-audit fees were approved by the Board of Statutory Auditorspursuant to the de minimis exception to the pre-approvalrequirement provided by paragraph (c)(7)(i) (c) of Rule 2-01 ofRegulation S-X.

 

 

**Item 16D. Exemptions from the ListingStandards for Audit Committees**

Making use of the exemption provided by Rule 10A-3(c)(3) fornon-U.S. private issuers, Eni has identified the Board ofStatutory Auditors as the body that, starting from June 1, 2005,is performing the functions required by the SEC rules and theSarbanes-Oxley Act to be performed by the audit committees ofnon-U.S. companies listed on the NYSE (see "Item 6 –Board of Statutory Auditors" above).

 

 

**Item 16E. Purchases of Equity Securities bythe Issuer and Affiliated Purchasers**

The following tables present purchases of own shares by Enifrom the beginning of the program through May 4, 2009:

| **Period** |   | **Number of shares        (million)** |   | **Average price        (euro per share)** |   | **Total cost****(euro million)** |   | **Share         capital %** |
|------------|--------|---------------------------------------|--------|-------------------------------------------|--------|----------------------------------|--------|-----------------------------|
|       |   |                                       |   |                                           |   |                                  |   |                             |

| 2000 (since September 1)                                                                           |   | 44.38      |   |   | 12.92     |   | 574       |   | 1.11     |
|----------------------------------------------------------------------------------------------------|--------|------------|--------|--------|-----------|--------|-----------|--------|----------|
| 2001                                                                                               |   | 110.00     |   |   | 13.58     |   | 1,494     |   | 2.75     |
| 2002                                                                                               |   | 52.26      |   |   | 14.74     |   | 771       |   | 1.30     |
| 2003                                                                                               |   | 23.94      |   |   | 13.76     |   | 329       |   | 0.60     |
| 2004                                                                                               |   | 4.23       |   |   | 16.60     |   | 70        |   | 0.10     |
| 2005                                                                                               |   | 47.06      |   |   | 21.97     |   | 1,034     |   | 1.18     |
| 2006                                                                                               |   | 53.13      |   |   | 23.35     |   | 1,241     |   | 1.33     |
| 2007                                                                                               |   | 27.56      |   |   | 24.69     |   | 680       |   | 0.68     |
| 2008                                                                                               |   | 35.90      |   |   | 21.67     |   | 778       |   | 0.90     |
| 2009,        through May 4, 2009                                                                   |   | -          |   |   | -         |   | -         |   | -        |
| **Total purchased as of May 4, 2009**                                                              |   | **398.47** |   |   | **17.49** |   | **6,971** |   | **9.95** |
| minus:                                                                                             |   |       |   |   |      |   |      |   |     |
| - stock options exercised and shares granted        pursuant to stock option and stock grant plans |   | (15.51     | )      |   |      |   |      |   |     |
| **Total        shares held in treasury**                                                           |   | **382.95** |   |   |      |   |      |   | **9.56** |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

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|   | **Total number of shares        purchased** |   | **Average price paid per        share (euro)** |   | **Total number of shares        purchased, as part of publicly announced plans or        programs** |   | **Maximum number of shares        that may yet be purchased under the plans or programs**.(2) |
|--------|---------------------------------------------|--------|------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------|
|   |                                             |   |                                                |   |                                                                                                     |   |                                                                                               |

| At December 31, 2007 (1)                  |   | 362,562,118 |   | 17.08 |   | 362,562,118     |   | 51,474,995     |
|-------------------------------------------|--------|-------------|--------|-------|--------|-----------------|--------|----------------|
| January        2008                       |   | 2,709,130   |   | 22.13 |   | 365,271,248     |   | 48,873,565     |
| February 2008                             |   | 3,380,161   |   | 22.25 |   | 368,651,409     |   | 45,504,204     |
| March 2008                                |   | 2,606,938   |   | 22.01 |   | 371,258,347     |   | 42,908,766     |
| April 2008 (3)                            |   | 2,242,200   |   | 23.41 |   | 373,500,547     |   | 40,678,566     |
| May 2008                                  |   | 2,728,900   |   | 25.74 |   | 376,229,447     |   | 37,949,666     |
| June 2008                                 |   | 2,982,450   |   | 24.50 |   | 379,211,897     |   | 34,967,216     |
| July 2008                                 |   | 2,823,050   |   | 22.37 |   | 382,034,947     |   | 32,144,166     |
| August 2008                               |   | 1,839,400   |   | 21.48 |   | 383,874,347     |   | 30,304,766     |
| September        2008                     |   | 13,426,200  |   | 19.79 |   | 397,300,547     |   | 16,878,566     |
| October 2008                              |   | 1,166,306   |   | 18.38 |   | 398,466,853     |   | 15,712,260     |
| November        2008                      |   | -           |   | -     |   | 398,466,853     |   | 15,712,260     |
| December 2008                             |   | -           |   | -     |   | 398,466,853     |   | 15,712,260     |
| January        2009                       |   | -           |   | -     |   | 398,466,853     |   | 15,712,260     |
| February 2009                             |   | -           |   | -     |   | 398,466,853     |   | 15,712,260     |
| March 2009                                |   | -           |   | -     |   | 398,466,853     |   | 15,712,260     |
| April 2009                                |   | -           |   | -     |   | 398,466,853     |   | 15,712,260     |
| **May        2009 (through May 4, 2009)** |   | **-**       |   | **-** |   | **398,466,853** |   | **15,712,260** |

|   |  |   |  |   |  |   |  |
|--------|--|--------|--|--------|--|--------|--|

----

| (1) |   | From May        2000, Eni’s Ordinary Shareholders’ Meeting has        authorized Eni’s Board of Directors to carry out a        program for the repurchase of own shares within such        limits as established by the Shareholders’ Meeting        itself. The shares are to be purchased on the Telematico        at a price no lower than their nominal value and no        higher than 5% over the reference price recorded on the        business day preceding each purchase.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) |   | Based on the        authorized purchase ceiling, deducting the total number        of shares purchased and adding back the number of stock        options exercised by and shares granted to Eni’s        managers pursuant to stock option and stock grant plans        as of Annual Shareholders’ Meeting date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| (3) |   | On April 29,        2008 Eni’s Ordinary Shareholders’ Meeting        authorized the continuation of the program for the        repurchase of own shares for a further 18-month period        and up to 400 million ordinary shares, nominal value euro        1 each, corresponding approximately to 10% of Eni’s        share capital, for an aggregate amount not exceeding euro        7.4 billion: The 400 million shares and the euro 7.4        billion thresholds take into account the number and        amount of Eni shares held in treasury as of April 29,        2008. As of April 29, 2008, Eni held in treasury 359.08        million own shares at a cost of euro 6,236 million. The        18-month period will expire in October 2009. According to        applicable regulations, the nominal value of shares so        purchased, including shares held by subsidiaries cannot        exceed 20% of a company’s share capital. Shares        purchased in excess of such 20% limit must be resold        within one year from the date of their purchase. |

 

 

**Item 16G.****Significant Differencesin Corporate Governance Practices as per Section 303A.11 of theNew York Stock Exchange Listed Company Manual**

*Corporate governance.*Eni’s governance structurefollows the traditional model as defined by the Italian CivilCode which provides for two main separate corporate bodies, theBoard of Directors and the Board of Statutory Auditors to whommanagement and monitoring duties are respectively entrusted.

This model differs from the U.S. one-tier model which providesfor the Board of Directors as the sole corporate body responsiblefor management and for the establishment of an Audit Committeewithin the same Board, for monitoring activities.

Below is a description of the most significant differencesbetween corporate governance practices followed by U.S. domesticcompanies under the NYSE standards and those followed by Eni,also with reference to Borsa Italiana Corporate Governance Codethat Eni adopted.

 

> 
**Independent Directors**

*NYSE standards.*Under NYSE standards listed U.S.companies’ Boards must have a majority of independentdirectors. A director qualifies as independent when the Boardaffirmatively determines that such director does not have amaterial relationship with the listed company (and itssubsidiaries), either directly, or indirectly. In particular, adirector may not be deemed independent if he/she or an immediatefamily member has a certain specific relationship with theissuer, its auditors or companies that have material businessrelationships with the issuer (e.g. he/she is an employee of theissuer or a partner of the auditor). In addition, a director cannot be considered independent in thethree-year "cooling-off" period following thetermination of any relationship that compromised adirector’s independence.

*Eni standards.*In Italy, the TUF states that at leastone member, or two members if the Board is composed by more thanseven members, must possess the independence requirementsprovided for Statutory Auditors of listed companies. 

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In particular, a director may not be deemed independent ifhe/she or an immediate family member has relationships with theissuer that could influence their autonomous judgment, with itsdirectors or with the companies in the same group of the issuer. Eni’s By-laws increases the number and states that at leastone member, if the Board is made up by up to five members, orthree Board members, in case the Board is made up by more thanfive members, shall have the independence requirement. Eni’s Code foresees further independence requirements, inline with the ones provided by the Borsa Italiana Code, thatrecommends that the Board of Directors includes an adequatenumber of independent non-executive directors in the sense thatthey do not maintain, nor have recently maintained, directly orindirectly, any business relationships with the issuer or personslinked to the issuer, of such a significance as to influencetheir autonomous judgment.In accordance with Eni’s By-laws, the Board of Directorsperiodically evaluates independence of Directors. Eni’s Codealso provides for the Board of Statutory Auditors to verify theproper application of criteria and procedures adopted by theBoard of Directors to evaluate the independence of its members.The results of the assessments of the Board shall be communicatedto the market.In accordance with Eni’s By-laws, should the independencerequirements be impaired or cease or the minimum number ofindependent directors diminish below the threshold set byEni’s By-laws, the Board declares the termination of officeof the member lacking said requirements and provides for hissubstitution. Board members are expected to inform the Company incase they lose their independence requirements or of any reasonsfor ineligibility or incompatibility that might arise.

 

> 
**Meetings of non Executive Directors**

*NYSE standards.*Non-executive directors, includingthose who are not independent, must meet at regularly scheduledexecutive sessions without management.In addition, if the group of non-executive directors includesdirectors who are not independent, independent directors shouldmeet separately at least once a year.

*Eni standards.*As provided by Eni’s Code theindependent Directors may hold meetings without the otherDirectors: this faculty was exercised on January 22, 2009.

 

> 
**Audit Committee**

*NYSE standards.* Listed U.S. companies must have anaudit committee that satisfies the requirements of Rule 10A-3under the Securities Exchange Act of 1934 and that complies withthe further provisions of the Sarbanes-Oxley Act and of Section303A.07 of the NYSE Listed Company Manual.

*Eni standards.* In its meeting of March 22, 2005,Eni’s Board of Directors, making use of the exemptionprovided by Rule 10A-3 for non-U.S. private issuers, hasidentified the Board of Statutory Auditors as the body that,starting from June 1, 2005, is performing the functions requiredby the SEC rules and the Sarbanes-Oxley Act to be performed bythe audit committees of non-U.S. companies listed on the NYSE(see paragraph "Board of Statutory Auditors" earlier).Under Section 303A.07 of the NYSE listed Company Manual auditcommittees of U.S. companies have further functions andresponsibilities which are not mandatory for non-U.S. privateissuers and which therefore are not included in the list offunctions shown in the paragraph referenced above.

 

> 
**Nominating/Corporate Governance Committee**

*NYSE standards.* U.S. listed companies must have anominating/corporate governance committee (or equivalent body)composed entirely of independent directors that are entrusted,among others, with the responsibility to identify individualsqualified to become board members and to select or recommenddirector nominees for submission to the Shareholders’Meeting, as well as to develop and recommend to the Board ofDirectors a set of corporate governance guidelines.

*Eni standards.*This provision is not applicable tonon-U.S. private issuers. The Borsa Italiana Code allows listedcompanies to have within the Board of Directors a committee fordirectors’ nominees proposals, above all when the Board ofDirectors detects difficulties in the shareholders’submission of nominees proposals, as could happen in publiclyowned companies. Eni has not set up a nominating committee, considering the natureof its shareholding as well as the circumstance that, underEni’s By-laws, directors are appointed by theShareholders’ Meeting based on lists presented byshareholders.

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> 
**Code of Business Conduct and Ethics**

*NYSE standards.*The NYSE listing standards require eachU.S. listed company to adopt a code of business conduct andethics for its directors, officers and employees, and promptlydisclose any waivers of the code for directors or executiveofficers. 

*Eni standards.*Eni’s Code of Ethic – adoptedon March 14, 2008, replacing the previous version of 1998 –represents a clear definition of the value system that Enirecognizes, accepts and upholds and the responsibilities that Eniassumes internally and externally in order to ensure that allbusiness activities are conducted in compliance with laws, in acontext of fair competition, with honesty, integrity, correctnessand in good faith, respecting the legitimate interests of allstakeholders with which Eni relates on ongoing basis:shareholders, employees, suppliers, customers, commercial andfinancial partners, and the local communities and institutions ofthe Countries where Eni operates. These values are stated in theCode of Ethics and all the people working for Eni, withoutexception or distinction, starting from Directors, seniormanagement and members of Company’s bodies, as alsorequested by the SEC rules and the Sarbanes-Oxley Act, arecommitted to observing and enforcing these principles withintheir function and responsibility. The Guarantor for the Code ofEthics – that is the Watch Structure of the "Model231" for the organizational, management and controlaccording to Legislative Decree No. 231/2001 – acts for theprotection and promotion of the above mentioned principles andevery six months presents a report on the implementation of theCode to the Internal Control Committee, to the Board of StatutoryAuditors and to the Chairman and the CEO, who reports on this tothe Board of Directors.

 

 

 

 

 

 

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**PART III**

**Item 17. FINANCIAL STATEMENTS**

Not applicable.

 

 

**Item 18. FINANCIAL STATEMENTS**

Index to Financial Statements:

|                                                                                                                               |   | **Page** |
|------------------------------------------------------------------------------------------------------------------------------------|--------|----------|
|                                                                                                                               |   |     |
| Report of Independent        Registered Public Accounting Firm                                                                     |   | F-1      |
|                                                                                                                               |   |     |
| Consolidated Balance Sheet        at December 31, 2008 and 2007                                                                    |   | F-3      |
|                                                                                                                               |   |     |
| Consolidated profit and loss        account for the years ended December 31, 2008, 2007 and        2006                            |   | F-4      |
|                                                                                                                               |   |     |
| Consolidated Statements of        changes in shareholder’s equity for the years ended        December 31, 2008, 2007 and 2006 |   | F-5      |
|                                                                                                                               |   |     |
| Consolidated Statement of        cash flows for the years ended December 31, 2008, 2007        and 2006                            |   | F-7      |
|                                                                                                                               |   |     |
| Supplemental cash flow        information for the years ended December 31, 2008, 2007        and 2006                              |   | F-9      |
|                                                                                                                               |   |     |
| Notes to the Consolidated        Financial Statements                                                                              |   | F-24     |

 

 

**Item 19. EXHIBITS**

1. By-laws of Eni SpA

8. List of subsidiaries

11. Code of Ethics

Certifications:

12.1. Certification pursuant to Rule13a-14(a) of the Securities Exchange Act

12.2. Certification pursuant to Rule13a-14(a) of the Securities Exchange Act

13.1. Certification furnished pursuant toRule 13a-14(b) of the Securities Exchange Act (such certificateis not deemed filed for purpose of Section 18 of the Exchange Actand not incorporated by reference with any filing under theSecurities Act)

13.2. Certification furnished pursuant toRule 13a-14(b) of the Securities Exchange Act (such certificateis not deemed filed for purpose of Section 18 of the Exchange Actand not incorporated by reference with any filing under theSecurities Act)

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**SIGNATURES**

The registrant certifies that it meets all of the requirementsfor filing on Form 20-F and has duly caused this annual report tobe signed on its behalf by the undersigned, thereunto dulyauthorized.

Date: May 14, 2009

 

 

 

 

 

 

 

| Eni SpA                           |
|-----------------------------------|
|                              |
| /s/ANTONIO CRISTODORO             |
|                                   |
|                              |
| Antonio Cristodoro                |
| Title: Deputy Corporate Secretary |

 

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**REPORT OF INDEPENDENT REGISTERED PUBLICACCOUNTING FIRM**

 

 

> 
To the Board of Directors and Shareholders of Eni            SpA.

 

In our opinion, the accompanying consolidated balance        sheets and the related consolidated profit and loss        accounts, consolidated statements of changes in        shareholders’ equity and consolidated statements of        cash flows present fairly, in all material respects, the        financial position of Eni SpA and its subsidiaries at        December 31, 2008 and December 31, 2007, and the results        of their operations and their cash flows for each of the        three years in the period ended December 31, 2008 in        conformity with International Financial Reporting        Standards as issued by the International Accounting        Standards Board. Also in our opinion, the Company        maintained, in all material respects, effective internal        control over financial reporting as of December 31, 2008,        based on criteria established in *Internal Control -        Integrated Framework* issued by the Committee of        Sponsoring Organizations of the Treadway Commission        (COSO). The Company's management is responsible for these        financial statements, for maintaining effective internal        control over financial reporting and for its assessment        of the effectiveness of internal control over financial        reporting, included in Management’s Annual Report on        Internal Control over Financial Reporting appearing in        Item 15 Controls and Procedures of the 2008 Annual Report        to Shareholders. Our responsibility is to express        opinions on these financial statements and on the        Company's internal control over financial reporting based        on our integrated audits. We conducted our audits in        accordance with the standards of the Public Company        Accounting Oversight Board (United States). Those        standards require that we plan and perform the audits to        obtain reasonable assurance about whether the financial        statements are free of material misstatement and whether        effective internal control over financial reporting was        maintained in all material respects. Our audits of the        financial statements included examining, on a test basis,        evidence supporting the amounts and disclosures in the        financial statements, assessing the accounting principles        used and significant estimates made by management, and        evaluating the overall financial statement presentation.        Our audit of internal control over financial reporting        included obtaining an understanding of internal control        over financial reporting, assessing the risk that a        material weakness exists, and testing and evaluating the        design and operating effectiveness of internal control        based on the assessed risk. Our audits also included        performing such other procedures as we considered        necessary in the circumstances. We believe that our        audits provide a reasonable basis for our opinions.

A company’s internal control over financial        reporting is a process designed to provide reasonable        assurance regarding the reliability of financial        reporting and the preparation of financial statements for        external purposes in accordance with generally accepted        accounting principles. A company’s internal control        over financial reporting includes those policies and        procedures that (i) pertain to the maintenance of records        that, in reasonable detail, accurately and fairly reflect        the transactions and dispositions of the assets of the        company; (ii) provide reasonable assurance that        transactions are recorded as necessary to permit        preparation of financial statements in accordance with        generally accepted accounting principles, and that        receipts and expenditures of the company are being made        only in accordance with authorizations of management and        directors of the company; and (iii) provide reasonable        assurance regarding prevention or timely detection of        unauthorized acquisition, use, or disposition of the        company’s assets that could have a material effect        on the financial statements.

 

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> 
 

Because of its inherent limitations, internal control        over financial reporting may not prevent or detect        misstatements. Also, projections of any evaluation of        effectiveness to future periods are subject to the risk        that controls may become inadequate because of changes in        conditions, or that the degree of compliance with the        policies or procedures may deteriorate.

 

**PricewaterhouseCoopers SpA**

Rome, Italy            May 14, 2009

 

 

 

 

 

 

 

 

 

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**CONSOLIDATED BALANCE SHEET****(euro million)**

|   |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|--------|--------|-------------------|--------|-------------------|
|   |   |                   |   |                   |

|    |   | Note   |   | Total amount |   | *of which with related parties* |   | Total amount |   | *of which with related parties* |
|--------------|--------|--------|--------|--------------|--------|---------------------------------|--------|--------------|--------|---------------------------------|
|         |   |   |   |              |   |                                 |   |              |   |                                 |

| **ASSETS**                                                                             |   |   |   |        |   |   |    |   |        |   |   |    |
|----------------------------------------------------------------------------------------|--------|--------|--------|-------------|--------|--------|---------|--------|-------------|--------|--------|---------|
| **Current        assets**                                                              |   |   |   |        |   |   |    |   |        |   |   |    |
| Cash and cash equivalents                                                              |   | (1)    |   | 2,114       |   |   |    |   | 1,939       |   |   |    |
| Other        financial assets held for trading or available for sale:                  |   | (2)    |   |        |   |   |    |   |        |   |   |    |
| *- equity instruments*                                                                 |   |   |   | *2,476*     |   |   |    |   | *2,741*     |   |   |    |
| *- other        securities*                                                            |   |   |   | *433*       |   |   |    |   | *495*       |   |   |    |
|                                                                                   |   |   |   | 2,909       |   |   |    |   | 3,236       |   |   |    |
| Trade and        other receivables                                                     |   | (3)    |   | 20,676      |   |   | *1,616* |   | 22,222      |   |   | *1,539* |
| Inventories                                                                            |   | (4)    |   | 5,499       |   |   |    |   | 6,082       |   |   |    |
| Current        tax assets                                                              |   | (5)    |   | 703         |   |   |    |   | 170         |   |   |    |
| Other current tax assets                                                               |   | (6)    |   | 833         |   |   |    |   | 1,130       |   |   |    |
| Other        current assets                                                            |   | (7)    |   | 1,080       |   |   |    |   | 2,349       |   |   | 59      |
| **Total current assets**                                                               |   |   |   | **33,814**  |   |   |    |   | **37,128**  |   |   |    |
| **Non-current        assets**                                                          |   |   |   |        |   |   |    |   |        |   |   |    |
| Property, plant and equipment                                                          |   | (8)    |   | 46,919      |   |   |    |   | 55,833      |   |   |    |
| Other        assets                                                                    |   | (9)    |   | 563         |   |   |    |   |        |   |   |    |
| Inventory - compulsory stock                                                           |   | (10)   |   | 2,171       |   |   |    |   | 1,196       |   |   |    |
| Intangible        assets                                                               |   | (11)   |   | 7,551       |   |   |    |   | 11,037      |   |   |    |
| Equity-accounted investments                                                           |   | (12)   |   | 5,639       |   |   |    |   | 5,471       |   |   |    |
| Other        investments                                                               |   | (12)   |   | 472         |   |   |    |   | 410         |   |   |    |
| Other financial assets                                                                 |   | (13)   |   | 923         |   |   | *87*    |   | 1,134       |   |   | *356*   |
| Deferred        tax assets                                                             |   | (14)   |   | 1,915       |   |   |    |   | 2,912       |   |   |    |
| Other non-current receivables                                                          |   | (15)   |   | 1,110       |   |   | *16*    |   | 1,401       |   |   | *21*    |
| **Total        non-current assets**                                                    |   |   |   | **67,263**  |   |   |    |   | **79,394**  |   |   |    |
| **Assets classified as held for sale**                                                 |   | (26)   |   | **383**     |   |   |    |   | **68**      |   |   |    |
| **TOTAL        ASSETS**                                                                |   |   |   | **101,460** |   |   |    |   | **116,590** |   |   |    |
| **LIABILITIES AND SHAREHOLDERS’ EQUITY**                                          |   |   |   |        |   |   |    |   |        |   |   |    |
| **Current        liabilities**                                                         |   |   |   |        |   |   |    |   |        |   |   |    |
| Short-term debt                                                                        |   | (16)   |   | 7,763       |   |   | *131*   |   | 6,359       |   |   | *153*   |
| Current        portion of long-term debt                                               |   | (21)   |   | 737         |   |   |    |   | 549         |   |   |    |
| Trade and other payables                                                               |   | (17)   |   | 17,116      |   |   | *1,021* |   | 20,515      |   |   | *1,253* |
| Income        taxes payable                                                            |   | (18)   |   | 1,688       |   |   |    |   | 1,949       |   |   |    |
| Other taxes payable                                                                    |   | (19)   |   | 1,383       |   |   |    |   | 1,660       |   |   |    |
| Other        current liabilities                                                       |   | (20)   |   | 1,556       |   |   | *4*     |   | 4,319       |   |   | *4*     |
| **Total current liabilities**                                                          |   |   |   | **30,243**  |   |   |    |   | **35,351**  |   |   |    |
| **Non-current        liabilities**                                                     |   |   |   |        |   |   |    |   |        |   |   |    |
| Long-term debt                                                                         |   | (21)   |   | 11,330      |   |   | *16*    |   | 13,929      |   |   | *9*     |
| Provisions        for contingencies                                                    |   | (22)   |   | 8,486       |   |   |    |   | 9,573       |   |   |    |
| Provisions for employee benefits                                                       |   | (23)   |   | 935         |   |   |    |   | 947         |   |   |    |
| Deferred        tax liabilities                                                        |   | (24)   |   | 5,471       |   |   |    |   | 5,742       |   |   |    |
| Other non-current liabilities                                                          |   | (25)   |   | 2,031       |   |   | *57*    |   | 2,538       |   |   | *53*    |
| **Total        non-current liabilities**                                               |   |   |   | **28,253**  |   |   |    |   | **32,729**  |   |   |    |
| **Liabilities directly associated with the        assets classified as held for sale** |   | (26)   |   | **97**      |   |   |    |   |        |   |   |    |
| **TOTAL        LIABILITIES**                                                           |   |   |   | **58,593**  |   |   |    |   | **68,080**  |   |   |    |
| **SHAREHOLDERS’ EQUITY**                                                          |   | (27)   |   |        |   |   |    |   |        |   |   |    |
| **Minority        interest**                                                           |   |   |   | **2,439**   |   |   |    |   | **4,074**   |   |   |    |
| **Eni shareholders’ equity**                                                      |   |   |   |        |   |   |    |   |        |   |   |    |
| Share        capital                                                                   |   |   |   | 4,005       |   |   |    |   | 4,005       |   |   |    |
| Reserves                                                                               |   |   |   | 34,610      |   |   |    |   | 40,722      |   |   |    |
| Treasury        shares                                                                 |   |   |   | (5,999      | )      |   |    |   | (6,757      | )      |   |    |
| Interim dividend                                                                       |   |   |   | (2,199      | )      |   |    |   | (2,359      | )      |   |    |
| Net profit                                                                             |   |   |   | 10,011      |   |   |    |   | 8,825       |   |   |    |
| **Total Eni shareholders’ equity**                                                |   |   |   | **40,428**  |   |   |    |   | **44,436**  |   |   |    |
| **TOTAL        SHAREHOLDERS’ EQUITY**                                             |   |   |   | **42,867**  |   |   |    |   | **48,510**  |   |   |    |
| **TOTAL LIABILITIES AND SHAREHOLDERS’        EQUITY**                             |   |   |   | **101,460** |   |   |    |   | **116,590** |   |   |    |

|   |   |   |   |  |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|--------|--|

F-3

----

##### Table of Contents

**CONSOLIDATED PROFIT AND LOSSACCOUNT****(euro million except asotherwise stated)**

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|    |   | Note   |   | Total amount |   | *of which with related parties* |   | Total amount |   | *of which with related parties* |   | Total amount |   | *of which with related parties* |
|--------------|--------|--------|--------|--------------|--------|---------------------------------|--------|--------------|--------|---------------------------------|--------|--------------|--------|---------------------------------|
|         |   |   |   |              |   |                                 |   |              |   |                                 |   |              |   |                                 |

| **REVENUES**                                                              |   |   |   |       |   |   |    |   |   |       |   |   |    |   |   |        |   |   |    |   |
|---------------------------------------------------------------------------|--------|--------|--------|------------|--------|--------|---------|--------|--------|------------|--------|--------|---------|--------|--------|-------------|--------|--------|---------|--------|
| Net sales        from operations                                          |   | (30)   |   | 86,105     |   |   | *3,974* |   |   | 87,256     |   |   | *4,198* |   |   | 108,148     |   |   | *5,048* |   |
| Other income and revenues                                                 |   |   |   | 783        |   |   |    |   |   | 827        |   |   |    |   |   | 720         |   |   | *39*    |   |
| **Total        revenues**                                                 |   |   |   | **86,888** |   |   |    |   |   | **88,083** |   |   |    |   |   | **108,868** |   |   |    |   |
| **OPERATING EXPENSES**                                                    |   | (31)   |   |       |   |   |    |   |   |       |   |   |    |   |   |        |   |   |    |   |
| Purchases,        services and other                                      |   |   |   | 57,490     |   |   | *2,720* |   |   | 58,179     |   |   | *3,777* |   |   | 76,408      |   |   | *6,298* |   |
| *- of which non-recurring charge*                                         |   |   |   | *239*      |   |   |    |   |   | *91*       |   |   |    |   |   | *(21*       | *)*    |   |    |   |
| Payroll        and related costs                                          |   |   |   | 3,650      |   |   |    |   |   | 3,800      |   |   |    |   |   | 4,004       |   |   |    |   |
| *- of which non-recurring income*                                         |   |   |   |       |   |   |    |   |   | *(83*      | *)*    |   |    |   |   |        |   |   |    |   |
| Depreciation,        depletion, amortization and impairments              |   |   |   | 6,421      |   |   |    |   |   | 7,236      |   |   |    |   |   | 9,815       |   |   |    |   |
| **OPERATING PROFIT**                                                      |   |   |   | **19,327** |   |   |    |   |   | **18,868** |   |   |    |   |   | **18,641**  |   |   |    |   |
| **FINANCE        INCOME (EXPENSE)**                                       |   | (32)   |   |       |   |   |    |   |   |       |   |   |    |   |   |        |   |   |    |   |
| Finance income                                                            |   |   |   | 3,749      |   |   | *58*    |   |   | 4,445      |   |   | *49*    |   |   | 7,985       |   |   | *42*    |   |
| Finance        expense                                                    |   |   |   | (3,971     | )      |   | *(18*   | *)*    |   | (4,554     | )      |   | *(20*   | *)*    |   | (8,198      | )      |   | *(17*   | *)*    |
| Derivative financial instruments                                          |   |   |   | 383        |   |   |    |   |   | 26         |   |   | *10*    |   |   | (551        | )      |   | *58*    |   |
|                                                                      |   |   |   | **161**    |   |   |    |   |   | **(83**    | **)**  |   |    |   |   | **(764**    | **)**  |   |    |   |
| **INCOME FROM INVESTMENTS**                                               |   | (33)   |   |       |   |   |    |   |   |       |   |   |    |   |   |        |   |   |    |   |
| Share of        profit (loss) of equity-accounted investments             |   |   |   | 795        |   |   |    |   |   | 773        |   |   |    |   |   | 640         |   |   |    |   |
| Other gain (loss) from investments                                        |   |   |   | 108        |   |   |    |   |   | 470        |   |   |    |   |   | 733         |   |   |    |   |
|                                                                      |   |   |   | **903**    |   |   |    |   |   | **1,243**  |   |   |    |   |   | **1,373**   |   |   |    |   |
| **PROFIT BEFORE INCOME TAXES**                                            |   |   |   | **20,391** |   |   |    |   |   | **20,028** |   |   |    |   |   | **19,250**  |   |   |    |   |
| Income        taxes                                                       |   | (34)   |   | (10,568    | )      |   |    |   |   | (9,219     | )      |   |    |   |   | (9,692      | )      |   |    |   |
| **Net profit**                                                            |   |   |   | **9,823**  |   |   |    |   |   | **10,809** |   |   |    |   |   | **9,558**   |   |   |    |   |
| **Attributable        to**                                                |   |   |   |       |   |   |    |   |   |       |   |   |    |   |   |        |   |   |    |   |
| Eni                                                                       |   |   |   | 9,217      |   |   |    |   |   | 10,011     |   |   |    |   |   | 8,825       |   |   |    |   |
| Minority        interest                                                  |   | (27)   |   | 606        |   |   |    |   |   | 798        |   |   |    |   |   | 733         |   |   |    |   |
|                                                                      |   |   |   | **9,823**  |   |   |    |   |   | **10,809** |   |   |    |   |   | **9,558**   |   |   |    |   |
| **Earnings        per share attributable to Eni**        (euro per share) |   | (35)   |   |       |   |   |    |   |   |       |   |   |    |   |   |        |   |   |    |   |
| Basic                                                                     |   |   |   | 2.49       |   |   |    |   |   | 2.73       |   |   |    |   |   | 2.43        |   |   |    |   |
| Diluted                                                                   |   |   |   | 2.49       |   |   |    |   |   | 2.73       |   |   |    |   |   | 2.43        |   |   |    |   |

|   |   |   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

F-4

----

##### Table of Contents

**CONSOLIDATED STATEMENTS OFCHANGES IN SHAREHOLDERS’ EQUITY****(euro million)**

|   | **Eni shareholders’ equity** |   |
|--------|-----------------------------------|--------|
|   |                                   |   |

|   |   | Share capital |   | Legal reserve of Eni SpA |   | Reserve for treasury shares |   | Other reserves |   | Cumulative         currency translation        differences |   | Treasury shares |   | Retained earnings |   | Interim dividend |   | Net profit for the year |   | Total |   | Minority interest |   | Total shareholders’ equity |
|--------|--------|---------------|--------|--------------------------|--------|-----------------------------|--------|----------------|--------|------------------------------------------------------------|--------|-----------------|--------|-------------------|--------|------------------|--------|-------------------------|--------|-------|--------|-------------------|--------|---------------------------------|
|   |   |               |   |                          |   |                             |   |                |   |                                                            |   |                 |   |                   |   |                  |   |                         |   |       |   |                   |   |                                 |

| **Balance at December 31, 2006**                                                                                                          |   | **4,005** |   |   | **959** |   |   | **7,262** |   |   | **400**    |   |   | **(398**   | **)**  |   | **(5,374** | **)**  |   | **25,168** |   |   | **(2,210** | **)**  |   | **9,217**  |   |   | **39,029** |   |   | **2,170** |   |   | **41,199** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------|--------|--------|---------|--------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|-----------|--------|--------|------------|--------|
| **Net        profit for the year**                                                                                                        |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   | **10,011** |   |   | **10,011** |   |   | **798**   |   |   | **10,809** |   |
| **Gains (losses) recognized directly in equity**                                                                                          |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |      |   |   |       |   |
| Change in        the fair value of available-for-sale securities                                                                          |   |      |   |   |    |   |   |      |   |   | (4         | )      |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   | (4         | )      |   |      |   |   | (4         | )      |
| Change in the fair value of cash flow hedge        derivatives                                                                            |   |      |   |   |    |   |   |      |   |   | (1,370     | )      |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   | (1,370     | )      |   |      |   |   | (1,370     | )      |
| Foreign        currency translation differences                                                                                           |   |      |   |   |    |   |   |      |   |   | 25         |   |   | (1,954     | )      |   |       |   |   |       |   |   |       |   |   |       |   |   | (1,929     | )      |   | (51       | )      |   | (1,980     | )      |
|                                                                                                                                      |   |      |   |   |    |   |   |      |   |   | **(1,349** | **)**  |   | **(1,954** | **)**  |   |       |   |   |       |   |   |       |   |   |       |   |   | **(3,303** | **)**  |   | **(51**   | **)**  |   | **(3,354** | **)**  |
| **Total        recognized income and (expense) for the year**                                                                             |   |      |   |   |    |   |   |      |   |   | **(1,349** | **)**  |   | **(1,954** | **)**  |   |       |   |   |       |   |   |       |   |   | **10,011** |   |   | **6,708**  |   |   | **747**   |   |   | **7,455**  |   |
| **Transactions with shareholders**                                                                                                        |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |      |   |   |       |   |
| Dividend        distribution of Eni SpA (euro 0.65 per share in        settlement of 2006 interim dividend of euro 0.60 per        share) |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   | 2,210      |   |   | (4,594     | )      |   | (2,384     | )      |   |      |   |   | (2,384     | )      |
| Interim dividend distribution of Eni SpA (euro        0.60 per share)                                                                     |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   | (2,199     | )      |   |       |   |   | (2,199     | )      |   |      |   |   | (2,199     | )      |
| Dividend        distribution of other companies                                                                                           |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   | (289      | )      |   | (289       | )      |
| Payments by minority shareholders                                                                                                         |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   | 1         |   |   | 1          |   |
| Allocation        of 2006 net profit                                                                                                      |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   | 4,623      |   |   |       |   |   | (4,623     | )      |   |       |   |   |      |   |   |       |   |
| Shares repurchased                                                                                                                        |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   | (680       | )      |   |       |   |   |       |   |   |       |   |   | (680       | )      |   |      |   |   | (680       | )      |
| Treasury        shares sold under incentive plans for Eni managers                                                                        |   |      |   |   |    |   |   | (55       | )      |   | 35         |   |   |       |   |   | 55         |   |   | 11         |   |   |       |   |   |       |   |   | 46         |   |   |      |   |   | 46         |   |
| Difference between the carrying amount and        strike price of stock options exercised by Eni managers                                 |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   | 9          |   |   |       |   |   |       |   |   | 9          |   |   |      |   |   | 9          |   |
|                                                                                                                                      |   |      |   |   |    |   |   | **(55**   | **)**  |   | **35**     |   |   |       |   |   | **(625**   | **)**  |   | **4,643**  |   |   | **11**     |   |   | **(9,217** | **)**  |   | **(5,208** | **)**  |   | **(288**  | **)**  |   | **(5,496** | **)**  |
| **Other changes in shareholders’ equity**                                                                                            |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |      |   |   |       |   |
| Net effect        related to the purchase of treasury shares by Saipem SpA        and Snam Rete Gas SpA                                   |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   | (201      | )      |   | (201       | )      |
| Cost related to stock option and stock grant                                                                                              |   |      |   |   |    |   |   |      |   |   |       |   |   |       |   |   |       |   |   | 18         |   |   |       |   |   |       |   |   | 18         |   |   |      |   |   | 18         |   |
| Foreign        currency translation differences on the distribution of        dividends and other changes                                 |   |      |   |   |    |   |   |      |   |   |       |   |   | 119        |   |   |       |   |   | (238       | )      |   |       |   |   |       |   |   | (119       | )      |   | 11        |   |   | (108       | )      |
|                                                                                                                                      |   |      |   |   |    |   |   |      |   |   |       |   |   | **119**    |   |   |       |   |   | **(220**   | **)**  |   |       |   |   |       |   |   | **(101**   | **)**  |   | **(190**  | **)**  |   | **(291**   | **)**  |
| **Balance        at December 31, 2007**                                                                                                   |   | **4,005** |   |   | **959** |   |   | **7,207** |   |   | **(914**   | **)**  |   | **(2,233** | **)**  |   | **(5,999** | **)**  |   | **29,591** |   |   | **(2,199** | **)**  |   | **10,011** |   |   | **40,428** |   |   | **2,439** |   |   | **42,867** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

F-5

----

##### Table of Contents

**CONSOLIDATED STATEMENTS OFCHANGES IN SHAREHOLDERS’ EQUITY***continued***(euro million)**

|   | **Eni shareholders’ equity** |   |
|--------|-----------------------------------|--------|
|   |                                   |   |

|   |   | Share capital |   | Legal reserve of Eni SpA |   | Reserve for treasury shares |   | Other reserves |   | Cumulative         currency translation        differences |   | Treasury shares |   | Retained earnings |   | Interim dividend |   | Net profit for the year |   | Total |   | Minority interest |   | Total shareholders’ equity |
|--------|--------|---------------|--------|--------------------------|--------|-----------------------------|--------|----------------|--------|------------------------------------------------------------|--------|-----------------|--------|-------------------|--------|------------------|--------|-------------------------|--------|-------|--------|-------------------|--------|---------------------------------|
|   |   |               |   |                          |   |                             |   |                |   |                                                            |   |                 |   |                   |   |                  |   |                         |   |       |   |                   |   |                                 |

| **Balance at December 31, 2007**                                                                                                   |    | **4,005**                |         |    | **959**                  |         |    | **7,207**    |         |    | **(914**     | **)**        |    | **(2,233**   | **)**        |    | **(5,999**               | **)**        |    | **29,591**   |         |    | **(2,199**   | **)**        |                | **10,011**               |         |                | **40,428**   |         |    | **2,439**    |         |                | **42,867**   |         |
|------------------------------------------------------------------------------------------------------------------------------------|--------------|--------------------------|--------------|--------------|--------------------------|--------------|--------------|--------------|--------------|--------------|--------------|--------------|--------------|--------------|--------------|--------------|--------------------------|--------------|--------------|--------------|--------------|--------------|--------------|--------------|--------------------------|--------------------------|--------------|--------------------------|--------------|--------------|--------------|--------------|--------------|--------------------------|--------------|--------------|
| **Net profit for the year**                                                                                                        |    |                |    |    |                |    |    |    |         |    |    |         |    |    |    |    |                |    |    |    |    |    |    |    |                | **8,825**                |    |                | **8,825**    |    |    | **733**      |    |                | **9,558**    |         |
| **Gains (losses) recognized directly in equity**                                                                                   |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    |    |    |                |                |    |                |    |    |    |    |    |                |    |    |
| Change in the fair value of available-for-sale        securities (Note 27)                                                         |    |                |    |    |                |    |    |    |    |    | 2            |    |    |    |         |    |                |    |    |    |    |    |    |    |      |                |    |      | 2            |    |         |    |    |      | 2            |    |
| Change in the fair value of cash flow hedge        derivatives (Note 27)                                                           |    |                |    |    |                |    |    |    |    |    | 1,255        |    |    |    |    |    |                |    |    |    |         |    |    |    |                |                |    |                | 1,255        |    |    | (52          | )            |                | 1,203        |    |
| Foreign currency translation differences                                                                                           |    |                |    |    |                |    |    |    |    |    |    |    |    | 1,066        |    |    |                |    |    |    |    |    |    |    |                |                |    |                | 1,066        |    |    | 11           |    |                | 1,077        |    |
|                                                                                                                          |    |                |    |    |                |    |    |    |    |    | **1,257**    |    |    | **1,066**    |    |    |                |    |    |    |    |    |    |    |                |      |    |                | **2,323**    |    |    | **(41**      | **)**        |                | **2,282**    |    |
| **Total recognized income and (expense) for the        year**                                                                      |    |                |    |    |                |    |    |    |    |    | **1,257**    |    |    | **1,066**    |    |    |      |    |    |    |    |    |    |    |                | **8,825**                |    |                | **11,148**   |    |    | **692**      |    |                | **11,840**   |    |
| **Transactions with shareholders**                                                                                                 |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    |    |    |                |                |    |                |    |    |    |    |    |                |    |    |
| Dividend distribution of Eni SpA (euro 0.70 per        share in settlement of 2007 interim dividend of euro 0.60        per share) |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    | 2,199        |    |                | (4,750                   | )            |                | (2,551       | )            |    |    |    |                | (2,551       | )            |
| Interim dividend distribution of Eni SpA (euro        0.65 per share)                                                              |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    | (2,359       | )            |                |                |    |                | (2,359       | )            |    |    |    |                | (2,359       | )            |
| Dividend distribution of other companies                                                                                           |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    |    |    |                |                |    |                |    |    |    | (297         | )            |                | (297         | )            |
| Payments by minority shareholders                                                                                                  |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    |    |    |                |                |    |                |    |    |    | 20           |    |                | 20           |    |
| Allocation of 2007 net profit                                                                                                      |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    | 5,261        |    |    |    |    |                | (5,261                   | )            |                |    |    |    |    |    |                |    |    |
| Shares repurchased                                                                                                                 |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    | (778                     | )            |    |    |    |    |    |    |                |                |    |                | (778         | )            |    |    |    |                | (778         | )            |
| Treasury shares sold under incentive plans for        Eni managers                                                                 |    |                |    |    |      |    |    | (20          | )            |    | 13           |    |    |    |    |    | 20                       |    |    | (1           | )            |    |    |    |                |                |    |                | 12           |    |    |    |    |                | 12           |    |
| Difference between the carrying amount and        strike price of stock options exercised by Eni managers                          |    |      |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    | 2            |    |    |    |    |                |                |    |                | 2            |    |    |    |    |                | 2            |    |
|                                                                                                                               |    |                |    |    |                |    |    | **(20**      | **)**        |    | **13**       |    |    |    |    |    | **(758**                 | **)**        |    | **5,262**    |    |    | **(160**     | **)**        |                | **(10,011**              | **)**        |                | **(5,674**   | **)**        |    | **(277**     | **)**        |                | **(5,951**   | **)**        |
| **Other changes in shareholders’ equity**                                                                                     |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    |    |    |                |                |    |                |    |    |    |    |    |                |    |         |
| Net effect related to the purchase of treasury        shares by Saipem SpA                                                         |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    |    |    |                |                |    |                |    |    |    | (31          | )            |                | (31          | )            |
| Cost related to stock option and stock grant                                                                                       |         |                |    |         |                |    |         |    |    |         |    |    |         |    |    |         |                |    |         | 18           |    |         |    |    |                     |                |    |                     | 18           |    |         |    |    |                     | 18           |    |
| Put option granted to Publigaz (the Distrigas        minority shareholder)                                                         |    |                |    |    |                |    |    |    |    |    | (1,495       | )            |    |    |    |    |                |    |    |    |    |    |    |    |                |                |    |                | (1,495       | )            |    |    |    |                | (1,495       | )            |
| Minority interest recognized following the        acquisition of Distrigas NV and Hindustan Oil Exploration        Co Ltd          |    |                |    |    |                |    |    |    |    |    |    |    |    |    |    |    |                |    |    |    |    |    |    |    |                |                |    |                |    |    |    | 1,261        |    |                | 1,261        |    |
| Foreign currency translation differences on the        distribution of dividends and other changes                                 |    |                |    |    |                |    |    |    |    |    | (1           | )            |    | 198          |    |    |                |    |    | (186         | )            |    |    |    |                |                |    |                | 11           |    |    | (10          | )            |                | 1            |    |
|                                                                                                                               |    |                |    |    |                |    |    |    |    |    | **(1,496**   | **)**        |    | **198**      |    |    |                |    |    | **(168**     | **)**        |    |    |    |                |                |    |                | **(1,466**   | **)**        |    | **1,220**    |    |                | **(246**     | **)**        |
| **Balance at December 31, 2008**(Note 27)                                                                                          |    | **4,005**                |         |    | **959**                  |         |    | **7,187**    |         |    | **(1,140**   | **)**        |    | **(969**     | **)**        |    | **(6,757**               | **)**        |    | **34,685**   |         |    | **(2,359**   | **)**        |                | **8,825**                |         |                | **44,436**   |         |    | **4,074**    |         |                | **48,510**   |         |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

F-6

----

##### Table of Contents

**CONSOLIDATED STATEMENT OFCASH FLOWS****(euro million)**

|   |   |    ** ****Note**** ** |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|------------------------------------------------|--------|----------|--------|----------|--------|----------|
|   |   |                                           |   |          |   |          |   |          |

| Net profit of the year                                                                                       |   |   |   | 9,823      |   |   | 10,809      |   |   | 9,558       |   |
|--------------------------------------------------------------------------------------------------------------|--------|--------|--------|------------|--------|--------|-------------|--------|--------|-------------|--------|
| Depreciation,        depletion and amortization                                                              |   | (31)   |   | 6,153      |   |   | 7,029       |   |   | 8,422       |   |
| Revaluations, net                                                                                            |   |   |   | (386       | )      |   | (494        | )      |   | 2,560       |   |
| Net change        in provisions for contingencies                                                            |   |   |   | (86        | )      |   | (122        | )      |   | 414         |   |
| Net change in the provisions for employee        benefits                                                    |   |   |   | 72         |   |   | (67         | )      |   | (8          | )      |
| Gain on        disposal of assets, net                                                                       |   |   |   | (59        | )      |   | (309        | )      |   | (219        | )      |
| Dividend income                                                                                              |   | (33)   |   | (98        | )      |   | (170        | )      |   | (510        | )      |
| Interest        income                                                                                       |   |   |   | (387       | )      |   | (603        | )      |   | (592        | )      |
| Interest expense                                                                                             |   |   |   | 346        |   |   | 523         |   |   | 809         |   |
| Exchange        differences                                                                                  |   |   |   | 6          |   |   | (119        | )      |   | (319        | )      |
| Income taxes                                                                                                 |   | (34)   |   | 10,568     |   |   | 9,219       |   |   | 9,692       |   |
| **Cash        generated from operating profit before changes in working        capital**                     |   |   |   | **25,952** |   |   | **25,696**  |   |   | **29,807**  |   |
| (Increase) decrease:                                                                                         |   |   |   |       |   |   |        |   |   |        |   |
| -        inventories                                                                                         |   |   |   | (953       | )      |   | (1,117      | )      |   | (801        | )      |
| - trade and other receivables                                                                                |   |   |   | (1,952     | )      |   | (655        | )      |   | (974        | )      |
| - other        assets                                                                                        |   |   |   | (315       | )      |   | (362        | )      |   | 162         |   |
| - trade and other payables                                                                                   |   |   |   | 2,146      |   |   | 360         |   |   | 2,318       |   |
| - other        liabilities                                                                                   |   |   |   | 50         |   |   | 107         |   |   | 1,507       |   |
| **Cash from operations**                                                                                     |   |   |   | **24,928** |   |   | **24,029**  |   |   | **32,019**  |   |
| Dividends        received                                                                                    |   |   |   | 848        |   |   | 658         |   |   | 1,150       |   |
| Interest received                                                                                            |   |   |   | 395        |   |   | 333         |   |   | 266         |   |
| Interest        paid                                                                                         |   |   |   | (294       | )      |   | (555        | )      |   | (852        | )      |
| Income taxes paid, net of tax receivables        received                                                    |   |   |   | (8,876     | )      |   | (8,948      | )      |   | (10,782     | )      |
| **Net        cash provided from operating activities**                                                       |   |   |   | **17,001** |   |   | **15,517**  |   |   | **21,801**  |   |
| *- of which with related parties*                                                                            |   | (37)   |   | *2,206*    |   |   | *549*       |   |   | *(62*       | *)*    |
| Investing        activities:                                                                                 |   |   |   |       |   |   |        |   |   |        |   |
| - tangible assets                                                                                            |   | (8)    |   | (5,963     | )      |   | (8,364      | )      |   | (12,082     | )      |
| -        intangible assets                                                                                   |   | (11)   |   | (1,870     | )      |   | (2,229      | )      |   | (2,480      | )      |
| - consolidated subsidiaries and businesses                                                                   |   |   |   | (46        | )      |   | (4,759      | )      |   | (3,634      | )      |
| -        investments                                                                                         |   | (12)   |   | (42        | )      |   | (4,890      | )      |   | (385        | )      |
| - securities                                                                                                 |   |   |   | (49        | )      |   | (76         | )      |   | (152        | )      |
| -        financing receivables                                                                               |   |   |   | (516       | )      |   | (1,646      | )      |   | (710        | )      |
| - change in payables and receivables in relation        to capital expenditures and capitalized depreciation |   |   |   | (26        | )      |   | 185         |   |   | 367         |   |
| **Cash        flow from investments**                                                                        |   |   |   | **(8,512** | **)**  |   | **(21,779** | **)**  |   | **(19,076** | **)**  |
| Disposals:                                                                                                   |   |   |   |       |   |   |        |   |   |        |   |
| - tangible        assets                                                                                     |   |   |   | 231        |   |   | 165         |   |   | 318         |   |
| - intangible assets                                                                                          |   |   |   | 18         |   |   | 35          |   |   | 2           |   |
| -        consolidated subsidiaries and businesses                                                            |   |   |   | 8          |   |   | 56          |   |   | 149         |   |
| - investments                                                                                                |   |   |   | 36         |   |   | 403         |   |   | 510         |   |
| -        securities                                                                                          |   |   |   | 382        |   |   | 491         |   |   | 145         |   |
| - financing receivables                                                                                      |   |   |   | 794        |   |   | 545         |   |   | 1,293       |   |
| *-*change        in payables and receivables in relation to disposals                                        |   |   |   | (8         | )      |   | (13         | )      |   | (299        | )      |
| **Cash flow from disposals**                                                                                 |   |   |   | **1,461**  |   |   | **1,682**   |   |   | **2,118**   |   |
| **Net        cash used in investing activities****(*)**                                                      |   |   |   | **(7,051** | **)**  |   | **(20,097** | **)**  |   | **(16,958** | **)**  |
| *- of which with related parties*                                                                            |   | (37)   |   | *(686*     | *)*    |   | *(822*      | *)*    |   | *(1,598*    | *)*    |

|   |   |   |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|

F-7

----

##### Table of Contents

**CONSOLIDATED STATEMENT OFCASH FLOWS*****continued*****(euro million)**

|   |   |    ** ****Note**** ** |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|------------------------------------------------|--------|----------|--------|----------|--------|----------|
|   |   |                                           |   |          |   |          |   |          |

| Proceeds from long-term debt                                                                                      |   |   |   | 2,888      |   |   | 6,589      |   |   | 3,774      |   |
|-------------------------------------------------------------------------------------------------------------------|--------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|
| Repayments        of long-term debt                                                                               |   |   |   | (2,621     | )      |   | (2,295     | )      |   | (2,104     | )      |
| Increase (decrease) in short-term debt                                                                            |   |   |   | (949       | )      |   | 4,467      |   |   | (690       | )      |
|                                                                                                              |   |   |   | **(682**   | **)**  |   | **8,761**  |   |   | **980**    |   |
| Net capital contributions by minority        shareholders                                                         |   |   |   | 22         |   |   | 1          |   |   | 20         |   |
| Net        acquisition of treasury shares different from Eni SpA                                                  |   |   |   | (477       | )      |   | (340       | )      |   | (50        | )      |
| Acquisition of additional interests in        consolidated subsidiaries                                           |   |   |   | (7         | )      |   | (16        | )      |   |       |   |
| Sale of        additional interests in consolidated subsidiaries                                                  |   |   |   | 35         |   |   |       |   |   |       |   |
| Dividends paid to Eni’s shareholders                                                                         |   |   |   | (4,610     | )      |   | (4,583     | )      |   | (4,910     | )      |
| Dividends        paid to minority interest                                                                        |   |   |   | (222       | )      |   | (289       | )      |   | (297       | )      |
| Net purchase of treasury shares                                                                                   |   |   |   | (1,156     | )      |   | (625       | )      |   | (768       | )      |
| **Net        cash used in financing activities**                                                                  |   |   |   | **(7,097** | **)**  |   | **2,909**  |   |   | **(5,025** | **)**  |
| *- of which with related parties*                                                                                 |   | (37)   |   | *(57*      | *)*    |   | *20*       |   |   | *14*       |   |
| *Effect        of change in consolidation (inclusion/exclusion of        significant/insignificant subsidiaries)* |   |   |   | *(4*       | *)*    |   | *(40*      | *)*    |   | *(1*       | *)*    |
| *Effect of exchange rate changes on cash and        cash equivalents*                                             |   |   |   | *(197*     | *)*    |   | *(160*     | *)*    |   | *8*        |   |
| **Net        cash flow for the period**                                                                           |   |   |   | **2,652**  |   |   | **(1,871** | **)**  |   | **(175**   | **)**  |
| **Cash and cash equivalents - beginning of year**                                                                 |   | (1)    |   | **1,333**  |   |   | **3,985**  |   |   | **2,114**  |   |
| **Cash        and cash equivalents - end of year**                                                                |   | (1)    |   | **3,985**  |   |   | **2,114**  |   |   | **1,939**  |   |

|   |   |   |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|--------------|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (*)          |    | Net cash used        in investing activities included investments in certain        financial assets to absorb temporary surpluses of cash or        as part of our ordinary management of financing        activities. Due to their nature and the circumstance that        they are very liquid, these financial assets are netted        against finance debt in determining net borrowings. For        the definition of net borrowings, see "Item 5 –        Operating and Financial Review and Prospects".        Cash flows of such investments were as follows: |
|    |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |

| (euro million) |   |    ** ** |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|------------------------------|--------|----------|--------|----------|--------|----------|
|           |   |                         |   |          |   |          |   |          |

| Financing investments:                       |   |     |   |   |       |   |   |      |   |
|----------------------------------------------|--------|----------|--------|--------|------------|--------|--------|-----------|--------|
| -        securities                          |   | (44      | )      |   | (75        | )      |   | (74       | )      |
| - financing receivables                      |   | (134     | )      |   | (970       | )      |   | (99       | )      |
|                                         |   | **(178** | **)**  |   | **(1,045** | **)**  |   | **(173**  | **)**  |
| Disposal of financing investments:           |   |     |   |   |       |   |   |      |   |
| -        securities                          |   | 340      |   |   | 419        |   |   | 145       |   |
| - financing receivables                      |   | 54       |   |   | 147        |   |   | 939       |   |
|                                         |   | **394**  |   |   | **566**    |   |   | **1,084** |   |
| **Net cash flows from financing activities** |   | **216**  |   |   | **(479**   | **)**  |   | **216**   |   |

|   |   |   |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|

F-8

----

##### Table of Contents

**SUPPLEMENTAL CASH FLOWINFORMATION****(euro million)**

|   |   |    **** |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|------------------------|--------|----------|--------|----------|--------|----------|
|   |   |                   |   |          |   |          |   |          |

| **Effect of investment of companies included in        consolidation and businesses** |   |    |   |   |      |   |   |      |   |
|---------------------------------------------------------------------------------------|--------|---------|--------|--------|-----------|--------|--------|-----------|--------|
| Current        assets                                                                 |   | 68      |   |   | 398       |   |   | 1,938     |   |
| Non-current assets                                                                    |   | 130     |   |   | 5,590     |   |   | 7,442     |   |
| Net        borrowings                                                                 |   | 53      |   |   | 1         |   |   | 1,543     |   |
| Current and non-current liabilities                                                   |   | (92     | )      |   | (972      | )      |   | (3,598    | )      |
| **Net        effect of investments**                                                  |   | **159** |   |   | **5,017** |   |   | **7,325** |   |
| Minority interests                                                                    |   |    |   |   |      |   |   | (1,261    | )      |
| Fair value        of investments held before the acquisition of control               |   |    |   |   | (13       | )      |   | (601      | )      |
| Sale of unconsolidated entities controlled by        Eni                              |   | (60     | )      |   |      |   |   |      |   |
| **Purchase        price**                                                             |   | **99**  |   |   | **5,004** |   |   | **5,463** |   |
| less:                                                                                 |   |    |   |   |      |   |   |      |   |
| *Cash        and cash equivalents*                                                    |   | (53     | )      |   | (245      | )      |   | (1,829    | )      |
| **Cash flow on investments**                                                          |   | **46**  |   |   | **4,759** |   |   | **3,634** |   |
| **Effect        of disposal of consolidated subsidiaries and businesses**             |   |    |   |   |      |   |   |      |   |
| Current assets                                                                        |   | 9       |   |   | 73        |   |   | 277       |   |
| Non-current        assets                                                             |   | 1       |   |   | 20        |   |   | 299       |   |
| Net borrowings                                                                        |   | (1      | )      |   | 26        |   |   | (118      | )      |
| Current        and non-current liabilities                                            |   | (4      | )      |   | (94       | )      |   | (270      | )      |
| **Net effect of disposals**                                                           |   | **5**   |   |   | **25**    |   |   | **188**   |   |
| Gain on        disposal                                                               |   | 3       |   |   | 33        |   |   | 25        |   |
| Minority interest                                                                     |   |    |   |   |      |   |   | (1        | )      |
| **Selling        price**                                                              |   | **8**   |   |   | **58**    |   |   | **212**   |   |
| less:                                                                                 |   |    |   |   |      |   |   |      |   |
| *Cash        and cash equivalents*                                                    |   |    |   |   | (2        | )      |   | (63       | )      |
| **Cash flow on disposals**                                                            |   | **8**   |   |   | **56**    |   |   | **149**   |   |

|   |   |   |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|

**Transactions that did not produce cashflows**Acquisition of equity investments in exchange of businessescontribution:

| (euro million) |   |    **** |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|------------------------|--------|----------|--------|----------|--------|----------|
|           |   |                   |   |          |   |          |   |          |

| Current assets                              |   | 23      |   |   |   |   |
|---------------------------------------------|--------|---------|--------|--------|--------|--------|
| Non-current        assets                   |   | 213     |   |   | 38     |   |
| Net borrowings                              |   | (44     | )      |   | (4     | )      |
| Long-term        and short-term liabilities |   | (53     | )      |   |   |   |
| **Net effect of contribution**              |   | **139** |   |   | **34** |   |
| Minority        interest                    |   | (36     | )      |   |   |   |
| Gain on contribution                        |   | 18      |   |   |   |   |
| **Acquisition        of investments**       |   | **121** |   |   | **34** |   |

|   |   |   |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|

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**Basis of presentation**

The Consolidated Financial Statements of Eni Group for theAnnual Report on Form 20-F have been prepared in accordance withInternational Financial Reporting Standards (IFRS) as issued bythe International Accounting Standards Board (IASB). Oil andnatural gas exploration and production activity is accounted forin conformity with internationally accepted accountingprinciples. Specifically, this concerns the determination of theamortization expenses using the unit-of-production method and therecognition of the production-sharing agreements and buy-backcontracts. The Consolidated Financial Statements have beenprepared on a historical cost basis except for certain items thatunder IFRS must be recognized at fair value as described in thesummary of significant accounting policies paragraph.

The Consolidated Financial Statements include the accounts ofEni SpA and the accounts of controlled subsidiary companies wherethe company holds the right to directly or indirectly exercisecontrol, determine financial and management decisions and obtaineconomic and financial benefits.

Immaterial subsidiaries are not consolidated. A subsidiary isgenerally considered to be immaterial when it does not exceed twoof the following three limits: (i) total assets or liabilities:euro 3,125 thousand; (ii) total revenues: euro 6,250 thousand;and (iii) average number of employees: 50 units. Moreover,companies for which consolidation does not produce significanteconomic and financial effects are not consolidated. These areusually entities acting as sole-operator in the management of oiland gas contracts on behalf of companies participating in a jointventure. These are financed proportionately based on a budgetapproved by the participating companies upon presentation ofperiodical reports of proceeds and expenses. Costs and revenuesand other operating data (production, reserves, etc.) of theproject, as well as the obligations arising from the project, arerecognized proportionally in the financial statements of thecompanies involved. The effects of these exclusions areimmaterial1.

Immaterial subsidiaries excluded from consolidation, jointlycontrolled entities, associates and other interests are accountedfor as described below under the item "Financial fixedassets".

Subsidiaries’ financial statements are audited by theindependent auditors who examine and certify also the informationrequired for the preparation of the Consolidated FinancialStatements.

The 2008 Consolidated Financial Statements approved byEni’s Board of Directors on March 13, 2009 were audited bythe independent auditor PricewaterhouseCoopers SpA (PwC). Theindependent auditor of Eni SpA, as the main auditor of the Group,is in charge of the auditing activities of the subsidiaries,unless this is incompatible with local laws, and, to the extentallowed under Italian legislation, of the work of otherindependent auditors.

Amounts in the notes to these financial statements areexpressed in millions of euros (euro million).

 

**Principles of consolidation**

**Interest in consolidated companies**Assets and liabilities, revenues and expenses related tofully consolidated subsidiaries are wholly incorporated in theConsolidated Financial Statements; the book value of interests inthese subsidiaries is eliminated against the corresponding shareof the shareholders’ equity by attributing to each of thebalance sheet items its fair value at the acquisition date.

When acquired, the net equity of controlled subsidiaries isinitially recognized at fair value. The excess of the purchaseprice of an acquired entity over the total fair value assigned toassets acquired and liabilities assumed is recognized asgoodwill; negative goodwill is recognized in the profit and lossaccount.

Equity and net profit of minority shareholders are included inspecific lines of the financial statements; this share of equityis determined using the fair value of assets and liabilities,excluding any related goodwill, at the time when control isacquired.

The purchase of additional ownership interests in subsidiariesfrom minority shareholders is recognized as goodwill andrepresents the excess of the amount paid over the carrying valueof the minority interest acquired.

Gains or losses associated with the sale of interests inconsolidated subsidiaries are reflected in the profit and lossaccount for the difference between proceeds from the sale and thedivested portion of net equity.

----

| (1) |    | According to        the requirements of the Framework of international        accounting standards, information is material if its        omission or misstatement could influence the economic        decisions that users make on the basis of the financial        statements. |
|-----|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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**Inter-company transactions**Inter-company transactions, balances and unrealized gains ontransactions between group companies are eliminated. Unrealizedlosses are not eliminated since they are considered an impairmentindicator of the asset transferred.

**Foreign currency translation**Financial statements of foreign companies having a functionalcurrency other than euro are translated into the presentationcurrency using closing exchange rates for assets and liabilities,historical exchange rates for equity accounts and average ratesfor the period for the profit and loss account (source: Bank ofItaly).

Cumulative exchange differences resulting from thistranslation are recognized in shareholders’ equity under"Other reserves" in proportion to the group’sinterest and under "Minority interest" for the portionrelated to minority shareholders. Cumulative exchange differencesare charged to the profit and loss account when the investmentsare sold or the capital employed is repaid.

Financial statements of foreign subsidiaries which aretranslated into euro are denominated in the functional currenciesof the countries where the entities operate. The U.S. dollar isthe prevalent functional currency for the entities that do notadopt euro.

 

**Summary of significant accounting policies**

The most significant accounting policies used in thepreparation of the Consolidated Financial Statements aredescribed below.

**Current assets******Held for trading financial assets and available-for-salefinancial assets are measured at fair value with gains or lossesrecognized in the profit and loss account under "Financialincome (expense)" and as a component of equity within"Other reserves", respectively.

In the latter case, changes in fair value recognized undershareholders’ equity are charged to the profit and lossaccount when they are impaired or realized. The objectiveevidence that an impairment loss has occurred is verifiedconsidering, interalia, significant breaches of contracts,serious financial difficulties or the high probability ofinsolvency of the counterparty; asset write downs are included inthe carrying amount2.

Available-for-sale financial assets include financial assetsother than derivative financial instruments, loans andreceivables, held for trading financial assets, held-to-maturityfinancial assets and investments associated with a derivativefinancial instrument. The latter are stated at fair value witheffects of changes in fair value recognized in the profit andloss account rather than in shareholders’ equity (theso-called "fair value option") in order to ensure amatch with the recognition in the profit and loss account of thechanges in fair value of the derivative instrument3.

The fair value of financial instruments is determined bymarket quotations or, in their absence, by the value resultingfrom the adoption of suitable financial valuation models whichtake into account all the factors adopted by market operators andprices obtained in similar recent transactions in the market.Interests and dividends on financial assets stated at fair valuewith gains or losses reflected in the profit and loss account areaccounted for on an accrual basis as "Financial income(expense)" and "Income (expense) frominvestments", respectively. When the purchase or sale of afinancial asset under a contract whose terms require delivery ofthe asset within the time frame established generally byregulation or convention in the market place concerned, thetransaction is accounted for on the settlement date. Receivablesare carried at amortized cost (see item "Financial fixedassets" below). Transferred financial assets arederecognized when the contractual rights to receive the cashflows of the financial assets are transferred together with therisks and rewards of the ownership.

Inventories, including compulsory stocks and excludingcontract work in progress, are stated at the lower of purchase orproduction cost and net realizable value. Net realizable value isthe estimated selling price less the costs to sell. The cost forinventories of hydrocarbons (crude oil, condensates and naturalgas) and petroleum products is 

 

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| (2) |    | Amendments to        IAS 39 "Financial Instruments: Recognition and        Measurement" and to IFRS 7 "Financial        Instruments: Disclosures" that permit, with certain        criteria met, an entity to reclassify held for trading        and available-for-sale financial assets into financial        instruments valuated at cost or at amortized cost have        not produced any effect for Eni. |
|-----|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (3) |    | Regarding the        investment in OAO Gazprom Neft see Note 2 - Other        financial assets held for trading or available for sale.                                                                                                                                                                                                                                                                                            |

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determined by applying the weighted-average cost method on athree-month basis; the cost for inventories of the Petrochemicalsegment is determined by applying the weighted-average cost on anannual basis.

Contract work in progress is measured using the cost-to-costmethod whereby contract revenue is recognized based on the stageof completion as determined by the cost sustained. Advances arededucted from inventories within the limits of contractualconsiderations; any excess of such advances over the value of theinventories is recorded as a liability. Losses related toconstruction contracts are accrued for once the company becomesaware of such losses. Contract work in progress not yet invoiced,whose payment will be made in a foreign currency, is translatedto euro using the current exchange rates at year end and theeffect of rate changes is reflected in the profit and lossaccount.

Hedging instruments are described in the section"Derivative instruments".

**Non-current assets**

**Property, plant and equipment**4****Tangible assets, including investment properties, arerecognized using the cost model and stated at their purchase orself-construction cost including any costs directly attributableto bringing the asset into operation. In addition, when asubstantial period of time is required to make the asset readyfor use, the purchase price or self-construction cost includesthe borrowing costs incurred that could have otherwise been savedhad the investment not been made. In the case of a presentobligation for the dismantling and removal of assets and therestoration of sites, the carrying value includes, with acorresponding entry to a specific provision, the estimated(discounted) costs to be borne at the moment the asset isretired. Changes in estimate of the carrying amounts ofprovisions due to the passage of time and changes in discountrates are recognized under "Provisions forcontingencies"5.

Property, plant and equipment is not revalued for financialreporting purposes.

Assets carried under financial leasing or concerningarrangements that do not take the legal form of a finance leasebut substantially transfer all the risks and rewards of ownershipof the leased asset are recognized at fair value, net of taxesdue from the lessor or, if lower, at the present value of theminimum lease payments. Leased assets are included withinproperty, plant and equipment. A corresponding financial debtpayable to the lessor is recognized as a financial liability.These assets are depreciated using the criteria described below.When the renewal is not reasonably certain, leased assets aredepreciated over the shorter of the lease term and the estimateduseful life of the asset.

Expenditures on renewals, improvements and transformationswhich provide additional economic benefits are capitalized toproperty, plant and equipment.

Tangible assets, from the moment they begin or should begin tobe used, are depreciated systematically using a straight-linemethod over their useful life which is an estimate of the periodover which the assets will be used by the company. When tangibleassets are composed of more than one significant element withdifferent useful lives, each component is depreciated separately.The amount to be depreciated is represented by the book valuereduced by the estimated net realizable value at the end of theuseful life, if it is significant and can be reasonablydetermined. Land is not depreciated, even when purchased with abuilding. Tangible assets held for sale are not depreciated butare valued at the lower of book value and fair value less costsof disposal.

Assets that can be used free of charge by third parties aredepreciated over the shorter term of the duration of theconcession and the useful life of the asset.

Replacement costs of identifiable components in complex assetsare capitalized and depreciated over their useful life; theresidual book value of the component that has been substituted ischarged to the profit and loss account. Expenditures for ordinarymaintenance and repairs are expensed as incurred.

The carrying value of property, plant and equipment isreviewed for impairment whenever events indicate that thecarrying amounts for those assets may not be recoverable. Therecoverability of an asset is assessed by comparing its carryingvalue with the recoverable amount represented by the higher offair value less costs to sell 

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| (4) |    | Recognition        and evaluation criteria of exploration and production        activities are described in the section "Exploration        and production activities" below.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|-----|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (5) |    | The company        recognizes material provisions for the retirement of        assets in the Exploration & Production business. No        significant asset retirement obligations associated with        any legal obligations to retire refining, marketing and        transportation (downstream) and chemical long-lived        assets are generally recognized, as undetermined        settlement dates for asset retirements do not allow a        reasonable estimate of the fair value of the associated        retirement obligation. The company performs periodic        reviews of its downstream and chemical long-lived assets        for any changes in facts and circumstances that might        require recognition of a retirement obligation. |

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and value in use. If there is no binding sales agreement, fairvalue is estimated on the basis of market values, recenttransactions, or the best available information that shows theproceeds that the company could reasonably expect to collect fromthe disposal of the asset. Value in use is the present value ofthe future cash flows expected to be derived from the use of theasset and, if significant and reasonably determinable, the cashflows deriving from its disposal at the end of its useful life,net of disposal costs. Cash flows are determined on the basis ofreasonable and documented assumptions that represent the bestestimate of the future economic conditions during the remaininguseful life of the asset, giving more importance to independentassumptions. Oil, natural gas and petroleum products prices (andto prices for products which derive therefrom) used to quantifythe expected future cash flows are estimated based on forwardprices prevailing in the marketplace for the first four years andmanagement’s long-term planning assumptions thereafter.Discounting is carried out at a rate that reflects a currentmarket valuation of the time value of money and of those specificrisks of the asset that are not reflected in the estimate of thefuture cash flows. In particular, the discount rate used is theWeighted Average Cost of Capital (WACC) adjusted for the specificcountry risk of the activity.

The evaluation of the specific country risk to be included inthe discount rate is provided by external parties. WACC differsconsidering the risk associated with individual operatingsegments; in particular for the assets belonging to the Gas &Power and Engineering & Construction segments, taking intoaccount the different risk compared with Eni, specific WACC rateshave been defined (for Gas & Power segment on the basis of asample of companies operating in the same segment; forEngineering & Construction segment on the basis of the marketquotation); WACC used for impairments in the Gas & Powersegment is adjusted to take into consideration the risk premiumof the specific country of the activity while WACC used forimpairments in the Engineering & Construction segment isnot adjusted for country risk as most of the company assets arenot located in a specific country. For the regulated activities,the discount rate to use for the measurement of value in use isequal to the rate of return defined by the Regulator. For theother segments, a single WACC is used considering that the riskis the same to that of Eni as a whole. Value in use is calculatednet of the tax effect as this method results in values similar tothose resulting from discounting pre-tax cash flows at a pre-taxdiscount rate deriving, through an iteration process, from apost-tax valuation. Valuation is carried out for each singleasset or, if the realizable value of a single asset cannot bedetermined, for the smallest identifiable group of assets thatgenerates independent cash inflows from their continuous use, theso-called "cash generating unit". When the reasons fortheir impairment cease to exist, Eni makes a reversal that isrecognized in profit or loss account as income from assetrevaluation. This reversed amount cannot exceed the carryingamount that would have been determined, net of depreciation, hadno impairment loss been recognized for the asset in prior years.

**Intangible assets**Intangible assets are assets without physical substance,controlled by the company and able to produce future economicbenefits, and goodwill acquired in business combinations. Anasset is classified as intangible when management is able todistinguish it clearly from goodwill. This condition is normallymet when: (i) the intangible asset arises from contractual orlegal rights, or (ii) the asset is separable, i.e. can be sold,transferred, licensed, rented or exchanged, either individuallyor as an integral part of other assets. An entity controls anasset if it has the power to obtain the future economic benefitsgenerated by the underlying asset and to restrict the access ofothers to those cash flows.

Intangible assets are initially stated at cost as determinedby the criteria used for tangible assets and they are notrevalued for financial reporting purposes.

Intangible assets with a definite useful life are amortizedsystematically over their useful life estimated as the periodover which the assets will be used by the company; the amount tobe amortized and the recoverability of the carrying amount areverified in accordance with the criteria described in the section"Property, plant and equipment".

Goodwill and other intangible assets with an indefinite usefullife are not amortized. The recoverability of their carryingvalue is reviewed at least annually and whenever events orchanges in circumstances indicate that the carrying value may notbe recoverable. Goodwill is tested for impairment at the level ofthe smallest aggregate on which the company, directly orindirectly, evaluates the return on the capital expenditure towhich goodwill relates. When the carrying amount of the cashgenerating unit, including goodwill allocated thereto, exceedsthe cash generating unit’s recoverable amount, the excess isrecognized as impairment. The impairment loss is first allocatedto reduce the carrying amount of goodwill; any remaining excessto be allocated to the assets of the unit is applied 

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pro-rata on the basis of the carrying amount of each asset inthe unit. Impairment charges against goodwill are not reversed6.Negative goodwill is recognized in the profit and loss account.

Costs of technological development activities are capitalizedwhen: (i) the cost attributable to the development activity canbe reasonably determined; (ii) there is the intention,availability of funding and technical capacity to make the assetavailable for use or sale; and (iii) it can be demonstrated thatthe asset is able to generate future economic benefits.Intangible assets also include public to private serviceconcession arrangements in which: (i) the grantor controls orregulates what services the operator must provide with theinfrastructure, to whom it must provide them and at what price;and (ii) the grantor controls – through ownership,beneficial entitlement or otherwise – any significantresidual interest in the infrastructure at the end of the term ofthe arrangement. According to the terms of the agreements theoperator has the right to operate the infrastructure, controlledby the grantor, in order to provide the public service 7 8.

**Exploration and production activities**9

*Acquisition of mineral rights*Costs associated with the acquisition of mineral rights arecapitalized in connection with the assets acquired (such asexploratory potential, probable and possible reserves and provedreserves). When the acquisition is related to a set ofexploratory potential and reserves, the cost is allocated to thedifferent assets acquired on the basis of the value of therelevant discounted cash flows.

Expenditure for the exploratory potential, represented by thecosts for the acquisition of the exploration permits and for theextension of existing permits, is recognized under"Intangible assets" and is amortized on a straight-linebasis over the period of the exploration as contractuallyestablished. If the exploration is abandoned, the residualexpenditure is charged to the profit and loss account.

Acquisition costs for proved reserves and for possible andprobable reserves are recognized in the balance sheet as assets.

Costs associated with proved reserves are amortized on a UOPbasis, as detailed in the section "Development",considering both developed and undeveloped reserves. Expendituresassociated with possible and probable reserves are not amortizeduntil classified as proved reserves; in case of a negativeresult, the costs are charged to the profit and loss account.

*Exploration*Costs associated with exploratory activities for oil and gasproducing properties incurred both before and after theacquisition of mineral rights (such as acquisition of seismicdata from third parties, test wells and geophysical surveys) areinitially capitalized in order to reflect their nature as aninvestment and subsequently amortized in full when incurred.

*Development*Development costs are those costs incurred to obtain accessto proved reserves and to provide facilities for extracting,gathering and storing oil and gas. They are capitalized withinproperty, plant and equipment and amortized generally on a UOPbasis, as their useful life is closely related to theavailability of feasible reserves. This method provides forresidual costs at the end of each quarter to be amortized at arate representing the ratio between the volumes extracted duringthe quarter and the proved developed reserves existing at the endof the quarter, increased by the volumes extracted during thequarter. This method is applied with reference to the smallestaggregate representing a direct correlation between investmentsand proved developed reserves.

Costs related to unsuccessful development wells or damagedwells are expensed immediately as losses on disposal. Impairmentsand reversal of impairments of development costs are made on thesame basis as those for tangible assets.

 

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| (6) |    | Impairment        charges recognized in an interim period are not reversed        also when, considering conditions existing in a        subsequent interim period, they would have been        recognized in a smaller amount or would not have been        recognized.                                                                                                                                                                                                |
|-----|--------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (7) |    | When the        operator has a unconditional contractual right to riceive        cash or another financial asset from or at the direction        of the grantor, considerations received or receivable by        the operator for construction or upgrade of the        infrastructure are recognized as a financial asset.                                                                                                                                             |
| (8) |    | The        accounting policy for service concession arrangement has        been defined according to IFRIC 12 "Service        concession arrangements" (IFRIC 12); the application        of IFRIC 12 has determined for 2007 the reclassification        of euro 3,218 million from the line item "Property,        plant and equipment" to "Intangible        assets"; the effects on profit and loss accounts are        not material. |
| (9) |    | IFRS do not        establish specific criteria for hydrocarbon exploration        and production activities. Eni continues to use existing        accounting policies for exploration and evaluation assets        previously applied before the introduction of IFRS 6        "Exploration for and evaluation of mineral        resources".                                                                                                                  |

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*Production*Production costs are those costs incurred to operate andmaintain wells and field equipment and are expensed as incurred.

*Production-sharing agreements and buy-back contracts*Oil and gas reserves related to production-sharing agreementsand buy-back contracts are determined on the basis of contractualclauses related to the repayment of costs incurred for theexploration, development and production activities executedthrough the use of company’s technologies and financing(cost oil) and the company’s share of production volumes notdestined to cost recovery (profit oil). Revenues from the sale ofthe production entitlements against both cost oil and profit oilare accounted for on an accrual basis whilst exploration,development and production costs are accounted for according tothe policies mentioned above.

The company’s share of production volumes and reservesrepresenting the profit oil includes the share of hydrocarbonswhich corresponds to the taxes to be paid, according to thecontractual agreement, by the national government on the behalfof the company. As a consequence, the company has to recognize atthe same time an increase in the taxable profit, through theincrease of the revenues, and a tax expense.

*Retirement*Costs expected to be incurred with respect to the retirementof a well, including costs associated with removal of productionfacilities, dismantlement and site restoration, are capitalizedand amortized on a UOP basis, consistent with the policydescribed under "Property, plant and equipment".

**Grants**Grants related to assets are recorded as a reduction ofpurchase price or production cost of the related assets whenthere is reasonable assurance that all the required conditionsattached to them, agreed upon with government entities, have beenmet. Grants not related to capital expenditure are recognized inthe profit and loss account.

**Financial fixed assets**

*Investments*Investments in subsidiaries excluded from consolidation,jointly controlled entities and associates are accounted forusing the equity method10. Subsidiaries, jointventures and associates excluded from consolidation are accountedfor at cost, adjusted for impairment losses if this does notresult in a misrepresentation of the company’s financialcondition. When the reasons for their impairment cease to exist,investments accounted for at cost are re-valued within the limitof the impairment made and their effects are included in"Other income (expense) from investments".

Other investments, included in non current assets, arerecognized at their fair value and their effects are included inshareholders’ equity under "Other reserves"; thisreserve is charged to the profit and loss account when it isimpaired or realized. When investments are not traded in a publicmarket and fair value cannot be reasonably determined,investments are accounted for at cost, adjusted for impairmentlosses; impairment losses may not be reversed11.

The risk deriving from losses exceeding shareholders’equity is recognized in a specific provision to the extent theparent company is required to fulfill legal or implicitobligations towards the subsidiary or to cover its losses.

*Receivables and financial assets to be held to maturity*Receivables and financial assets to be held to maturity arestated at cost represented by the fair value of the initialexchanged amount adjusted to take into account direct externalcosts related to the transaction (e.g. fees of agents orconsultants, etc.). The initial carrying value is then adjustedto take into account capital repayments, devaluations andamortization of the difference between the reimbursement valueand the initial carrying value. Amortization is carried out onthe basis of the effective internal rate of return represented bythe rate that equalizes, at the moment of the initialrevaluation, the current value of expected cash flows to theinitial carrying value (so-called amortized cost method). Anyimpairment is recognized by comparing the carrying value with thepresent value of the expected cash flows discounted at theeffective interest rate defined at the initial recognition, or atthe 

 

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| (10) |    | In the case        of step acquisition of a significant influence (or joint        control), the investment is recognized at the acquisition        date of significant influence (joint control) at the        amount deriving from the use of the equity method        assuming the adoption of this method since initial        acquisition; the "step-up" of the carrying        amount of interests owned before the acquisition of        significant influence (joint control) is taken to equity. |
|------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (11) |    | Impairment        charges recognised in an interim period are not reversed        also when, considering conditions existing in a        subsequent interim period, they would have been        recognized in a smaller amount or would not have been        recognized. |
|------|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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moment of its updating to reflect re-pricings contractuallyestablished. Receivables and financial assets to be held tomaturity are recognized net of the allowance for impairmentlosses; when the impairment loss is definite the excess allowancefor impairment losses is reversed. Changes to the carrying amountof receivables or financial assets in accordance with theamortized cost method are recognized as "Financial income(expense)".

**Financial liabilities**Debt is carried at amortized cost (see item "Financialfixed assets" above).

**Provisions for contingencies**Provisions for contingencies are liabilities for risks andcharges of a definite nature and whose existence is certain orprobable but for which at year-end the timing or amount of futureexpenditure is uncertain. Provisions are recognized when: (i)there is a current obligation (legal or constructive) as a resultof a past event; (ii) it is probable that the settlement of thatobligation will result in an outflow of resources embodyingeconomic benefits; and (iii) the amount of the obligation can bereliably estimated. The amount recognized as a provision is thebest estimate of the expenditure required to settle the presentobligation at the balance sheet date or to transfer it to thirdparties at that time. If the effect of the time value ismaterial, and the payment date of the obligations can bereasonably estimated, provisions to be accrued are the presentvalue of the expenditures expected to be required to settle theobligation at a discount rate that reflects the company’saverage borrowing rate taking into account the risks associatedwith the obligation. The increase in the provision due to thepassage of time is recognized as "Financial income(expense)".

When the liability regards a tangible asset (e.g. siterestoration and abandonment), the provision is stated with acorresponding entry to the asset to which it refers; charges tothe profit and loss account charge are made with the amortizationprocess.

Costs that the company expects to bear in order to carry outrestructuring plans are recognized when the company formallydefines the plan and the interested parties have developed thereasonable expectation that the restructuring will happen.

Provisions are periodically updated to show the variations ofestimates of costs, production times and actuarial rates; theestimated revisions to the provisions are recognized in the sameprofit and loss account item that had previously held theprovision, or, when the liability regards tangible assets (i.e.site restoration and abandonment) with a corresponding entry tothe assets to which they refer.

In the notes to the consolidated financial statements thefollowing potential liabilities are described: (i) possible, butnot probable obligations deriving from past events, whoseexistence will be confirmed only when one or more future eventsbeyond the company’s control occur; and (ii) currentobligations deriving from past events whose amount cannot bereasonably estimated or whose fulfillment will probably notresult in an outflow of resources embodying economic benefits.

**Employee benefits**Post-employment benefit plans, including constructiveobligations, are classified as either defined contribution plansor defined benefit plans depending on the economic substance ofthe plan as derived from its principal terms and conditions. Inthe first case, the company’s obligation, which consists ofmaking payments to the State or a trust or a fund, is determinedon the basis of contributions due.

The liabilities related to defined benefit plans, net of anyplan assets, are determined on the basis of actuarial assumptionsand charged on an accrual basis during the employment periodrequired to obtain the benefits.

The actuarial gains and losses of defined benefit plans arerecognized pro-rata on service, in the profit and loss accountusing the corridor method, if and to the extent that netcumulative actuarial gains and losses unrecognized at the end ofthe previous reporting period exceed the greater of 10% of thepresent value of the defined benefit obligation and 10% of thefair value of the plan assets, over the expected averageremaining working lives of the employees participating to theplan.

Such actuarial gains and losses derive from changes in theactuarial assumptions used or from a change in the conditions ofthe plan.

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Obligations for long-term benefits are determined by adoptingactuarial assumptions; the effect of changes in actuarialassumptions or a change in the characteristics of the benefit aretaken to profit or loss in their entirety.

**Treasury shares**Treasury shares are recorded at cost and as a reduction ofequity. Gains resulting from subsequent sales are recorded inequity.

**Revenues and costs**Revenues associated with sales of products and services arerecorded when significant risks and rewards of ownership pass tothe customer or when the transaction can be considered settledand associated revenue can be reliably measured. In particular,revenues are recognized for the sale of:

- crude oil, generally upon shipment;
- natural gas, upon delivery to the customer;
- petroleum products sold to retail distribution networks,        generally upon delivery to the service stations, whereas        all other sales are generally recognized upon shipment;
- chemical products and other products, generally upon        shipment.

Revenues are recognized upon shipment when, at that date,significant risks are transferred to the buyer. Revenues fromcrude oil and natural gas production from properties in which Enihas an interest together with other producers are recognized onthe basis of Eni’s net working interest in those properties(entitlement method). Differences between Eni’s net workinginterest volume and actual production volumes are recognized atcurrent prices at year end.

Income related to partially rendered services is recognized inthe measurement of accrued income if the stage of completion canbe reliably determined and there is no significant uncertainty asto the collectability of the amount and the related costs. Whenthe outcome of the transaction cannot be estimated reliably,revenue is recognized only to the extent of the expensesrecognized that are recoverable.

Revenues accrued in the year related to construction contractsare recognized on the basis of contractual revenues withreference to the stage of completion of a contract measured onthe cost-to-cost basis12.

Requests of additional revenues, deriving from a change in thescope of work, are included in the total amount of revenues whenit is probable that the customer will approve the variation andthe related amount; claims deriving from additional costsincurred for reasons attributable to the client are included inthe total amount of revenues when it is probable that thecounterparty will accept them.

Revenues are stated net of returns, discounts, rebates,bonuses and direct taxation. The exchange of goods and servicesof a similar nature and value do not give rise to revenues andcosts as they do not represent sale transactions.

Costs are recorded when the related goods and services aresold, consumed or allocated, or when their future benefits cannotbe determined. Costs associated with emission quotas, determinedon the basis of the average prices of the main European marketsat period end, are reported in relation to the amount of thecarbon dioxide emissions that exceed the amount assigned; relatedrevenues are recognized upon sale. Costs related to the purchaseof the emission rights are taken to intangible assets net of anynegative difference between the amount of emissions and thequotas assigned.

Operating lease payments are recognized in the profit and lossaccount over the length of the contract.

Labor costs include stock grants and stock options granted tomanagers, consistent with their actual remunerative nature. Theinstruments granted are recorded at fair value on the vestingdate and are not subject to subsequent adjustments; the currentportion is calculated pro-rata over the vesting period13.Fair value of stock options is determined using valuationtechniques which consider conditions related to the exercise ofoptions, current share prices, expected volatility and therisk-free interest rate. The fair value of the stock grants andstock options is recorded as a charge to "Otherreserves".

 

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| (12) |    | For service        concession arrangements in which customers fees do not        provide a distinction compensation for        construction/update of the infrastructure and        compensation for operating it and in the absence of        external benchmarks which could be used to determine the        respective fair value of these two items, revenues        recognised during the construction phase are limited to        the amount of the costs incurred. |
|------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (13) |    | For stock        grants, the period between the date of the award and the        date of assignation of stock; for stock options, the        period between the date of the award and the date at        which the option can be exercised. |
|------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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The costs for the acquisition of new knowledge or discoveries,the study of products or alternative processes, new techniques ormodels, the planning and construction of prototypes or, in anycase, costs borne for other scientific research activities ortechnological development, which cannot be capitalized, areincluded in the profit and loss account.

**Exchange rate differences**Revenues and costs associated with transactions in currenciesother than the functional currency are translated into thefunctional currency by applying the exchange rate at the date ofthe transaction.

Monetary assets and liabilities denominated in currenciesother than the functional currency are converted by applying theyear end exchange rate and the effect is stated in the profit andloss account. Non-monetary assets and liabilities denominated incurrencies other than the functional currency valued at cost aretranslated at the initial exchange rate; non-monetary assets thatare re-measured to fair value, recoverable amount or realizablevalue are translated at the exchange rate applicable at the dateof re-measurement.

**Dividends**Dividends are recognized at the date of the generalShareholders’ Meeting in which they were declared, exceptwhen the sale of shares before the ex-dividend date is certain.

**Income taxes**Current income taxes are determined on the basis of estimatedtaxable income. The estimated liability is included in"Income tax payables". Current tax assets andliabilities are measured at the amount expected to be paid to(recovered from) the tax authorities, using tax laws that havebeen enacted or substantively enacted at the balance sheet dateand the tax rates estimated on an annual basis. Deferred taxassets or liabilities are provided on temporary differencesarising between the carrying amounts of the assets andliabilities and their tax bases, based on tax rates (tax laws)that have been enacted or substantively enacted for future years.Deferred tax assets are recognized when their realization isconsidered probable. Deferred tax assets and liabilities areincluded in non-current assets and liabilities and are offset ata single entity level if related to offsettable taxes. Thebalance of the offset, if positive, is recognized in the item"Deferred tax assets"; if negative, in the item"Deferred tax liabilities". When the results oftransactions are recognized directly in shareholders’equity, current taxes, deferred tax assets and liabilities arealso charged to the shareholders’ equity.

**Derivatives**

Derivatives, including embedded derivatives which areseparated from the host contract, are assets and liabilitiesrecognized at their fair value which is estimated by using thecriteria described in the section "Current assets".When there is objective evidence that an impairment loss hasoccurred (see "Current assets" paragraph) derivativesare recognized net of the allowance for impairment losses.

Derivatives are classified as hedging instruments when therelationship between the derivative and the subject of the hedgeis formally documented and the effectiveness of the hedge is highand is checked periodically. When hedging instruments cover therisk of variation of the fair value of the hedged item (fairvalue hedge, e.g. hedging of the variability of the fair value offixed interest rate assets/liabilities) the derivatives arestated at fair value and the effects charged to the profit andloss account. Hedged items are consistently adjusted to reflectthe variability of fair value associated with the hedged risk.When derivatives hedge the cash flow variation risk of the hedgeditem (cash flow hedge, e.g. hedging the variability on the cashflows of assets/liabilities as a result of the fluctuations ofexchange rate), changes in the fair value of the derivativesconsidered effective are initially stated in equity and thenrecognized in the profit and loss account consistent with theeconomic effects produced by the hedged transaction. The changesin the fair value of derivatives that do not meet the conditionsrequired to qualify for hedge accounting are shown in the profitand loss account.

Economic effects of transactions, which relate to purchase orsales contracts for commodities entered into to meet theentity’s normal operating requirements and for which thesettlement is provided with the delivery of the goods, arerecognized on an accrual basis (the so-called normal sale andnormal purchase exemption or own use exemption).

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**Financial statements**Assets and liabilities of the balance sheet are classified ascurrent and non-current. Items of the profit and loss account arepresented by nature14.

The statement of changes in shareholders’ equity includesprofit and loss for the year, transactions with shareholders andother changes in shareholders’ equity.

The statement of cash flows is presented using the indirectmethod, whereby net profit is adjusted for the effects ofnon-cash transactions.

 

**Use of accounting estimates**

The company’s Consolidated Financial Statements areprepared in accordance with IFRS. These require the use ofestimates and assumptions that affect the assets, liabilities,revenues and expenses reported in the financial statements, aswell as amounts included in the notes thereto, includingdiscussion and disclosure of contingent liabilities. Estimatesmade are based on complex or subjective judgments and pastexperience of other assumptions deemed reasonable inconsideration of the information available at the time. Theaccounting policies and areas that require the most significantjudgments and estimates to be used in the preparation of theConsolidated Financial Statements are in relation to theaccounting for oil and natural gas activities, specifically inthe determination of proved reserves, impairment of fixed assets,intangible assets and goodwill, asset retirement obligations,business combinations, pensions and other post-retirementbenefits, recognition of environmental liabilities andrecognition of revenues in the oilfield services construction andengineering businesses. Although the company uses its bestestimates and judgments, actual results could differ from theestimates and assumptions used. A summary of significantestimates follows.

**Oil and gas activities**Engineering estimates of the Company’s oil and gasreserves are inherently uncertain. Proved reserves are theestimated volumes of crude oil, natural gas and gas condensates,liquids and associated substances which geological andengineering data demonstrate can be produced with reasonablecertainty to be recoverable in future years from known reservoirsunder existing economic and operating conditions. Although thereare authoritative guidelines regarding the engineering criteriathat must be met before estimated oil and gas reserves can bedesignated as "proved", the accuracy of any reserveestimate is a function of the quality of available data andengineering and geological interpretation and judgment.

Field reserves will only be categorized as proved when all thecriteria for attribution of proved status have been met. At thisstage, all booked reserves will be classified as provedundeveloped. Volumes will subsequently be reclassified fromproved undeveloped to proved developed as a consequence ofdevelopment activity. The first proved developed bookings willoccur at the point of first oil or gas production. Majordevelopment projects typically take one to four years from thetime of initial booking to the start of production. Enireassesses its estimate of proved reserves periodically. Theestimated proved reserves of oil and natural gas may be subjectto future revision and upward and downward revision may be madeto the initial booking of reserves due to production, reservoirperformance, commercial factors, acquisition and divestmentactivity and additional reservoir development activity. Inparticular, changes in oil and natural gas prices could impactthe amount of Eni’s proved reserves as regards the initialestimate and, in the case of Production-sharing agreements andbuy-back contracts, the share of production and reserves to whichEni is entitled. Accordingly, the estimated reserves could bematerially different from the quantities of oil and natural gasthat ultimately will be recovered.

Oil and natural gas reserves have a direct impact on certainamounts reported in the Consolidated Financial Statements.Estimated proved reserves are used in determining depreciationand depletion expenses and impairment expense.

Depreciation rates on oil and gas assets using the UOP basisare determined from the ratio between the amount of hydrocarbonsextracted in the quarter and proved developed reserves existingat the end of the quarter increased by the amounts extractedduring the quarter.

Assuming all other variables are held constant, an increase inestimated proved developed reserves for each field decreasesdepreciation, depletion and amortization expense. Conversely, adecrease in estimated proved 

 

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| (14) |    | Further        information on financial instruments as classified in        accordance with IFRS is provided in Note 29 - Guarantees,        commitments and risks "Other information about        financial instruments". |
|------|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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developed reserves increases depreciation, depletion andamortization expense. In addition, estimated proved reserves areused to calculate future cash flows from oil and gas properties,which serve as an indicator in determining whether or notproperty impairment is to be carried out. The larger the volumeof estimated reserves, the lower the likelihood of assetimpairment.

**Impairment of assets**Eni assesses its tangible assets and intangible assets,including goodwill, for possible impairment if there are eventsor changes in circumstances that indicate the carrying values ofthe assets are not recoverable.

Such indicators include changes in the Group’s businessplans, changes in commodity prices leading to unprofitableperformance, a reduced utilization of the plants and, for oil andgas properties, significant downward revisions of estimatedproved reserve quantities or significant increase of theestimated development costs. Determination as to whether and howmuch an asset is impaired involves management estimates on highlyuncertain matters such as future commodity prices, the effects ofinflation and technology improvements on operating expenses,production profiles and the outlook for global or regional marketsupply and demand conditions for crude oil, natural gas,commodity chemicals and refined products.

The amount of an impairment loss is determined by comparingthe book value of an asset with its recoverable amount. Therecoverable amount is the greater of fair value net of disposalcosts and value in use. The estimated value in use is based onthe present values of expected future cash flows net of disposalcosts. The expected future cash flows used for impairment reviewsare based on judgmental assessments of future production volumes,prices and costs, considering available information at the dateof review and are discounted by using a rate related to theactivity involved.

For oil and natural gas properties, the expected future cashflows are estimated principally based on developed andnon-developed proved reserves including, among other elements,production taxes and the costs to be incurred for the reservesyet to be developed. The estimated future level of production isbased on assumptions concerning: future commodity prices, liftingand development costs, field decline rates, market demand andsupply, economic regulatory climates and other factors.

Oil, natural gas and petroleum products prices used toquantify the expected future cash flows are estimated based onforward prices prevailing in the marketplace for the first fouryears and management’s long-term planning assumptionsthereafter. The estimate of the future amount of production isbased on assumptions related to the commodity future prices,lifting and development costs, market demand and to otherfactors. The discount rate reflects the current market valuationof the time value of money and of the specific risks of the assetnot reflected in the estimate of the future cash flows.

Goodwill and other intangible assets with an indefinite usefullife are not subject to amortization. The company tests suchassets at the cash-generating unit level for impairment on anannual basis and between annual tests if an event occurs orcircumstances change that would more likely than not reduce thefair value below its carrying amount. In particular, goodwillimpairment is based on the determination of the fair value ofeach cash-generating unit to which goodwill can be attributed ona reasonable and consistent basis. A cash generating unit is thesmallest aggregate on which the company, directly or indirectly,evaluates the return on the capital expenditure. If therecoverable amount of a cash generating unit is lower than thecarrying amount, goodwill attributed to that cash generating unitis impaired up to that difference; if the carrying amount ofgoodwill is less than the amount of impairment, assets of thecash generating unit are impaired on a pro-rata basis for theresidual difference.

**Asset retirement obligations**Obligations to remove tangible equipment and restore land orseabed require significant estimates in calculating the amount ofthe obligation and determining the amount required to be recordedpresently in the consolidated financial statements. Estimatingfuture asset retirement obligations is complex. It requiresmanagement to make estimates and judgments with respect toremoval obligations that will come to term many years into thefuture and contracts and regulations are often unclear as to whatconstitutes removal. In addition, the ultimate financial impactof environmental laws and regulations is not always clearly knownas asset removal technologies and costs constantly evolve in thecountries where Eni operates, as do political, environmental,safety and public expectations. The subjectivity of theseestimates is also increased by the accounting method used thatrequires entities to record the fair value of a liability for anasset retirement obligation in the period when it is incurred(typically, at the time the asset is installed at the productionlocation). When liabilities are initially recorded, the relatedfixed assets are increased by an equal corresponding amount. Theliabilities are increased with the passage of time (i.e. interest

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accretion) and any change in the estimates following themodification of future cash flows and discount rate adopted. Therecognized asset retirement obligations are based on futureretirement cost estimates and incorporate many assumptions suchas: expected recoverable quantities of crude oil and natural gas,abandonment time, future inflation rates and the risk-free rateof interest adjusted for the Company’s credit costs.

**Business combinations**Accounting for business combinations requires the allocationof the purchase price to the various assets and liabilities ofthe acquired business at their respective fair values. Anypositive residual difference is recognized as"Goodwill". Negative residual differences are creditedto the profit and loss account. Management uses all availableinformation to make these fair value determinations and, formajor business acquisitions, typically engages an independentappraisal firm to assist in the fair value determination of theacquired assets and liabilities.

**Environmental liabilities**Together with other companies in the industries in which itoperates, Eni is subject to numerous EU, national, regional andlocal environmental laws and regulations concerning its oil andgas operations, production and other activities. They includelegislation that implement international conventions orprotocols. Environmental costs are recognized when it becomesprobable that a liability has been incurred and the amount can bereasonably estimated.

Management, considering the actions already taken, insurancepolicies to cover environmental risks and provision for risksaccrued, does not expect any material adverse effect onEni’s consolidated results of operations and financialposition as a result of such laws and regulations. However, therecan be no assurance that there will not be a material adverseimpact on Eni’s consolidated results of operations andfinancial position due to: (i) the possibility of an unknowncontamination; (ii) the results of the ongoing surveys and otherpossible effects of statements required by Decree No. 471/1999 ofthe Ministry of Environment concerning the remediation ofcontaminated sites; (iii) the possible effects of futureenvironmental legislations and rules; (iv) the effects ofpossible technological changes relating to future remediation;and (v) the possibility of litigation and the difficulty ofdetermining Eni’s liability, if any, as against otherpotentially responsible parties with respect to such litigationsand the possible insurance recoveries.

**Employee benefits**Defined benefit plans and other long-term benefits areevaluated with reference to uncertain events and based uponactuarial assumptions including among others discount rates,expected rates of return on plan assets, expected rates of salaryincreases, medical cost trends, estimated retirement dates andmortality rates. The significant assumptions used to account forpensions and other post-retirement benefits are determined asfollows: (i) discount and inflation rates reflect the rates atwhich benefits could be effectively settled, taking into accountthe duration of the obligation. Indicators used in selecting thediscount rate include rates of annuity contracts and rates ofreturn on high quality fixed-income investments. The inflationrates reflect market conditions observed country by country; (ii)the future salary levels of the individual employees aredetermined including an estimate of future changes attributed togeneral price levels (consistent with inflation rateassumptions), productivity, seniority and promotion; (iii)healthcare cost trend assumptions reflect an estimate of theactual future changes in the cost of the healthcare relatedbenefits provided to the plan participants and are based on pastand current healthcare cost trends including healthcareinflation, changes in healthcare utilization and changes inhealth status of the participants; (iv) demographic assumptionssuch as mortality, disability and turnover reflect the bestestimate of these future events for individual employeesinvolved, based principally on available actuarial data; and (v)determination of the expected rates of return on assets is madethrough compound averaging. For each plan, the distribution ofinvestments among bonds, equities and cash and their specificaverage expected rate of return is taken into account.Differences between expected and actual costs and between theexpected return and the actual return on plan assets routinelyoccur and are called actuarial gains and losses. Eni applies thecorridor method to amortize its actuarial losses and gains. Thismethod amortizes on a pro-rata basis the net cumulativeunrecognized actuarial gains and losses at the end of theprevious reporting period that exceed 10% of the greater of: (i)the present value of the defined benefit obligation; and (ii) thefair value of plan assets, over the average expected remainingworking lives of the employees participating in the plan.

Additionally, obligations for other long-term benefits aredetermined by adopting actuarial assumptions. The effect ofchanges in actuarial assumptions or a change in thecharacteristics of the benefit are taken to profit or loss intheir entirety.

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**Contingencies**In addition to accruing the estimated costs for environmentalliabilities, asset retirement obligation and employee benefits,Eni accrues for all contingencies that are both probable andestimable. These other contingencies are primarily related tolitigation and tax issues. Determining appropriate amounts foraccrual is a complex estimation process that includes subjectivejudgments.

**Revenue recognition in the Engineering & Constructionsegment**Revenue recognition in the Engineering & Constructionsegment is based on the stage of completion of a contract asmeasured on the cost-to-cost basis applied to contractualrevenues. Use of the stage of completion method requiresestimates of future gross profit on a contract by contract basis.The future gross profit represents the profit remaining afterdeducting costs attributable to the contract from revenuesprovided for in the contract. The estimate of future gross profitis based on a complex estimation process that includesidentification of risks related to the geographical region,market conditions in that region and any assessment that isnecessary to estimate with sufficient precision the total futurecosts as well as the expected timetable. Requests of additionalincome, deriving from a change in the scope of work, are includedin the total amount of revenues when it is probable that thecustomer will approve the variation and the related amount.Claims deriving from additional costs incurred for reasonsattributable to the client are included in the total amount ofrevenues when it is probable that the counterparty will acceptthem.

 

**Recent accounting principles**

**Accounting standards and interpretations issued by IASB/IFRIC**IFRS 8 "Operating Segments" replaced IAS 14"Segment Reporting". IFRS 8 sets out requirements fordisclosure of information about the group segments thatmanagement uses to make decisions about operating matters. Theidentification of operating segments is based on internal reportsthat are regularly reviewed by the chief operating decision makerin order to allocate resources to the segments and assess theirperformances. IFRS 8 comes into effect starting on January 1,2009.

The revised IAS 1 "Presentation of FinancialStatements" requires, among other things, a statement ofcomprehensive income that begins with the amount of net profitfor the year adjusted with all items of income and expensesdirectly recognized in equity, but excluded from net income, inaccordance with IFRS. The revised standard comes into effectstarting on January 1, 2009.

The revised IAS 23 "Borrowing Costs" requires theremoval of the option of immediately recognizing as an expenseborrowing costs that are directly attributable to theacquisition, construction or production of a qualifying assetthat take a substantial period of time to get ready for use orsale. The company is required to capitalize such borrowing costsas part of the cost of the asset. The revised standard comes intoeffect starting on January 1, 2009.

The revised IFRS 2 "Share-based payment" specifiesthe accounting treatment of all cancellations of a grant ofequity instruments to employees. It also imposes that vestingconditions are only service and performance conditions requiredin return for the equity instruments issued. The revised standardcomes into effect starting on January 1, 2009.

IFRIC 13 "Customer Loyalty Programmes" addresses howcompanies, which grant their customers loyalty, award creditswhen buying goods or services, should account for theirobligation to provide free or discounted goods or services if andwhen the customers redeem the credits. In particular IFRIC 13requires companies to allocate some of the consideration receivedfrom the sales transaction to the award credits and theirrecognition at fair value. This interpretation came into effectfor annual periods beginning on or after July 1, 2008 (for Eni:2009 financial statements).

Amendments to IAS 1 "Presentation of FinancialStatements" and to IAS 32 "Financial Instruments:Presentation" define the conditions that the puttableinstruments issued by companies have to meet in order to beclassified as equity. Moreover it allowed the classification asequity of instruments issued by the company that impose on thecompany an obligation to deliver to another party a pro ratashare of the net assets of the entity only on liquidation. Theamendments to IAS 1 and IAS 32 come into effect starting onJanuary 1, 2009.

"Improvements to IFRSs", defined in the context ofthe annual process of "Improvements to IFRS" regardsonly changes to the existing standards with a technical andeditorial nature. The provisions come into effect starting onJanuary 1, 2009.

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On January 10, 2008, IASB issued a revised IFRS 3"Business Combinations" and an amended version of IAS27 "Consolidated and Separate Financial Statements".The revisions to IFRS 3 require, among other things, (i) theacquisition-related costs to be accounted for separately from thebusiness combination and then recognized as expenses rather thanincluded in goodwill, (ii) the recognition in the incomestatement of any change to contingent consideration, and (iii)the choice of the full goodwill method which means to treat thefull value of the goodwill of the business combination includingthe share attributable to minority interest. In the case of stepacquisitions, the revisions also relate to the recognition in theprofit and loss account of the difference between the fair valueat the acquisition date of the net assets previously held andtheir carrying amounts.

The amendments of IAS 27 require, among other things, thatacquisitions or disposals of non-controlling interests in asubsidiary that do not result in the loss of control, shall beaccounted for as equity transactions. By contrast, disposal ofany interests that the parent retains in a former subsidiary mayresult in a loss of control. In this case, at the date whencontrol is lost the remaining investment retained isincreased/decreased to fair value with gains or losses arisingfrom the difference between the fair value and carrying amount ofthe held investment recognized in the profit or loss account. Therevised Standards shall be applied for annual periods beginningon or after July 1, 2009 (for Eni: 2010 financial statements).

On July 3, 2008, IFRIC issued IFRIC 16 "Hedges of a NetInvestment in a Foreign Operation" which defines thecriteria for recognition and evaluation of hedges of a netinvestment in a foreign operation. In particular theinterpretation defines, among other things, that the object ofthe hedge is the exchange differences between the functionalcurrency of the foreign operation and the parent’sfunctional currency and that the hedge instrument can be held byany Group company with the exception of the hedged foreignoperation. This interpretation shall be applied for annualperiods beginning on or after October 1, 2008 (for Eni: 2009financial statements).

On November 27, 2008, IFRIC issued IFRIC 17"Distributions of Non-cash Assets to Owner" whichdefines the criteria of recognition and evaluation of thedistributions of assets other than cash when it pays dividends toits owner. It also applies in those situations in which an entitygives its owner a choice of receiving either non-cash assets or acash alternative. In particular, an entity shall measure aliability to distribute non-cash assets as dividends to itsowners at the fair value of the assets to be distributed. Theliability, with any adjustments, is recognized as a contra toequity. When the entity settles the dividend payable, thedifference, if any, between the carrying amount of the assetsdistributed and the fair value of the dividend payable is takento profit or loss. This interpretation shall be applied forannual periods beginning on or after July 1, 2009 (for Eni: 2010financial statements).

On January 29, 2008, IFRIC issued IFRIC 18 "Transfers ofAssets from customers" which defines the criteria ofrecognition and evaluation of transfers of items of property,plant and equipment by service providers that receive suchtransfers from their customers. The interpretation is alsoapplied in the cases in which the entity receives cash from acustomer that must be used only to connect the customer to anetwork. When the definition of an asset is met, the asset isrecognized at its fair value. When the connection is realized,the entity shall recognize the revenue for a period generallydetermined by the terms of the arrangement with the customer or,if the arrangement does not specify a term, over a periodcorresponding to the lower of the length of the supply and theuseful life of the asset used to provide the ongoing service.This interpretation shall be applied for annual periods beginningon or after July 1, 2009 (for Eni: 2010 financial statements).

Eni is currently reviewing these new IFRS and interpretationsto determine the likely impact on the Group’s results.

 

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**Notes to the ConsolidatedFinancial Statements****Current assets****1 Cash and cash equivalents**Cash and cash equivalents of euro 1,939 million (euro2,114 million at December 31, 2007) included financingreceivables originally due within 90 days for euro 616 million(euro 415 million at December 31, 2007). The latter were relatedto amounts on deposit with financial institutions accessible onlyon a 48-hour notice.

**2 Other financial assets held for tradingor available for sale**Other financial assets held for trading oravailable for sale are set out below:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| **Investments**                                                                      |   | **2,476** |   | **2,741** |
|--------------------------------------------------------------------------------------|--------|-----------|--------|-----------|
| **Securities        held for operating purposes**                                    |   |      |   |      |
| Listed Italian treasury bonds                                                        |   | 229       |   | 257       |
| Listed        securities issued by Italian and foreign financial        institutions |   | 27        |   | 45        |
| Non-quoted securities                                                                |   | 3         |   | 8         |
|                                                                                 |   | **259**   |   | **310**   |
| **Securities held for non-operating purposes**                                       |   |      |   |      |
| Listed        Italian treasury bonds                                                 |   | 168       |   | 109       |
| Listed securities issued by Italian and foreign        financial institutions        |   | 5         |   | 67        |
| Non-quoted        securities                                                         |   | 1         |   | 9         |
|                                                                                 |   | **174**   |   | **185**   |
| **Total        other securities**                                                    |   | **433**   |   | **495**   |
|                                                                                 |   | **2,909** |   | **3,236** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Equity instruments of euro 2,741 million (U.S. $3,815 millionat December 31, 2008 exchange rate) comprised the carrying amountof a 20% interest in OAO Gazprom Neft acquired on April 4, 2007following finalization of a bid within the Yukos liquidationprocedure. This entity is currently listed at the London StockExchange where approximately 5% of the share capital is traded,while Gazprom currently holds a 75% stake. This accountingclassification reflects the circumstance that Eni granted toGazprom a call option on the entire 20% interest to beexercisable by Gazprom within 24 months from the acquisitiondate, at a price of U.S. $3.7 billion equaling the bid price,adjusted by subtracting dividends distributed and adding possibleshare capital increases, a contractual remuneration of 9.4% onthe capital employed and related financing expenses.

The existing shareholder agreements establish that thegovernance of the investee will be modified to allow Eni toexercise significant influence through participation in thefinancial and operating policy decisions of the investee in thecase that Gazprom does not exercise its call option. The carryingamount of the interest equals the strike price of the call optionas of December 31, 2008. Eni decided not to adjust the carryingamount of the interest to the market prices at the balance sheetdate resulting in U.S. $1,961 million for the following reasons:(i) if Gazprom decides to exercise the call option, the strikeprice will be equal to the current carrying amount; (ii) ifGazprom decides not to exercise the call option, Eni will begranted significant influence in the decision-making process ofthe investee and consequently will be in a position to accountfor the investee in accordance with the equity method ofaccounting provided by IAS 28 for interests in associates. Underthe equity method, Eni is required to allocate the purchase priceto the corresponding interest in net equity and the residualamount to fair values of the investee’s assets andliabilities. Subsequently, the carrying amount is adjusted toreflect Eni’s share of losses and profits of the investee.Based on available information and the outcome of an impairmenttest performed also with the support of an independentconsultant, the equity method assessment would result in anamount not lower than the current carrying amount of theinterest.

Other securities of euro 495 million (euro 433 million atDecember 31, 2007) were available-for-sale securities. AtDecember 31, 2007 and December 31, 2008, Eni did not ownfinancial assets held for trading.

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The effects of the valuation at fair value of securities areset out below:

| (euro        million) |   | **Value at****Dec. 31, 2007** |   | **Changes recognized in        the reserves of shareholders' equity** |   | **Value at****Dec. 31, 2008** |
|-----------------------|--------|-------------------------------|--------|-----------------------------------------------------------------------|--------|-------------------------------|
|                  |   |                               |   |                                                                       |   |                               |

| Fair value                                             |   | 2      |   |   | 3     |   |   | **5** |   |
|--------------------------------------------------------|--------|--------|--------|--------|-------|--------|--------|-------|--------|
| Deferred tax liabilities                               |   |   |   |   | (1    | )      |   | (1    | )      |
| **Other reserves of        shareholders’ equity** |   | **2**  |   |   | **2** |   |   | **4** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Securities held for operating purposes of euro 310 million(euro 259 million at December 31, 2007) were designed to providecoverage of technical reserves of Group’s insurance companyEni Insurance Ltd for euro 302 million (euro 256 million atDecember 31, 2007).

The fair value of securities was determined by reference toquoted market prices.

**3 Trade and other receivables**Trade and other receivables were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Trade receivables                                                                 |   | 15,609     |   | 16,444     |
|-----------------------------------------------------------------------------------|--------|------------|--------|------------|
| Financing        receivables:                                                     |   |       |   |       |
| - for operating purposes - short-term                                             |   | 357        |   | 402        |
| - for        operating purposes - current portion of long-term        receivables |   | 27         |   | 85         |
| - for non-operating purposes                                                      |   | 990        |   | 337        |
|                                                                              |   | **1,374**  |   | **824**    |
| Other receivables:                                                                |   |       |   |       |
| - from        disposals                                                           |   | 125        |   | 149        |
| - other                                                                           |   | 3,568      |   | 4,805      |
|                                                                              |   | **3,693**  |   | **4,954**  |
|                                                                              |   | **20,676** |   | **22,222** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Receivables are stated net of the allowance forimpairment losses of euro 1,251 million (euro 935 million atDecember 31, 2007):

| (euro        million) |   | **Value at****Dec. 31, 2007** |   | **Additions** |   | **Deductions** |   | **Other changes** |   | **Value at****Dec. 31, 2008** |
|-----------------------|--------|-------------------------------|--------|---------------|--------|----------------|--------|-------------------|--------|-------------------------------|
|                  |   |                               |   |               |   |                |   |                   |   |                               |

| Trade receivables            |   | 595     |   |   | 251     |   |   | (36     | )      |   | (63     | )      |   | **747**   |   |
|------------------------------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|-----------|--------|
| Financing        receivables |   |    |   |   | 14      |   |   |    |   |   | 5       |   |   | 19        |   |
| Other receivables            |   | 340     |   |   | 137     |   |   | (26     | )      |   | 34      |   |   | 485       |   |
|                         |   | **935** |   |   | **402** |   |   | **(62** | **)**  |   | **(24** | **)**  |   | **1,251** |   |

|   |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|

The increase in trade receivables of euro 835million was primarily related to the Gas & Power segment(euro 1,987 million), the Engineering & Construction segment(euro 513 million). These increases were partially offset by thedecrease related to the Refining & Marketing segment (euro1,036 million), Petrochemicals (euro 459 million) and Exploration& Production segment (euro 115 million).

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##### Table of Contents

Trade and other receivables were as follows: 

| (euro        million) |   | **Dec. 31, 2008** |
|-----------------------|--------|-------------------|
|                  |   |                   |

|   |   | Trade receivables |   | Other receivables |   | Total |
|--------|--------|-------------------|--------|-------------------|--------|-------|
|   |   |                   |   |                   |   |       |

| Neither impaired nor past due                              |   | 12,611     |   | 3,395     |   | 16,006     |
|------------------------------------------------------------|--------|------------|--------|-----------|--------|------------|
| Impaired        (net of the valuation allowance)           |   | 1,242      |   | 88        |   | 1,330      |
| Not impaired and past due in the following        periods: |   |       |   |      |   |       |
| - within        90 days                                    |   | 1,812      |   | 502       |   | 2,314      |
| - 3 to 6 months                                            |   | 231        |   | 68        |   | 299        |
| - 6 to 12        months                                    |   | 248        |   | 294       |   | 542        |
| - over 12 months                                           |   | 300        |   | 607       |   | 907        |
|                                                       |   | **2,591**  |   | **1,471** |   | **4,062**  |
|                                                       |   | **16,444** |   | **4,954** |   | **21,398** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Trade receivables not impaired and past due primarily referredto high-credit-quality public administrations and otherhighly-reliable counterparties for oil, natural gas and chemicalproducts supplies.

Allowances for impairment losses of traded receivables of euro251 million (euro 98 million in 2007) primarily referred toRefining & Marketing segment (euro 72 million), Gas &Power segment (euro 65 million), Petrochemicals (euro 60 million)and Syndial SpA (euro 27 million). In comparison with 2007 theamount of the allowance is more than double as a consequence ofthe larger number of clients in financial difficulties after theworsening of general economic conditions over the last part ofthe year.

Allowances for impairment losses of other receivables of euro137 million (euro 109 million in 2007) primarily referred to theExploration & Production segment (euro 135 million) dueprimarily to impairment of certain receivables associated withcost recovery with respect to local state-owned co-venturersbased on underlying petroleum agreements and modifications of theCompany’s interest in certain joint ventures.

Trade receivables included guarantees for work in progress foreuro 213 million (euro 156 million at December 2007).

Other receivables for euro 227 million associated with costrecovery in the Exploration & Production segment arecurrently undergoing arbitration procedure. No impairment losshas been recognized as the Company and the third party are in theprocess of defining a transaction on amicable terms.

Receivables for financing operating activities of euro 487million (euro 384 million at December 31, 2007) included euro 399million due from not consolidated subsidiaries, joint venturesand associates (euro 246 million at December 31, 2007) and euro47 million cash deposit to provide coverage of Eni Insurance Ltdtechnical reserves (euro 112 million at December 31, 2007).Receivables for financing non-operating activities amounted toeuro 337 million (euro 990 million at December 31, 2007) of whicheuro 173 million related to the current portion of a restricteddeposit held by Eni Lasmo Plc as a guarantee of a debenture andeuro 88 million related to deposit of Eni Insurance Ltd. Thedecrease of euro 653 million related for euro 898 million to thedischarge of a collateral cash deposit made by Eni SpA toguarantee certain cash flow hedging derivatives.

Other receivables were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Accounts receivable from:                                      |   |      |   |      |
|----------------------------------------------------------------|--------|-----------|--------|-----------|
| - joint        venture operators in exploration and production |   | 1,699     |   | 2,242     |
| - Italian government entities                                  |   | 386       |   | 378       |
| -        insurance companies                                   |   | 253       |   | 146       |
|                                                           |   | **2,338** |   | **2,766** |
| Prepayments        for services                                |   | 194       |   | 857       |
| Receivables relating to factoring operations                   |   | 182       |   | 171       |
| Other        receivables                                       |   | 979       |   | 1,160     |
|                                                           |   | **3,693** |   | **4,954** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

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##### Table of Contents

Receivables deriving from factoring operations of euro 171million (euro 182 million at December 31, 2007) were related toSerfactoring SpA and consisted primarily of advances forfactoring operations with recourse and receivables for factoringoperations without recourse.

Receivables with related parties are described in Note 37 -Transactions with related parties.

Because of the short-term maturity of trade receivables, thefair value approximated their carrying amount.

**4 Inventories**Inventories were as follows:

|   |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|--------|--------|-------------------|--------|-------------------|
|   |   |                   |   |                   |

| (euro million) |   | Crude oil, gas and petroleum products |   | Chemical products |   | Work in progress |   | Other |   | Total |   | Crude oil, gas and petroleum products |   | Chemical products |   | Work in progress |   | Other |   | Total |
|----------------|--------|---------------------------------------|--------|-------------------|--------|------------------|--------|-------|--------|-------|--------|---------------------------------------|--------|-------------------|--------|------------------|--------|-------|--------|-------|
|           |   |                                       |   |                   |   |                  |   |       |   |       |   |                                       |   |                   |   |                  |   |       |   |       |

| Raw and auxiliary materials and consumables                |   | 861       |   | 299       |   |    |   | 809     |   | 1,969     |   | 466       |   | 263     |   |    |   | 1,155     |   | 1,884     |
|------------------------------------------------------------|--------|-----------|--------|-----------|--------|---------|--------|---------|--------|-----------|--------|-----------|--------|---------|--------|---------|--------|-----------|--------|-----------|
| Products        being processed and semi finished products |   | 74        |   | 27        |   |    |   | 15      |   | 116       |   | 48        |   | 17      |   |    |   | 3         |   | 68        |
| Work in progress                                           |   |      |   |      |   | 553     |   |    |   | 553       |   |      |   |    |   | 953     |   |      |   | 953       |
| Finished        products and goods                         |   | 1,962     |   | 703       |   |    |   | 17      |   | 2,682     |   | 2,528     |   | 557     |   |    |   | 92        |   | 3,177     |
| Advances                                                   |   |      |   |      |   | 179     |   |    |   | 179       |   |      |   |    |   |    |   |      |   |      |
|                                                       |   | **2,897** |   | **1,029** |   | **732** |   | **841** |   | **5,499** |   | **3,042** |   | **837** |   | **953** |   | **1,250** |   | **6,082** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Inventories increased by euro 583 million primarily due to:(i) an increase in the trade value of the inventories in the Gas& Power segment reflecting favorable trends in the gas priceformulas (euro 661 million); and (ii) inclusion in consolidationof Distrigas NV (euro 322 million). Those increases werepartially offset by a decrease of euro 718 million in the tradevalue of crude oil and petroleum products inventories in theRefining & Marketing segment primarily due to the impact offalling oil and petroleum product prices resulting in therecognition of a provision to write inventories down to their netrealizable value at the year end. 

Contract work in progress for euro 953 million (euro 553million at December 31, 2007) are net of prepayments for euro 274million (euro 577 million at December 31, 2007) within the limitsof contractual considerations.

Inventories are stated net of the valuation allowance of euro697 million (euro 75 million at December 31, 2007):

| (euro        million) |   | **Value at****Dec. 31, 2007** |   | **Additions** |   | **Deductions** |   | **Other changes** |   | **Value at****Dec. 31, 2008** |
|-----------------------|--------|-------------------------------|--------|---------------|--------|----------------|--------|-------------------|--------|-------------------------------|
|                  |   |                               |   |               |   |                |   |                   |   |                               |

|   | **75** |   |   | 628 |   |   | (5 | ) |   | (1 | ) |   | **697** |   |
|--------|--------|--------|--------|-----|--------|--------|----|---|--------|----|---|--------|---------|--------|

|   |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|

The additions of euro 628 million (euro 9 million in 2007)primarily related to the Refining & Marketing segment (euro402 million) and to Petrochemicals (euro 215 million) as aconsequence of the alignment of the inventories to their netrealizable values at the closing date.

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##### Table of Contents

**5 Current tax assets**Current tax assets were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Italian subsidiaries        |   | 634     |   | 53      |
|-----------------------------|--------|---------|--------|---------|
| Foreign        subsidiaries |   | 69      |   | 117     |
|                        |   | **703** |   | **170** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

The euro 533 million decrease in the current income tax assetsprimarily referred to Eni SpA which has used the tax receivablesto offset the tax payables for 2008 year (euro 554 million).

**6 Other current tax assets**Other current tax assets were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| VAT                              |   | 376     |   | 623       |
|----------------------------------|--------|---------|--------|-----------|
| Excise and        customs duties |   | 316     |   | 167       |
| Other taxes and duties           |   | 141     |   | 340       |
|                             |   | **833** |   | **1,130** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

**7 Other current assets**Other current assets were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Fair value of non-hedging derivatives            |   | 629       |   | 1,608     |
|--------------------------------------------------|--------|-----------|--------|-----------|
| Fair value        of cash flow hedge derivatives |   | 10        |   | 474       |
| Other assets                                     |   | 441       |   | 267       |
|                                             |   | **1,080** |   | **2,349** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

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##### Table of Contents

The fair value of derivative contracts which donot meet the criteria to be classified as hedges under IFRS wasas follows:

|   |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|--------|--------|-------------------|--------|-------------------|
|   |   |                   |   |                   |

| (euro        million) |    | Fair value |    | Purchase commitments |    | Sale        commitments |    | Fair value |    | Purchase commitments |    | Sale        commitments |
|-----------------------|--------------|------------|--------------|----------------------|--------------|-------------------------|--------------|------------|--------------|----------------------|--------------|-------------------------|
|                  |         |            |         |                      |         |                         |         |            |         |                      |         |                         |

| **Non-hedging derivatives on exchange rate**        |   |    |   |      |   |      |   |      |   |      |   |      |
|-----------------------------------------------------|--------|---------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|
| Interest        currency swap                       |   | 170     |   | 821       |   | 291       |   | 141       |   | 403       |   | 200       |
| Currency swap                                       |   | 69      |   | 1,596     |   | 2,881     |   | 202       |   | 2,654     |   | 1,712     |
| Other                                               |   | 3       |   | 18        |   | 11        |   | 314       |   | 111       |   | 1,202     |
|                                                |   | **242** |   | **2,435** |   | **3,183** |   | **657**   |   | **3,168** |   | **3,114** |
| **Non-hedging        derivatives on interest rate** |   |    |   |      |   |      |   |      |   |      |   |      |
| Interest rate swap                                  |   | 91      |   | 248       |   | 3,466     |   | 29        |   | 217       |   | 703       |
| Other                                               |   |    |   |      |   |      |   |      |   | 4         |   |      |
|                                                |   | **91**  |   | **248**   |   | **3,466** |   | **29**    |   | **221**   |   | **703**   |
| **Non-hedging        derivatives on commodities**   |   |    |   |      |   |      |   |      |   |      |   |      |
| Over the counter                                    |   | 12      |   | 75        |   | 22        |   | 864       |   | 1,270     |   | 2,709     |
| Other                                               |   | 284     |   | 2         |   | 1,218     |   | 58        |   | 65        |   | 53        |
|                                                |   | **296** |   | **77**    |   | **1,240** |   | **922**   |   | **1,335** |   | **2,762** |
|                                                |   | **629** |   | **2,760** |   | **7,889** |   | **1,608** |   | **4,724** |   | **6,579** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Fair value of the derivative contracts is determined usingmarket quotations provided by the primary info-provider, or inthe absence of market information, appropriate valuation methodsused in the marketplace.

The increase in the fair value of the non-hedging derivativesof euro 979 million referred to the fair value of the derivativesderiving from the consolidation of Distrigas NV after theacquisition of control by the Gas & Power segment (euro 637million).

Fair value of the cash flow hedges of euro 474 millionreferred to Distrigas NV (euro 293 million) and to Exploration& Production segment (euro 181 million). The Distrigas NVderivatives were designated to hedge surpluses or deficits of gasto achieve a proper balance in the gas portfolio andsales/purchases of amounts of gas and oil products at fixedprice. Fair value related to the Exploration & Productionsegment referred to the fair value of the future sale agreementsof the proved oil reserves with a deadline by 2009. Thosederivatives were entered into to hedge exposure to variability infuture cash flows deriving from the sale in the 2008-2011 periodof approximately 2% of Eni’s proved reserves as of December31, 2006 corresponding to 125.7 mmBBL, decreasing to 79.7 mmBOEas of the end of December 2008 due to transactions settled in theyear. These hedging transactions were undertaken in connectionwith acquisitions of oil and gas assets in the Gulf of Mexico andCongo that were executed in 2007.

Fair value of contracts expiring by 2009 is givenin Note 20 - Other current liabilities; fair value of contractsexpiring beyond 2009 is given in Note 15 - Other non-currentreceivables and in Note 25 - Other non-current liabilities. Theeffects of the evaluation at fair value of cash flow hedgederivatives are given in the Note 27 - Shareholders’ equityand in the Note 32 - Finance income (expense).

The nominal value of cash flow hedge derivativesreferred to purchase and sale commitments for euro 1,069 millionand euro 3,130 million. Information on the hedged risks and thehedging policies is given in Note 29 - Guarantees, commitmentsand risks.

Other assets amounted to euro 267 million (euro441 million at December 31, 2007) and included prepayments andaccrued income for euro 63 million (euro 297 million at December31, 2007), rentals for euro 31 million (euro 21 million atDecember 31, 2007), and insurance premiums for euro 11 million(euro 10 million at December 31, 2007).

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##### Table of Contents

**Non-current assets****8 Property, plant and equipment**Analysis of tangible assets is set out below:

| (euro        million) |   | **Net value at the beginning of the year** |   | **Investments** |   | **Depreciation** |   | **Impairments** |   | **Change in the scope of consolidation** |   | **Currency translation differences** |   | **Other changes** |   | **Net value at the end of the year** |   | **Gross value at the end of the year** |   | **Provisions for amortization and        impairments** |
|-----------------------|--------|--------------------------------------------|--------|-----------------|--------|------------------|--------|-----------------|--------|------------------------------------------|--------|--------------------------------------|--------|-------------------|--------|--------------------------------------|--------|----------------------------------------|--------|--------------------------------------------------------|
|                  |   |                                            |   |                 |   |                  |   |                 |   |                                          |   |                                      |   |                   |   |                                      |   |                                        |   |                                                        |

| **Dec. 31, 2007**                        |   |       |   |   |       |   |   |       |   |   |       |   |   |      |   |   |       |   |   |      |   |   |       |   |   |        |   |   |       |   |
|------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|-----------|--------|--------|------------|--------|--------|-----------|--------|--------|------------|--------|--------|-------------|--------|--------|------------|--------|
| Land                                     |   | 442        |   |   | 4          |   |   |       |   |   |       |   |   | 28        |   |   |       |   |   | 123       |   |   | 597        |   |   | 627         |   |   | 30         |   |
| Buildings                                |   | 1,406      |   |   | 74         |   |   | (98        | )      |   | (3         | )      |   | 115       |   |   | (3         | )      |   | (152      | )      |   | 1,339      |   |   | 3,123       |   |   | 1,784      |   |
| Plant and        machinery               |   | 32,494     |   |   | 1,774      |   |   | (4,642     | )      |   | (37        | )      |   | 31        |   |   | (1.530     | )      |   | 4.885     |   |   | 32,975     |   |   | 78,030      |   |   | 45,055     |   |
| Industrial and commercial equipment      |   | 230        |   |   | 163        |   |   | (112       | )      |   |       |   |   | 40        |   |   | (8         | )      |   | 38        |   |   | 351        |   |   | 1,434       |   |   | 1,083      |   |
| Other        assets                      |   | 328        |   |   | 86         |   |   | (83        | )      |   | (3         | )      |   | 1         |   |   | (11        | )      |   | 23        |   |   | 341        |   |   | 1,361       |   |   | 1,020      |   |
| Tangible assets in progress and advances |   | 6,229      |   |   | 6,263      |   |   |       |   |   | (97        | )      |   | 235       |   |   | (648       | )      |   | (666      | )      |   | 11,316     |   |   | 11,969      |   |   | 653        |   |
|                                     |   | **41,129** |   |   | **8,364**  |   |   | **(4,935** | **)**  |   | **(140**   | **)**  |   | **450**   |   |   | **(2,200** | **)**  |   | **4,251** |   |   | **46,919** |   |   | **96,544**  |   |   | **49,625** |   |
| **Dec. 31, 2008**                        |   |       |   |   |       |   |   |       |   |   |       |   |   |      |   |   |       |   |   |      |   |   |       |   |   |        |   |   |       |   |
| Land                                     |   | 597        |   |   | 8          |   |   |       |   |   |       |   |   | (7        | )      |   |       |   |   | 27        |   |   | 625        |   |   | 655         |   |   | 30         |   |
| Buildings                                |   | 1,339      |   |   | 101        |   |   | (105       | )      |   | (29        | )      |   | (122      | )      |   | 7          |   |   | (341      | )      |   | 850        |   |   | 3,055       |   |   | 2,205      |   |
| Plant and machinery                      |   | 32,975     |   |   | 3,486      |   |   | (5,648     | )      |   | (652       | )      |   | 1.299     |   |   | 123        |   |   | 4,535     |   |   | 36,118     |   |   | 86,714      |   |   | 50,596     |   |
| Industrial and commercial equipment      |   | 351        |   |   | 180        |   |   | (158       | )      |   | (3         | )      |   |      |   |   | 1          |   |   | 230       |   |   | 601        |   |   | 1,722       |   |   | 1,121      |   |
| Other assets                             |   | 341        |   |   | 124        |   |   | (83        | )      |   | (6         | )      |   | (13       | )      |   | 5          |   |   | 9         |   |   | 377        |   |   | 1,563       |   |   | 1,186      |   |
| Tangible assets in progress and advances |   | 11,316     |   |   | 8,183      |   |   |       |   |   | (653       | )      |   | 2.344     |   |   | 414        |   |   | (4,342    | )      |   | 17,262     |   |   | 18,481      |   |   | 1,219      |   |
|                                     |   | **46,919** |   |   | **12,082** |   |   | **(5,994** | **)**  |   | **(1,343** | **)**  |   | **3.501** |   |   | **550**    |   |   | **118**   |   |   | **55,833** |   |   | **112,190** |   |   | **56,357** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Capital expenditures of euro 12,082 million (euro 8,364million at December 31, 2007) primarily related to theExploration & Production segment (euro 7,611 million), theEngineering & Construction segment (euro 2,015 million), theGas & Power segment (euro 1,318 million) and the Refining& Marketing segment (euro 941 million). Capital expendituresincluded capitalized finance expenses of euro 236 million (euro180 million at December 31, 2007) essentially related to theExploration & Production segment (euro 109 million), theRefining & Marketing segment (euro 44 million) and the Gas& Power segment (euro 42 million). The interest rate used forthe capitalization of finance expense ranged from 3.5% to 5.1%(4.4% and 5.2% at December 31, 2007).

The depreciation rates used were as follows:

| (%)                                 |   |   |   |   |   |   |   |   |   |
|-------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Buildings                           |   |   |   |   | 2      |   | -      | 10     |   |
| Plant and machinery                 |   |   |   |   | 2      |   | -      | 10     |   |
| Industrial and commercial equipment |   |   |   |   | 4      |   | -      | 33     |   |
| Other assets                        |   |   |   |   | 6      |   | -      | 33     |   |

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##### Table of Contents

The break-down by segment of impairments amounting to euro1,343 million (euro 140 at December 31, 2007) and the associatedtax effect is provided below:

| (euro        million) |   | **2007** |   | **2008** |
|-----------------------|--------|----------|--------|----------|
|                  |   |          |   |          |

| **Impairment**                                          |   |    |   |      |
|---------------------------------------------------------|--------|---------|--------|-----------|
| Exploration & Production                            |   | 86      |   | 765       |
| Refining        & Marketing                         |   | 52      |   | 292       |
| Petrochemicals                                          |   |    |   | 279       |
| Other        segments                                   |   | 2       |   | 7         |
|                                                    |   | **140** |   | **1,343** |
| **Fiscal        effect**                                |   |    |   |      |
| Exploration & Production                            |   | 30      |   | 213       |
| Refining        & Marketing                         |   | 19      |   | 108       |
| Petrochemicals                                          |   |    |   | 88        |
| Other        segments                                   |   |    |   | 2         |
|                                                    |   | **49**  |   | **411**   |
| **Impairment        net of the relevant fiscal effect** |   |    |   |      |
| Exploration & Production                            |   | 56      |   | 552       |
| Refining        & Marketing                         |   | 33      |   | 184       |
| Petrochemicals                                          |   |    |   | 191       |
| Other        segments                                   |   | 2       |   | 5         |
|                                                    |   | **91**  |   | **932**   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

In assessing whether impairment is required, the carryingvalue of the asset is compared with its recoverable amount. Therecoverable amount is the higher of the asset’s fair valueless costs to sell and value in use. Given the nature ofEni’s activities, information on the fair value of an assetis usually difficult to obtain unless negotiations with potentialpurchasers are taking place. Consequently the recoverable amountused in assessing the impairment charges described below is valuein use. Value in use is calculated by discounting the estimatedcash flows determined on the basis of the best informationavailable at the moment of the assessment deriving from: (i) theCompany’s four-year plan approved by the top managementwhich provides information on expected oil and gas production,sales volumes, capital expenditures, operating costs and marginsand industrial and marketing set-up, as well as trends in themain monetary variables, including inflation, nominal interestrates and exchange rates. For the subsequent years beyond theplan horizon, a real growth rate ranging from 0% to 2% has beenused; (ii) the commodity prices have been assessed based on theforward prices prevailing in the market place as of the balancesheet date for the first four years of the cash flow projectionsand the long-term price assumptions adopted by the Company’smanagement for strategic planning purposes for the followingyears (see "Basis of presentation").

Post-tax cash flows are discounted at the rate whichcorresponds for the Exploration & Production, Refining& Marketing and Petrochemicals segments to theCompany’s weighted average cost of capital, adjusted toconsider the risks specific to each country of activity. Thepost-tax WACC used for impairment purposes has ranged from 8.5%to 12.5%. Post-tax cash flows and discount rates have beenadopted as they result in an assessment that is substantiallyequal to a pre-tax assessment.

In the Exploration & Production segment the mainimpairments were associated to proved and unproved properties inTurkmenistan, Iran and Gulf of Mexico as a consequence of changesin the regulatory and contractual framework, cost increases, aswell as a changed pricing environment.

In the Refining & Marketing segment the main impairmentsreferred to: (i) refining plants due to a worsening pricingenvironment and specific plant factors (low complexity and highfixed operating costs); and (ii) the motorway retail network ofservice stations due to a worsening pricing environment, lowerforecast volumes, increased motorway royalties and thecommitments with the grantor to execute certain capitalexpenditures that bear no return.

In Petrochemicals the main impairments referred to: (i)aromatic plants of the Sicilian industrial base and of PortoMarghera due to lower expected profitability associated with aworsening margin environment; (ii) styrene plants of Mantova dueto the structural drop of the demand by the users of polystyrene;and (iii) polyethylene plants of the Sicilian industrial base dueto the low competitiveness of the product, to the drop of thedemand and the competitive pressure.

Changes in the consolidation area of euro 3,501 million (euro450 million at December 31, 2007) referred to the acquisition ofcontrol by the Exploration & Production segment of BurrenEnergy Plc (euro 2,543 million), First 

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Petroleums Ltd (euro 757 million), Hindustan Oil ExplorationCo (euro 199 million) and Eni Hewett Ltd (euro 118 million), theacquisition of control by the Gas & Power segment ofDistrigas NV (euro 30 million) and the sale by Refining &Marketing of Agip España SA (euro 146 million). More informationon acquisitions is included in the Note 28 - Other information.

Foreign currency translation differences of euro 550 millionwere primarily related to translation of entities accountsdenominated in U.S. dollar (euro 1,374 million). This effect waspartially offset by translation of entities accounts denominatedin Norwegian krones (euro 433 million) and British pounds (euro308 million).

Other changes in the net book value of tangible assets (euro118 million) referred to the initial recognition and change inthe estimated amount of the costs for the dismantling andrestoration of sites referring to the Exploration &Production segment (euro 620 million). This effect was partiallyoffset by asset disposals for euro 318 million, of which euro 248million related to oil and gas assets of the Exploration &Production segment.

The accumulated impairments amounted to euro 3,328 million andeuro 4,692 million at December 31, 2007 and 2008, respectively.

At December 31, 2008, Eni pledged property, plant andequipment for euro 27 million primarily as collateral againstcertain borrowings (euro 52 million at December 31, 2007).

Government grants recorded as a decrease of property, plantand equipment amounted to euro 651 million (euro 682 million atDecember 31, 2007).

Assets acquired under financial lease agreements amounted toeuro 163 million, of which euro 127 million related to a drillingplatform by the Engineering & Construction segment, euro 25million related to FPSO ships used by the Exploration &Production segment to support oil production and treatmentactivities and euro 11 million related to service stations in theRefining & Marketing segment.

Contractual commitments related to the purchase of property,plant and equipment are included in Note 29 - Guarantees,commitments and risks - Liquidity risk.

Property, plant and equipment under concession arrangementsare described in Note 29 - Guarantees, commitments and risks -Assets under concession arrangements.

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**Property, plant and equipment by segment**

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| **Property, plant and equipment, gross**                                |   |       |   |   |        |   |
|-------------------------------------------------------------------------|--------|------------|--------|--------|-------------|--------|
| Exploration        & Production                                     |   | 54,284     |   |   | 66,023      |   |
| Gas & Power                                                         |   | 17,438     |   |   | 18,944      |   |
| Refining        & Marketing                                         |   | 12,421     |   |   | 12,899      |   |
| Petrochemicals                                                          |   | 4,918      |   |   | 5,036       |   |
| Engineering        & Construction                                   |   | 5,823      |   |   | 7,702       |   |
| Other activities                                                        |   | 1,543      |   |   | 1,550       |   |
| Corporate        and financial companies                                |   | 344        |   |   | 391         |   |
| Elimination of intra-group profits                                      |   | (227       | )      |   | (355        | )      |
|                                                                    |   | **96,544** |   |   | **112,190** |   |
| **Accumulated depreciation, amortization and        impairment losses** |   |       |   |   |        |   |
| Exploration        & Production                                     |   | 27,806     |   |   | 32,811      |   |
| Gas & Power                                                         |   | 6,179      |   |   | 6,863       |   |
| Refining        & Marketing                                         |   | 7,926      |   |   | 8,403       |   |
| Petrochemicals                                                          |   | 3,819      |   |   | 4,124       |   |
| Engineering        & Construction                                   |   | 2,310      |   |   | 2,548       |   |
| Other activities                                                        |   | 1,461      |   |   | 1,467       |   |
| Corporate        and financial companies                                |   | 148        |   |   | 179         |   |
| Elimination of intra-group profits                                      |   | (24        | )      |   | (38         | )      |
|                                                                    |   | **49,625** |   |   | **56,357**  |   |
| **Property, plant and equipment, net**                                  |   |       |   |   |        |   |
| Exploration        & Production                                     |   | 26,478     |   |   | 33,212      |   |
| Gas & Power                                                         |   | 11,259     |   |   | 12,081      |   |
| Refining        & Marketing                                         |   | 4,495      |   |   | 4,496       |   |
| Petrochemicals                                                          |   | 1,099      |   |   | 912         |   |
| Engineering        & Construction                                   |   | 3,513      |   |   | 5,154       |   |
| Other activities                                                        |   | 82         |   |   | 83          |   |
| Corporate        and financial companies                                |   | 196        |   |   | 212         |   |
| Elimination of intra-group profits                                      |   | (203       | )      |   | (317        | )      |
|                                                                    |   | **46,919** |   |   | **55,833**  |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

 

**9 Other assets**The carrying amount of the expropriated Dación assets(euro 563 million at December 31, 2007) have been reclassified inthe item "Other non-current receivables" following thesettlement agreement with the Republic of Venezuela. Under theterms of this agreement, Eni will receive cash compensation, apart of which has been already collected in the year, to be paidin seven yearly installments, yielding interest income from thedate of the settlement. The net present value of this cashcompensation is in line with the book value of assets, net of therelated provisions.

**10 Inventory - compulsory stock**Inventory - compulsory stock was as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Crude oil and petroleum products |   | 2,015     |   | 1,040     |
|----------------------------------|--------|-----------|--------|-----------|
| Natural        gas               |   | 156       |   | 156       |
|                             |   | **2,171** |   | **1,196** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

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Compulsory stock was primarily held by Italian companies (euro2,008 million and euro 1,184 million at December 31, 2007 and2008, respectively) in accordance with minimum stock requirementsset forth by applicable laws. The decrease of euro 975 million incrude oil and petroleum products is primarily due to theimpairment for alignment of the inventories to the net realizablevalues recognized at year end (euro 724 million).

**11 Intangible assets**Intangible assets were as follows: 

| (euro        million) |   | **Net value at the beginning of the year** |   | **Investments** |   | **Amortization** |   | **Changes in the scope of consolidation** |   | **Other changes** |   | **Net value at the end of the year** |   | **Gross value at the end of the year** |   | **Provisions for amortization        and writedowns** |
|-----------------------|--------|--------------------------------------------|--------|-----------------|--------|------------------|--------|-------------------------------------------|--------|-------------------|--------|--------------------------------------|--------|----------------------------------------|--------|-------------------------------------------------------|
|                  |   |                                            |   |                 |   |                  |   |                                           |   |                   |   |                                      |   |                                        |   |                                                       |

| **Dec. 31, 2007**                                          |   |      |   |   |      |   |   |       |   |   |      |   |   |    |   |   |       |   |   |       |   |   |      |   |
|------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|--------|-----------|--------|--------|---------|--------|--------|------------|--------|--------|------------|--------|--------|-----------|--------|
| **Intangible        assets with finite useful lives**      |   |      |   |   |      |   |   |       |   |   |      |   |   |    |   |   |       |   |   |       |   |   |      |   |
| Exploration expenditures                                   |   | 409       |   |   | 1,682     |   |   | (1,812     | )      |   |      |   |   | 470     |   |   | 749        |   |   | 1,509      |   |   | 760       |   |
| Industrial        patents and intellectualproperty rights  |   | 112       |   |   | 40        |   |   | (81        | )      |   |      |   |   | 77      |   |   | 148        |   |   | 1,179      |   |   | 1,031     |   |
| Concessions, licenses, trademarksand similar        items  |   | 856       |   |   | 12        |   |   | (83        | )      |   | 1         |   |   |    |   |   | 786        |   |   | 2,449      |   |   | 1,663     |   |
| Service        concession arrangements                     |   | 3,183     |   |   | 168       |   |   | (96        | )      |   |      |   |   | (37     | )      |   | 3,218      |   |   | 5,699      |   |   | 2,481     |   |
| Intangible assets in progressand advances                  |   | 151       |   |   | 312       |   |   |       |   |   |      |   |   | (86     | )      |   | 377        |   |   | 381        |   |   | 4         |   |
| Other        intangible assets                             |   | 141       |   |   | 15        |   |   | (24        | )      |   | 36        |   |   | (10     | )      |   | 158        |   |   | 572        |   |   | 414       |   |
|                                                       |   | **4,852** |   |   | **2,229** |   |   | **(2,096** | **)**  |   | **37**    |   |   | **414** |   |   | **5,436**  |   |   | **11,789** |   |   | **6,353** |   |
| **Intangible        assets with indefinite useful lives**  |   |      |   |   |      |   |   |       |   |   |      |   |   |    |   |   |       |   |   |       |   |   |      |   |
| Goodwill                                                   |   | 2,084     |   |   |      |   |   |       |   |   |      |   |   | 31      |   |   | 2,115      |   |   |       |   |   |      |   |
|                                                       |   | **6,936** |   |   | **2,229** |   |   | **(2,096** | **)**  |   | **37**    |   |   | **445** |   |   | **7,551**  |   |   |       |   |   |      |   |
| **Dec. 31, 2008**                                          |   |      |   |   |      |   |   |       |   |   |      |   |   |    |   |   |       |   |   |       |   |   |      |   |
| **Intangible assets with finite useful lives**             |   |      |   |   |      |   |   |       |   |   |      |   |   |    |   |   |       |   |   |       |   |   |      |   |
| Exploration expenditures                                   |   | 749       |   |   | 1,907     |   |   | (2,097     | )      |   | 326       |   |   | 77      |   |   | 962        |   |   | 2,286      |   |   | 1,324     |   |
| Industrial patents and intellectual property        rights |   | 148       |   |   | 44        |   |   | (85        | )      |   |      |   |   | 42      |   |   | 149        |   |   | 1,203      |   |   | 1,054     |   |
| Concessions, licenses, trademarks and similar        items |   | 786       |   |   | 17        |   |   | (93        | )      |   | (15       | )      |   | 38      |   |   | 733        |   |   | 2,475      |   |   | 1,742     |   |
| Service concession arrangements                            |   | 3,218     |   |   | 230       |   |   | (109       | )      |   |      |   |   | (17     | )      |   | 3,322      |   |   | 5,837      |   |   | 2,515     |   |
| Intangible assets in progressand advances                  |   | 377       |   |   | 264       |   |   |       |   |   |      |   |   | (61     | )      |   | 580        |   |   | 590        |   |   | 10        |   |
| Other intangible assets                                    |   | 158       |   |   | 18        |   |   | (52        | )      |   | 1,600     |   |   | 14      |   |   | 1,738      |   |   | 2,000      |   |   | 262       |   |
|                                                       |   | **5,436** |   |   | **2,480** |   |   | **(2,436** | **)**  |   | **1,911** |   |   | **93**  |   |   | **7,484**  |   |   | **14,391** |   |   | **6,907** |   |
| **Intangible assetswith indefinite useful lives**          |   |      |   |   |      |   |   |       |   |   |      |   |   |    |   |   |       |   |   |       |   |   |      |   |
| Goodwill                                                   |   | 2,115     |   |   |      |   |   |       |   |   | 1,439     |   |   | (1      | )      |   | 3,553      |   |   |       |   |   |      |   |
|                                                       |   | **7,551** |   |   | **2,480** |   |   | **(2,436** | )      |   | **3,350** |   |   | **92**  |   |   | **11,037** |   |   |       |   |   |      |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Exploration expenditures of euro 962 million related toacquisition costs of unproved reserves other than probable andpossible resources included in business combinations and thepurchase of mineral rights. Main additions in the year includedexploration drilling expenditures which were fully amortized asincurred for euro 1,715 million included within"investments" (euro 1,610 million at December 31,2007).

Concessions, licenses, trademarks and similar items for euro733 million primarily comprised transmission rights for naturalgas imported from Algeria (euro 482 million) and concessions formineral exploration (euro 189 million).

Service concession arrangements primarily refer to the Italiangas distribution activity (euro 3,111 million and euro 3,205million at December 31, 2007 and 2008, respectively). Suchactivity is conducted on the basis of concessions granted bylocal public entities. At the expiry date of the concession,compensation is paid, defined by using criteria of businessappraisal, to the outgoing operator following the sale of its owngas distribution network. Service tariffs for distribution aredefined on the basis of a method established by the Authority forElectricity and Gas. Legislative Decree No. 164/2000 provides thegrant of distribution service exclusively by tender, with a 

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maximum length of 12 years. Government grants recorded as adecrease of service concession arrangements amounted to euro 657million (euro 513 million at December 31, 2007).

Other intangible assets with finite useful lives of euro 1,738million primarily referred to: (i) customer relationship andorder backlog for euro 1,355 million recognized after theacquisition of control of Distrigas NV. These assets areamortized on the basis of the supply contract with the longestterm (19 years) and the residual useful life of the sale contract(4 years); (ii) the development project of the gas storagecapacity recognized after the acquisition of control of EniHewett Ltd (euro 208 million); (iii) royalties for the use oflicenses by Polimeri Europa SpA (euro 72 million); and (iv)estimated costs for Eni’s social responsibility projects inrelation to oil development programs in Val d’Agri (euro 18million) following commitments made with the Basilicata Region.

The depreciation rates used were as follows:

| (%)                                                        |   |   |   |   |   |   |   |   |   |
|------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Exploration expenditures                                   |   |   |   |   | 10     |   | -      | 33     |   |
| Industrial patents and        intellectual property rights |   |   |   |   | 20     |   | -      | 33     |   |
| Concessions, licenses, trademarks and similar        items |   |   |   |   | 7      |   | -      | 33     |   |
| Service concession        arrangements                     |   |   |   |   | 2      |   | -      | 20     |   |
| Other intangible assets                                    |   |   |   |   | 4      |   | -      | 25     |   |

Changes in the consolidation area related to the intangibleassets with a finite useful life of euro 1,911 million primarilyrelated to the acquisition of control by the Gas & Powersegment on Distrigas NV for euro 1,395 million (customerrelationship for euro 1,216 million, order backlog for euro 165million and software for euro 14 million), unproved reservesother than probable and possible resources recognized after theacquisition of control by the Exploration & Productionsegment on Burren Energy Plc for euro 326 million and thedevelopment project of the gas storage capacity recognized afterthe acquisition of control of Eni Hewett Ltd (euro 208 million).

Change in the consolidation area related to the intangibleassets with an indefinite useful life (goodwill) of euro 1,439million primarily refers to the acquisition of control by the Gas& Power segment on Distrigas NV (euro 1,245 million), theacquisition of control by the Exploration & Productionsegment on Burren Energy Plc (euro 89 million), on First CalgaryPetroleums Ltd (euro 88 million) and on Eni Hewett (euro 39million).

The carrying amount of goodwill at the end of the year waseuro 3,553 million (euro 2,115 million at December 31, 2007). Thebreak-down by operating segment is as follows: 

| (euro        million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|-----------------------|--------|-------------------|--------|-------------------|
|                  |   |                   |   |                   |

| Exploration & Production          |   | 158       |   | 266       |
|---------------------------------------|--------|-----------|--------|-----------|
| Gas &        Power                |   | 1,125     |   | 2,399     |
| Refining & Marketing              |   | 86        |   | 142       |
| Engineering        & Construction |   | 746       |   | 746       |
|                                  |   | **2,115** |   | **3,553** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Goodwill acquired through business combinations has beenallocated to the cash generating units ("CGUs") thatare expected to benefit from the synergies of the acquisition.The recoverable amount of the CGUs is the higher of: (i) fairvalue less costs to sell if there is an active market or recenttransactions for similar assets within the same industry betweenknowledgeable and willing parties; and (ii) value-in-usedetermined by discounting the estimated future cash flowsdetermined on the basis of the best pieces of informationavailable at the moment of the assessment deriving from: (a) theCompany’s four-year plan approved by the top managementwhich provides information on expected oil and gas production,sales volumes, capital expenditures, operating costs and marginsand industrial and marketing set-up, as well as trends in themain monetary variables, including inflation, nominal interestrates and exchange rates. For the subsequent years beyond theplan horizon, a real growth rate ranging from 0% to 2% has beenused; (b) the commodity prices have been assessed based on theforward prices prevailing in the market place as of the balancesheet date for the first four years of the cash flow projectionsand the long-term price assumptions adopted by the Company’stop management for strategic planning purposes for the followingyears (see Basis of presentation).

Value-in-use is determined by discounting post-tax cash flowsat the rate which corresponds: (i) for the Exploration &Production and Refining & Marketing and Petrochemicalssegments at the Company’s weighted average cost of capital(post-tax WACC), adjusted to consider risks specific to eachcountry of activity. WACC used for the impairment purposes hasranged from 8.5% to 12.5%; (ii) for the Gas & Power andEngineering 

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& Construction segments at their specific WACC. Forthe Gas & Power segment it has been estimated on the basis ofa sample of companies operating in the same segment, for theEngineering & Construction segment on the basis of marketdata. WACC used for impairments in the Gas & Power segmenthas been adjusted to take into consideration risks specific toeach country of activity, while WACC used for impairments in theEngineering & Construction segment has not been adjustedas most of the company assets are not permanently located in aspecific country. WACC used for impairment has ranged from 7.5%to 9% for the Gas & Power segment and it was 8% for theEngineering & Construction segment; and (iii) for theregulated activities in the Italian natural gas sector, thediscount rates have been assumed equal to the rates of returndefined by the Italian Authority for Electricity and Gas.

Post-tax cash flows and discount rates have been adopted asthey result in an assessment that is substantially equal to apre-tax assessment.

Goodwill has been allocated to the following CGUs:

**Gas & Power**

| (euro        million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|-----------------------|--------|-------------------|--------|-------------------|
|                  |   |                   |   |                   |

| Domestic gas market                                |   | 743       |   | 743       |
|----------------------------------------------------|--------|-----------|--------|-----------|
| Foreign        gas market                          |   | 67        |   | 1,341     |
| *- of which Distrigas NV*                          |   |      |   | *1,245*   |
| Domestic        natural gas transportation network |   | 305       |   | 305       |
| Other                                              |   | 10        |   | 10        |
|                                               |   | **1,125** |   | **2,399** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Goodwill allocated to the CGU domestic gas market referredprimarily to goodwill recognized following the purchase ofminorities in Italgas SpA in 2003 through a public offering (euro706 million). The key assumptions adopted for assessing therecoverable amount of the CGU which exceeds its carrying amountreferred to commercial margins, forecast volumes, the discountrate and the growth rates adopted to determine the terminalvalue. Information on these drivers has been collected from thefour-year-plan approved by the Company’s top managementwhile the terminal value has been estimated through theperpetuity method of the last-year-plan. The excess of therecoverable amount of the domestic gas market CGU over itscarrying amount including the allocated portion of goodwill(headroom) would be reduced to zero under each of the followinghypothesis: (i) a decrease of 20% in the projected commercialmargins in each of the four years of the plan; (ii) a decrease of20% in the expected volumes in each of the four years of theplan; (iii) an increase of 1.7 percentage points in the discountrate; and (iv) a negative real growth rate of 2%.

Goodwill allocated to the Distrigas CGU has been recognizedfollowing the acquisition of a controlling interest of 57.24% inthe Belgian company in October 2008. The allocation is on apreliminary basis. When the price allocation is finalized,goodwill is expected to be allocated to the different CGUs thatare expected to benefit from the synergies of the acquisition. Atthat time, it will be possible to determine any excess of therecoverable amount of the CGUs over their carrying amounts,including any allocated portion of goodwill, and define thehypothesis under which the headroom would be reduced to zero.

Goodwill allocated to the domestic natural gas transportationnetwork CGU referred to the purchase of own shares by Snam ReteGas SpA and it is equal to the difference between the purchasecost over the carrying amount of the corresponding share ofequity. The recoverable amount of the CGU is assessed based onits Regulatory Asset Base (RAB) as recognized by the ItalianAuthority for Electricity and Gas and it is higher than itscarrying amount, including the allocated goodwill. Managementbelieves that no reasonably possible change in the assumptionsadopted would cause the headroom of the CGU to be reduced tozero.

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**Engineering & Construction**The segment goodwill of euro 746 million was mainlyrecognized following the acquisition of Bouygues Offshore SA, nowSaipem SA (euro 711 million) and was allocated to the followingCGUs:

| (euro        million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|-----------------------|--------|-------------------|--------|-------------------|
|                  |   |                   |   |                   |

| Offshore constructions       |   | 416     |   | 416     |
|------------------------------|--------|---------|--------|---------|
| Onshore        constructions |   | 315     |   | 314     |
| Other                        |   | 15      |   | 16      |
|                         |   | **746** |   | **746** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

The key assumptions adopted for assessing the recoverableamount of the CGUs which exceeds the carrying amount referred tooperating results, the discount rate and the growth rates adoptedto determine the terminal value. Information on these drivers hasbeen collected from the four-year-plan approved by theCompany’s top management while the terminal value has beenestimated by using a perpetual growth rate of 2% applied to anaverage normalized terminal cash flow.

The following changes in each of the assumptions, all elsebeing equal would cause the headroom of the Offshore constructionCGU to be reduced to zero: (i) decrease of 52% of the operatingresult of the four years of the plan; (ii) increase of 6percentage points of the discount rate; and (iii) negative realgrowth rate.

Changes in each of the assumptions, all else being equal thatwould cause the headroom of the Onshore construction CGU to bereduced to zero are greater than those of the Offshoreconstruction CGU described above. As well, also the headroom forthe Offshore and Onshore CGUs calculated by removing thenormalization of the terminal cash flows results widely positive.

Other changes in goodwill of euro 1 million referred toimpairments of euro 44 million of which euro 38 million primarilyreferred to Exploration & Production which has impaired theinterest in goodwill recognized following the acquisition ofBurren Energy Plc (euro 28 million) and of Lasmo Plc (euro 9million). More information on acquisitions is included in theNote 28 - Other information.

**12 Investments****Equity-accounted investments******Equity-accounted investments were as follows:

| (euro        million) |   | **Value at the beginning of the year** |   | **Acquisition and subscriptions** |   | **Share of profit of equity-accounted        investments** |   | **Share of loss of equity-accounted        investments** |   | **Deduction for dividends** |   | **Currency translation differences** |   | **Other changes** |   | **Value at the end of the year** |
|-----------------------|--------|----------------------------------------|--------|-----------------------------------|--------|------------------------------------------------------------|--------|----------------------------------------------------------|--------|-----------------------------|--------|--------------------------------------|--------|-------------------|--------|----------------------------------|
|                  |   |                                        |   |                                   |   |                                                            |   |                                                          |   |                             |   |                                      |   |                   |   |                                  |

| **Dec. 31, 2007**                                               |   |      |   |   |      |   |   |    |   |   |     |   |   |     |   |   |     |   |   |     |   |   |      |   |
|-----------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|---------|--------|--------|----------|--------|--------|----------|--------|--------|----------|--------|--------|----------|--------|--------|-----------|--------|
| Investments        in unconsolidated entities controlled by Eni |   | 144       |   |   | 4         |   |   | 10      |   |   | (2       | )      |   | (9       | )      |   | (6       | )      |   |     |   |   | 141       |   |
| Joint ventures                                                  |   | 2,506     |   |   | 1,109     |   |   | 481     |   |   | (130     | )      |   | (351     | )      |   | (173     | )      |   | (132     | )      |   | 3,310     |   |
| Associates                                                      |   | 1,236     |   |   | 813       |   |   | 415     |   |   | (3       | )      |   | (220     | )      |   | (42      | )      |   | (11      | )      |   | 2,188     |   |
|                                                            |   | **3,886** |   |   | **1,926** |   |   | **906** |   |   | **(135** | **)**  |   | **(580** | **)**  |   | **(221** | **)**  |   | **(143** | **)**  |   | **5,639** |   |
| **Dec. 31, 2008**                                               |   |      |   |   |      |   |   |    |   |   |     |   |   |     |   |   |     |   |   |     |   |   |      |   |
| Investments in unconsolidated entities        controlled by Eni |   | 141       |   |   | 41        |   |   | 27      |   |   | (6       | )      |   | (5       | )      |   | 3        |   |   | (24      | )      |   | 177       |   |
| Joint ventures                                                  |   | 3,310     |   |   | 47        |   |   | 536     |   |   | (94      | )      |   | (444     | )      |   | (123     | )      |   | 25       |   |   | 3,257     |   |
| Associates                                                      |   | 2,188     |   |   | 289       |   |   | 198     |   |   | (5       | )      |   | (266     | )      |   | 35       |   |   | (402     | )      |   | 2,037     |   |
|                                                            |   | **5,639** |   |   | **377**   |   |   | **761** |   |   | **(105** | **)**  |   | **(715** | **)**  |   | **(85**  | **)**  |   | **(401** | **)**  |   | **5,471** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Acquisitions and subscriptions for euro 377 million related tothe subscription of capital increase for euro 345 million, ofwhich euro 254 million related to Angola LNG Ltd.

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Share of profit of equity-accounted investments and thedecrease following the distribution of the dividends referred tothe following companies:

| (euro        million) |    | **Dec. 31, 2007** |    | **Dec. 31, 2008** |
|-----------------------|--------------|-------------------|--------------|-------------------|
|             |    |                   |    |                   |

|    |    | Share of profit of        equity-accounted investments |    | Deduction for dividends |    | Eni’s interest % |    | Share of profit of        equity-accounted investments |    | Deduction for dividends |    | Eni’s interest % |
|--------------|--------------|--------------------------------------------------------|--------------|-------------------------|--------------|-----------------------|--------------|--------------------------------------------------------|--------------|-------------------------|--------------|-----------------------|
|         |         |                                                        |         |                         |         |                       |         |                                                        |         |                         |         |                       |

| Unión Fenosa Gas SA             |   | 181     |   | 173     |   | 50.00  |   | 200     |   | 185     |   | 50.00  |
|--------------------------------------|--------|---------|--------|---------|--------|--------|--------|---------|--------|---------|--------|--------|
| United Gas        Derivatives Co     |   | 79      |   | 40      |   | 33.33  |   | 107     |   | 127     |   | 33.33  |
| EnBW Eni Verwaltungsgesellschaft mbH |   | 64      |   | 42      |   | 50.00  |   | 40      |   | 22      |   | 50.00  |
| Trans        Austria Gasleitung GmbH |   | 43      |   | 28      |   | 89.00  |   | 39      |   | 28      |   | 89.00  |
| Supermetanol CA                      |   | 34      |   | 36      |   | 34.51  |   | 39      |   | 34      |   | 34.51  |
| Galp        Energia SGPS SA          |   | 255     |   | 126     |   | 33.34  |   | 39      |   | 88      |   | 33.34  |
| Other investments                    |   | 250     |   | 135     |   |   |   | 297     |   | 231     |   |   |
|                                 |   | **906** |   | **580** |   |   |   | **761** |   | **715** |   |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

The share of loss of equity-accounted investmentsof euro 105 million primarily related to Enirepsa Gas Ltd (euro44 million) and Lipardiz - Construção de Estruturas MaritimasLda (euro 40 million).

Other changes of euro 401 million are due to theexclusion from the equity-accounted investments and the inclusionin the consolidation area of Burren Energy Plc after theacquisition of control by the Exploration & Productionsegment (euro 592 million), the disposal of Gaztransport etTechnigaz SAS (euro 115 million). These effects were partiallyoffset by the inclusion in the equity-accounted investments ofAngola LNG Ltd (euro 175 million).

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The following table sets out the net carryingamount relating to equity-accounted: 

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

|   |   | Net carrying amount |   | Eni’s interest % |   | Net carrying amount |   | Eni’s interest % |
|--------|--------|---------------------|--------|-----------------------|--------|---------------------|--------|-----------------------|
|   |   |                     |   |                       |   |                     |   |                       |

| Investments in unconsolidated entities        controlled by Eni:     |   |      |   |   |   |      |   |   |
|----------------------------------------------------------------------|--------|-----------|--------|--------|--------|-----------|--------|--------|
| - Eni Btc        Ltd                                                 |   | 42        |   | 100.00 |   | 62        |   | 100.00 |
| - other investments (*)                                              |   | 99        |   |   |   | 115       |   |   |
|                                                                 |   | **141**   |   |   |   | **177**   |   |   |
| Joint ventures:                                                      |   |      |   |   |   |      |   |   |
| - Artic        Russia BV                                             |   | 925       |   | 60.00  |   | 895       |   | 60.00  |
| - Unión Fenosa Gas SA                                           |   | 507       |   | 50.00  |   | 499       |   | 50.00  |
| - Blue        Stream Pipeline Co BV                                  |   | 298       |   | 50.00  |   | 351       |   | 50.00  |
| - EnBW Eni Verwaltungsgesellschaft mbH                               |   | 256       |   | 50.00  |   | 268       |   | 50.00  |
| - Azienda        Energia e Servizi Torino SpA                        |   | 162       |   | 49.00  |   | 166       |   | 49.00  |
| - Eteria Parohis Aeriou Thessalonikis AE                             |   | 154       |   | 49.00  |   | 158       |   | 49.00  |
| - Toscana        Energia SpA                                         |   | 133       |   | 49.38  |   | 136       |   | 49.38  |
| - Raffineria di Milazzo ScpA                                         |   | 126       |   | 50.00  |   | 128       |   | 50.00  |
| - Trans        Austria Gasleitung GmbH                               |   | 96        |   | 89.00  |   | 109       |   | 89.00  |
| - Super Octanos CA                                                   |   | 90        |   | 49.00  |   | 90        |   | 49.00  |
| -        Supermetanol CA                                             |   | 78        |   | 34.51  |   | 90        |   | 34.51  |
| - Unimar Llc                                                         |   | 71        |   | 50.00  |   | 65        |   | 50.00  |
| - Eteria        Parohis Aeriou Thessalias AE                         |   | 41        |   | 49.00  |   | 42        |   | 49.00  |
| - Transmediterranean Pipeline Co Ltd                                 |   | 47        |   | 50.00  |   | 40        |   | 50.00  |
| -        Transitgas AG                                               |   | 30        |   | 46.00  |   | 33        |   | 46.00  |
| - Altergaz SA                                                        |   | 18        |   | 27.80  |   | 25        |   | 38.91  |
| - Lipardiz        - Construção de Estruturas Maritimas Lda |   | 88        |   | 50.00  |   | 10        |   | 50.00  |
| - FPSO Mystras - Produção de Petròleo Lda             |   | 58        |   | 50.00  |   | 2         |   | 50.00  |
| - other        investments (*)                                       |   | 132       |   |   |   | 150       |   |   |
|                                                                 |   | **3,310** |   |   |   | **3,257** |   |   |
| Associates:                                                          |   |      |   |   |   |      |   |   |
| - Galp Energia SGPS SA                                               |   | 911       |   | 33.34  |   | 862       |   | 33.34  |
| - Angola        LNG Ltd                                              |   |      |   |   |   | 453       |   | 13.60  |
| - Ceska Rafinerska AS                                                |   | 325       |   | 32.44  |   | 323       |   | 32.44  |
| - United        Gas Derivatives Co                                   |   | 140       |   | 33.33  |   | 128       |   | 33.33  |
| - ACAM Gas SpA                                                       |   | 45        |   | 49.00  |   | 46        |   | 49.00  |
| -        Distribuidora de Gas del Centro SA                          |   | 33        |   | 31.35  |   | 32        |   | 31.35  |
| - Burren Energy Plc                                                  |   | 592       |   | 24.90  |   |      |   |   |
| - other        investments (*)                                       |   | 142       |   |   |   | 193       |   |   |
|                                                                 |   | **2,188** |   |   |   | **2,037** |   |   |
|                                                                 |   | **5,639** |   |   |   | **5,471** |   |   |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                            |
|--------------|--------------|--------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein did not exceed euro 25        million. |

The net carrying amount of investments in notconsolidated entities controlled by Eni, joint ventures andassociates include the differences between purchase price andEni’s equity in investments of euro 615 million. Suchdifferences primarily related to Unión Fenosa Gas SA (euro 195million), EnBW - Eni Verwaltungsgesellschaft mbH (euro 187million), Galp Energia SGPS SA (euro 106 million) and CeskaRafinerska AS (euro 97 million).

Artic Russia BV (the former Eni Russia BV) held100% interest in three Russian companies acquired on April 4,2007 in partnership with Enel (Eni 60%, Enel 40%), followingaward of a bid for Lot 2 in the Yukos liquidation procedure. Thethree companies – OAO Arctic Gas, OAO Urengoil and OAONeftegaztechnologiya – engage in exploration and developmentof gas reserves.

Eni and Enel granted to Gazprom a call option toacquire a 51% interest in the three companies to be exercisableby Gazprom within 24 months from the acquisition date. Eniassesses the investment in Artic Russia BV under the equitymethod as it jointly controls the three entities based on ongoingshareholder arrangements, therefore exercising significantinfluence in the financial and operating policy decisions of theinvestees. This 60% interest corresponds to the present ownershipinterest of Eni in the acquired companies determined by nottaking 

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into account the possible exercise of the calloption by Gazprom. The carrying amount of the three entities islower than the strike price of the call option with respect tothe underlying stake. The strike price equals the bid priceadjusted by subtracting dividends received and adding possibleshare capital increases, a contractual remuneration of 9.4% onthe capital employed and additional financing expenses.

The fair value of listed investments was asfollows:

|         |         | **Shares** |         | **Ownership**        (%) |         | **Price        per share**        (euro) |         | **Fair        value**        (euro million) |
|--------------|--------------|------------|--------------|--------------------------|--------------|------------------------------------------|--------------|---------------------------------------------|
|    |    |            |    |                          |    |                                          |    |                                             |

| Galp Energia SGPS SA |   | 276,472,160 |   | 33.34 |   | 7.18 |   | 1,985 |
|----------------------|--------|-------------|--------|-------|--------|------|--------|-------|
| Altergaz        SA   |   | 1,050,892   |   | 38.91 |   | 9.90 |   | 10    |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

The table below sets out the provisions forlosses included in the provisions for contingencies of euro 119million (euro 135 million at December 31, 2007), primarilyrelated to the following equity-accounted investments:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Charville - Consultores e Serviços Lda                                 |   | 31      |   | 33      |
|-----------------------------------------------------------------------------|--------|---------|--------|---------|
| Polimeri        Europa Elastomeres France SA (under liquidation)            |   | 50      |   | 31      |
| Industria Siciliana Acido Fosforico - ISAF - SpA        (under liquidation) |   | 28      |   | 27      |
| Southern        Gas Constructors Ltd                                        |   | 14      |   | 17      |
| Other investments                                                           |   | 12      |   | 11      |
|                                                                        |   | **135** |   | **119** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

**Other investments**Other investments were as follows:

| (euro        million) |   | **Net value at the beginning of the year** |   | **Acquisition and subscriptions** |   | **Currency translation differences** |   | **Other changes** |   | **Net value at the end of the year** |   | **Gross value at the end of the year** |   | **Accumulated impairment charges** |
|-----------------------|--------|--------------------------------------------|--------|-----------------------------------|--------|--------------------------------------|--------|-------------------|--------|--------------------------------------|--------|----------------------------------------|--------|------------------------------------|
|                  |   |                                            |   |                                   |   |                                      |   |                   |   |                                      |   |                                        |   |                                    |

| **Dec. 31, 2007**                                               |   |    |   |   |    |   |   |    |   |   |    |   |   |    |   |   |    |   |   |   |   |
|-----------------------------------------------------------------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|--------|--------|
| Investments        in unconsolidated entities controlled by Eni |   | 21      |   |   | 3       |   |   | (1      | )      |   | 2       |   |   | 25      |   |   | 36      |   |   | 11     |   |
| Associates                                                      |   | 9       |   |   |    |   |   |    |   |   | 1       |   |   | 10      |   |   | 11      |   |   | 1      |   |
| Other        investments                                        |   | 330     |   |   | 190     |   |   | (36     | )      |   | (47     | )      |   | 437     |   |   | 443     |   |   | 6      |   |
|                                                            |   | **360** |   |   | **193** |   |   | **(37** | **)**  |   | **(44** | **)**  |   | **472** |   |   | **490** |   |   | **18** |   |
| **Dec. 31, 2008**                                               |   |    |   |   |    |   |   |    |   |   |    |   |   |    |   |   |    |   |   |   |   |
| Investments in unconsolidated entities        controlled by Eni |   | 25      |   |   | 1       |   |   |    |   |   | 4       |   |   | 30      |   |   | 41      |   |   | 11     |   |
| Associates                                                      |   | 10      |   |   |    |   |   |    |   |   | (6      | )      |   | 4       |   |   | 28      |   |   | 24     |   |
| Other investments                                               |   | 437     |   |   | 5       |   |   | 11      |   |   | (77     | )      |   | 376     |   |   | 382     |   |   | 6      |   |
|                                                            |   | **472** |   |   | **6**   |   |   | **11**  |   |   | **(79** | **)**  |   | **410** |   |   | **451** |   |   | **41** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Investments in not consolidated entities controlled by Eni andassociates are stated at cost net of impairment losses. Otherinvestments, for which fair value cannot be reliably determined,were recognized at cost and adjusted for impairment losses.

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The net carrying amount of other investments ofeuro 410 million (euro 472 million at December 31, 2007) wasrelated to the following entities: 

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

|   |   | Net carrying amount |   | Eni’s interest % |   | Net carrying amount |   | Eni’s interest % |
|--------|--------|---------------------|--------|-----------------------|--------|---------------------|--------|-----------------------|
|   |   |                     |   |                       |   |                     |   |                       |

| Investments in unconsolidated entities        controlled by Eni (*) |   | **25**  |   |   |   | **30**  |   |   |
|---------------------------------------------------------------------|--------|---------|--------|--------|--------|---------|--------|--------|
| Associates                                                          |   | **10**  |   |   |   | **4**   |   |   |
| Other investments:                                                  |   |    |   |   |   |    |   |   |
| -        Interconnector (UK) Ltd                                    |   | 22      |   | 5.00   |   | 135     |   | 16.06  |
| - Nigeria LNG Ltd                                                   |   | 80      |   | 10.40  |   | 85      |   | 10.40  |
| - Darwin        LNG Pty Ltd                                         |   | 87      |   | 10.99  |   | 83      |   | 10.99  |
| - Angola LNG Ltd                                                    |   | 175     |   | 13.60  |   |    |   |   |
| - other (*)                                                         |   | 73      |   |   |   | 73      |   |   |
|                                                                |   | **437** |   |   |   | **376** |   |   |
|                                                                |   | **472** |   |   |   | **410** |   |   |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                            |
|--------------|--------------|--------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein did not exceed euro 25        million. |

Provisions for losses related to otherinvestments, included within the provisions for contingencies,amounted to euro 44 million (euro 28 million at December 31,2007) and were primarily in relation to the following entities:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Caspian Pipeline Consortium R - Closed Joint        Stock Co |   | 25     |   | 24     |
|--------------------------------------------------------------|--------|--------|--------|--------|
| Burren        Energy Ship Management Ltd (Cyprus)            |   |   |   | 17     |
| Other investments                                            |   | 3      |   | 3      |
|                                                         |   | **28** |   | **44** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

**Other information about investments**The following table summarizes key financial data, net toEni, as disclosed in the latest available financial statements ofnot consolidated entities controlled by Eni, joint ventures andassociates:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

|   |   | Not consolidated entities controlled by Eni |   | Joint ventures |   | Associates |   | Not consolidated entities controlled by Eni |   | Joint ventures |   | Associates |
|--------|--------|---------------------------------------------|--------|----------------|--------|------------|--------|---------------------------------------------|--------|----------------|--------|------------|
|   |   |                                             |   |                |   |            |   |                                             |   |                |   |            |

| Total assets              |   | 1,247 |   | 7,781 |   | 4,252 |   | 1,361 |   | 7,761 |   | 4,020 |
|---------------------------|--------|-------|--------|-------|--------|-------|--------|-------|--------|-------|--------|-------|
| Total        liabilities  |   | 1,111 |   | 4,526 |   | 2,061 |   | 1,230 |   | 4,565 |   | 1,958 |
| Net sales from operations |   | 99    |   | 4,667 |   | 5,134 |   | 134   |   | 5,303 |   | 5,067 |
| Operating        profit   |   | 14    |   | 674   |   | 502   |   | 2     |   | 736   |   | 702   |
| Net profit                |   | 14    |   | 318   |   | 410   |   | 20    |   | 490   |   | 690   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

The total assets and liabilities of notconsolidated controlled entities of euro 1,361 million and euro1,230 million, respectively (euro 1,247 million and euro 1,111million at December 31, 2007) concerned for euro 923 million andeuro 923 million (euro 873 million and euro 873 million atDecember 31, 2007) entities for which consolidation does notproduce significant effects.

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**13 Other financial assets**Other financial assets were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Financing receivables:                                      |   |    |   |      |
|-------------------------------------------------------------|--------|---------|--------|-----------|
| -        receivables for financing operating activities     |   | 677     |   | 1,084     |
| - receivables for financing non-operating        activities |   | 225     |   |      |
|                                                        |   | **902** |   | **1,084** |
| Securities:                                                 |   |    |   |      |
| -        securities held for operating purposes             |   | 21      |   | 50        |
|                                                        |   | **21**  |   | **50**    |
|                                                        |   | **923** |   | **1,134** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Financing receivables are presented net of theallowance for impairment losses of euro 26 million (euro 24million at December 31, 2007). Operating financing receivables ofeuro 1,084 million (euro 677 million at December 31, 2007)primarily concerned loans made by the Exploration &Production segment (euro 754 million), Refining & Marketingsegment (euro 109 million) and Gas & Power segment (euro 76million), as well as receivables for financial leasing (euro 128million). Receivables for financial leasing related to thedisposal of the Belgian gas network by Finpipe GIE, companyincluded in the consolidation area after the acquisition ofcontrol by the Gas & Power segment of Distrigas NV. Thefollowing table shows principal receivable by maturity date,which was obtained by summing future lease payment receivablesdiscounted at the effective interest rate, interest and thenominal value of future lease receivables: 

| (euro        million) |   | **Maturity range** |   |
|-----------------------|--------|--------------------|--------|
|                  |   |                    |   |

|    |    | Within 12 months |    | Between one and five years |    | Beyond five years |    | Total |
|--------------|--------------|------------------|--------------|----------------------------|--------------|-------------------|--------------|-------|
|         |         |                  |         |                            |         |                   |         |       |

| Principal receivable                        |   | 19 |   | 95  |   | 33 |   | 147 |
|---------------------------------------------|--------|----|--------|-----|--------|----|--------|-----|
| Interests                                   |   | 4  |   | 13  |   | 2  |   | 19  |
| Undiscounted value of future lease payments |   | 23 |   | 108 |   | 35 |   | 166 |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

Receivables with a maturity date within one year are shown incurrent assets in the item trade receivables for operatingpurposes – current portion of long-term receivables in theNote 3 - Trade and other receivables.

Non-operating financing receivables of euro 225 million atDecember 31, 2007 concerning a restricted deposit held by EniLasmo Plc as a guarantee of a debenture have been reclassified tocurrent assets in the item financing receivables for nonoperating purposes in the Note 3 - Trade and other receivables.

Receivables in currencies other than euro amounted to euro 827million (euro 821 million at December 31, 2007).

Receivables due beyond five years amounted to euro 617 million(euro 509 million at December 31, 2007).

Securities of euro 50 million (euro 21 million at December 31,2007), designated as held-to-maturity investments, are listedsecurities, issued by foreign governments (euro 30 million) andby the Italian Government (euro 20 million). The increase of euro29 million referred to Banque Eni SA.

Securities with a maturity beyond five years amounted to euro20 million.

The fair value of financing receivables and securities did notdiffer significantly from their carrying amount. The fair valueof financing receivables has been determined based on the presentvalue of expected future cash flows discounted at rates rangingfrom 1.9% to 3.9% (3.8% and 6.0% at December 31, 2007). The fairvalue of securities was derived from quoted market prices.

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**14 Deferred tax assets**Deferred tax assets were recognized net of deferred taxliabilities able to be offset for euro 3,468 million (euro 3,526million at December 31, 2007).

| (euro        million) |   | **Value at         Dec. 31, 2007** |   | **Additions** |   | **Deductions** |   | **Currency translation differences** |   | **Other changes** |   | **Value at         Dec. 31, 2008** |
|-----------------------|--------|------------------------------------|--------|---------------|--------|----------------|--------|--------------------------------------|--------|-------------------|--------|------------------------------------|
|                  |   |                                    |   |               |   |                |   |                                      |   |                   |   |                                    |

|   |   | **1,915** |   |   | 1,778 |   |   | (767 | ) |   | (43 | ) |   | 29 |   |   | **2,912** |   |
|--------|--------|-----------|--------|--------|-------|--------|--------|------|---|--------|-----|---|--------|----|--------|--------|-----------|--------|

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Deferred tax assets are described in Note 24 -Deferred tax liabilities.

**15 Other non-current********receivables**The following table provides an analysis of other non-currentreceivables:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Tax receivables from:                                    |   |      |   |      |
|----------------------------------------------------------|--------|-----------|--------|-----------|
| - Italian        tax authorities                         |   |      |   |      |
|   . income tax                                 |   | 486       |   | 24        |
|   .        interest on tax credits             |   | 325       |   | 58        |
|   . Value Added Tax (VAT)                      |   | 42        |   | 2         |
|   .        other                               |   | 11        |   |      |
|                                                     |   | **864**   |   | **84**    |
| - foreign        tax authorities                         |   | 30        |   | 28        |
|                                                     |   | **894**   |   | **112**   |
| Other        receivables:                                |   |      |   |      |
| - in relation to disposals                               |   | 7         |   | 780       |
| - other        non-current receivables                   |   | 197       |   | 268       |
|                                                     |   | **204**   |   | **1,048** |
| Fair value        cash flow hedge derivative instruments |   |      |   | 197       |
| Other asset                                              |   | 12        |   | 44        |
|                                                     |   | **1,110** |   | **1,401** |

|   |   |  |   |  |
|--------|--------|--|--------|--|

The decrease of tax receivables of euro 782 million primarilyreferred to Eni SpA which obtained the reimbursement of theincome tax and of the related interest of euro 746 million.

The other receivables related to disposals amounting to euro780 million related to: (i) the receivable of euro 501 millionrecognized after the agreement settled with the Republic ofVenezuela according to which Eni will receive a cash compensationfor the expropriated Dación assets, for a part already received,to be paid in seven annual installments which yields interestincome from the date of the settlement. More information isincluded in Note 9 - Other assets; and (ii) the receivable ofeuro 275 million related to the disposal of the interest of 1.71%in the Kashagan project to the local partner kazMunaiGas on thebasis of the agreements defined with the international partnersof the North Caspian Sea PSA and the Kashagan government, whichare effective starting from January 1, 2008.

Fair value of the derivative contracts is determined usingmarket quotations provided by primary info-provider, or in theabsence of market information, appropriate valuation methodsgenerally accepted in the marketplace.

Fair value of the cash flow hedge derivatives of euro 197million referred to Distrigas NV (euro 105 million) and to theExploration & Production segment (euro 92 million). Furtherinformation on cash flow hedge derivatives is given in Note 7 -Other current assets; fair value related to the contractsexpiring beyond 2009 is given in Note 25 - Other non-currentliabilities; fair value related to the contracts expiring in 2009is indicated in Note 7 - Other current assets and in Note 20 -Other current liabilities. The effects of the evaluation at fairvalue of cash flow hedge derivatives are given in Note 27 -Shareholders’ equity and in Note 32 - Finance income(expense).

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The nominal value of cash flow hedge derivativesreferred to purchase and sale commitments for euro 64 million andeuro 1,268 million. Information on the hedged risks and thehedging policies is given in Note 29 - Guarantees, commitmentsand risks.

**Current liabilities****16 Short-term debt**Short-term debt was as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Banks                        |   | 4,070     |   | 2,411     |   |
|------------------------------|--------|-----------|--------|-----------|--------|
| Ordinary        bonds        |   | 3,176     |   | 3,663     |   |
| Other financial institutions |   | 517       |   | 285       |   |
|                         |   | **7,763** |   | **6,359** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Short-term debt decreased by euro 1,404 millionprimarily due to the balance of repayments and new proceeds (euro1,652 million), partially offset by currency translationdifferences (euro 193 million) and changes in the consolidationarea (euro 48 million) due to the acquisition of Distrigas NV bythe Gas & Power segment (euro 76 million) and the disposal ofAgip España SA by the Refining & Marketing segment (euro 28million). Debt comprised commercial paper of euro 3,663 million(euro 3,176 million at December 31, 2007) mainly issued by thefinancial company Eni Coordination Center SA.

Short-term debt per currency is shown in thetable below:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Euro               |   | 5,453     |   | 3,801     |   |
|--------------------|--------|-----------|--------|-----------|--------|
| U.S.        dollar |   | 1,591     |   | 1,332     |   |
| Other currencies   |   | 719       |   | 1,226     |   |
|               |   | **7,763** |   | **6,359** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

In 2008, the weighted average interest rate onshort-term debt was 4.2% (4.9% in 2007).

At December 31, 2008 Eni had undrawn committedand uncommitted borrowing facilities available of euro 3,313million and euro 7,696 million, respectively (euro 5,006 millionand euro 6,298 million at December 31, 2007). These facilitieswere under interest rates that reflected market conditions.Charges for unutilized facilities were not significant.

**17 Trade and other payables******Trade and other payables were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Trade payables                           |   | 11,092     |   | 12,590     |   |
|------------------------------------------|--------|------------|--------|------------|--------|
| Advances                                 |   | 1,483      |   | 2,916      |   |
| Other payables:                          |   |       |   |       |   |
| - related        to capital expenditures |   | 1,301      |   | 1,716      |   |
| - others                                 |   | 3,240      |   | 3,293      |   |
|                                     |   | **4,541**  |   | **5,009**  |   |
|                                     |   | **17,116** |   | **20,515** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

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The increase of euro 1,498 million in trade payables wasprimarily related to the Gas & Power segment (euro 1,417million), the Engineering & Construction segment (euro 630million), the Exploration & Production segment (euro 658million) and was partly offset by a decrease relating to theRefining & Marketing segment (euro 942 million) and thePetrochemical segment (euro 251 million).

Advances of euro 2,916 million (euro 1,483 million at December31, 2007) were related to advances on contract work in progressfor euro 2,516 million (euro 996 million at December 31, 2007)and other advances for euro 400 million (euro 487 million atDecember 31, 2007).

Advances on contract work in progress were in respect of theEngineering & Construction segment.

Other payables were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Payables due to:                                                                 |   |      |   |      |   |
|----------------------------------------------------------------------------------|--------|-----------|--------|-----------|--------|
| - joint        venture operators in exploration and production        activities |   | 1,624     |   | 2,007     |   |
| - suppliers in relation to investments                                           |   | 1,015     |   | 1,057     |   |
| -        non-financial government entities                                       |   | 397       |   | 441       |   |
| - employees                                                                      |   | 257       |   | 400       |   |
| - social        security entities                                                |   | 226       |   | 284       |   |
|                                                                             |   | **3,519** |   | **4,189** |   |
| Other        payables                                                            |   | 1,022     |   | 820       |   |
|                                                                             |   | **4,541** |   | **5,009** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Payables to related parties are described in Note37 - Transactions with related parties.

The fair value of trade and other payables didnot differ significantly from their carrying amount consideringthe short-term maturity of trade payables.

**18 Income taxes payable**Income taxes payable were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Italian subsidiaries        |   | 247       |   | 808       |   |
|-----------------------------|--------|-----------|--------|-----------|--------|
| Foreign        subsidiaries |   | 1,441     |   | 1,141     |   |
|                        |   | **1,688** |   | **1,949** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Income taxes payable by Italian subsidiaries were affected bythe fair value valuation of cash flow hedging derivatives (euro291 million). This effect was recorded in the relevant provisionwithin equity. Further information is provided in Note 7 - Othercurrent assets, Note 15 - Other non-current receivables, Note 20- Other current liabilities and Note 25 - Other non-currentliabilities.

**19 Other taxes payable**Other taxes payable were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Excise and customs duties     |   | 804       |   | 920       |   |
|-------------------------------|--------|-----------|--------|-----------|--------|
| Other        taxes and duties |   | 579       |   | 740       |   |
|                          |   | **1,383** |   | **1,660** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

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##### Table of Contents

**20 Other current liabilities******Other current liabilities were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Fair value of non-hedging derivatives            |   | 412       |   | 1,982     |   |
|--------------------------------------------------|--------|-----------|--------|-----------|--------|
| Fair value        of cash flow hedge derivatives |   | 911       |   | 452       |   |
| Other liabilities                                |   | 233       |   | 1,885     |   |
|                                             |   | **1,556** |   | **4,319** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Fair value of non-hedging derivative contractswas as follows:

|   |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|--------|--------|-------------------|--------|-------------------|
|   |   |                   |   |                   |

| (euro        million) |    | Fair value |    | Purchase commitments |    | Sale commitments |    | Fair value |    | Purchase commitments |    | Sale commitments |
|-----------------------|--------------|------------|--------------|----------------------|--------------|------------------|--------------|------------|--------------|----------------------|--------------|------------------|
|                  |         |            |         |                      |         |                  |         |            |         |                      |         |                  |

| **Non-hedging derivatives on exchange rate**        |   |    |   |      |   |    |   |      |   |      |   |      |
|-----------------------------------------------------|--------|---------|--------|-----------|--------|---------|--------|-----------|--------|-----------|--------|-----------|
| Currency        swap                                |   | 63      |   | 2,096     |   | 296     |   | 293       |   | 1,928     |   | 2,479     |
| Interest currency swap                              |   | 5       |   | 140       |   |    |   | 82        |   | 694       |   | 100       |
| Other                                               |   | 7       |   | 76        |   | 1       |   | 327       |   | 151       |   | 1,197     |
|                                                |   | **75**  |   | **2,312** |   | **297** |   | **702**   |   | **2,773** |   | **3,776** |
| **Non-hedging        derivatives on interest rate** |   |    |   |      |   |    |   |      |   |      |   |      |
| Interest rate swap                                  |   | 24      |   | 722       |   | 401     |   | 134       |   | 641       |   | 3,002     |
|                                                |   | **24**  |   | **722**   |   | **401** |   | **134**   |   | **641**   |   | **3,002** |
| **Non-hedging derivatives on commodities**          |   |    |   |      |   |    |   |      |   |      |   |      |
| Over the        counter                             |   | 12      |   | 49        |   | 58      |   | 1,090     |   | 3,297     |   | 388       |
| Other                                               |   | 301     |   | 1,187     |   | 28      |   | 56        |   | 66        |   | 119       |
|                                                |   | **313** |   | **1,236** |   | **86**  |   | **1,146** |   | **3,363** |   | **507**   |
|                                                |   | **412** |   | **4,270** |   | **784** |   | **1,982** |   | **6,777** |   | **7,285** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Fair value of derivative contracts was determined by usingmarket quotations reported by major market data providers, or, ifno market information was available, on the basis of valuationmodels generally accepted in the marketplace.

The increase in the fair value of non-hedging derivatives ofeuro 1,570 million comprises the inclusion of the derivativecontracts held by Distrigas NV which has been included in theconsolidation area following the acquisition of control by theGas & Power segment (euro 873 million).

The fair value of cash flow hedges amounted to euro 452million (euro 911 million at December 31, 2007) and related toDistrigas NV for euro 415 million and the Exploration &Production segment for euro 37 million (euro 911 million atDecember 31, 2007). Further information on cash flow hedgederivatives is given in Note 7 - Other current assets. The fairvalue related to the contracts expiring in 2009 is given in Note7 - Other current assets, in Note 15 - Other non-currentreceivables and in Note 25 - Other non-current liabilities. Theeffects of fair value valuation of cash flow hedging derivativesare given in Note 27 - Shareholders’ equity and in Note 32 -Finance income (expense).

The nominal value of cash flow hedge derivativesreferred to purchase and sale commitments for euro 989 millionand euro 895 million, respectively (euro 1,399 million and euro1,977 million at December 31, 2007).

Information on the hedged risks and the hedgingpolicies is given in Note 29 - Guarantees, commitments and risks.

Other liabilities of euro 1,885 million (euro 233million at December 31, 2007) comprised the put option granted toPubligaz (the Distrigas minority shareholder) to divest its31.25% stake in Distrigas to Eni for a total amount of euro 1,495million based on the same per-share price of the ongoingmandatory tender offer to minorities as part of the Distrigasacquisition as provided for the Shareholders Agreement signed bythe two partners on July 30, 2008. This liability was recognizedagainst the Group’s net equity. In subsequent periods,changes in the put option value will be recognized against theprofit and loss account.

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**Non-current liabilities****21 Long-term debt and current portion oflong-term debt**Long-term debt included the current portion maturingduring the year following the balance sheet date (currentmaturity). The table below analyzes debt by year of forecastedrepayment:

| (euro million) |   | **At December 31** |   |   |   | **Long-term maturity** |
|----------------|--------|--------------------|--------|--------|--------|------------------------|
|           |   |                    |   |   |   |                        |

| Type of debt instrument |   | Maturity range |   | 2007 |   | 2008 |   | Current maturity 2009 |   | 2010 |   | 2011 |   | 2012 |   | 2013 |   | After |   | Total |
|-------------------------|--------|----------------|--------|------|--------|------|--------|-----------------------|--------|------|--------|------|--------|------|--------|------|--------|-------|--------|-------|
|                    |   |                |   |      |   |      |   |                       |   |      |   |      |   |      |   |      |   |       |   |       |

| Towards banks:                        |   |          |   |       |   |       |   |    |   |      |   |    |   |      |   |      |   |      |   |       |
|---------------------------------------|--------|---------------|--------|------------|--------|------------|--------|---------|--------|-----------|--------|---------|--------|-----------|--------|-----------|--------|-----------|--------|------------|
| - bank        loans                   |   | **2009-2019** |   | 6,073      |   | 6,896      |   | 145     |   | 2,503     |   | 600     |   | 2,584     |   | 324       |   | 740       |   | 6,751      |
| - other bank loans at favorable rates |   | **2009-2012** |   | 9          |   | 6          |   | 2       |   | 2         |   | 1       |   | 1         |   |      |   |      |   | 4          |
| - other                               |   | **2009-2010** |   |       |   | 101        |   |    |   | 101       |   |    |   |      |   |      |   |      |   | 101        |
|                                  |   |          |   | **6,082**  |   | **7,003**  |   | **147** |   | **2,606** |   | **601** |   | **2,585** |   | **324**   |   | **740**   |   | **6,856**  |
| Ordinary        bonds                 |   | **2009-2037** |   | 5,386      |   | 6,843      |   | 360     |   | 844       |   | 133     |   | 40        |   | 1,602     |   | 3,864     |   | 6,483      |
| Other financial institutions          |   | **2009-2020** |   | 599        |   | 632        |   | 42      |   | 180       |   | 63      |   | 62        |   | 55        |   | 230       |   | 590        |
|                                  |   |          |   | **12,067** |   | **14,478** |   | **549** |   | **3,630** |   | **797** |   | **2,687** |   | **1,981** |   | **4,834** |   | **13,929** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Long-term debt, including the current portion of long-termdebt, of euro 14,478 million (euro 12,067 million at December 31,2007) increased by euro 2,411 million. The increase mainlyreflected the balance of payments and new proceeds of euro 2,466million as well as the change in the consolidation area (euro 286million) primarily due to the acquisition of First CalgaryPetroleums Ltd by the Exploration & Production segment thataccounts for euro 229 million.

This increase was offset by the negative impact of foreigncurrency translation differences and translation differencesarising on debt taken on by euro-reporting subsidiariesdenominated in foreign currencies which are translated into euroat year-end exchange rates (euro 383 million).

Debt from other financial institutions of euro 632 millionincluded euro 161 million of finance lease transactions. Thefollowing table shows principal outstanding by maturity date,which was obtained by summing future lease payments discounted atthe effective interest rate, interest and the nominal value offuture lease payments:

|   |   | **Maturity range** |   |
|--------|--------|--------------------|--------|
|   |   |                    |   |

| (euro        million) |    | Within 12 months |    | Between one and five years |    | Beyond five years |    | Total |
|-----------------------|--------------|------------------|--------------|----------------------------|--------------|-------------------|--------------|-------|
|                  |         |                  |         |                            |         |                   |         |       |

| Principal debt outstanding                  |   | 134 |   | 22 |   | 5 |   | 161 |
|---------------------------------------------|--------|-----|--------|----|--------|---|--------|-----|
| Interests                                   |   | 3   |   | 5  |   | 2 |   | 10  |
| Undiscounted value of future lease payments |   | 137 |   | 27 |   | 7 |   | 171 |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

Eni entered into long-term borrowing facilities with theEuropean Investment Bank which were conditioned to themaintenance of certain performance indicators based on Eni’sconsolidated financial statements or a rating not inferior to A-(S&P) and A3 (Moody’s). At December 31, 2007 and 2008,the amount of short and long-term debt subject to restrictivecovenants was euro 1,429 million and euro 1,323 million,respectively. Furthermore, Saipem SpA entered into certainborrowing facilities for euro 75 million with a number offinancial institutions subordinated to the maintenance of certainperformance indicators based on the consolidated financialstatements of Saipem. Eni and Saipem are in compliance with thecovenants contained in their respective financing arrangements.

Bonds of euro 6,843 million consisted of bonds issued withinthe Euro Medium Term Notes Program for a total of euro 6,391million and other bonds for a total of euro 452 million.

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The following table analyses bonds per issuing entity,maturity date, interest rate and currency as at December 31,2008:

|   |   | **Amount** |   | **Discount on bond issue and accrued        expense** |   | **Total** |   | **Currency** |   | **Maturity** |   | **% rate** |
|--------|--------|------------|--------|-------------------------------------------------------|--------|-----------|--------|--------------|--------|--------------|--------|------------|
|   |   |       |   |                                                  |   |      |   |         |   |              |   |            |

| (euro        million) |   |   |   |   |   |   |   |   |   | from |   | to |   | from |   | to |
|-----------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|------|--------|----|--------|------|--------|----|
|                  |   |        |   |        |   |        |   |        |   |      |   |    |   |      |   |    |

| **Issuing entity**                |   |      |   |   |   |   |      |   |   |   |   |   |   |   |   |   |     |
|-----------------------------------|--------|-----------|--------|--------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|--------|--------|----------|
| *Euro        Medium Term Notes*   |   |      |   |   |   |   |      |   |   |   |   |   |   |   |   |   |     |
| Eni SpA                           |   | 1,500     |   | 43     |   |   | 1,543     |   | EUR    |   |   |   | 2013   |   |   |   | 4.625    |
| Eni SpA                           |   | 1,250     |   | (5     | )      |   | 1,245     |   | EUR    |   |   |   | 2017   |   |   |   | 4.750    |
| Eni SpA                           |   | 1,250     |   | 2      |   |   | 1,252     |   | EUR    |   |   |   | 2014   |   |   |   | 5.875    |
| Eni        Coordination Center SA |   | 682       |   | 7      |   |   | 689       |   | GBP    |   | 2010   |   | 2019   |   | 4.875  |   | 6.125    |
| Eni SpA                           |   | 500       |   | 16     |   |   | 516       |   | EUR    |   |   |   | 2010   |   |   |   | 6.125    |
| Eni        Coordination Center SA |   | 366       |   | 1      |   |   | 367       |   | YEN    |   | 2012   |   | 2037   |   | 1.150  |   | 2.810    |
| Eni Coordination Center SA        |   | 350       |   | 10     |   |   | 360       |   | EUR    |   | 2010   |   | 2028   |   | 2.876  |   | 5.441    |
| Eni        Coordination Center SA |   | 183       |   | 2      |   |   | 185       |   | USD    |   | 2013   |   | 2015   |   | 4.450  |   | 4.800    |
| Eni Coordination Center SA        |   | 165       |   | 4      |   |   | 169       |   | EUR    |   | 2009   |   | 2015   |   |   |   | variable |
| Eni        Coordination Center SA |   | 34        |   |   |   |   | 34        |   | CHF    |   |   |   | 2010   |   |   |   | 2.043    |
| Eni Coordination Center SA        |   | 32        |   | (1     | )      |   | 31        |   | USD    |   |   |   | 2013   |   |   |   | variable |
|                              |   | **6,312** |   | **79** |   |   | **6,391** |   |   |   |   |   |   |   |   |   |     |
| *Other bonds*                     |   |      |   |   |   |   |      |   |   |   |   |   |   |   |   |   |     |
| Eni USA        Inc                |   | 287       |   | 3      |   |   | 290       |   | USD    |   |   |   | 2027   |   |   |   | 7.300    |
| Eni Lasmo Plc (*)                 |   | 157       |   | (6     | )      |   | 151       |   | GBP    |   |   |   | 2009   |   |   |   | 10.375   |
| Eni UK        Holding Plc         |   | 11        |   |   |   |   | 11        |   | GBP    |   |   |   | 2013   |   |   |   | variable |
|                              |   | **455**   |   | **(3** | **)**  |   | **452**   |   |   |   |   |   |   |   |   |   |     |
|                              |   | **6,767** |   | **76** |   |   | **6,843** |   |   |   |   |   |   |   |   |   |     |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|      |      |                                                                                                                         |
|--------------------------|--------------------------|-----------------------------------------------------------------------------------------------------------------------------------|
| (*)                      |           | The bond is        guaranteed by a restricted cash deposit recorded under        non-current financial assets (euro 173 million). |

As at December 31, 2008 bonds maturing within 18 months (euro412 million) were issued by Eni Coordination Center SA for euro261 million and by Eni Lasmo Plc for euro 151 million. During2008, Eni SpA, Eni Coordination Center SA and Eni UK Holding Plcissued bonds for euro 1,499 million, euro 302 million and euro 11million respectively.

The following table shows the currency composition oflong-term debt and its current portion, and the related weightedaverage interest rates on total borrowings.

|   |   | **Dec. 31, 2007******(euro million) |   | **Average rate**        (%) |   | **Dec. 31, 2008******(euro million) |   | **Average rate**        (%) |
|--------|--------|-------------------------------------|--------|-----------------------------|--------|-------------------------------------|--------|-----------------------------|
|   |   |                                     |   |                             |   |                                     |   |                             |

| Euro                |   | 9,973      |   | 4.4    |   | 12,284     |   | 4.2    |
|---------------------|--------|------------|--------|--------|--------|------------|--------|--------|
| U.S.        dollar  |   | 900        |   | 8.6    |   | 912        |   | 6.1    |
| British pound       |   | 882        |   | 6.2    |   | 859        |   | 6.2    |
| Japanese        yen |   | 281        |   | 1.9    |   | 367        |   | 2.0    |
| Other currencies    |   | 31         |   | 2.0    |   | 56         |   | 3.8    |
|                |   | **12,067** |   |   |   | **14,478** |   |   |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

At December 31, 2008 Eni had undrawn committed long-termborrowing facilities of euro 1,850 million (euro 1,400 million atDecember 31, 2007). Interest rates on these contracts were atmarket conditions. Charges for unutilized facilities were notsignificant. 

Fair value of long-term debt, including the current portion oflong-term debt amounted to euro 15,247 million (euro 12,390million at December 31, 2007) and consisted of the following:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Ordinary bonds               |   | 5,523      |   | 7,505      |   |
|------------------------------|--------|------------|--------|------------|--------|
| Banks                        |   | 6,148      |   | 7,056      |   |
| Other financial institutions |   | 719        |   | 686        |   |
|                         |   | **12,390** |   | **15,247** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

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Fair value was calculated by discounting the expected futurecash flows at rates ranging from 1.4% to 3.9% (3.8% and 6.0% atDecember 31, 2007).

At December 31, 2008 Eni pledged restricted deposits ascollateral against its borrowings for euro 151 million (euro 198million at December 31, 2007).

Analysis of net borrowings, as defined in the "Item 5– Operating and Financial Review and Prospects",was as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

|   |   | Current |   | Non-current |   | Total |   | Current |   | Non-current |   | Total |
|--------|--------|---------|--------|-------------|--------|-------|--------|---------|--------|-------------|--------|-------|
|   |   |         |   |             |   |       |   |         |   |             |   |       |

| A. Cash and cash equivalents                      |   | 2,114     |   |       |   | 2,114      |   | 1,939     |   |       |   | 1,939      |
|---------------------------------------------------|--------|-----------|--------|------------|--------|------------|--------|-----------|--------|------------|--------|------------|
| B.        Available-for-sale securities           |   | 174       |   |       |   | 174        |   | 185       |   |       |   | 185        |
| **C. Liquidity (A+B)**                            |   | **2,288** |   |       |   | **2,288**  |   | **2,124** |   |       |   | **2,124**  |
| **D.        Financing receivables**               |   | **990**   |   | **225**    |   | **1,215**  |   | **337**   |   |       |   | **337**    |
| E. Short-term debt towards banks                  |   | 4,070     |   |       |   | 4,070      |   | 2,411     |   |       |   | 2,411      |
| F.        Long-term debt towards banks            |   | 161       |   | 5,921      |   | 6,082      |   | 147       |   | 6,856      |   | 7,003      |
| G. Bonds                                          |   | 263       |   | 5,123      |   | 5,386      |   | 360       |   | 6,483      |   | 6,843      |
| H.        Short-term debt towards related parties |   | 131       |   |       |   | 131        |   | 153       |   |       |   | 153        |
| I. Long-term debt towards related parties         |   |      |   | 16         |   | 16         |   |      |   | 9          |   | 9          |
| L. Other        short-term debt                   |   | 3,562     |   |       |   | 3,562      |   | 3,795     |   |       |   | 3,795      |
| M. Other long-term debt                           |   | 313       |   | 270        |   | 583        |   | 42        |   | 581        |   | 623        |
| **N.        Total borrowings (E+F+G+H+I+L+M)**    |   | **8,500** |   | **11,330** |   | **19,830** |   | **6,908** |   | **13,929** |   | **20,837** |
| **O. Net borrowings (N-C-D)**                     |   | **5,222** |   | **11,105** |   | **16,327** |   | **4,447** |   | **13,929** |   | **18,376** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Available-for-sale securities of euro 185 million (euro 174million at December 31, 2007) were held for non-operatingpurposes.

Not included in the calculation above were held-to-maturityand available-for-sale securities held for operating purposesamounting to euro 360 million (euro 280 million at December 31,2007), of which euro 302 million (euro 256 million at December31, 2007) were held to provide coverage of technical reserves forEni’s insurance companies.

Financing receivables of euro 337 million (euro 1,215 millionat December 31, 2007) were held for non-operating purposes.

Not included in the calculation above were financingreceivables held for operating purposes amounting to euro 487million (euro 384 million at December 31, 2007), of which euro399 million (euro 246 million at December 31, 2007) were inrespect of securities granted to non-consolidated subsidiaries,joint ventures and associates primarily in relation to theimplementation of certain capital projects and a euro 47 millioncash deposit to provide coverage of Eni Insurance Ltd technicalreserves. At December 31, 2007, non-current financial receivablesof euro 225 million were related to a restricted deposit held byEni Lasmo Plc as a guarantee of a debenture; the financialreceivable has been reclassified in the current portion for euro173 million.

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**22 Provisions for contingencies**Provisions for contingencies were as follows:

| (euro        million) |   | **Value at Dec. 31, 2007** |   | **Additions** |   | **Changes of estimated        expenditures** |   | **Accretion discount** |   | **Reversal of utilized        provisions** |   | **Reversal of unutilized        provisions** |   | **Other changes** |   | **Value at Dec. 31, 2008** |
|-----------------------|--------|----------------------------|--------|---------------|--------|----------------------------------------------|--------|------------------------|--------|--------------------------------------------|--------|----------------------------------------------|--------|-------------------|--------|----------------------------|
|                  |   |                            |   |               |   |                                              |   |                        |   |                                            |   |                                              |   |                   |   |                            |

| Provision for site restoration and abandonment                                             |   | 3,974     |   |   |      |   |   | 635     |   |   | 202     |   |   | (113     | )      |   | (8       | )      |   | (116   | )      |   | 4,574     |   |
|--------------------------------------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|---------|--------|--------|---------|--------|--------|----------|--------|--------|----------|--------|--------|--------|--------|--------|-----------|--------|
| Provision        for environmental risks                                                   |   | 1,858     |   |   | 369       |   |   |    |   |   | 38      |   |   | (333     | )      |   | (9       | )      |   | 57     |   |   | 1,980     |   |
| Provision for legal and other proceedings                                                  |   | 716       |   |   | 90        |   |   |    |   |   | 1       |   |   | (30      | )      |   | (35      | )      |   | 70     |   |   | 812       |   |
| Loss        adjustments and actuarial provisions for Eni’s        insurance companies |   | 418       |   |   | 1         |   |   |    |   |   |    |   |   |     |   |   | (49      | )      |   | 34     |   |   | 404       |   |
| Provisions for the supply of goods                                                         |   | 187       |   |   | 115       |   |   |    |   |   | 6       |   |   |     |   |   |     |   |   |   |   |   | 308       |   |
| Provision        for taxes                                                                 |   | 213       |   |   | 39        |   |   |    |   |   |    |   |   | (3       | )      |   | (10      | )      |   | 21     |   |   | 260       |   |
| Provision for losses on investments                                                        |   | 163       |   |   | 21        |   |   |    |   |   |    |   |   |     |   |   | (5       | )      |   | (16    | )      |   | 163       |   |
| Provisions        for marketing and promotion initiatives                                  |   | 65        |   |   | 75        |   |   |    |   |   |    |   |   | (57      | )      |   | (2       | )      |   |   |   |   | 81        |   |
| Provision for OIL insurance                                                                |   | 80        |   |   | 14        |   |   |    |   |   |    |   |   | (13      | )      |   | (8       | )      |   | (1     | )      |   | 72        |   |
| Provision        for restructuring or decommissioning                                      |   | 130       |   |   |      |   |   |    |   |   |    |   |   |     |   |   |     |   |   | (114   | )      |   | 16        |   |
| Provision for onerous contracts                                                            |   | 50        |   |   |      |   |   |    |   |   |    |   |   | (50      | )      |   |     |   |   | 4      |   |   | 4         |   |
| Other (*)                                                                                  |   | 632       |   |   | 418       |   |   | (2      | )      |   | 2       |   |   | (151     | )      |   | (73      | )      |   | 73     |   |   | 899       |   |
|                                                                                       |   | **8,486** |   |   | **1,142** |   |   | **633** |   |   | **249** |   |   | **(750** | **)**  |   | **(199** | **)**  |   | **12** |   |   | **9,573** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                             |
|--------------|--------------|---------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein does not exceed euro 50        million. |

The provision for site restoration and abandonment of euro4,574 million primarily referred to the estimation of futurecosts relating to decommissioning of oil and natural gasproduction facilities at the end of the producing lives offields, well-plugging, abandonment and site restoration (euro4,494 million). The increase in the provision for the yearamounted to euro 635 million and was primarily due to changes inthe estimates of future costs made by subsidiaries in theExploration & Production segment including Eni Norge AS (euro183 million), Eni UK Ltd (euro 90 million) and Eni Petroleum CoInc (euro 82 million) with a corresponding entry to fixed assets.Also an amount of euro 202 million was recognized through profitand loss as the accretion charge for the period.

The discount rates adopted ranged from 3.3% to 6.2% (from 4.2%to 6.2% at December 31, 2007). Other changes of euro 116 millionrelated to negative currency translation differences which arosefrom the translation of financial statements denominated incurrencies other than euro (euro 157 million). Offsetting thiseffect was the acquisition of Eni Hewett Ltd by the Exploration& Production segment (euro 52 million).

The provision for environmental risks of euro 1,980 millionprimarily related to the estimated future costs of remediation inaccordance with existing laws and regulations recognized bySyndial SpA (euro 1,382 million) and the Refining & Marketingsegment (euro 454 million). The increase in the provision of euro369 million was primarily related to Syndial SpA (euro 222million) and the Refining & Marketing segment (euro 108million). Specifically, Syndial SpA recognized the estimated costof the remediation of the divested area of Crotone as theclean-up has become probable and the associated costs can bereliably estimated. The decrease of euro 333 million was relatedto the reversal of utilized provisions primarily by Syndial SpA(euro 194 million) and the Refining & Marketing segment(euro 93 million). Other changes of euro 57 million included thereclassification from the provision for restructuring ordecommissioning made by the Refining & Marketing segment(euro 114 million).

The provision for legal and other proceedings of euro 812million primarily included charges expected on failure to performcertain contractual obligations and estimated future losses onpending litigation including legal, antitrust and administrativematters. These provisions are stated on the basis of Eni’sbest estimate of the expected probable liability and primarilyrelate to the Gas & Power segment (euro 452 million), SyndialSpA (euro 225 million) and the Petrochemical segment (euro 36million). Other changes of euro 70 million were essentiallyrelated to the change in the consolidation area following theacquisition of Distrigas NV by the Gas & Power segment (euro68 million).

Loss adjustments and actuarial provisions for Eni’sinsurance companies of euro 404 million represented theliabilities accrued for claims on insurance policies underwrittenby Eni’s insurance company, Eni Insurance Ltd.

Provisions for the supply of goods for euro 308 millionrelated to Eni SpA and included the estimated costs of the supplycontracts.

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The provision for taxes of euro 260 million primarily includedcharges for unsettled tax claims in connection with uncertainapplications of the tax regulation for foreign subsidiaries ofthe Exploration & Production segment (euro 193 million).

The provision for losses on investments of euro 163 millionwas made with respect to losses on investments in entitiesincurred to date where the losses exceeded the carrying amount ofthe investments.

The provision for marketing and promotional initiativesamounted to euro 81 million and was made in respect of marketinginitiatives involving awards and prizes to clients in theRefining & Marketing segment.

The provision for OIL insurance cover of euro 72 millionincluded a mutual insurance provision for future increases ininsurance charge as a result of past accidents that will be paidin the next 5 years by Eni for participating in the mutualinsurance policy of Oil Insurance Ltd.

The provision for restructuring or decommissioning of unusedproduction facilities of euro 16 million was primarily made forthe estimated future costs of site restoration and remediation inconnection with divestments and the closing of facilities in theRefining & Marketing segment (euro 10 million). Other changesof euro 114 million related to a reclassification to theprovision for environmental risks made by the Refining &Marketing segment.

The provision for onerous contracts of euro 4 million relatedto contracts for which the termination or execution costs exceedthe benefits. The reversal of utilized provisions related toSyndial SpA.

**23 Provisions for employee benefits**Provisions for employee benefits were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| TFR                                                                                           |   | 499     |   | 458     |   |
|-----------------------------------------------------------------------------------------------|--------|---------|--------|---------|--------|
| Foreign        pension plans                                                                  |   | 219     |   | 223     |   |
| Supplementary medical reserve for Eni managers        (FISDE) and other foreign medical plans |   | 99      |   | 98      |   |
| Other        benefits                                                                         |   | 118     |   | 168     |   |
|                                                                                          |   | **935** |   | **947** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Provisions for indemnities upon termination of employmentprimarily related to the provisions accrued by Italian companiesfor employee termination indemnities ("TFR"),determined using actuarial techniques and regulated by Article2120 of the Italian Civil Code.

The indemnity is paid upon retirement as a lump sum paymentthe amount of which corresponds to the total of the provisionsaccrued during the employee’s service period based onpayroll costs as revalued until retirement. Following changes inthe regime, starting from January 1, 2007, the amount alreadyaccrued and the future benefits have been transferred to apension fund or the treasury fund custodied by the Italianadministration for post-retirement benefits (INPS). Companieswith less than 50 employees can choose not to adopt the newscheme. Therefore, the allocation of future TFR provisions topension funds or the INPS treasury fund determines that theseamounts will be classified as costs to provide benefits under adefined contribution plan. Past unpaid amounts accrued as atDecember 31, 2006 for post-retirement indemnities under theItalian TFR regime continue to represent costs to providebenefits under a defined benefit plan and must be assessed basedon actuarial assumptions.

Pension funds are defined benefit plans provided by foreignsubsidiaries located mainly in Nigeria and in Germany. Benefitsunder these plans consisted of payments based on seniority andthe salary paid in the last year of service, or alternatively,the average annual salary over a defined period prior toretirement.

Group companies provide healthcare benefits to retiredmanagers. Liability to these plans and the current cost arelimited to the contributions made by the company.

Other benefits primarily related to a deferred cash incentivescheme for managers and certain Jubilee awards. The provision forthe deferred cash incentive scheme is assessed based on thelikelihood that the company will 

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reach planned targets and the employees will reach individualperformance goals. Jubilee awards are benefits due following theattainment of a minimum period of service and, for the Italiancompanies, consist of an in-kind remuneration.

The value of employee benefits, estimated by applyingactuarial techniques, consisted of the following: 

|   | **Foreign pension plans** |   |
|--------|---------------------------|--------|
|   |                           |   |

| (euro        million) |   | TFR |   | Gross liability |   | Plan assets |   | FISDE        and other foreign medical plans |   | Other benefits |   | Total |
|-----------------------|--------|-----|--------|-----------------|--------|-------------|--------|----------------------------------------------|--------|----------------|--------|-------|
|                  |   |     |   |                 |   |             |   |                                              |   |                |   |       |

| **2007**                                                                                    |   |    |   |   |    |   |   |     |   |   |   |   |   |    |   |   |      |   |
|---------------------------------------------------------------------------------------------|--------|---------|--------|--------|---------|--------|--------|----------|--------|--------|--------|--------|--------|---------|--------|--------|-----------|--------|
| **Current        value of benefit liabilities and plan assets at beginning        of year** |   | **614** |   |   | **771** |   |   | **(440** | **)**  |   | **91** |   |   | **95**  |   |   | **1,131** |   |
| Current cost                                                                                |   | 13      |   |   | 13      |   |   |     |   |   | 1      |   |   | 38      |   |   | 65        |   |
| Interest        cost                                                                        |   | 23      |   |   | 32      |   |   |     |   |   | 4      |   |   | 2       |   |   | 61        |   |
| Expected return on plan assets                                                              |   |    |   |   |    |   |   | (23      | )      |   |   |   |   |    |   |   | (23       | )      |
| Employee        contributions                                                               |   |    |   |   |    |   |   | (126     | )      |   |   |   |   |    |   |   | (126      | )      |
| Actuarial gains (losses)                                                                    |   | (52     | )      |   | 3       |   |   | 12       |   |   | 1      |   |   | (1      | )      |   | (37       | )      |
| Benefits        paid                                                                        |   | (64     | )      |   | (35     | )      |   | 18       |   |   | (6     | )      |   | (7      | )      |   | (94       | )      |
| Amendments                                                                                  |   | 1       |   |   | 2       |   |   |     |   |   |   |   |   |    |   |   | 3         |   |
| Curtailments        and settlements                                                         |   | (62     | )      |   | (201    | )      |   | 201      |   |   |   |   |   |    |   |   | (62       | )      |
| Currency translation differences and other        changes                                   |   | 3       |   |   | 36      |   |   | (4       | )      |   | 1      |   |   | (9      | )      |   | 27        |   |
| **Current        value of benefit liabilities and plan assets at end of        year**       |   | **476** |   |   | **621** |   |   | **(362** | **)**  |   | **92** |   |   | **118** |   |   | **945**   |   |
| **2008**                                                                                    |   |    |   |   |    |   |   |     |   |   |   |   |   |    |   |   |      |   |
| **Current value of benefit liabilities and plan        assets at beginning of year**        |   | **476** |   |   | **621** |   |   | **(362** | **)**  |   | **92** |   |   | **118** |   |   | **945**   |   |
| Current cost                                                                                |   |    |   |   | 21      |   |   |     |   |   | 1      |   |   | 48      |   |   | 70        |   |
| Interest cost                                                                               |   | 25      |   |   | 28      |   |   |     |   |   | 5      |   |   | 5       |   |   | 63        |   |
| Expected return on plan assets                                                              |   |    |   |   |    |   |   | (25      | )      |   |   |   |   |    |   |   | (25       | )      |
| Employee contributions                                                                      |   |    |   |   | (1      | )      |   | (41      | )      |   |   |   |   |    |   |   | (42       | )      |
| Actuarial gains (losses)                                                                    |   | 8       |   |   | (11     | )      |   | 102      |   |   | 3      |   |   | 3       |   |   | 105       |   |
| Benefits paid                                                                               |   | (65     | )      |   | (25     | )      |   | 20       |   |   | (7     | )      |   | (7      | )      |   | (84       | )      |
| Curtailments and settlements                                                                |   |    |   |   |    |   |   |     |   |   | (2     | )      |   |    |   |   | (2        | )      |
| Currency translation differences and other        changes                                   |   | (1      | )      |   | 169     |   |   | (147     | )      |   | 2      |   |   | 1       |   |   | 24        |   |
| **Current value of benefit liabilities and plan        assets at end of year**              |   | **443** |   |   | **802** |   |   | **(453** | **)**  |   | **94** |   |   | **168** |   |   | **1,054** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

The gross liability for foreign employee pension plans of euro802 million (euro 621 million at December 31, 2007) included theliabilities related to joint ventures operating in explorationand production activities for euro 67 million and euro 77 millionat December 31, 2007 and 2008, respectively. A receivable of anamount equivalent to such liability was recorded. Other benefitsof euro 168 million (euro 118 million at December 31, 2007)primarily concerned the deferred monetary incentive plan for euro107 million (euro 69 million at December 31, 2007) and jubileeawards for euro 47 million (euro 40 million at December 31,2007).

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The reconciliation of benefit obligations to plan assets wasas follows:

|   |   | **TFR** |   | **Foreign pension plans** |   | **FISDE and other foreign medical plans** |   | **Other benefits** |
|--------|--------|---------|--------|---------------------------|--------|-------------------------------------------|--------|--------------------|
|   |   |         |   |                           |   |                                           |   |                    |

| (euro        million) |   | Dec. 31, 2007 |   | Dec. 31, 2008 |   | Dec. 31, 2007 |   | Dec. 31, 2008 |   | Dec. 31, 2007 |   | Dec. 31, 2008 |   | Dec. 31, 2007 |   | Dec. 31, 2008 |
|-----------------------|--------|---------------|--------|---------------|--------|---------------|--------|---------------|--------|---------------|--------|---------------|--------|---------------|--------|---------------|
|                  |   |               |   |               |   |               |   |               |   |               |   |               |   |               |   |               |

| Present value of benefit obligations with plan        assets              |   |    |   |    |   | 439     |   |   | 610     |   |   |   |   |   |   |    |   |    |
|---------------------------------------------------------------------------|--------|---------|--------|---------|--------|---------|--------|--------|---------|--------|--------|--------|--------|--------|--------|---------|--------|---------|
| Present        value of plan assets                                       |   |    |   |    |   | (362    | )      |   | (453    | )      |   |   |   |   |   |    |   |    |
| **Net present value of benefit obligations with        plan assets**      |   |    |   |    |   | **77**  |   |   | **157** |   |   |   |   |   |   |    |   |    |
| **Present        value of benefit obligations without plan assets**       |   | **476** |   | **443** |   | **182** |   |   | **192** |   |   | **92** |   | **94** |   | **118** |   | **168** |
| Actuarial gains (losses) not recognized                                   |   | 23      |   | 15      |   | (33     | )      |   | (126    | )      |   | 7      |   | 4      |   |    |   |    |
| Past        service cost not recognized                                   |   |    |   |    |   | (7      | )      |   |    |   |   |   |   |   |   |    |   |    |
| **Net liabilities recognized in provisions for        employee benefits** |   | **499** |   | **458** |   | **219** |   |   | **223** |   |   | **99** |   | **98** |   | **118** |   | **168** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Costs charged to the profit and loss account were as follows: 

| (euro        million) |   | **TFR** |   | **Foreign pension plans** |   | **FISDE and other foreign medical plans** |   | **Other benefits** |   | **Total** |
|-----------------------|--------|---------|--------|---------------------------|--------|-------------------------------------------|--------|--------------------|--------|-----------|
|                  |   |         |   |                           |   |                                           |   |                    |   |           |

| **2007**                                      |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
|-----------------------------------------------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|
| Current        cost                           |   | 13      |   |   | 13     |   |   | 1      |   |   | 38     |   |   | 65      |   |
| Interest cost                                 |   | 23      |   |   | 32     |   |   | 4      |   |   | 2      |   |   | 61      |   |
| Expected        return on plan assets         |   |    |   |   | (23    | )      |   |   |   |   |   |   |   | (23     | )      |
| Amortization of actuarial gains (losses)      |   | 1       |   |   | 3      |   |   |   |   |   |   |   |   | 4       |   |
| Effect of        curtailments and settlements |   | (83     | )      |   | 41     |   |   |   |   |   |   |   |   | (42     | )      |
|                                          |   | **(46** | **)**  |   | **66** |   |   | **5**  |   |   | **40** |   |   | **65**  |   |
| **2008**                                      |   |    |   |   |   |   |   |   |   |   |   |   |   |    |   |
| Current cost                                  |   |    |   |   | 19     |   |   | 1      |   |   | 48     |   |   | 70      |   |
| Interest cost                                 |   | 25      |   |   | 28     |   |   | 5      |   |   | 5      |   |   | 63      |   |
| Expected return on plan assets                |   |    |   |   | (25    | )      |   |   |   |   |   |   |   | (25     | )      |
| Amortization of actuarial gains (losses)      |   |    |   |   | 1      |   |   |   |   |   |   |   |   | 1       |   |
| Effect of curtailments and settlements        |   |    |   |   |   |   |   | (2     | )      |   |   |   |   | (2      | )      |
|                                          |   | **25**  |   |   | **25** |   |   | **4**  |   |   | **53** |   |   | **107** |   |

|   |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|

The main actuarial assumptions used for the valuation ofpost-retirement benefit obligations at year-end and for theestimate of costs expected for 2009 were as follows:

| (%)    |   | **TFR** |   | **Foreign pension plans** |   | **FISDE and other foreign medical plans** |   | **Other benefits** |
|--------|--------|---------|--------|---------------------------|--------|-------------------------------------------|--------|--------------------|
|   |   |         |   |                           |   |                                           |   |                    |

| **2007**                             |   |    |   |     |   |   |   |    |
|--------------------------------------|--------|---------|--------|----------|--------|--------|--------|---------|
| Discount        rate                 |   | 5.4     |   | 3.5-13.0 |   | 5.5    |   | 4.8-5.4 |
| Expected return rate on plan assets  |   |    |   | 4.0-13.0 |   |   |   |    |
| Rate of        compensation increase |   | 2.7-3.0 |   | 2.0-12.0 |   |   |   | 2.7-4.0 |
| Rate of price inflation              |   | 2.0     |   | 1.0-10.0 |   | 2.0    |   | 2.0     |
|                                 |   |    |   |     |   |   |   |    |
| **2008**                             |   |    |   |     |   |   |   |    |
| Discount rate                        |   | 6.0     |   | 3.5-13.0 |   | 6.0    |   | 5.2-6.0 |
| Expected return rate on plan assets  |   |    |   | 4.5-13.0 |   |   |   |    |
| Rate of compensation increase        |   | 2.7-3.0 |   | 2.4-13.0 |   |   |   | 2.7-4.0 |
| Rate of price inflation              |   | 2.5     |   | 1.3-11.0 |   | 2.5    |   | 2.5     |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

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With regards to Italian plans, demographic tables prepared byRagioneria Generale dello Stato (RG48) were used. The expectedreturn rate by plan assets has been determined by reference toquoted prices expressed in regulated markets.

Plan assets consisted of the following:

| (%)    |   | **Plan assets** |   | **Expected return** |
|--------|--------|-----------------|--------|---------------------|
|   |   |                 |   |                     |

| Securities  |   | 6.9       |   | 6.6-8.9  |   |
|-------------|--------|-----------|--------|----------|--------|
| Bonds       |   | 20.4      |   | 2.8-10.0 |   |
| Real estate |   | 1.8       |   | 5.4-15.0 |   |
| Other       |   | 70.9      |   | 2.0-13.0 |   |
| **Total**   |   | **100.0** |   |     |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

The effective return on plan assets amounted to a cost of euro77 million (a profit of euro 11 million at December 31, 2007).

With reference to healthcare plans, the effects deriving froma 1% change of the actuarial assumptions of medical costs were asfollows: 

| (euro million) |   | **1% Increase** |   | **1% Decrease** |
|----------------|--------|-----------------|--------|-----------------|
|           |   |                 |   |                 |

| Impact on the current costs and interest costs |   | 1  |   | (1 | ) |
|------------------------------------------------|--------|----|--------|----|---|
| Impact on        net benefit obligation        |   | 10 |   | (9 | ) |

|   |   |  |   |  |
|--------|--------|--|--------|--|

The amount expected to be accrued to defined benefit plans for2009 is euro 32 million.

The analysis of changes in the actuarial valuation of the netliability with respect to prior year deriving from thenon-correspondence of actuarial assumptions with actual valuesrecorded at year-end was as follows:

| (euro        million) |   | **TFR** |   | **Foreign pension plans** |   | **FISDE and other foreign medical plans** |   | **Other benefits** |
|-----------------------|--------|---------|--------|---------------------------|--------|-------------------------------------------|--------|--------------------|
|                  |   |         |   |                           |   |                                           |   |                    |

| **2007**                                |   |   |   |   |   |   |   |   |   |   |   |   |
|-----------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Impact on        net benefit obligation |   | (8     | )      |   | 6      |   |   |   |   |   |   |   |
| Impact on plan assets                   |   |   |   |   | 3      |   |   |   |   |   |   |   |
| **2008**                                |   |   |   |   |   |   |   |   |   |   |   |   |
| Impact on net benefit obligation        |   | 7      |   |   | 15     |   |   | 3      |   |   | 1      |   |
| Impact on plan assets                   |   |   |   |   | (62    | )      |   |   |   |   |   |   |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

**24 Deferred tax liabilities**Deferred tax liabilities were recognized net of offsettabledeferred tax assets for euro 3,468 million (euro 3,526 million atDecember 31, 2007).

| (euro        million) |   | **Value at         Dec. 31, 2007** |   | **Additions** |   | **Deductions** |   | ****Changes in the scope of consolidation**** |   | **Currency translation differences** |   | **Other changes** |   | **Value at         Dec. 31, 2008** |
|-----------------------|--------|------------------------------------|--------|---------------|--------|----------------|--------|-----------------------------------------------|--------|--------------------------------------|--------|-------------------|--------|------------------------------------|
|                  |   |                                    |   |               |   |                |   |                                               |   |                                      |   |                   |   |                                    |

|   | **5,471** |   | 952 |   | (2,335 | ) |   | 1,684 |   | (38 | ) |   | 8 |   | **5,742** |
|--------|-----------|--------|-----|--------|--------|---|--------|-------|--------|-----|---|--------|---|--------|-----------|

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

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Deferred tax liabilities and deferred tax assets consisted ofthe following:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Deferred tax liabilities                            |   | 8,997     |   |   | 9,210     |   |
|-----------------------------------------------------|--------|-----------|--------|--------|-----------|--------|
| Deferred        tax assets available for offset     |   | (3,526    | )      |   | (3,468    | )      |
|                                                |   | **5,471** |   |   | **5,742** |   |
| Deferred        tax assets not available for offset |   | (1,915    | )      |   | (2,912    | )      |
|                                                |   | **3,556** |   |   | **2,830** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

The most significant temporary differences giving rise to netdeferred tax liabilities were as follows:

| (euro        million) |   | **Value at         Dec. 31, 2007** |   | **Additions** |   | **Deductions** |   | **Currency translation differences** |   | **Other changes** |   | **Value at         Dec. 31, 2008** |
|-----------------------|--------|------------------------------------|--------|---------------|--------|----------------|--------|--------------------------------------|--------|-------------------|--------|------------------------------------|
|                  |   |                                    |   |               |   |                |   |                                      |   |                   |   |                                    |

| Deferred tax liabilities:                                                             |   |       |   |   |       |   |   |       |   |   |    |   |   |      |   |   |       |   |
|---------------------------------------------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|---------|--------|--------|-----------|--------|--------|------------|--------|
| -        accelerated tax depreciation                                                 |   | 6,257      |   |   | 212        |   |   | (895       | )      |   | (60     | )      |   | (148      | )      |   | 5,366      |   |
| - site restoration and abandonment (tangible        assets)                           |   | 539        |   |   | 191        |   |   | (30        | )      |   | (32     | )      |   | (14       | )      |   | 654        |   |
| -        capitalized interest expense                                                 |   | 177        |   |   | 10         |   |   | (15        | )      |   |    |   |   | 1         |   |   | 173        |   |
| - application of the weighted average cost        method in evaluation of inventories |   | 731        |   |   | 335        |   |   | (1,070     | )      |   |    |   |   | 83        |   |   | 79         |   |
| - other                                                                               |   | 1,293      |   |   | 204        |   |   | (325       | )      |   | 54      |   |   | 1,712     |   |   | 2,938      |   |
|                                                                                  |   | **8,997**  |   |   | **952**    |   |   | **(2,335** | **)**  |   | **(38** | **)**  |   | **1,634** |   |   | **9,210**  |   |
| Deferred        tax assets:                                                           |   |       |   |   |       |   |   |       |   |   |    |   |   |      |   |   |       |   |
| - site restoration and abandonment (provisions        for contingencies)              |   | (1,363     | )      |   | (244       | )      |   | 17         |   |   | 45      |   |   | (27       | )      |   | (1,572     | )      |
| - accruals        for impairment losses and provisions for contingencies              |   | (913       | )      |   | (701       | )      |   | 235        |   |   | 3       |   |   | (21       | )      |   | (1,397     | )      |
| - depreciation and amortization                                                       |   | (622       | )      |   | (278       | )      |   | 48         |   |   | (42     | )      |   | (16       | )      |   | (910       | )      |
| - assets        revaluation as per Laws No. 342/2000 and No. 448/2001                 |   | (788       | )      |   |       |   |   | 60         |   |   |    |   |   | (7        | )      |   | (735       | )      |
| - carry-forward tax losses                                                            |   | (79        | )      |   | (10        | )      |   | 37         |   |   | 1       |   |   | (6        | )      |   | (57        | )      |
| - other                                                                               |   | (1,676     | )      |   | (545       | )      |   | 370        |   |   | 36      |   |   | 106       |   |   | (1,709     | )      |
|                                                                                  |   | **(5,441** | **)**  |   | **(1,778** | **)**  |   | **767**    |   |   | **43**  |   |   | **29**    |   |   | **(6,380** | **)**  |
| **Net        deferred tax liabilities**                                               |   | **3,556**  |   |   | **(826**   | **)**  |   | **(1,568** | **)**  |   | **5**   |   |   | **1,663** |   |   | **2,830**  |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Deferred tax assets are recognized for deductible temporarydifferences to the extent that is probable that sufficienttaxable profit will be available against which part or all of thedeductible temporary differences can be utilized. When futuretaxable profit is no longer deemed to be sufficient to absorb allexisting deferred tax assets, any surplus is written off.

Other changes of euro 1,663 million included: (i) changes inthe consolidation area for euro 1,456 million following of theacquisition made by the Exploration & Production segment ofBurren Energy Plc (euro 733 million), of First Calgary PetroleumsLtd (euro 108 million), of Eni Hewett Ltd (euro 91 million) andof Hindustan Oil Exploration Co Ltd (euro 31 million), theacquisition made by the Gas & Power segment of Distrigas NV(euro 504 million) and the disposal done by the Refining &Marketing segment of Agip España SA (euro 11 million); and (ii)the recognition of the deferred tax effect against equity on thefair value evaluation of derivatives designated as cash flowhedge for euro 76 million. Further information on cash flowhedging derivatives is given in Note 7 - Other current assets, inNote 15 - Other non-current receivables and in Note 25 - Othernon-current liabilities.

Italian taxation law allows the carry-forward of tax lossesover the five subsequent years. Losses suffered in the firstthree years of the company’s life can however be, for themost part, carried forward indefinitely. The tax rate applied bythe Italian subsidiaries to determine the portion ofcarry-forwards tax losses to be utilized equaled 33%; 33.73% forforeign entities.

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Carry-forward tax losses of euro 1,024 million can be used inthe following periods:

| (euro million) |   | **Italian        subsidiaries** |   | **Foreign        subsidiaries** |
|----------------|--------|---------------------------------|--------|---------------------------------|
|           |   |                                 |   |                                 |

| 2009               |   | 41     |   | 7       |   |
|--------------------|--------|--------|--------|---------|--------|
| 2010               |   |   |   | 12      |   |
| 2011               |   |   |   | 1       |   |
| 2012               |   |   |   |    |   |
| 2013               |   | 6      |   | 3       |   |
| Beyond        2013 |   | 3      |   | 14      |   |
| Without limit      |   | 38     |   | 899     |   |
|               |   | **88** |   | **936** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Carry-forward tax losses of euro 171 millionexpected to be offset against future taxable profit and were inrespect of Italian subsidiaries for euro 88 million and offoreign subsidiaries for euro 83 million. Deferred tax assetsrecognized on these losses amounted to euro 29 million and euro28 million, respectively. 

**25 Other non-current liabilities**Other non-current liabilities were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Fair value of cash flow hedge derivatives |   | 1,340     |   | 499       |   |
|-------------------------------------------|--------|-----------|--------|-----------|--------|
| Current        income tax liabilities     |   | 215       |   | 254       |   |
| Payables related to capital expenditures  |   | 22        |   |      |   |
| Other        payables                     |   | 295       |   | 55        |   |
| Other liabilities                         |   | 159       |   | 1,730     |   |
|                                      |   | **2,031** |   | **2,538** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

The fair value of derivative contracts was determined by usingmarket quotations reported by major market data providers, or, ifno market information was available, on the basis of generallyaccepted methods for financial valuations.

The fair value of cash flow hedging derivatives amounted toeuro 499 million (euro 1,340 million at December 31, 2007) andrelated to the Exploration & Production segment for euro 264million (euro 1,340 million at December 31, 2007) and toDistrigas NV (euro 235 million).

Further information on cash flow hedging derivatives is givenin Note 7 - Other current assets. The fair value related to thecontracts expiring in 2009 is given in Note 7 - Other currentassets, in Note 15 - Other non-current receivables and in Note 25- Other non-current liabilities. The effects of the fair valuevaluation of cash flow hedging derivatives are given in Note 27 -Shareholders’ equity and in Note 32 - Finance income(expense).

The nominal value of these derivatives referred to purchaseand sale commitments for euro 1,878 million and euro 1,832million, respectively (euro 2,804 million and euro 3,404 millionat December 31, 2007).

Information on the hedged risks and the hedging policies isshown in Note 29 - Guarantees, commitments and risks.

The group’s liability for current income taxes of euro254 million (euro 215 million at December 31, 2007) was due asspecial tax (with a rate lower than the statutory tax rate),relating to the option to increase the deductible tax bases ofcertain tangible and other assets to their carrying amounts aspermitted by the 2008 Budget Law.

Other liabilities of euro 1,730 million (euro 159 million atDecember 31, 2007) included advances received by Suez followingthe long-term supply of natural gas and electricity of euro 1,552million.

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**26 Assets classified asheld for sale and liabilities directly associated with the assetsclassified as held for sale**Non-current assets held for sale and directly associatedliabilities related to the disposal of Fertlizantes Nitrogenadosde Oriente, a company specialized in the production offertilizers.

**27 Shareholders’ equity****Minority interest**Minority interest and the attributable profit withreference to certain consolidated subsidiaries related to:

| (euro million) |   | **Net profit** |   | **Shareholders’        equity** |
|----------------|--------|----------------|--------|--------------------------------------|
|           |   |                |   |                                      |

|   |   | 2007 |   | 2008 |   | Dec. 31, 2007 |   | Dec. 31, 2008 |
|--------|--------|------|--------|------|--------|---------------|--------|---------------|
|   |   |      |   |      |   |               |   |               |

| Saipem SpA                                                                                                |   | 514     |   | 407     |   |   | 1,299     |   | 1,560     |
|-----------------------------------------------------------------------------------------------------------|--------|---------|--------|---------|--------|--------|-----------|--------|-----------|
| Distrigas        NV                                                                                       |   |    |   | 74      |   |   |      |   | 1,162     |
| Snam Rete Gas SpA                                                                                         |   | 268     |   | 254     |   |   | 865       |   | 948       |
| Hindustan        Oil Exploration Co Ltd                                                                   |   |    |   | (1      | )      |   |      |   | 128       |
| Tigàz Tiszàntùli Gàzszolgàltatò        Részvénytàrsasàg |   | 1       |   | (11     | )      |   | 79        |   | 65        |
| Others                                                                                                    |   | 15      |   | 10      |   |   | 196       |   | 211       |
|                                                                                                      |   | **798** |   | **733** |   |   | **2,439** |   | **4,074** |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

**Eni shareholders’ equity**Eni’s net equity at December 31 was as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Share capital                                              |   | 4,005      |   |   | 4,005      |   |
|------------------------------------------------------------|--------|------------|--------|--------|------------|--------|
| Legal        reserve                                       |   | 959        |   |   | 959        |   |
| Reserve for treasury shares                                |   | 7,207      |   |   | 7,187      |   |
| Cumulative        foreign currency translation differences |   | (2,233     | )      |   | (969       | )      |
| Other reserves                                             |   | (914       | )      |   | (1,140     | )      |
| Retained        earnings                                   |   | 29,591     |   |   | 34,685     |   |
| Treasury shares                                            |   | (5,999     | )      |   | (6,757     | )      |
| Interim        dividend                                    |   | (2,199     | )      |   | (2,359     | )      |
| Net profit for the period                                  |   | 10,011     |   |   | 8,825      |   |
|                                                       |   | **40,428** |   |   | **44,436** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

**Share capital**At December 31, 2008 the parent company’s issued sharecapital consisted of 4,005,358,876 shares (nominal value euro 1each) fully paid-up (the same amount at December 31, 2007).

On April 29, 2008 Eni’s Shareholders’ Meetingdeclared a dividend distribution of euro 0.70 per share, with theexclusion of treasury shares held at the ex-dividend date, infull settlement of the 2007 dividend of euro 1.30 per share, ofwhich euro 0.60 per share paid as interim dividend. The balancewas paid on May 22, 2008 to shareholders on the register on May19, 2008.

**Legal reserve**This reserve represents earnings restricted from the paymentof dividends pursuant to Article 2430 of the Italian Civil Code.The legal reserve has reached the maximum amount required by theItalian Law.

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**Reserve for treasury shares**The reserve for treasury shares represents the reserverestricted to the purchase of own shares in accordance with thedecisions of Eni’s Shareholders’ Meetings. The amountof euro 7,187 million (euro 7,207 million at December 31, 2007)included treasury shares purchased. The decrease of euro 20million primarily concerned the sale and grant of treasury sharesto Group managers following stock option and stock grantsincentive schemes.

**Cumulative foreign currency translationdifferences**The cumulative foreign currency translation differences arosefrom the translation of financial statements denominated incurrencies other than euro.

**Other reserves**Other reserves of negative amount were euro 1,140 million (atDecember 31, 2007 other reserves of negative amount were euro 914million) and included:

| • |   | a reserve of euro 247        million constituted following the sale by Eni SpA of        Snamprogetti SpA to Saipem Projects SpA (now Saipem SpA)        (same amount at December 31, 2007);                                                                                                                                                                                                                                                                                                       |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | a reserve of euro 194        million (euro 181 million at December 31, 2007) deriving        from Eni SpA’s equity;                                                                                                                                                                                                                                                                                                                                                                           |
| • |   | a reserve of euro 86 million        (at December 31, 2007 a negative for euro 1,342 million)        including the related tax, for the valuation at fair        value of available-for-sale securities and cash flow        hedge derivatives. Further information is given in Note 2        - Other financial assets held for trading or available        for sale, Note 7 - Other current assets, Note 20 - Other        current liabilities and Note 25 - Other non-current        liabilities; |
| • |   | a negative reserve of euro        1,495 million related to the put option granted to        Publigaz (the Distrigas minority shareholder) to divest        its 31.25% stake in Distrigas NV valued at the same        per-share price of the ongoing mandatory tender offer to        minorities.                                                                                                                                                                                                  |

The valuation at fair value of securities available for saleand cash flow hedge derivatives, net of the related tax effect,consisted of the following:

|   |   | **Available-for-sale securities** |   | **Cash flow hedge derivatives** |   | **Total** |
|--------|--------|-----------------------------------|--------|---------------------------------|--------|-----------|
|   |   |                                   |   |                                 |   |           |

| (euro        million) |   | Gross reserve |   | Deferred tax liabilities |   | Net reserve |   | Gross reserve |   | Deferred tax liabilities |   | Net reserve |   | Gross reserve |   | Deferred tax liabilities |   | Net reserve |
|-----------------------|--------|---------------|--------|--------------------------|--------|-------------|--------|---------------|--------|--------------------------|--------|-------------|--------|---------------|--------|--------------------------|--------|-------------|
|                  |   |               |   |                          |   |             |   |               |   |                          |   |             |   |               |   |                          |   |             |

| **Reserve as of December 31, 2006**                     |   | **8**  |   |   | **(2** | **)**  |   | **6**  |   |   | **1**      |   |   |    |   |   | **1**      |   |   | **9**      |   |   | **(2**  | **)**  |   | **7**      |   |
|---------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|---------|--------|--------|------------|--------|--------|------------|--------|--------|---------|--------|--------|------------|--------|
| Changes of        the year 2007                         |   |   |   |   |   |   |   |   |   |   | (2,237     | )      |   | 867     |   |   | (1,370     | )      |   | (2,237     | )      |   | 867     |   |   | (1,370     | )      |
| Foreign currency translation differences                |   |   |   |   |   |   |   |   |   |   | 51         |   |   | (26     | )      |   | 25         |   |   | 51         |   |   | (26     | )      |   | 25         |   |
| Amount        recognized in the profit and loss account |   | (6     | )      |   | 2      |   |   | (4     | )      |   |       |   |   |    |   |   |       |   |   | (6         | )      |   | 2       |   |   | (4         | )      |
| **Reserve as of December 31, 2007**                     |   | **2**  |   |   |   |   |   | **2**  |   |   | **(2,185** | **)**  |   | **841** |   |   | **(1,344** | **)**  |   | **(2,183** | **)**  |   | **841** |   |   | **(1,342** | **)**  |
| Changes of        the year 2008                         |   | 3      |   |   | (1     | )      |   | 2      |   |   | 964        |   |   | (364    | )      |   | 600        |   |   | 967        |   |   | (365    | )      |   | 602        |   |
| Changes in the scope of consolidation                   |   |   |   |   |   |   |   |   |   |   | (68        | )      |   | 23      |   |   | (45        | )      |   | (68        | )      |   | 23      |   |   | (45        | )      |
| Foreign        currency translation differences         |   |   |   |   |   |   |   |   |   |   | 48         |   |   | (23     | )      |   | 25         |   |   | 48         |   |   | (23     | )      |   | 25         |   |
| Amount recognized in the profit and loss account        |   |   |   |   |   |   |   |   |   |   | 1,005      |   |   | (402    | )      |   | 603        |   |   | 1,005      |   |   | (402    | )      |   | 603        |   |
| **Reserve        as of December 31, 2008**              |   | **5**  |   |   | **(1** | **)**  |   | **4**  |   |   | **(236**   | **)**  |   | **75**  |   |   | **(161**   | **)**  |   | **(231**   | **)**  |   | **74**  |   |   | **(157**   | **)**  |
| *of which: Eni Group*                                   |   | *5*    |   |   | *(1*   | *)*    |   | *4*    |   |   | *(128*     | *)*    |   | *38*    |   |   | *(90*      | *)*    |   | *(123*     | *)*    |   | *37*    |   |   | *(86*      | *)*    |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

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The ineffective portion of the change in fairvalue of cash flow hedging derivatives (time value component)entered into by the Exploration & Production segmentconsisted of the following:

| (euro        million) |   | **Value at****Dec. 31, 2007** |   | **Changes recognized in        profit and loss account** |   | **Currency translation        differences** |   | **Value at****Dec. 31, 2008** |
|-----------------------|--------|-------------------------------|--------|----------------------------------------------------------|--------|---------------------------------------------|--------|-------------------------------|
|                  |   |                               |   |                                                          |   |                                             |   |                               |

|   |   | **(56** | **)** |   | 7 |   | 4 |   | **(45** | **)** |
|--------|--------|---------|-------|--------|---|--------|---|--------|---------|-------|

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

**Treasury shares purchased**A total of 382,954,240 ordinary shares (348,525,005 atDecember 31, 2007) with nominal value of euro 1 each, were heldin treasury, for a total cost of euro 6,757 million (euro 5,999million at December 31, 2007). 23,557,425 treasury shares(35,423,925 at December 31, 2007) at a cost of euro 505 million(euro 768 million at December 31, 2007) were available for2002-2005 and 2006-2008 stock option plans.

The decrease of 11,866,500 shares consisted of the following:

|   |   | **Stock option** |   | **Stock grant** |   | **Total** |
|--------|--------|------------------|--------|-----------------|--------|-----------|
|   |   |                  |   |                 |   |           |

| **Number of shares at December 31, 2007**                      |   | **34,521,125**  |   |   | **902,800**  |   |   | **35,423,925**  |   |
|----------------------------------------------------------------|--------|-----------------|--------|--------|--------------|--------|--------|-----------------|--------|
| Rights not        assigned for the 2006-2008 stock option plan |   | (9,406,500      | )      |   |         |   |   | (9,406,500      | )      |
| Rights exercised                                               |   | (582,100        | )      |   | (893,400     | )      |   | (1,475,500      | )      |
| Rights        cancelled                                        |   | (975,100        | )      |   | (9,400       | )      |   | (984,500        | )      |
|                                                           |   | **(10,963,700** | **)**  |   | **(902,800** | **)**  |   | **(11,866,500** | **)**  |
| **Number        of shares at December 31, 2008**               |   | **23,557,425**  |   |   |         |   |   | **23,557,425**  |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

At December 31, 2008, options outstanding were 23,557,425shares. Options refer to the 2002 stock plan for 97,000 shareswith an exercise price of euro 15.216 per share, to the 2003stock plan for 231,900 shares with an exercise price of euro13.743 per share, to the 2004 stock plan for 671,600 shares withan exercise price of euro 16.576 per share, to the 2005 stockplan for 3,756,000 shares with an exercise price of euro 22.512per share, to the 2006 stock plan for 5,954,250 shares with anweighted average exercise price of euro 23.119 per share, to the2007 stock plan for 5,492,375 with an weighted average exerciseprice of euro 27.451 per share and to the 2008 stock plan for7,354,300 with an weighted average exercise price of euro 22.540per share.

Information about commitments related to stock grant and stockoption plans is included in Note 31 - Operating expenses. 

**Interim dividend**Interim dividend for the year 2008 amounted of euro 2,359 millioncorresponding to euro 0.65 per share, as decided by the Board ofDirectors on September 11, 2008 in accordance with Article2433-bis, paragraph 5 of the Italian Civil Code; the dividend waspaid on September 25, 2008. 

**Distributable reserves**At December 31, 2008 Eni shareholders’ equity includeddistributable reserves for euro 39,000 million.

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**Reconciliation of net profit and shareholders’equity of the parent company Eni SpA to consolidated net profitand shareholders’ equity**

|    |    | **Net profit** |    | **Shareholders’        equity** |
|--------------|--------------|----------------|--------------|--------------------------------------|
|    |    |                |    |                                      |

| (euro        million) |    | 2007 |    | 2008 |    | Dec. 31, 2007 |    | Dec. 31, 2008 |
|-----------------------|--------------|------|--------------|------|--------------|---------------|--------------|---------------|
|             |    |      |    |      |    |               |    |               |

| **As recorded in Eni SpA’s Financial        Statements**                                                                                                                                                         |   | **6,600**  |   |   | **6,745** |   |   | **28,926** |   |   | **30,049** |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------|--------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|
| Difference        between the equity value of individual accounts of        consolidated subsidiaries with respect to the        corresponding carrying amount in the statutory accounts        of the parent company |   | 4,122      |   |   | 4,140     |   |   | 16,320     |   |   | 18,999     |   |
| Consolidation adjustments:                                                                                                                                                                                            |   |       |   |   |      |   |   |       |   |   |       |   |
| -        difference between cost and underlying value of equity                                                                                                                                                       |   | (1         | )      |   | (330      | )      |   | 1,245      |   |   | 5,161      |   |
| - elimination of tax adjustments and compliance        with accounting policies                                                                                                                                       |   | 649        |   |   | (1,373    | )      |   | (1,235     | )      |   | (2,852     | )      |
| -        elimination of unrealized intercompany profits                                                                                                                                                               |   | (435       | )      |   | 216       |   |   | (3,383     | )      |   | (3,127     | )      |
| - deferred taxes                                                                                                                                                                                                      |   | (97        | )      |   | 159       |   |   | 711        |   |   | (15        | )      |
| - other        adjustments                                                                                                                                                                                            |   | (29        | )      |   | 1         |   |   | 283        |   |   | 295        |   |
|                                                                                                                                                                                                                  |   | **10,809** |   |   | **9,558** |   |   | **42,867** |   |   | **48,510** |   |
| Minority        interest                                                                                                                                                                                              |   | (798       | )      |   | (733      | )      |   | (2,439     | )      |   | (4,074     | )      |
| **As recorded in Consolidated Financial        Statements**                                                                                                                                                           |   | **10,011** |   |   | **8,825** |   |   | **40,428** |   |   | **44,436** |   |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

 

**28 Other information****Acquisitions***Burren Energy Plc*On January 11, 2008, following a non-hostile takeover bymeans of a cash offer, Eni acquired control over the British oilcompany Burren Energy Plc (Burren). Burren held producing assetsin Turkmenistan and Congo, and exploratory licenses in Egypt,Yemen and India. Total consideration for this transaction of euro2,358 million, of which euro 14 million related to additionalcosts directly attributable to the combination, has beenallocated to assets and liabilities on a definitive basis.

*Hindustan Oil Exploration Co Ltd (HOEC)*On August 5, 2008, following the execution of a mandatorytender offer on a 20% stake of the HOEC share capital, Eniacquired control over the Indian company Hindustan OilExploration Co Ltd (HOEC). The mandatory offer was associatedwith Eni’s acquisition of a 27.18% of HOEC as part of theBurren deal. Total consideration for this transaction of euro 107million, with the exclusion of the minority interest, has beenallocated to assets and liabilities on a preliminary basisbecause of the significant amount of time required for a moreprecise valuation.

*Distrigas NV*On October 30, 2008, following the acquisition of a 57.243%majority stake from the French company Suez-Tractebel Eniacquired control over the Belgian company Distrigas NV. OnDecember 30, 2008, Eni was granted authorization from the Belgianmarket authorities to execute a mandatory tender offer to theminorities of Distrigas. The deadline of the offer was March 19,2009. Total consideration for this transaction of euro 2,751million, of which euro 12 million related to additional costsdirectly attributable to the acquisition, with the exclusion ofthe minority interest, has been allocated to assets andliabilities on a preliminary basis because of the amount of timerequired for a more precise valuation.

*First Calgary Petroleums Ltd*On November 21, 2008, following the acquisition of all of thecommon shares Eni gained control of First Calgary Petroleums Ltd,a Canadian oil and gas company with exploration and developmentactivities in Algeria. Total consideration for this transactionof euro 605 million, of which euro 5 million related toadditional costs directly attributable to the acquisition, hasbeen allocated to assets and liabilities on a preliminary basisbecause of the amount of time required for a more precisevaluation.

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*Eni Hewett Ltd*On November 28, 2008, following the finalization of anagreement with the British company Tullow Oil Ltd Eni acquired a52% stake and the operatorship of fields in the Hewett Unit andrelevant facilities in the North Sea, with the aim to upgradecertain depleted fields in the area so as to achieve a gasstorage facility. Total consideration for this transaction ofeuro 224 million has been allocated to assets and liabilities ona preliminary basis because of the amount of time required for amore precise valuation.

| (euro        million) |   | **Burren Energy Plc** |   | **Hindustan Oil        Exploration Co Ltd** |   | **Distrigas NV** |   | **First Calgary Petroleums        Ltd** |   | **Eni Hewett Ltd** |
|-----------------------|--------|-----------------------|--------|---------------------------------------------|--------|------------------|--------|-----------------------------------------|--------|--------------------|
|                  |   |                       |   |                                             |   |                  |   |                                         |   |                    |

|   |   | Pre- acquisition |   | Post- acquisition |   | Pre- acquisition |   | Post- acquisition |   | Pre- acquisition |   | Post- acquisition |   | Pre- acquisition |   | Post- acquisition |   | Pre- acquisition |   | Post- acquisition |
|--------|--------|------------------|--------|-------------------|--------|------------------|--------|-------------------|--------|------------------|--------|-------------------|--------|------------------|--------|-------------------|--------|------------------|--------|-------------------|
|   |   |                  |   |                   |   |                  |   |                   |   |                  |   |                   |   |                  |   |                   |   |                  |   |                   |

| Current assets                            |   | 187     |   | 187       |   | 115     |   | 115     |   | 3,375     |   | 3,375     |   | 148     |   | 148     |   | 56     |   | 19      |
|-------------------------------------------|--------|---------|--------|-----------|--------|---------|--------|---------|--------|-----------|--------|-----------|--------|---------|--------|---------|--------|--------|--------|---------|
| Property,        plant and equipment      |   | 457     |   | 2,543     |   | 79      |   | 199     |   | 30        |   | 30        |   | 643     |   | 757     |   | 29     |   | 118     |
| Intangible assets                         |   | 47      |   | 326       |   | 8       |   |    |   | 1         |   | 1,395     |   |    |   |    |   |   |   | 208     |
| Goodwill                                  |   |    |   | 89        |   |    |   |    |   |      |   | 1,245     |   |    |   | 88      |   |   |   | 39      |
| Investments                               |   | 56      |   | 53        |   | 1       |   | 1       |   | 112       |   | 112       |   |    |   |    |   |   |   |    |
| Other        non-current assets           |   | 17      |   | 17        |   |    |   |    |   | 202       |   | 203       |   |    |   |    |   | 9      |   |    |
| **Assets acquired**                       |   | **764** |   | **3,215** |   | **203** |   | **315** |   | **3,720** |   | **6,360** |   | **791** |   | **993** |   | **94** |   | **384** |
| Current        liabilities                |   | 62      |   | 100       |   | 37      |   | 37      |   | 1,796     |   | 1,796     |   | 45      |   | 45      |   | 17     |   | 17      |
| Net deferred tax liabilities              |   | 36      |   | 733       |   | (5      | )      | 31      |   | 30        |   | 504       |   | 15      |   | 108     |   |   |   | 91      |
| Provisions        for contingencies       |   | 14      |   | 24        |   | 4       |   | 3       |   | 80        |   | 80        |   | 3       |   | 6       |   | 44     |   | 52      |
| Other non-current liabilities             |   |    |   |      |   | 17      |   | 17      |   | 88        |   | 88        |   | 229     |   | 229     |   |   |   |    |
| **Liabilities        acquired**           |   | **112** |   | **857**   |   | **53**  |   | **88**  |   | **1,994** |   | **2,468** |   | **292** |   | **388** |   | **61** |   | **160** |
| Minority interest                         |   |    |   |      |   | 79      |   | 120     |   | 748       |   | 1,141     |   |    |   |    |   |   |   |    |
| **Eni’s        shareholders equity** |   | **652** |   | **2,358** |   | **71**  |   | **107** |   | **978**   |   | **2,751** |   | **499** |   | **605** |   | **33** |   | **224** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

 

**29 Guarantees, commitmentsand risks****Guarantees**Guarantees were as follows:

|   |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|--------|--------|-------------------|--------|-------------------|
|   |   |                   |   |                   |

| (euro million) |   | Unsecured guarantees |   | Other        guarantees |   | Total |   | Unsecured guarantees |   | Other        guarantees |   | Total |
|----------------|--------|----------------------|--------|-------------------------|--------|-------|--------|----------------------|--------|-------------------------|--------|-------|
|           |   |                      |   |                         |   |       |   |                      |   |                         |   |       |

| Consolidated subsidiaries                        |   |      |   | 6,388     |   | 6,388      |   |      |   | 13,139     |   | 13,139     |
|--------------------------------------------------|--------|-----------|--------|-----------|--------|------------|--------|-----------|--------|------------|--------|------------|
| Unconsolidated        entities controlled by Eni |   |      |   | 150       |   | 150        |   |      |   | 151        |   | 151        |
| Joint ventures and associates                    |   | 5,896     |   | 1,099     |   | 6,995      |   | 6,027     |   | 1,075      |   | 7,102      |
| Others                                           |   | 12        |   | 279       |   | 291        |   | 8         |   | 245        |   | 253        |
|                                             |   | **5,908** |   | **7,916** |   | **13,824** |   | **6,035** |   | **14,610** |   | **20,645** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Other guarantees issued on behalf of consolidatedsubsidiaries of euro 13,139 million (euro 6,388 million atDecember 31, 2007) primarily consisted of: (i) guarantees givento third parties relating to bid bonds and performance bonds foreuro 7,004 million (euro 3,244 million at December 31, 2007), ofwhich euro 5,965 million related to the Engineering &Construction segment (euro 2,351 million at December 31, 2007);(ii) guarantees issued on behalf of Eni Gas & Power BelgiumSA for euro 2,739 million related to the Share Purchase Agreementwith Suez-Tractebel SA for the acquisition of a 57.24% majoritystake in Distrigas NV; (iii) VAT recoverable from tax authoritiesfor euro 1,248 million (euro 1,286 million at December 31, 2007);and (iv) insurance risk for euro 257 million reinsured by Eni(euro 259 million at December 31, 2007). At December 31, 2007 theunderlying commitment covered by such guarantees was euro 10,202million (euro 6,050 million at December 31, 2007).

Other guarantees issued on behalf ofunconsolidated subsidiaries of euro 151 million (euro 150 millionat December 31, 2007) consisted of letters of patronage and otherguarantees issued to commissioning entities relating to bid bondsand performance bonds for euro 146 million (euro 144 million atDecember 31, 2007). At December 31, 2008, the underlyingcommitment covered by such guarantees was euro 79 million (euro19 million at December 31, 2007).

Unsecured guarantees and other guarantees issuedon behalf of joint ventures and associates of euro 7,102 million(euro 6,995 million at December 31, 2007) primarily concerned:(i) an unsecured guarantee of euro 6,001 million (euro 5,870million at December 31, 2007) given by Eni SpA to Treno AltaVelocità - TAV - SpA for the proper and timely completion of aproject relating to the Milan-Bologna train link by CEPAV(Consorzio Eni per 

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l’Alta Velocità) Uno; consortium members,excluding unconsolidated entities controlled by Eni, gave Eniliability of surety letters and bank guarantees amounting to 10%of their respective portion of the work; (ii) unsecuredguarantees, letters of patronage and other guarantees given tobanks in relation to loans and lines of credit received for euro871 million (euro 824 million at December 31, 2007), of whicheuro 716 million related to a contract released by Snam SpA (nowmerged into Eni SpA) on behalf of Blue Stream Pipeline Co BV (Eni50%) to a consortium of international financial institutions(euro 677 million at December 31, 2007); and (iii) unsecuredguarantees and other guarantees given to commissioning entitiesrelating to bid bonds and performance bonds for euro 107 million(euro 119 million at December 31, 2007). At December 31, 2008,the underlying commitment covered by such guarantees was euro 983million (euro 1,562 million at December 31, 2007).

Unsecured and other guarantees given on behalf ofthird parties of euro 253 million (euro 291 million at December31, 2007) consisted primarily of: (i) guarantees issued on behalfof Gulf LNG Energy and Gulf LNG Pipeline and on behalf of AngolaLNG Supply Service Llc (Eni 13.6%) as security against paymentcommitments of fees in connection with the re-gasificationactivity for euro 216 million (euro 204 million at December 31,2007); and (ii) guarantees issued by Eni SpA to banks and otherfinancial institutions in relation to loans and lines of creditfor euro 19 million on behalf of minor investments or companiessold (euro 20 million at December 31, 2007).

At December 31, 2008 the underlying commitmentcovered by such guarantees was euro 232 million (euro 281 millionat December 31, 2007). 

**Commitments and contingencies**Commitments and contingencies were as follows:

| (euro million) |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|----------------|--------|-------------------|--------|-------------------|
|           |   |                   |   |                   |

| Commitments |   | 200       |   | 205       |   |
|-------------|--------|-----------|--------|-----------|--------|
| Risks       |   | 1,520     |   | 1,660     |   |
|        |   | **1,720** |   | **1,865** |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

Other commitments of euro 205 million (euro 200 million atDecember 31, 2007) were essentially related to a memorandum ofintent signed with the Basilicata Region, whereby Eni has agreedto invest euro 180 million in the future, also on account ofShell Italia E&P SpA, in connection with Eni’sdevelopment plan of oil fields in Val d’Agri (euro 177million at December 31, 2007).

Risks of euro 1,660 million (euro 1,520 million at December31, 2007) primarily concerned potential risks associated with thevalue of assets of third parties under the custody of Eni foreuro 1,273 million (euro 1,126 million at December 31, 2007) andcontractual assurances given to acquirers of certain investmentsand businesses of Eni for euro 387 million (euro 376 million atDecember 31, 2007).

**Risk factors**FOREWORDThe main risks that the Company is facing and actively monitoringand managing are the following: (i) the market risk deriving fromexposure to fluctuations in interest rates, foreign currencyexchange rates and commodity prices; (ii) the credit riskderiving from the possible default of a counterparty; (iii) theliquidity risk deriving from the risk that suitable sources offunding for the Group’s operations may not be available;(iv) the country risk in the upstream business; (v) theoperational risk; (vi) the possible evolution of the Italian gasmarket; and (vii) the specific risks deriving from explorationand production activities.

Financial risks are managed in respect of guidelines definedby the parent company, targeting to align and coordinate Groupcompanies’ policies on financial risks.

*Market risk*Market risk is the possibility that changes in currency exchangerates, interest rates or commodity prices will adversely affectthe value of the Group’s financial assets, liabilities orexpected future cash flows. The Company actively manages marketrisk in accordance with a set of policies and guidelines thatprovide a centralized model of conducting finance, treasury andrisk management operations based on three separate entities: theparent company’s (Eni SpA) finance department, EniCoordination Center and Banque Eni which is subject to certainbank regulatory 

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restrictions preventing the Group’s exposure toconcentrations of credit risk. Additionally, in 2007, Eni Trading& Shipping was established and has the mandate to manage andmonitor solely commodity derivative contracts. In particular EniSpA and Eni Coordination Center manage subsidiaries’financing requirements in and outside of Italy, respectively,covering funding requirements and using available surpluses. Alltransactions concerning currencies and derivative financialcontracts are managed by the parent company as well as theactivity of trading certificates according to the European UnionEmission Trading Scheme. The commodity risk is managed by eachbusiness unit with Eni Trading & Shipping ensuring thenegotiation of hedging derivatives. Eni uses derivative financialinstruments (derivatives) in order to minimize exposure to marketrisks related to changes in exchange rates and interest rates andto manage exposure to commodity prices fluctuations. Eni does notenter into derivative transactions on a speculative basis. Theframework defined by Eni’s policies and guidelinesprescribes that measurement and control of market risk beperformed on the basis of maximum tolerable levels of riskexposure defined in accordance with value-at-risk techniques.These techniques make a statistical assessment of the market riskon the Group’s activity, i.e., potential gain or loss infair values, due to changes in market conditions taking accountof the correlation existing among changes in fair value ofexisting instruments. Eni’s finance departments definemaximum tolerable levels of risk exposure to changes in interestrates and foreign currency exchange rates, pooling Groupcompanies risk positions. Eni’s calculation and measurementtechniques for interest rate and foreign currency exchange raterisks are in accordance with established banking standards, asestablished by the Basel Committee for bank activitiessurveillance. Tolerable levels of risk are based on aconservative approach, considering the industrial nature of thecompany. Eni’s guidelines prescribe that Eni’s Groupcompanies minimize such kinds of market risks. With regard to thecommodity risk, Eni’s policies and guidelines define rulesto manage this risk aiming at the optimization of core activitiesand the pursuing of preset targets of industrial margins. Themaximum tolerable level of risk exposure is pre-defined in termsof value at risk in connection with trading and commercialactivities, while the strategic risk exposure to commodity pricesfluctuations – i.e. the impact on the Group’s businessresults deriving from changes in commodity prices – ismonitored in terms of value-at risk, albeit not hedged in asystematic way. Accordingly, Eni evaluates the opportunity tomitigate its commodity risk exposure by entering into hedgingtransactions in view of certain acquisition deals of oil and gasreserves as part of the Group’s strategy to achieve itsgrowth targets or ordinary asset portfolio management. The Groupcontrols commodity risk with a maximum value-at-risk limitawarded to each business unit. Hedging needs from business unitsare pooled by Eni Trading & Shipping which also manages itsown risk exposure. The three different market risks, whosemanagement and control have been summarized above, are describedbelow. 

*Exchange rate risk*Exchange rate risk derives from the fact that Eni’soperations are conducted in currencies other than the euro(mainly in the U.S. dollar). Revenues and expenses denominated inforeign currencies may be significantly affected by exchangerates fluctuations due to conversion differences on singletransaction arising from the time lag existing between executionand definition of relevant contractual terms (economic risk) andconversion of foreign currency-denominated trade and financingpayables and receivables (transactional risk). Exchange ratefluctuations affect Group’s reported results and net equityas financial statements of subsidiaries denominated in currenciesother than the euro are translated from their functional currencyinto euro (translation risk). Generally, an appreciation of theU.S. dollar versus the euro has a positive impact on Eni’sresults of operations, and vice versa. Eni’s foreignexchange risk management policy is to minimize economic andtransactional exposures arising from foreign currency movements.Eni does not undertake any hedging activity for risks derivingfrom translation of foreign currency denominated profits orassets and liabilities of subsidiaries which prepare financialstatements in a currency other than the euro, except for singletransactions to be evaluated on a case-by-case basis. Effectivemanagement of exchange rate risk is performed within Eni’scentral finance departments which match opposite positions withinGroup companies, hedging the Group net exposure through the useof certain derivatives, such as currency swaps, forwards andoptions. Such derivatives are evaluated at fair value on thebasis of market prices provided by specialized sources. Changesin fair value of those derivatives are normally recognizedthrough the profit and loss account as they do not meet theformal criteria to be recognized as hedges in accordance with IAS39. The VAR techniques are based on variance/covariancesimulation models and are used to monitor the risk exposurearising from possible future changes in market values over a24-hour period within a 99% confidence level and a 20-day holdingperiod. 

*Interest rate risk*Changes in interest rates affect the market value of financialassets and liabilities of the company and the level of financecharges. Eni’s interest rate risk management policy is tominimize risk with the aim to achieve financial structureobjectives defined and approved in the management’s financeplans. Borrowing requirements of the Group’s companies arepooled by the Group’s central finance department in order tomanage net positions and the funding of portfolio developmentsconsistently with management’s plans while maintaining alevel of risk exposure within prescribed limits. Eni enters intointerest rate derivative transactions, in particular interestrate swaps, to effectively manage the balance between fixed andfloating rate debt.

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Such derivatives are evaluated at fair value on the basis ofmarket prices provided from specialized sources. Changes in fairvalue of those derivatives are normally recognized through theprofit and loss account as they do not meet the formal criteriato be accounted for under the hedge accounting method inaccordance with IAS 39. Value at risk deriving from interest rateexposure is measured daily on the basis of a variance/covariancemodel, with a 99% confidence level and a 20-day holding period. 

*Commodity risk*Eni’s results of operations are affected by changes in theprices of commodities. A decrease in oil and gas prices generallyhas a negative impact on Eni’s results of operations andvice-versa. Eni manages exposure to commodity price risk arisingin normal trading and commercial activities in view of achievingstable margins. In order to accomplish this, Eni uses derivativestraded on the organized markets of ICE and NyMEx (futures) andderivatives traded over the counter (swaps, forward, contractsfor differences and options) with the underlying commoditiesbeing crude oil, refined products or electricity. Suchderivatives are evaluated at fair value on the basis of marketprices provided from specialized sources or, absent marketprices, on the basis of estimates provided by brokers or suitableevaluation techniques. Changes in fair value of those derivativesare normally recognized through the profit and loss account asthey do not meet the formal criteria to be recognized as hedgesin accordance with IAS 39. Value at risk deriving from commodityexposure is measured daily on the basis of a historicalsimulation technique, with a 95% confidence level and a one-dayholding period. The following table shows amounts in terms ofvalue at risk, recorded in the first half of 2008 (compared withfull year 2007) relating to interest rate and exchange rate risksin the first section, and commodity risk in the second section.

*(Value at risk - parametric methodvariance/covariance; holding period: 20 days; confidence level:99%)*

|   | **2007** |   | **2008** |
|--------|----------|--------|----------|
|   |          |   |          |

| (euro        million) |   | High |   | Low |   | Avg |   | At year end |   | High |   | Low |   | Avg |   | At year end |
|-----------------------|--------|------|--------|-----|--------|-----|--------|-------------|--------|------|--------|-----|--------|-----|--------|-------------|
|                  |   |      |   |     |   |     |   |             |   |      |   |     |   |     |   |             |

| Interest rate        |   | 7.36 |   | 0.47 |   | 1.39 |   | 4.35 |   | 12.31 |   | 0.73 |   | 4.17 |   | 6.54 |
|----------------------|--------|------|--------|------|--------|------|--------|------|--------|-------|--------|------|--------|------|--------|------|
| Exchange        rate |   | 1.25 |   | 0.03 |   | 0.21 |   | 0.43 |   | 1.48  |   | 0.09 |   | 0.48 |   | 0.47 |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

*(Value at risk - historic simulationmethod; holding period: 1 day; confidence level: 95%)*

|   | **2007** |   | **2008** |
|--------|----------|--------|----------|
|   |          |   |          |

| (U.S. $        million) |   | High |   | Low |   | Avg |   | At year end |   | High |   | Low |   | Avg |   | At year end |
|-------------------------|--------|------|--------|-----|--------|-----|--------|-------------|--------|------|--------|-----|--------|-----|--------|-------------|
|                    |   |      |   |     |   |     |   |             |   |      |   |     |   |     |   |             |

| Area oil, products              |   | 44.59 |   | 4.39  |   | 20.17 |   | 12.68 |   | 46.48 |   | 3.44  |   | 19.88 |   | 5.43  |
|---------------------------------|--------|-------|--------|-------|--------|-------|--------|-------|--------|-------|--------|-------|--------|-------|--------|-------|
| Area Gas        & Power (*) |   | 54.11 |   | 20.12 |   | 34.56 |   | 25.57 |   | 67.04 |   | 24.38 |   | 43.53 |   | 32.07 |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                                                                         |
|--------------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (*)          |    | Amounts        relating to the Gas & Power business also include        results of Distrigas NV for the months of November and        December 2008 based on the closing date of acquisition. |

*Credit risk*Credit risk is the potential exposure of the Group to losses incase counterparties fail to perform or pay amounts due. The Groupmanages differently credit risk depending on whether credit riskarises from exposure to financial counterparties or to customersrelating to outstanding receivables. Individual business unitsare responsible for managing credit risk arising in the normalcourse of the business. The Group has established formal creditsystems and processes to ensure that before trading with a newcounterpart can start, its creditworthiness is assessed. Alsocredit litigation and receivable collection activities areassessed. The monitoring activity of credit risk exposure isperformed at the Group level according to set guidelines andmeasurement techniques that establish counterparty limits andsystems to monitor exposure against limits and report regularlyon those exposures. Specifically, credit risk exposure tomulti-business clients and exposures higher than the limit set ateuro 4 million are closely monitored. Monitoring activities donot include retail clients and public administrations. Theassessment methodology assigns a score to individual clientsbased on publicly available financial data and capital,profitability and liquidity ratios. Based on those scores, aninternal credit rating is assigned to each counterparty that isaccordingly allocated to its proper risk category. The Group riskcategories are comparable to those prepared by the main ratingagencies on the marketplace. The Group’s internal ratingsare also benchmarked against ratings prepared by a specializedexternal source.

With regard to risk arising from financial counterparties, Enihas established guidelines prior to entering into cash managementand derivative contracts to assess the counterparty’sfinancial soundness and rating in view of optimizing the riskprofile of financial activities while pursuing operationaltargets. Maximum limits of risk exposure are set in terms ofmaximum amounts of credit exposures for categories ofcounterparties as defined by the 

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Company’s Board of Directors taking into accounts thecredit ratings provided by the primary credit rating agencies onthe marketplace. Credit risk arising from financialcounterparties is managed by the Group central financedepartments, including Eni’s subsidiary Eni Trading &Shipping which specifically engages in commodity derivativestransactions. Those are the sole Group entities entitled to beparty to financial transactions due to the Group centralizedfinance model. Eligible financial counterparties are closelymonitored to check exposures against limits assigned to eachcounterparty on a daily basis. Exceptional market conditions haveforced the Group to adopt contingency plans and under certaincircumstances to suspend eligibility to be a Group financialcounterparty. Actions implemented also have been intended tolimit concentrations of credit risk by maximizing counterpartydiversification and turnover. Counterparties have been alsoselected on more stringent criteria particularly in transactionson derivatives instruments and with maturity longer than athree-month period. Eni has not experienced materialnon-performance by any counterparty. As of December 31, 2007 and2008, Eni had no significant concentrations of credit risk. 

*Liquidity risk*Liquidity risk is the risk that suitable sources of funding forthe Group may not be available, or the Group is unable to sellits assets on the market place as to be unable to meet short-termfinance requirements and to settle obligations. Such a situationwould negatively impact the Group results as it would result inthe Company incurring higher borrowing expenses to meet itsobligations or under the worst of conditions the inability of theCompany to continue as a going concern. As part of its financialplanning process, Eni manages the liquidity risk by targetingsuch a capital structure as to allow the Company to maintain alevel of liquidity adequate to the Group’s needs optimizingthe opportunity cost of maintaining liquidity reserves alsoachieving an efficient balance in terms of maturity andcomposition of finance debt. The Group capital structure is setaccording to the Company’s industrial targets and within thelimits established by the Company’s Board of Directors whoare responsible for prescribing the maximum ratio of debt tototal equity and minimum ratio of medium and long-term debt tototal debt as well as fixed rate medium and long-term debt tototal medium and long-term debt. In spite of ongoing tough creditmarket conditions resulting in higher spreads to borrowers, theCompany has succeeded in maintaining access to a wide range offunding at competitive rates through the capital markets andbanks. The actions implemented as part of Eni’s financialplanning have enabled the Group to maintain access to the creditmarket particularly via the issue of commercial paper alsotargeting to increase the flexibility of funding facilities. Theabove mentioned actions aimed at ensuring availability ofsuitable sources of funding to fulfill short-term commitments anddue obligations also preserving the necessary financialflexibility to support the Group’s development plans. Indoing so, the Group has pursued an efficient balance of financedebt in terms of maturity and composition leveraging on thestructure of its lines of credit particularly the committed ones.

At present, the Group believes it has access to sufficientfunding and has also both committed and uncommitted borrowingfacilities to meet currently foreseeable borrowing requirements. 

As of December 31, 2008, Eni maintained short-term committedand uncommitted unused borrowing facilities of euro 11,099million, of which euro 3,313 million were committed, andlong-term committed unused borrowing facilities of euro 1,850million.

These facilities were under interest rates that reflectedmarket conditions. Fees charged for unused facilities were notsignificant. Eni has in place a program for the issuance of EuroMedium Term Notes up to euro 10 billion, of which euro 6,391million were drawn as of the balance sheet date.

The Group has debt ratings of AA- and A-1+ respectively forthe long and short-term debt assigned by Standard &Poor’s and Aa2 and P-1 assigned by Moody’s; the outlookis stable for both. 

The tables below summarize the Group main contractualobligations for finance debt repayments, including expectedpayments for interest charges, and trade and other payablesmaturities.

**Finance debt**

|    |    | **Maturity year** |
|--------------|--------------|-------------------|
|         |         |                   |

| (euro        million) |    | 2009 |    | 2010 |    | 2011 |    | 2012 |    | 2013 |    | 2014 and thereafter |    | Total |
|-----------------------|--------------|------|--------------|------|--------------|------|--------------|------|--------------|------|--------------|---------------------|--------------|-------|
|             |         |      |    |      |    |      |    |      |    |      |    |                     |    |       |

| Non current debt                     |   | 549       |   | 3,630     |   | 797     |   | 2,687     |   | 1,981     |   | 4,834     |   | **14,478** |
|--------------------------------------|--------|-----------|--------|-----------|--------|---------|--------|-----------|--------|-----------|--------|-----------|--------|------------|
| Current        financial liabilities |   | 6,359     |   | -         |   | -       |   | -         |   | -         |   | -         |   | **6,359**  |
|                                 |   | **6,908** |   | **3,630** |   | **797** |   | **2,687** |   | **1,981** |   | **4,834** |   | **20,837** |
| Interest        on finance debt      |   | 502       |   | 469       |   | 412     |   | 383       |   | 336       |   | 791       |   | **2,893**  |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

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**Trade and other payables**

|    |    | **Maturity year** |
|--------------|--------------|-------------------|
|    |    |                   |

| (euro        million) |    | 2009 |    | 2010-2013 |    | 2014 and thereafter |    | Total |
|-----------------------|--------------|------|--------------|-----------|--------------|---------------------|--------------|-------|
|             |    |      |    |           |    |                     |    |       |

| Trade payables                  |   | 12,590     |   | -      |   | -      |   | **12,590** |
|---------------------------------|--------|------------|--------|--------|--------|--------|--------|------------|
| Advances,        other payables |   | 7,925      |   | 28     |   | 27     |   | **7,980**  |
|                            |   | **20,515** |   | **28** |   | **27** |   | **20,570** |

|   |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|

In addition to finance debt and trade payables presented inthe financial statements, the Group has in place a number ofcontractual obligations arising in the normal course of thebusiness. To meet these commitments, the Group will have to makepayments to third parties. The Company’s main obligationsare certain arrangements to purchase goods or services that areenforceable and legally binding and that specify all significantterms. Such arrangements include non-cancelable, long-termcontractual obligations to secure access to supply and transportof natural gas, which include take-or-pay clauses whereby theCompany obligations consist of off-taking minimum quantities ofproduct or service or paying the corresponding cash amount thatentitles the Company to off-take the product in future years.Future obligations in connection with these contracts werecalculated by applying the forecasted prices of energy orservices included in the four-year business plan approved by theCompany’s Board of Directors and on the basis of thelong-term market scenarios used by Eni for planning purposes tominimum take and minimum ship quantities. 

The table below summarizes the Group principal contractualobligations as of the balance sheet date, shown on anundiscounted basis.

**Expected payments by period under contractualobligations and commercial commitments**

|   |   | **Maturity year** |
|--------|--------|-------------------|
|   |   |                   |

| (euro        million) |    | 2009 |    | 2010 |    | 2011 |    | 2012 |    | 2013 |    | 2014 and thereafter |    | Total |
|-----------------------|--------------|------|--------------|------|--------------|------|--------------|------|--------------|------|--------------|---------------------|--------------|-------|
|                  |         |      |         |      |         |      |         |      |         |      |         |                     |         |       |

| **Operating lease obligations**(1)                                                     |   | **618**    |   | **1,025**  |   | **697**    |   | **468**    |   | **395**    |   | **1,084**   |   | **4,287**   |
|----------------------------------------------------------------------------------------|--------|------------|--------|------------|--------|------------|--------|------------|--------|------------|--------|-------------|--------|-------------|
| **Decommissioning        liabilities**(2)                                              |   | **269**    |   | **35**     |   | **61**     |   | **18**     |   | **256**    |   | **8,830**   |   | **9,469**   |
| **Environmental liabilities**                                                          |   | **396**    |   | **421**    |   | **284**    |   | **223**    |   | **221**    |   | **443**     |   | **1,988**   |
| **Purchase        obligations**(3)                                                     |   | **17,938** |   | **13,777** |   | **14,326** |   | **14,405** |   | **14,112** |   | **185,415** |   | **259,973** |
| Gas                                                                                    |   |       |   |       |   |       |   |       |   |       |   |        |   |        |
| - *Natural        gas to be purchased in connection with take-or-pay        contracts* |   | 15,694     |   | 13,041     |   | 13,574     |   | 13,610     |   | 13,343     |   | 179,067     |   | **248,329** |
| - *Natural gas to be transported in connection        with ship-or-pay contracts*      |   | 539        |   | 537        |   | 545        |   | 549        |   | 528        |   | 3,151       |   | **5,849**   |
| Other        take-or-pay and ship-or-pay obligations                                   |   | 139        |   | 135        |   | 126        |   | 111        |   | 106        |   | 838         |   | **1,455**   |
| Other purchase obligations (4)                                                         |   | 1,566      |   | 64         |   | 81         |   | 135        |   | 135        |   | 2,359       |   | **4,340**   |
| **Other        obligations**                                                           |   | **8**      |   | **5**      |   | **5**      |   | **5**      |   | **5**      |   | **152**     |   | **180**     |
| of which:                                                                              |   |       |   |       |   |       |   |       |   |       |   |        |   |        |
| -        Memorandum of intent relating Val d’Agri                                 |   | 8          |   | 5          |   | 5          |   | 5          |   | 5          |   | 152         |   | **180**     |
|                                                                                   |   | **19,229** |   | **15,263** |   | **15,373** |   | **15,119** |   | **14,989** |   | **195,924** |   | **275,897** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--------------|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)          |    | Operating        leases primarily regarded assets for drilling activities,        time charter and long-term rentals of vessels, lands,        service stations and office buildings. Such leases did        not include renewal options. There are no significant        restrictions provided by these operating leases which        limit the ability of the Company to pay dividend, use        assets or to take on new borrowings. |
| (2)          |    | Represents        the estimated future costs for the decommissioning of oil        and natural gas production facilities at the end of the        producing lives of fields, well-plugging, abandonment and        site restoration.                                                                                                                                                                                                     |
| (3)          |    | Represents        any agreement to purchase goods or services that is        enforceable and legally binding and that specifies all        significant terms.                                                                                                                                                                                                                                                                            |
| (4)          |    | Mainly refers        to arrangements to purchase capacity entitlements at        certain re-gasification facilities in the U.S.                                                                                                                                                                                                                                                                                                          |

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The table below summarizes Eni’s capitalexpenditure commitments for property, plant and equipment andcapital projects at December 31, 2008. Capital expenditures areconsidered to be committed when the project has received theappropriate level of internal management approval. Such costs areincluded in the amounts shown.

|   |   | **Maturity year** |
|--------|--------|-------------------|
|   |   |                   |

| (euro        million) |    | 2009 |    | 2010 |    | 2011 |    | 2012 |    | 2013 and subsequent years |    | Total |
|-----------------------|--------------|------|--------------|------|--------------|------|--------------|------|--------------|---------------------------|--------------|-------|
|                  |         |      |         |      |         |      |         |      |         |                           |         |       |

| Committed on major projects     |   | 4,938      |   | 3,831     |   | 2,697     |   | 1,837     |   | 9,856      |   | **23,159** |
|---------------------------------|--------|------------|--------|-----------|--------|-----------|--------|-----------|--------|------------|--------|------------|
| Other        committed projects |   | 5,147      |   | 4,342     |   | 3,186     |   | 2,389     |   | 9,846      |   | **24,910** |
|                            |   | **10,085** |   | **8,173** |   | **5,883** |   | **4,226** |   | **19,702** |   | **48,069** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

*Country risk*Substantial portions of Eni’s hydrocarbons reserves arelocated in countries outside the EU and North America, certain ofwhich may be politically or economically less stable than EU orNorth American. At December 31, 2007, approximately 70% ofEni’s proved hydrocarbons reserves were located in suchcountries. Similarly, a substantial portion of Eni’s naturalgas supplies comes from countries outside the EU and NorthAmerica. In 2007, approximately 60% of Eni’s domestic supplyof natural gas came from such countries. Developments in thepolitical framework, economic crisis, social unrest cancompromise temporarily or permanently Eni’s ability tooperate or to economically operate in such countries, and to haveaccess to oil and gas reserves. Further risks related to theactivity undertaken in these countries, are represented by: (i)lack of well established and reliable legal systems anduncertainties surrounding enforcement of contractual rights; (ii)unfavorable developments in laws and regulations leading toexpropriation of Eni’s titles and mineral assets, changes inunilateral contractual clauses reducing value of Eni’sassets; (iii) restrictions on exploration, production, importsand exports; (iv) tax or royalty increases; and (v) civil andsocial unrest leading to sabotages, acts of violence andincidents. While the occurrence of these events is unpredictable,it is possible that they can have a material adverse impact onEni’s financial condition and results of operations. Eniperiodically monitors political, social and economic risks ofapproximately 60 countries where it has invested, or, with regardto upstream projects evaluation, where Eni is planning to investin order to assess returns of single projects based also on theevaluation of each country’s risk profile. Country risk ismitigated in accordance with guidelines on risk managementdefined in the procedure "Project risk assessment andmanagement". In the most recent years, unfavorabledevelopments in the regulatory framework, mainly regarding taxissues, have been implemented or announced also in EU countriesand in North America. 

*Operational risk*Eni’s business activities conducted in and outside of Italyare subject to a broad range of laws and regulations, includingspecific rules concerning oil and gas activities currently inforce in countries in which it operates. In particular, thoselaws and regulations require the acquisition of a license beforeexploratory drilling may commence and compliance with health,safety and environment standards. Environmental laws imposerestrictions on the types, quantities and concentration ofvarious substances that can be released into the environment andon discharges to surface and subsurface water. In particular Eniis required to follow strict operating practices and standards toprotect biodiversity when exploring for, drilling and producingoil and gas in certain ecologically sensitive locations(protected areas). Breach of environmental, health and safetylaws exposes employees to criminal and civil liability and in thecase of violation of certain rules regarding safety on theworkplace also companies can be liable as provided for by ageneral EU rule on businesses liability due to negligent orwillful conduct on part of their employees as adopted in Italywith Law Decree No. 231/2001.

Environmental, health and safety laws andregulations have a substantial impact on Eni’s operationsand expenses and liabilities that Eni may incur in relation tocompliance with environmental, health and safety laws andregulations are expected to remain material to the group’sresults of operations or financial position in future years.Recently enacted regulation of safety and health of the workplacein Italy will impose a new array of obligations to the Companyoperations, particularly regarding contractors. New regulationprescribe that a company adopts certified operational andorganizational systems whereby the Company can discharge possibleliabilities due to a violation of health and security standardson condition that adopted operational systems and processesworked properly and were effective.

Eni has adopted guidelines for assessing andmanaging health, safety and environmental (HSE) risks, with theobjective of protecting Eni’s employees, the populationsinvolved in its activity, contractors and clients, and theenvironment and being in compliance with local and internationalrules and regulations. Eni’s guidelines prescribe theadoption of international best practices in setting internalprinciples, standards and solutions. The ongoing process foridentifying, evaluating and managing HSE operations in each phaseof the business activity and is performed through the adoption ofprocedures and effective pollution management systems tailored onthe 

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peculiarities of each business and industrialsite and on steady enhancement of plants and process.Additionally, coding activities and procedures on operatingphases allow reduce the human component in the plant riskmanagement. Operating emergencies that may have an adverse impacton the assets, people and the environment are managed by thebusiness units for each site. These units manage the HSE riskthrough a systematic way that involves having emergency responseplans in place with a number of corrective actions to be takenthat minimize damage in the event of an incident. In the case ofmajor crisis, Divisions/Entities are assisted by the Eni Unit ofCrises to deal with the emergency through a team which has thenecessary training and skills to coordinate in a timely andefficient manner resources and facilities.

The integrated management system of health,safety and environmental matters is supported by the adoption ofEni’s Model of HSE operations in all the Divisions andcompanies of Eni Group. This is a procedure based on an annualcycle of planning, implementation, control, review of results anddefinition of new objectives. The model is directed towards theprevention of risks, the systematic monitoring and control of HSEperformance, in a continuous improvement cycle, also subject toaudits by internal and independent experts. Major refining andpetrochemical facilities of Eni are certified to internationalenvironmental standards, such as ISO14001, OHSAS 18001 and EMAS.Eni provides a program of specific training and development forHSE staff in order to:(i) promote the execution of behaviors consistent withguidelines;(ii) drive people’s learning growth process by developingprofessionalism, management and corporate culture;(iii) support management knowledge and control of HSE risks.

**Possible evolution of the Italian gasmarket**Legislative Decree No. 164/2000 opened the Italian natural gasmarket to competition, impacting on Eni’s activities, as thecompany is engaged in all the phases of the natural gas chain.The opening to competition was achieved through the enactment ofcertain antitrust thresholds on volumes input into the nationaltransport network and on volumes sold to final customers. Theseenabled new competitors to enter the Italian gas market,resulting in declining selling margins on gas. Other materialaspects regarding the Italian gas sector regulation are theregulated access to natural gas infrastructure (transportbackbones, storage fields, distribution networks and LNGterminals), the Code adopted by the Authority for Electricity andGas on the issue of unbundling which forbids a controlling entityfrom interfering in the decision-making process of itssubsidiaries running gas transport and distributioninfrastructures and the circumstance that the Authority forElectricity and Gas is entrusted with certain powers in thematters of natural gas pricing and in establishing tariffs forthe use of natural gas infrastructures. Particularly, theAuthority for Electricity and Gas holds a general surveillancepower on pricing in the natural gas market in Italy and the powerto establish selling tariffs for supply of natural gas toresidential and commercial users consuming less than 200,000 CM/y(qualified as non eligible customers at December 31, 2002 asdefined by Legislative Decree No. 164/2000) taking into accountthe public goal of containing the inflationary pressure due torising energy costs. Accordingly, decisions of the Authority onthese matters may limit the ability of Eni to pass an increase inthe cost of fuels onto final consumers of natural gas. As amatter of fact, following a complex and lengthy administrativeprocedure started in 2004 and finalized in March 2007 withResolution No. 79/2007, the Authority finally established a newindexation mechanism for updating the raw material cost componentin supplies to residential and commercial users consuming lessthan 200,000 CM/y, establishing, among other things: (i) that anincrease in the international price of Brent crude oil is onlypartially transferred to residential and commercial users ofnatural gas in case international prices of Brent crude oilexceed the 35 dollars per barrel threshold; and (ii) that Italiannatural gas importers – including Eni – mustrenegotiate wholesale supply contracts in order to take accountof this new indexation mechanism.

Also certain provisions of law may limit theCompany ability to set commercial margins. Specifically, LawDecree No. 112 enacted in June 2008 forbids energy companies likeEni to pass to prices to final customers higher income taxesincurred in connection with a supplemental tax rate of 5.5percentage points introduced by the same decree on energycompanies with a yearly turnover in excess of euro 25 million.The Authority for Electricity and Gas is in charge of monitoringcompliance with the rule. The Authority has subsequentlyestablished with a set of deliberations that energy companieshave to adopt effective operational and monitoring systemscertified by the Company CEO in order to prevent unlawfulincreases of final prices of gas.

In order to meet the medium and long-term demandfor natural gas, in particular in the Italian market, Eni enteredinto long-term purchase contracts with producing countries. Thesecontracts which contain take-or-pay clauses will ensure totalsupply volumes of approximately 62.4 BCM/y of natural gas to Eniby 2010 (excluding take-or-pay volumes coming from Distrigasacquisition which will destined to supply the Belgian market).Despite the fact that an increasing portion of natural gasvolumes purchased under said contracts is planned to be marketedoutside Italy, management believes that in the long-termunfavorable trends in the Italian demand and supply for naturalgas, also taking into account the start-up of new import capacityto the Italian market by Eni and third parties 

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as well as implementation of all publiclyannounced plans for the construction of new importinfrastructures (backbone upgrading and new LNG terminals), anddevelopments within the Italian regulatory framework, representrisk factors for the ability of the Company to meet itscontractual obligations in connection with its take-or-pay supplycontracts. Particularly, should natural gas demand in Italy growat a lower pace than management expectations, also in view of theexpected build-up of natural gas supplies to the Italian market,the Company could face a further increase in competitive pressureon the Italian gas market resulting in a negative impact on itsselling margins, taking account of Eni’s gas availabilityunder take-or-pay supply contracts and risks in executing itsexpansion plans to grow sales volumes in European markets.

**Specific risks associated with theexploration and production of oil and natural gas**The exploration and production of oil and natural gas requireshigh levels of capital expenditure and entails particulareconomic risks. It is subject to natural hazards and otheruncertainties including those relating to the physicalcharacteristics of oil or natural gas fields. Exploratoryactivity involves numerous risks including the risk of dry holesor failure to find commercial quantities of hydrocarbons.Developing and marketing hydrocarbons reserves typically requiresseveral years after a discovery is made. This is because adevelopment project involves an array of complex and lengthyactivities, including appraising a discovery in order to evaluateits commerciality, sanctioning a development project and buildingand commissioning relating facilities.

As a consequence, rates of return of such longlead-time projects are exposed to the volatility of oil and gasprices and the risk of an increase in developing and liftingcosts, resulting in lower rates of return. This set ofcircumstances is particularly important to those projectsintended to develop reserves located in deep water and harshenvironments, where the majority of Eni’s planned andongoing projects is located. 

**Managing sources of funds**Eni management makes use of the leverage as a financial measureto assess the soundness and efficiency of the Group balance sheetin terms of optimal mix between net borrowings and net equity,and to carry out benchmark analysis with industry standards.Leverage is a measure of the company’s level ofindebtedness, calculated as the ratio between net borrowings andshareholders’ equity, including minority interests. In themedium-term, management plans to target a level of leverage up to0.4 which is intended to provide an efficient capital structureand the appropriate level of financial flexibility.

 

 

 

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**Other information about financialinstruments**The carrying amount of financial instruments and relevanteconomic effect for the year 2008 consisted of the following:

|   |   | **Finance income (expense) recognized in** |
|--------|--------|--------------------------------------------|
|   |   |                                            |

| (euro        million) |   | Carrying amount |   | Profit and loss account |   | Equity |
|-----------------------|--------|-----------------|--------|-------------------------|--------|--------|
|                  |   |                 |   |                         |   |        |

| **Held-for-trading financial instruments**                                                |   |    |   |   |      |   |   |    |   |
|-------------------------------------------------------------------------------------------|--------|---------|--------|--------|-----------|--------|--------|---------|--------|
| Non-hedging        derivatives (a)                                                        |   | (374    | )      |   | (558      | )      |   |    |   |
| **Held-to-maturity financial instruments**                                                |   |    |   |   |      |   |   |    |   |
| Securities                                                                                |   | 50      |   |   | 2         |   |   | 3       |   |
| **Available-for-sale financial instruments**                                              |   |    |   |   |      |   |   |    |   |
| Securities        (a)                                                                     |   | 495     |   |   | 19        |   |   |    |   |
| **Receivables and payables and other        assets/liabilities valued at amortized cost** |   |    |   |   |      |   |   |    |   |
| Trade and        receivables and other (b)                                                |   | 22,446  |   |   | (254      | )      |   |    |   |
| Financing receivables (a)                                                                 |   | 1,908   |   |   | 117       |   |   |    |   |
| Trade        payables and other (c)                                                       |   | 20,570  |   |   | (53       | )      |   |    |   |
| Financing payables (a)                                                                    |   | 20,837  |   |   | (607      | )      |   |    |   |
| **Assets        at fair value through profit or loss (fair value option)**                |   |    |   |   |      |   |   |    |   |
| Investments (a)                                                                           |   | 2,741   |   |   | 241       |   |   |    |   |
| **Net        liabilities for hedging derivatives**(d)                                     |   | **280** |   |   | **1,012** |   |   | **964** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------------|--------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a)          |    | Gains or        losses were recognized in the profit and loss account        within "Finance income (expense)".                                                                                                                                                                                                                                                                                                     |
| (b)          |    | In the profit        and loss account, impairments and losses on receivables        were recognized within "Purchase, services and        other" for euro 385 million whilst negative exchange        differences arising from accounts denominated in foreign        currency and translated into euro at year-end were        recognized within "Finance income (expense)"        for euro 100 million. |
| (c)          |    | Positive        exchange differences arising from accounts denominated in        foreign currency and translated into euro at year-end        were recognized in the profit and loss account within        "Finance income (expense)".                                                                                                                                                                              |
| (d)          |    | Gains or        losses were recognized in the profit and loss account        within "Net sales from operations" and        "Purchase, services and other" for euro 1,005        million within "Finance income (expense)" for        euro 7 million (time value component).                                                                                                                     |

**Legal Proceedings**

Eni is a party to a number of civil actions and administrativearbitral and other judicial proceedings arising in the ordinarycourse of business. Based on information available to date, andtaking into account the existing risk provisions, Eni believesthat the foregoing will not have an adverse effect on Eni’sConsolidated Financial Statements. The following is a descriptionof the most significant proceedings currently pending. Unlessotherwise indicated below, no provisions have been made for theselegal proceedings as Eni believes that negative outcomes are notprobable or because the amount of the provision cannot beestimated reliably.

**1. Environment**

**1.1 Criminal proceedings**

| **ENI SPA** |
|-------------|
| **(i)**     |   | **Subsidence.**The Court        of Rovigo conducted investigations concerning a        subsidence phenomenon allegedly caused by hydrocarbon        exploration and extraction activities in the Ravenna and        North Adriatic area both on land and in the sea. Eni        appointed an independent and interdisciplinary scientific        commission, composed of prominent and highly qualified        international experts of subsidence caused by hydrocarbon        exploration and extraction activities, with the aim of        verifying the magnitude and effects and any actions        appropriate to reduce or to neutralize any subsidence        phenomenon in the area. This commission produced a study        which excludes the possibility of any risk to human        health or damage to the environment. The study also        states that worldwide there are no instances of accidents        of harm to public safety caused by subsidence induced by        hydrocarbon production. It also shows that Eni employs        the most advanced techniques for monitoring, measuring        and controlling the soil. This proceeding is |

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|   |   | in the first level hearing        stage. The Veneto Region, other local bodies and two        private entities have been acting as plaintiffs. Eni was        admitted as a defendant. The Court decided that the        proceeding must be heard by the Court of Ravenna. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **(ii)**  |   | **Alleged damage.**In        2002, the public prosecutor of Gela commenced a criminal        investigation to ascertain alleged damage caused by        emissions of the Gela plant, owned by Polimeri Europa        SpA, Syndial SpA (formerly EniChem SpA) and Raffineria di        Gela SpA. The judge for the preliminary hearing dismissed        the accusation of adulteration of food products, while        the proceeding for the other allegations regarding        pollution and environmental damage remains underway. The        trial ended in acquittal with regard to the general        manager and officer pro tempore of the refinery. The        sentence of the Gela Tribunal stated that the charges        were lacking factual basis.      |
|-----------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **(iii)** |   | **Alleged negligent fire in        the refinery of Gela.**In June 2002, in connection        with a fire at the refinery of Gela, a criminal        investigation began concerning alleged negligent fire,        environmental crimes and crimes against natural beauty.        First degree proceedings ended with an acquittal        sentence. In November 2007, the public prosecutors of        Gela and of Caltanissetta filed an appeal against this        decision.                                                                                                                                                                                                                                                                                       |
| **(iv)**  |   | **Investigation of the        quality of ground water in the area of the refinery of        Gela.**In 2002, the public prosecutor of Gela        commenced a criminal investigation concerning the        refinery of Gela to ascertain the quality of ground water        in the area of the refinery. Eni is charged of having        breached environmental rules concerning the pollution of        water and soil and of illegal disposal of liquid and        solid waste materials. The preliminary hearing phase was        closed for one employee who would stand trial, while the        preliminary hearing phase is ongoing for other        defendants. During the hearings the judge admitted as        plaintiffs three environmental associations. |
| **(v)**   |   | **Alleged negligent fire (Priolo).**The        public prosecutor of Siracusa commenced an investigation        regarding certain Eni managers who were previously in        charge of conducting operations at the Priolo refinery        (Eni divested this asset in 2002) to ascertain whether        they acted with negligence in connection with a fire that        occurred at the Priolo plants on April 30 and May 1-2,        2006. After preliminary investigations and based on the        outcome of preliminary hearing the public prosecutor        requested the opening of a proceeding against the        mentioned managers for negligent behavior.                                                                                               |
| **(vi)**  |   | **Groundwater at the Priolo site.**The        Public Prosecutor of Siracusa (Sicily) has started an        investigation in order to ascertain the level of        contamination of the groundwater at the Priolo site. The        Company has been notified that a number of its executive        officers are being investigated who were in charge at the        time of the events subject to probe, including chief        executive officers and plant general managers of the        Company’s subsidiaries AgipPetroli SpA (now merged        into the parent company), Syndial and Polimeri Europa.        Probes on technical issues are ongoing as required by the        Prosecutor.                                                               |

|             |   |   |
|------------------|--------|--------|
| **ENIPOWER SPA** |

| **(i)**  |   | **Alleged unauthorized        waste management activities.** In 2004, the public        prosecutor of Rovigo commenced an investigation for        alleged crimes related to unauthorized waste management        activities in Loreo relating to the samples of soil used        during the construction of the new EniPower power station        in Mantova. The prosecutor requested the CEO of EniPower        and the managing director of the Mantova plant at the        time of the alleged crime to stand trial. |
|----------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **(ii)** |   | **Air emissions.**The        public prosecutor of Mantova commenced an investigation        against two managers of the Mantova plant in connection        with air emissions by the new power plant.                                                                                                                                                                                                                                                                                                                     |

|            |   |   |
|-----------------|--------|--------|
| **SYNDIAL SPA** |

| **(i)** |   | **Porto Torres.** In        March 2009, the Public Prosecutor of Sassari (Sardinia)        resolved to commence a criminal trial against a number of        executive officers and managing directors of companies        engaging in petrochemicals operations at the site of        Porto Torres, including the manager responsible for plant        operations of the Company’s fully-owned subsidiary        Syndial. The charge involves environmental damage and        poisoning of water and stuff destined to feeding. A        preliminary hearing is scheduled in July 2009. |
|---------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**1.2 Civil and administrative proceedings**

| **SYNDIAL SPA (FORMER ENICHEM SPA)** |
|--------------------------------------|

| **(i)** |   | **Alleged pollution caused        by the activity of the Mantova plant.** In 1992, the        Ministry of Environment summoned EniChem SpA (now Syndial        SpA) and Edison SpA before the Court of Brescia. The        Ministry requested, primarily, environmental remediation        for the alleged pollution caused by the activity |
|---------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   |   | of the Mantova plant from        1976 until 1990, and provisionally, in case there was no        possibility to remediate, the payment of environmental        damages. Edison agreed on a settlement with the Ministry        whereby Edison quantified compensation for environmental        damage freeing from any obligation Syndial, which        purchased the plant in 1989. Parties are working through        a possible settlement of the matter. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **(ii)** |   | **Summon before the Court        of Venice for environmental damages allegedly caused to        the lagoon of Venice by the Porto Marghera plants.** On        December 13, 2002, EniChem SpA (now Syndial SpA), jointly        with Ambiente SpA (now merged into Syndial SpA) and        European Vinyls Corporation Italia SpA, was summoned        before the Court of Venice by the Province of Venice. The        province requested compensation for environmental damages        that were not quantified, allegedly caused to the lagoon        of Venice by the Porto Marghera plants, which were        already the subject of two previous criminal proceedings        against employees and managers of the defendants. EVC        Italia and Ineos presented an action to be indemnified by        Eni’s Group companies in case the alleged pollution        is proved. The environmental damage has been assessed by        an independent consultant who filed his advice to be        discussed in a hearing set in October 2009. |
|----------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **(iii)** |   | **Claim of environmental        damages, allegedly caused by industrial activities in the        area of Crotone, commenced by the President of the        Regional Council of Calabria.**On April 14, 2003, the        President of the Regional Council of Calabria, as        Delegated Commissioner for Environmental Emergency in the        Calabria Region, commenced an action against EniChem SpA        (now Syndial SpA) with reference to environmental damages        for approximately euro 129 million and damages for euro        250 million (plus interest and compensation) in        connection with loss of income and damage to property        allegedly caused by industrial activities in the area of        Crotone. In addition, the Province of Crotone is acting        as plaintiff, claiming damage for euro 300 million. With        a decision in May 2007, the Court of Milan declared the        invalidity of the power of proxy conferred to the        Delegated Commissioner to act on behalf of the Calabria        Region with the notice served to Syndial SpA and decided        the liquidation of expenses born by the defendant. The        Province of Crotone appealed this decision. The second        instance court accepted this appeal and Syndial repealed        this determination. On October 21, 2004, Syndial was        convened before the Court of Milan by the Calabria Region        which is seeking to obtain a condemnation of Syndial for        a damage payment, should the office of the Delegated        Commissioner for Environmental Emergency in the Calabria        Region cease during this proceeding. The Calabria Region        requested a damage payment amounting to euro 800 million        as already requested by the Delegated Commissioner for        Environmental Emergency in the Calabria Region in the        proceeding commenced in 2003. This new proceeding is in        the preliminary investigation stage. This proceeding was        unified with the one opened by the Ministry of the        Environment. Syndial filed a new project for the        environmental remediation of the site to be approved by        the Ministry and the body of public administrations and        entities involved in the matter that expressed a first        partial consent in January 2009. The environmental        provision was consequently increased. In 2006, the        Council of Ministers, Ministry for the Environment and        the Delegated Commissioner for Environmental Emergency in        the Calabria Region represented by the State Lawyer        requested Syndial to appear before the Court of Milan to        obtain the ascertainment, quantification and payment of        damage (in the form of land, air and water pollution and        therefore of the general condition of the population)        caused by the operations of Pertusola Sud SpA in the        Municipality of Crotone and in surrounding        municipalities. The local authorities requested the        ascertainment of Syndial’s responsibility as        concerns expenses borne and to be borne for the cleanup        and reclamation of sites, currently quantified at euro        129 million. This proceeding concerns the same matter and        damage claim as the proceedings commenced by the        Delegated Commissioner for Environmental Emergency in the        Calabria Region and the Calabria Region against Syndial        in 2003 and 2004, respectively. |
|-----------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **(iv)**  |   | **Summon for alleged        environmental damage caused by DDT pollution in the Lake        Maggiore.** With a temporarily executive decision dated        July 3, 2008 the District Court of Turin sentenced the        subsidiary Syndial SpA (former EniChem) to compensate for        environmental damages that were allegedly caused when        EniChem managed an industrial plant at Pieve Vergonte        during the 1990-1996 period. Specifically, the Court        sentenced Syndial to pay the Italian Ministry of the        Environment compensation amounting to euro 1,833.5        million, plus legal interests that accrue from the filing        of the decision. Syndial and Eni technical-legal        consultants have considered the decision and the amount        of the compensation to be without factual and legal basis        and have concluded that a negative outcome of this        proceeding is unlikely. Particularly, Eni and its        subsidiary deem the amount of the environmental damage to        be absolutely ill-founded as the sentence has been        considered to lack sufficient elements to support such a        material amount of the liability charged to Eni and its        subsidiary with respect to the volume of pollutants        ascertained by the Italian Environmental Minister. As no        development of the proceeding has occurred since the        filing of the Court’s decision, management has        confirmed its stance of making no provision for this        proceeding in accordance with accounting principles.        Syndial will appeal against the ruling on Pieve Vergonte        site of the District Court of Turin as soon as possible.        Another administrative proceeding is ongoing regarding a        ministerial decree enacted by the Italian Ministry for        the Environment. The decree provides that Syndial        executes the following tasks: (i) the upgrading of a                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |

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|   |   | hydraulic barrier to protect        the site; and (ii) the design of a project for the        environmental remediation of Lake Maggiore. The        Administrative Court of Piemonte rejected Syndial’s        opposition against the outlined environmental measures        requested by the Ministry of the Environment. However,        the Court judged the prescriptions of the Ministry        regarding the remediation of the site to be plain        findings of an environmental enquiry to ascertain the        state of the lake. Syndial has filed an appeal against        the decision of the Court before an upper degree body,        also requesting suspension of the effectiveness of the        decision. The appeal has been put on hold considering        that a plan to ascertain the environmental status of the        site is going to be approved by all interested parties,        including the Ministry and local municipalities. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **(v)** |   | **Action commenced by the        Municipality of Carrara for the remediation and        reestablishment of previous environmental conditions at        the Avenza site and payment of environmental damage.**        The Municipality of Carrara commenced an action before        the Court of Genova requesting Syndial SpA to remediate        and restore previous environmental conditions at the        Avenza site and the payment of certain environmental        damage which cannot be cleaned up as well as further        damages of various types (e.g. damage to the natural        beauty of this site). This request is related to an        accident that occurred in 1984, as a consequence of which        EniChem Agricoltura SpA (later merged into Syndial SpA),        at the time owner of the site, carried out safety and        remediation works. The Ministry of the Environment joined        the action and requested environmental damage payment        – from a minimum of euro 53.5 million to a maximum        of euro 93.3 million – to be broken down among the        various companies that ran the plant in the past. Syndial        summoned Rumianca SpA, Sir Finanziaria SpA and Sogemo        SpA, who ran the plant in previous years, in order to be        guaranteed. A report produced by an independent expert        appointed by the judge was filed with the Court. The        findings of this report quantify the residual        environmental damage at euro 15 million. With a sentence        of March 2008, the Court of Genova rejected all claims        made by the Municipality of Carrara and the Ministry of        environment. Both plaintiffs filed an appeal against this        decision in June 2008, requesting to all defendants        cumulative damage amounting to euro 189.9 million.        Syndial filed in the appeal hearing, disputing the        plaintiffs’ claims. |
|---------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **(vi)** |   | **Ministry for the        Environment Augusta harbor.** The Italian Ministry for        the Environment with various administrative acts ordered        companies running plants in the petrochemical site of        Priolo to perform safety and environmental remediation        works in the Augusta harbor. Companies involved include        Eni subsidiaries Polimeri Europa and Syndial. Pollution        has been detected in this area primarily due to a high        mercury concentration which is allegedly attributed to        the industrial activity of the Priolo petrochemical site.        Polimeri Europa opposed said administrative actions,        objecting in particular to the way in which remediation        works have been designed and information on concentration        of pollutants has been gathered. The Regional        Administrative Court of Catania with its decision of July        2007 annulled the decision made by the Service Conference        of the Ministry of the Environment concerning Priolo and        the Augusta harbor. The Ministry and the municipalities        of Augusta and Melilli filed a claim with an        Administrative Court of the Sicily Region which accepted        the claim. In January 2008 the Regional Court of Catania        accepted two further claims on this matter, remitting to        the European Union Court of Justice the correct        application of the debated community principle on the        matter of environmental responsibility. In June 2008 the        Ministry for the Environment and the Municipalities of        Melilli and Augusta filed and appeal against the decision        of the Regional Court of Catania with the Administrative        Justice Council. Syndial challenged the administrative        acts of December 20, 2007 and March 6, 2008, also        requesting the Court of Justice of the EU to decide on        the correct application of the debated community        principle. A review of the issue made by an independent        consultant has been filed showing evidence supporting the        thesis of the plaintiffs. The proceedings are still        pending before the Administrative Court of Lazio. |
|----------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|-------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **ENI SPA** |
| **(i)**     |   | **Reorganization        procedure of the airlines companies Volare Group, Volare        Airlines and Air Europe.**On March 2009 Eni was        notified of a bankruptcy claw-back as part of a        reorganization procedure filed by the airlines companies        Volare Group, Volare Airlines and Air Europe which        commenced under the provisions of Ministry of Production        Activities, on November 30, 2004. The request regarded        the override of all the payments made by those entities        to Eni and its subsidiary Sofid in the year previous to        the insolvency declaration from November 30, 2003 to        November 29, 2004, for a total estimated amount of euro        46 million. |

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| **2. Other        judicial or arbitration proceedings** |
|---------------------------------------------------------|
|                                                    |   |   |
| **SYNDIAL SPA        (FORMER ENICHEM SPA)**             |
| **(i)**                                                 |   | **Serfactoring:        disposal of receivables.**In 1991, Agrifactoring SpA        commenced proceedings against Serfactoring SpA, a company        49% owned by Sofid SpA and which is controlled by Eni        SpA. The claim relates to an amount receivable of euro        182 million for fertilizer sales (plus interest and        compensation for inflation), originally owed by        Federconsorzi to EniChem Agricoltura SpA (later        Agricoltura SpA - in liquidation), and Terni Industrie        Chimiche SpA (merged into Agricoltura SpA - in        liquidation), that has been merged into EniChem SpA (now        Syndial SpA). Such receivables were transferred by        Agricoltura and Terni Industrie Chimiche to Serfactoring,        which appointed Agrifactoring as its agent to collect        payments. Agrifactoring guaranteed to pay the amount of        such receivables to Serfactoring, regardless of whether        or not it received payment on the due date. Following        payment by Agrifactoring to Serfactoring, Agrifactoring        was placed in liquidation and the liquidator of        Agrifactoring commenced proceedings in 1991 against        Serfactoring to recover such payments (equal to euro 182        million) made to Serfactoring based on the claim that the        foregoing guarantee became invalid when Federconsorzi was        itself placed in liquidation. Agricoltura and Terni        Industrie Chimiche brought counterclaims against        Agrifactoring (in liquidation) for damages amounting to        euro 97 million relating to acts carried out by        Agrifactoring SpA as agent. The amount of these        counterclaims has subsequently been reduced to euro 46        million following partial payment of the original        receivables by the liquidator of Federconsorzi and        various setoffs. These proceedings, which have all been        joined, were decided with a partial judgment, deposited        on February 24, 2004; the request of Agrifactoring has        been rejected and the company has been ordered to pay the        sum requested by Serfactoring and damages in favor of        Agricoltura, to be determined following the decision. A        final verdict on this issue is pending. Agrifactoring        appealed this partial decision, requesting in particular        the annulment of the first step judgment, the        reimbursement of euro 180 million from Serfactoring along        with the rejection of all its claims and the payment of        all proceeding expenses. On June 2008, the trial was        decided with a partial judgment that, reforming the        previous judgment of the Court of Rome, granted the        requests of Agrifactoring and condemned Serfactoring to        reimburse to Agrifactoring in liquidation the amount of        the receivables due from Federconsorzi and not collected        as Federconsorzi went bankrupt. The Court resolved to        appoint an independent accounting consultant to quantify        the amount paid by Agrifactoring to Serfactoring and        amounts paid by Federconsorzi to Agrifactoring. The        hearing has been rescheduled to February 2010 in order to        allow the Court to review the independent accounting        consultant’s advice. Syndial and Serfactoring have        appealed the sentence with the Supreme Court of Appeal.        Agrifactoring has presented a counter-recourse. Eni        accrued a provision with respect to this proceeding. |

|        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|-------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **ENI SPA** |
| **(i)**     |   | **Fintermica.**Fintermica        presented a claim against Eni concerning the management        of the Jacorossi joint venture with reference to an        alleged abuse of key roles played by Eni SpA in the joint        venture, thus damaging the other partner’s interest        and the alleged dilatory behavior of Syndial in selling        its interest in the joint venture to Fintermica. The        parties decided to commence arbitration on the matter.        The examining phase is ongoing and an independent        assessment of this matter is being executed. The Board of        Arbitrators issued a decision on November 26, 2008        condemning Eni and Syndial to compensate Fintermica for        the damages suffered amounting to euro 5 million        including monetary revaluation and accrued interest as of        April 3, 2001. |

|   |   |   |
|--------|--------|--------|

| **SNAMPROGETTI        SPA** |
|-----------------------------|
| **(i)**                     |   | **CEPAV Uno and CEPAV Due.**Eni        holds interests in the CEPAV Uno (50.36%) and CEPAV Due        (52%) consortia that in 1991 signed two contracts with        TAV SpA for the construction of two railway tracks for        high speed/high capacity trains from Milan to Bologna        (under construction) and from Milan to Verona (in the        design phase). With regard to the project for the        construction of the line from Milan to Bologna, an        Addendum to the contract between CEPAV Uno and TAV was        signed on June 27, 2003, redefining certain terms and        conditions of the contract. Subsequently, the CEPAV Uno        consortium requested a time extension for the completion        of works and a claim amounting to euro 800 million. CEPAV        Uno and TAV failed to solve this dispute amicably. CEPAV        Uno opened an arbitration procedure as provided for under        terms of the contract on April 27, 2006. With regard to        the project for the construction of a high-speed railway        from Milan to Verona, in December 2004, CEPAV Due        presented the final project, prepared in accordance with        Law No. 443/2001 on the basis of the preliminary project        approved by an Italian governmental authority (CIPE). As        concerns the arbitration procedure requested by CEPAV Due        against TAV for the recognition of costs incurred by the        Consortium in the 1991-2000 ten-year period plus suffered        damage, in January 2007, the arbitration committee        determined the Consortium’s right to recover the        costs incurred in connection with the design activities        performed. A technical independent survey is underway to        assess the amount of compensation |

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|                                                                                                                                 |   | to be awarded to the Consortium as        requested by the arbitration committee. TAV appealed the        arbitration committee’s determination. In April        2007, the Consortium filed with the second instance court        of Rome an appeal against Law Decree No. 7 of December        31, 2007, that revoked the concessions awarded to TAV        resulting in the annulment of arrangements signed between        TAV and the Consortium to build the high-speed railway        section from Milan to Verona. The European Court of        Justice was requested to judge on this matter. In the        meantime, TAV decided to not request the reimbursement of        advances paid to the Consortium. Subsequently, Law        133/2008 re-established the concessions awarded to TAV        resulting in the continuation of the arrangements between        the consortium CEPAV Due and a new entity in charge of        managing the Italian railway system.                                                                                                                                                                                                                         |
|--------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                 |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| **3. Antitrust,        EU Proceedings, Actions of the Authority for Electricity        and Gas and of Other Regulatory Authorities** |
|                                                                                                                                 |
| **3.1 Antitrust**                                                                                                                    |
|                                                                                                                                 |
| **ENI SpA**                                                                                                                          |
| **(i)**                                                                                                                              |   | **Abuse of dominant        position of Snam alleged by the Italian Antitrust        Authority.** In March 1999, the Italian Antitrust        Authority concluded its investigation started in 1997        and: (i) found that Snam SpA (merged in Eni SpA in 2002)        abused its dominant position in the market for the        transportation and primary distribution of natural gas        relating to the transportation and distribution tariffs        applied to third parties and the access of third parties        to infrastructure; (ii) fined Snam for euro 2 million;        and (iii) ordered a review of the practices relating to        such abuses. Snam believes it has complied with existing        legislation and appealed the decision with the Regional        Administrative Court of Lazio requesting its suspension.        On May 26, 1999, stating that these decisions are against        Law No. 9/1991 and the European Directive 98/30/EC, this        Court granted the suspension of the decision. The        Authority did not appeal this decision. The decision on        the merit of this dispute is still pending before the        same Administrative Court. |

| **(ii)**  |   | **Formal assessment        commenced by the Commission of the European Communities        for the evaluation of alleged participation to activities        limiting competition in the field of paraffin.** On        April 28, 2005, the Commission of the European        Communities commenced a formal assessment to evaluate the        alleged participation of Eni and its subsidiaries in        activities limiting competition in the field of paraffin.        The alleged violation of competition is for: (i) the        determination of and increase in prices; (ii) the        subdivision of customers; and (iii) exchange of trade        secrets, such as production capacity and sales volumes.        After, the Commission requested information on Eni’s        activities in the field of paraffin and certain        documentation acquired by the Commission during an        inspection. Eni filed the requested information. On        October 2008, the Commission of the European Communities        issued the final decision on the matter condemning Eni to        the payment of a sanction amounting to euro 29,120,000.        Eni has filed for recourse against this decision that is        fully covered by the accrued risk provision.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-----------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **(iii)** |   | **Ascertainment by the        European Commission of the level of competition in the        European natural gas market.**As part of its        activities to ascertain the level of competition in the        European natural gas market, with Decision No. C        (2006)1920/1 of May 5, 2006, the European Commission        informed Eni that the Group companies were subject to an        inquiry under Article 20, paragraph 4 of the European        Regulation No. 1/2003 of the Council in order to verify        the possible existence of any business conducts breaching        European rules in terms of competition and intended to        prevent access to the Italian natural gas wholesale        market and to subdivide the market among few operators in        the activity of supply and transport of natural gas.        Similar actions have been performed by the Commission        also against the main operators in natural gas in        Germany, France, Austria and Belgium. In April 2007, the        European Commission made public its decision to start a        further stage of inquiry, as the elements collected        supported its suspicion that Eni adopted behaviors        leading to "capacity hoarding and strategic, in its        view, underinvestment in the transmission system leading        to the foreclosure of competitors and harm for        competition and customers in one or more supply markets        in Italy". On March 9, 2009 Eni received a Statement        of Objections related to a proceeding under Article No.        82 of the EU Treaty and Article No. 54 of the SEE        agreement with reference to an alleged unjustifiable        refusal of access to the TAG and TENP/Transitgas gas        pipelines, that are interconnected with the Italian gas        transport system through actions intended to        "capacity hoarding, capacity degradation and        strategic limitation of investment" with the effect        of "hindering the development of a real competition        in the downstream market and [...] harming the        consumers". The European Commission envisages the        possible imposition of a fine and of structural remedies.        The Company is currently assessing the reasoning        underlying the Commission’s objections in order to        ascertain whether the challenged actions are supported by        evidence and may be qualified as infringement of the        European competition rules. The Company will file its        defensive memories within the proceeding. In addition,        and following the aforementioned assessment, the Company        may consider whether to voluntarily file a set of        remedies to settle the proceeding as provided |

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|   |   | by Article No. 9 of the European Regulation No.        1/2003. Taking into account the numerous elements to be        considered in determining the amount of the fine, the        complex checks to carry out with respect to the Statement        of Objections, and also the circumstance that the        Commission’s approval of the possible remedies,        presented by Eni pursuant to European Regulation No.        1/2003, would settle the matter without imposing a fine,        management believes that the liability is contingent upon        the future events described and cannot be measured with        reasonable reliability. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **(iv)** |   | **TTPC.**In April 2006,        Eni filed a claim before the Regional Administrative        Court of Lazio against the decision of the Italian        Antitrust Authority of February 15, 2006 stating that        Eni’s behavior pertaining to implementations of        plans for the upgrading of the TTPC pipeline for        importing natural gas from Algeria represented an abuse        of dominant position under Article 82 of the European        Treaty and fined Eni. The initial fine amounted to euro        390 million and was reduced to euro 290 million in        consideration of Eni’s commitment to perform actions        favoring competition including the upgrade of the        gasline. Eni accrued a provision with respect to this        proceeding. With a decision filed on November 29, 2006,        the Regional Administrative Court of Lazio partially        accepted Eni’s claim, annulling such part of the        Authority’s decision where the fine was quantified.        Eni is waiting for the filing of the motivations of the        Court decision to ascertain the impact of said decision.        Pending this development, the payment of the fine has        been voluntarily suspended. In 2007, the Regional        Administrative Court of Lazio accepted in part Eni’s        claim and cancelled the quantification of the fine based        on the Antitrust Authority’s inadequate evaluation        of the circumstances presented by Eni. Eni filed an        appeal with the Council of State, as did the Antitrust        Authority and TTPC. Pending the final outcome, Eni awaits        for the determination of the amount of the fine to be        paid. |
|----------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **(v)**                                        |   | **Italian natural gas market.**On        May 7, 2009, the Italian Antitrust Authority started a        preliminary investigation against the Company and its        fully-owned subsidiary Italgas and other operators        engaging in the gas retail market in Italy. The        investigation targets an alleged abuse of dominant        position in the gas retail market in Italy associated        with commercial practices intended to make it difficult        for retail clients to change the supplier and the        retrieval of data on volumes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
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|                                           |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| **POLIMERI        EUROPA SPA AND SYNDIAL SPA** |
| **(i)**                                        |   | **Inquiries in relation to        alleged anti-competitive agreements in the area of        elastomers.** In December 2002, inquiries were        commenced concerning alleged anti-competitive agreements        in the field of elastomers. These inquiries were        commenced concurrently by European and U.S. authorities.        At present, proceedings are pending before the European        Commission regarding the CR and NBR products. In March        2007, the Commission sent to Eni, Polimeri Europa and        Syndial a statement of objections, thus opening the        second phase of this proceeding. In December 2007, the        European Commission dismissed Syndial’s position on        CR and imposed on Eni and Polimeri a fine amounting to        euro 132.16 million. The two companies have filed an        appeal with the EU Court of First Instance against this        decision and, at the same time, paid the fine in March        2008. Investigations relating to other elastomers        products resulted in the ascertainment of Eni having        infringed European competition laws in the field of        synthetic rubber production (BR and ESBR). On November        29, 2006, the Commission fined Eni and its subsidiary        Polimeri Europa for an amount of euro 272.25 million. Eni        and its subsidiary filed claims against this decision        before the European Court of First Instance in February        2007. The Commission filed a counter appeal. Pending the        outcome, Polimeri Europa presented a bank guarantee for        euro 200 million and paid the residual amount of the        fine. In August 2007, Eni submitted a request for a        negative ascertainment with the Court of Milan aimed at        proving the non-existence of alleged damages suffered by        tire manufacturers. With regard to NBR, an inquiry is        underway also in the U.S., where class actions have also        been commenced. On the federal level, the class action        was abandoned by the plaintiffs. However, the federal        judge has yet to acknowledge this abandonment. With        regard to other products under investigation in the U.S.,        settlements were reached with both relevant U.S.        antitrust authorities and the plaintiffs acting through a        class action. Eni recorded a provision for these matters. |

 

**3.2 Regulation**

**TOSCANA ENERGIA CLIENTI SPA**Eni’s subsidiary Toscana Energia Clienti SpA started anaction against a customer regarding alleged lack of measurementof gas consumption due to inability to access a measurementfacility at the customer’s site, also in connection with theapplication of Resolution No. 229/2001 of the Italian Authorityfor Electricity and Gas. This customer has annual consumption inexcess of 5,000 CM. The defendant has filed a counter-claim inrelation to this proceeding. In the hearing of November 12, 2008the judge resolved to partially accept the Eni’s subsidiaryreasons and to limit compensation to be paid to the defendant toonly euro 1,475 with interests amounting to euro 90. The sum waspaid while the defendant is evaluating the opportunity to appealthe sentence.

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| **DISTRIBUIDORA        DE GAS CUYANA SA** |
|-------------------------------------------|
| **(i)**                                   |   | **Formal investigation of        the agency entrusted with the regulations for the natural        gas market in Argentina.** Enargas started a formal        investigation on some operators, among them Distribuidora        de Gas Cuyana SA, a company controlled by Eni. Enargas        stated that the company improperly applied conversion        factors to volumes of natural gas invoiced to customers        and requested the company to apply the conversion factors        imposed by local regulations from the date of the default        notification (March 31, 2004) without prejudice to any        damage payment and fines that may be decided after        closing the investigation. In April 2004 the company        filed a defensive memorandum. On April 28, 2006, the        company formally requested the acquisition of documents        from Enargas in order to have access to the documents on        which the allegations are based. |

 

**4. Tax Proceedings**

**ENI SPADispute for the omitted payment of the municipal tax related tooil platforms located in territorial waters in the Adriatic Sea.**With a formal assessment presented by the Municipality of Pineto(Teramo) in December 1999, Eni SpA has been accused of not havingpaid a municipal tax on real estate for the period from 1993 to1998 on four oil platforms located in the Adriatic Sea whichconstitute municipal waters in front of the coast of Pineto. Eniwas requested to pay a total of approximately euro 17 millionincluding interest and a fine. Eni filed a claim against thisrequest stating that the sea where the platforms are located isnot part of the municipal territory and the tax application asrequested by the municipality lacked objective fundamentals. Theclaim has been accepted in the first two degrees of judgment atthe Provincial and Regional Tax Commissions. However, the Courtoverturned both judgments, declaring that a municipality canconsider requesting a tax on real estate in the sea facing itsterritory and with the decision of February 2005 sent theproceeding to another section of the Regional Tax Commission inorder to judge on the matters of the proceeding. This commissionnominated a Board of Consultants, in order to make all theaccounting/technical verifications necessary for the judgment. OnDecember 28, 2005, the Municipality of Pineto presented the samerequest for the same platforms for the years 1999 to 2004. Thetotal amount requested from Eni is euro 24 million includinginterest and penalties. Eni filed a claim against this requestwhich was accepted by the first degree judge with a decision ofDecember 4, 2007. Similar formal assessments related to Eni oiland gas offshore platforms were presented by the Municipalitiesof Falconara Marittima and Pedaso. The total amounts of thoseclaims were approximately euro 6 million. The company filedappeal or is planning to appeal.

**AGIP KARACHAGANAK BVClaims concerning unpaid taxes and relevant payment of interestand penalties.** In July 2004, relevant Kazakh Authoritiesinformed Agip Karachaganak BV and Agip Karachaganak PetroleumOperating Co BV, shareholder and operator of the Karachaganakcontract, respectively, on the final outcome of 2000 to 2003 taxaudits. Both companies counterclaimed against the assessment anda preliminary agreement was reached on November 18, 2004. Finalassessments have now been issued by the Kazakh Authorities, andpayment has been made. The final amount assessed and paid was $39million net to Eni; this figure included taxes and interest. Thecompanies continue to dispute the assessments and reserve theright to challenge their findings further.

 

**5. Court Inquiries**

| **(i)** |   | **EniPower.** In June        2004, the Milan Public Prosecutor commenced inquiries        into contracts awarded by Eni’s subsidiary EniPower        and on supplies from other companies to EniPower. These        inquiries were widely covered by the media. It emerged        that illicit payments were made by EniPower suppliers to        a manager of EniPower who was immediately dismissed. The        Court presented EniPower (commissioning entity) and        Snamprogetti (contractor of engineering and procurement        services) with notices of process in accordance with        existing laws regulating the administrative        responsibility of companies (Legislative Decree No.        231/2001). In its meeting of August 10, 2004, Eni’s        Board of Directors examined the aforementioned situation        and Eni’s CEO approved the creation of a task force        in charge of verifying the compliance with Group        procedures regarding the terms and conditions for the        signing of supply contracts by EniPower and Snamprogetti        and the subsequent execution of works. The Board also |
|---------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   |   | advised divisions and        departments of Eni to cooperate fully in every respect        with the Court. From the inquiries performed, no default        in the organization emerged, nor deficiency in internal        control systems. External experts have performed        inquiries with regard to certain specific aspects. In        accordance with its transparency and firmness guidelines,        Eni will take the necessary steps in acting as plaintiff        in the expected legal action in order to recover any        damage that could have been caused to Eni by the illicit        behavior of its suppliers and of their and Eni employees.        In the meantime, preliminary investigations have found        that both EniPower and Snamprogetti are not to be        considered defendants in accordance with existing laws        regulating the administrative responsibility of companies        (Legislative Decree No. 231/2001). In August 2007, Eni        was notified that the Public Prosecutor requested the        dismissal of EniPower SpA and Snamprogetti SpA, while the        proceeding continues against former employees of these        companies and employees and managers of the suppliers        under the provisions of Legislative Decree No. 231/2001.        Eni SpA, EniPower and Snamprogetti presented themselves        as plaintiffs. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **(ii)**  |   | **Trading.**An        investigation is pending regarding two former Eni        managers who were allegedly bribed by third parties to        favor the closing of certain transactions with two oil        product trading companies. Within such investigation, on        March 10, 2005, the public prosecutor of Rome notified        Eni of two judicial measures for the seizure of        documentation concerning Eni’s transactions with the        said companies. Eni is acting as plaintiff in this        proceeding. The judge for preliminary hearings rejected        most of the dismissal request, forcing the public        prosecutor to continue with the criminal case.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **(iii)** |   | **TSKJ Consortium        Investigations of the SEC and other Authorities.**The        U.S. Securities and Exchange Commission (SEC), the U.S.        Department of Justice (DoJ), and other authorities are        investigating alleged improper payments made by the TSKJ        Consortium to certain Nigerian public officials in        relation to the construction of natural gas liquefaction        facilities at Bonny Island in Nigeria. Snamprogetti        Netherlands BV had a 25% participation in the TSKJ        companies, with the remaining participations held by        subsidiaries of Halliburton/KBR, Technip, and JGC.        Snamprogetti SpA, the holding company of Snamprogetti        Netherlands BV, was a wholly owned subsidiary of Eni        until February 2006, when an agreement was entered into        for the sale of Snamprogetti to Saipem SpA and        Snamprogetti was merged into Saipem as of October 1,        2008. Eni holds a 43% participation in Saipem. In        connection with the sale of Snamprogetti to Saipem, Eni        agreed to indemnify Saipem for a variety of matters,        including potential losses resulting from the        investigations into the TSKJ matter. In February 2009,        KBR and its former parent company, Halliburton, announced        that they had reached a settlement with the SEC and DoJ        with respect to the TSKJ matter as well as other        unspecified matters. In connection with the settlement,        KBR pleaded guilty to Foreign Corrupt Practices Act        (FCPA) charges stemming from the TSKJ matter. KBR and        Halliburton also agreed to pay a substantial fine and        entered into civil settlements with the SEC. We        understand that the DoJ and the SEC believe that        representatives of the other members of the TSKJ        Consortium were involved in the conduct that gave rise to        the FCPA charges against KBR. Since June 2004, Eni and        Saipem/Snamprogetti have been in discussions with, and        have provided information in response to requests by,        various regulators, including the SEC, the DoJ and the        Public Prosecutor’s office of Milan, in connection        with the investigations. |

| **(iv)** |   | **Gas Metering.**On May        28, 2007, a seizure order (in respect to certain        documentation) was served upon Eni and other Group        companies as part of a proceeding brought by the Public        Prosecutor at the Courts of Milan. The order was also        served upon five top managers of the Group companies in        addition to third party companies and their top managers.        The investigation alleges behavior which breaches Italian        criminal law, starting from 2003, regarding the use of        instruments for measuring gas, the related payments of        excise duties and the billing of clients as well as        relations with the Supervisory Authorities. The        allegation regards, interalia, the offense contemplated        by Legislative Decree of June 8, 2001, No. 231, which        establishes the liability of the legal entity for crimes        committed by its employee in the interests of such legal        entity, or to its advantage. Accordingly, notice of the        commencement of investigations was served upon Eni Group        companies (Eni, Snam Rete Gas and Italgas) as well as        third party companies. The Group companies are        cooperating with the Supervising Authorities in the        investigations. |
|----------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **(v)**  |   | **Agip KCO NV.** In        November 2007, the public prosecutor of Kazakhstan        informed Agip KCO of the start of an inquiry for an        alleged fraud in the award of a contract to the Overseas        International Constructors GmbH in 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |

 

**6. Settled Proceedings**

**ENI SPAInquiry of the Italian Authority for Electricity and Gasregarding information to clients about the right to pay amountsdue for natural gas sales in installments.** With Decision No.228/2007, the Italian Authority for Electricity and Gas commenceda formal inquiry regarding information to clients about the rightto pay amounts due 

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for the natural gas sales in installments in order to possiblyput a stop to the alleged infringement of the clients’rights and to impose a fine. In April 2008, the Authorityconcluded its inquiry and fined the Company by euro 3.2 million.

**SYNDIAL SPA (FORMER ENICHEM SPA)Criminal action commenced by the public prosecutor of Brindisi.**In 2000, the public prosecutor of Brindisi commenced a criminalaction against 68 persons who are employees or former employeesof companies that owned and managed plants for the manufacture ofdichloroethane, vinyl chloride monomer and vinyl polychloridefrom the early 1960s to date, some of which were managed byEniChem from 1983 to 1993. At the end of the preliminaryinvestigation the public prosecutor asked for the dismissal ofthe case in respect of the employees and the managers of EniChem.Plaintiffs presented oppositions, but the prosecutor confirmedthe request to dismiss the case with a decision of June 2008, thepublic prosecutor dismissed the accusation as unfounded andrequested the closing of the proceeding.

**AGIP KCO NV**In December 2007 the Kazakh tax authority filed a notice oftax assessment for fiscal years 2004 to 2006 to Agip KCO,operator of the Kashagan contract. Allegedly unpaid taxes,including interest and penalties, amounted to approximately U.S.$235 million net to Eni and related to unpaid amounts andinapplicable deductions on value added tax and the default inapplying certain withholding taxes on payments to foreignsuppliers. The same notice also informed the companies party tothe Kashagan contract that further assessments were pending onnon-deductible costs for U.S. $188 million net Eni and highertaxable income on Kazakh branches for U.S. $48 million net toEni. The further assessments were subsequently issued, thecompany filed an appeal and a settlement was reached in October2008 with the following outcome: the unpaid taxes net to Eni wereagreed at U.S. $24 million (U.S. $235 million assessed). Anadjustment to deductible costs was agreed at U.S. $38 million netto Eni (U.S. $188 million assessed) and it was further agreedthat there would be no income taxable on Kazakh branches (U.S.$48 million assessed).

**Other risks and commitments**Parent company guarantees amounted to euro 11,110 million(euro 4,911 million at December 31, 2006) were issued inconnection with certain contractual commitments for hydrocarbonexploration and production activities, quantified on the basis ofthe capital expenditures to be incurred. The increase of euro6,199 million primarily related to commitments that Agip CaspianSea BV in Kazakhstan had entered into for euro 5,605 million.

Under the convention signed on October 15, 1991 by Treno AltaVelocità - TAV SpA and CEPAV (Consorzio Eni per l’AltaVelocità) Due, Eni committed to guarantee the execution ofdesign and construction of the works assigned to the CEPAVConsortium (to which it is party) and guaranteed to TAV thecorrect and timely execution of all obligations indicated in theconvention in a subsequent integration deed and in any furtheraddendum or change or integration to the same. The regulation ofCEPAV Due contains the same obligations and guarantees containedin the CEPAV Uno Agreement.

A commitment entered into by Eni USA Gas Marketing Llc onbehalf of Cameron LNG for fulfilling certain obligations inconnection with a regasification contract signed on August 1,2005. This commitment is subject to a suspension clause and willcome into force when the regasification service starts in aperiod included between October 1, 2008 and June 30, 2009 for anestimated total consideration of euro 226 million.

A commitment entered into by Eni USA Gas Marketing Llc onbehalf of Gulf LNG Energy for the acquisition of unusedregasification capacity (5.78 BCM/y) over a twenty-year period(2011-2031) for an estimated total consideration as high as$1,400 million equal to euro 951 million.

A commitment entered into by Eni USA Gas Marketing Llc onbehalf of Angola LNG Supply Service for the acquisition ofregasified gas at the Pascagoula plant in the United States thatwill come into force when the regasification service starts in aperiod included between 2011-2031.

Eni is liable for certain non-quantifiable risks related tocontractual assurances given to acquirers of certain ofEni’s assets, including businesses and investments, againstcertain contingent liabilities deriving from tax, social securitycontributions, environmental issues and other matters applicableto periods during which such assets were 

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operated by Eni. Eni believes such matters will not have amaterial adverse effect on the Company’s results ofoperations and liquidity.

**Assets under concession arrangements**

Eni operates under concession arrangements mainly in theExploration & Production segment and in some activities ofthe Gas & Power segment and the Refining & Marketingsegment. In the Exploration & Production segment contractualclauses governing mineral concessions, licenses and explorationpermits regulate the access of Eni to hydrocarbon reserves. Suchclauses can differ in each country. In particular, mineralconcessions, licenses and permits are granted by the legal ownersand, generally, entered into with government entities, State oilcompanies and, in some legal contexts, private owners. As acompensation for mineral concessions, Eni pays royalties andtaxes in accordance with local tax legislation. Eni sustains allthe operation risks and costs related to the production anddevelopment activities and it is entitled to the productionsrealized. In Product Sharing Agreement and in buy-back contracts,realized productions are defined on the basis of contractualagreements drawn up with State oil companies which hold theconcessions. Such contractual agreements regulate the recover ofcosts incurred for the exploration, development and operatingactivities (cost oil) and give entitlement to the own portion ofthe realized productions (profit oil). With reference to naturalgas storage in Italy, the activity is conducted on the basis ofconcessions with a duration that does not exceed a twenty yearduration and it is granted by the Ministry of ProductiveActivities to persons that are consistent with legislationrequirements and that can demonstrate to be able to conduct astorage program that meets the public interest in accordance withthe laws. In the Gas & Power segment the gas distributionactivity is primarily conducted on the basis of concessionsgranted by local public entities. At the expiry date of theconcession, compensation is paid, defined by using criteria ofbusiness appraisal, to the outgoing operator following the saleof its own gas distribution network. Service tariffs fordistribution are defined on the basis of a method established bythe Authority for Electricity and Gas. Legislative Decree No.164/2000 provides the grant of distribution service exclusivelyby tender, with a maximum length of 12 years.

In the Refining & Marketing segment several servicestations and other auxiliary assets of the distribution serviceare located in the motorway areas and they are granted by themotorway concession operators following a public tender for thesub-concession of the supplying of oil products distributionservice and other auxiliary services. Such assets are amortizedover the length of the concession (generally, 5 years for Italy).In exchange of the granting of the services described above, Eniprovides to the motorway companies fixed and variable royaltieson the basis of quantities sold. At the end of the concessionperiod, all non-removable assets are transferred to the grantorof the concession.

**Environmental regulations**

Risks associated with the footprint of Eni’s activitieson the environment, health and safety are described in the risksection above, under the paragraph "Operational risks".Regarding the environmental risk, management does not currentlyexpect any material adverse effect upon Eni’s consolidatedfinancial statements, taking account of ongoing remedial actions,existing insurance policies to cover environmental risks and theenvironmental risk provision accrued in the consolidatedfinancial statements. However, management believes that it ispossible that Eni may incur material losses and liabilities infuture years in connection with environmental matters due to: (i)the possibility of as yet unknown contamination; (ii) the resultsof the ongoing surveys and the other possible effects ofstatements required by Decree No. 471/1999 of the Ministry ofEnvironment; (iii) new developments in environmental regulation;(iv) the effect of possible technological changes relating tofuture remediation; and (v) the possibility of litigation and thedifficulty of determining Eni’s liability, if any, asagainst other potentially responsible parties with respect tosuch litigation and the possible insurance recoveries.

**Emission trading**

Legislative Decree No. 216 of April 4, 2006 implemented theEmission Trading Directive 2003/87/EC concerning greenhouse gasemissions and Directive 2004/101/EC concerning the use of carboncredits deriving from projects for the reduction of emissionsbased on the flexible mechanisms devised by the Kyoto Protocol.This European emission trading scheme has been in force sinceJanuary 1, 2005, and on this matter, on November 27, 2008, theNational Committee for Emissions Trading Scheme (Ministry ofEnvironment-Mse) published the Resolution 20/2008 definingemission permits for the 2008-2012 period. In particular, Eni wasassigned permits corresponding to 127.2 mmtonnes of carbondioxide (approximately 25 mmtonnes/y) in addition toapproximately 7.4 million of permits expected to be assigned withrespect to new plants in the five-year period 2008-2012.Emissions of carbon dioxide from Eni’s plants were lowerthan permits assigned in 2008. Emission permits for 25.9 

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million tonnes were assigned, against emissionsof carbon dioxide of approximately 25.3 million tonnes, resultingin a surplus of 0.6 million tonnes.

**30 Revenues**The following is a summary of the main components of"Revenues". For more information about changes inrevenues, see "Item 5 – Operating and Financial Reviewand Prospects".

Net sales from operations were as follows:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Net sales from operations                  |   | 85,957     |   | 87,103     |   | 107,843     |
|--------------------------------------------|--------|------------|--------|------------|--------|-------------|
| Change in        contract work in progress |   | 148        |   | 153        |   | 305         |
|                                       |   | **86,105** |   | **87,256** |   | **108,148** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Net sales from operations were net of thefollowing items:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Excise taxes                                                                                |   | 13,762     |   | 13,292     |   | 13,142     |
|---------------------------------------------------------------------------------------------|--------|------------|--------|------------|--------|------------|
| Exchanges of        oil sales (excluding excise taxes)                                      |   | 2,750      |   | 2,728      |   | 2,694      |
| Services billed to joint venture partners                                                   |   | 1,385      |   | 1,554      |   | 2,081      |
| Sales to        service station managers for sales billed to holders of        credit cards |   | 1,453      |   | 1,480      |   | 1,700      |
| Exchanges of other products                                                                 |   | 127        |   | 121        |   | 83         |
|                                                                                        |   | **19,477** |   | **19,175** |   | **19,700** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Net sales from operations by business segment and geographicarea of destination are presented in Note 36 - Information byindustry segment and geographic financial information.

**Other income and revenues**Other income and revenues were as follows:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Gains on price adjustments under        overlifting/underlifting transactions |   | 30      |   | 79      |   | 180     |
|-------------------------------------------------------------------------------|--------|---------|--------|---------|--------|---------|
| Lease and        rental income                                                |   | 98      |   | 95      |   | 98      |
| Gains from sale of assets                                                     |   | 100     |   | 66      |   | 48      |
| Contract        penalties and other trade revenues                            |   | 61      |   | 181     |   | 23      |
| Compensation for damages                                                      |   | 40      |   | 87      |   | 15      |
| Other        proceeds (*)                                                     |   | 454     |   | 319     |   | 356     |
|                                                                          |   | **783** |   | **827** |   | **720** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

|   |   |                                                                                  |
|--------|--------|---------------------------------------------------------------------------------------|
| (*)    |   | Each        individual amount included herein does not exceed euro 50        million. |

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**31 Operating expenses**The following is a summary of the main components of"Operating expenses". For more information aboutchanges in operating expenses, see "Item 5 – Operatingand Financial Review and Prospects". 

**Purchases, services and other**Purchases, services and other included the following:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Production costs - raw, ancillary and consumable        materials and goods                        |   | 44,661     |   |   | 44,884     |   |   | 58,712     |   |
|----------------------------------------------------------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|
| Production        costs - services                                                                 |   | 10,015     |   |   | 10,828     |   |   | 13,355     |   |
| Operating leases and other                                                                         |   | 1,903      |   |   | 2,276      |   |   | 2,558      |   |
| Net        provisions for contingencies                                                            |   | 767        |   |   | 591        |   |   | 900        |   |
| Other expenses                                                                                     |   | 1,089      |   |   | 1,095      |   |   | 1,652      |   |
|                                                                                               |   | **58,435** |   |   | **59,674** |   |   | **77,177** |   |
| less:                                                                                              |   |       |   |   |       |   |   |       |   |
| -        capitalized direct costs associated with self-constructed        assets - tangible assets |   | (783       | )      |   | (1,325     | )      |   | (645       | )      |
| - capitalized direct costs associated with        self-constructed assets - intangible assets      |   | (162       | )      |   | (170       | )      |   | (124       | )      |
|                                                                                               |   | **57,490** |   |   | **58,179** |   |   | **76,408** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Production costs-services included brokerage feesrelated to Engineering & Construction segment for euro 155million (euro 39 million and euro 37 million in 2006 and 2007,respectively).

Costs incurred in connection with research anddevelopment activity recognized in profit and loss amounted toeuro 216 million (euro 219 million and euro 189 million in 2006and 2007, respectively) as they do not meet the requirements tobe capitalized.

The item "Operating leases and other"included operating leases for euro 957 million (euro 860 millionand euro 1,081 million in 2006 and 2007, respectively) androyalties on hydrocarbons extracted for euro 871 million (euro823 million and euro 772 million in 2006 and 2007, respectively).Future minimum lease payments expected to be paid undernon-cancelable operating leases were as follows:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| To be paid within 1 year     |   | 594       |   | 588       |   | 618       |
|------------------------------|--------|-----------|--------|-----------|--------|-----------|
| Between 2 and        5 years |   | 1,474     |   | 1,401     |   | 2,585     |
| Beyond 5 years               |   | 762       |   | 942       |   | 1,084     |
|                         |   | **2,830** |   | **2,931** |   | **4,287** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Operating leases primarily concerned assets for drillingactivities, time charter and long-term rentals of vessels, lands,service stations and office buildings. Such leases did notinclude renewal options. There are no significant restrictionsprovided by these operating leases which limit the ability of Enito pay dividends, use assets or to take on new borrowings.

Increase of provisions for contingencies net of reversal ofunutilized provisions amounted to euro 874 million (euro 767million and euro 591 million in 2006 and 2007, respectively) andmainly regarded environmental risks for euro 360 million (euro248 million and euro 327 million in 2006 and 2007, respectively),marketing initiatives awarding prizes to clients for euro 73million (euro 44 million and euro 59 million in 2006 and 2007,respectively) and legal or other proceedings for euro 55 million(euro 149 million and euro 79 million in 2006 and 2007,respectively). More information is included in Note 22 -Provisions for contingencies. 

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**Payroll and related costs**Payroll and related costs were as follows:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Wages and salaries                                                                                   |   | 2,630     |   |   | 2,906     |   |   | 3,204     |   |
|------------------------------------------------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|
| Social        security contributions                                                                 |   | 691       |   |   | 690       |   |   | 694       |   |
| Cost related to defined benefits plans and        defined contributions plans                        |   | 230       |   |   | 161       |   |   | 107       |   |
| Other        costs                                                                                   |   | 305       |   |   | 275       |   |   | 282       |   |
|                                                                                                 |   | **3,856** |   |   | **4,032** |   |   | **4,287** |   |
| less:                                                                                                |   |      |   |   |      |   |   |      |   |
| - capitalized direct costs associated with        self-constructed assets - tangible assets          |   | (99       | )      |   | (109      | )      |   | (148      | )      |
| -        capitalized direct costs associated with self-constructed        assets - intangible assets |   | (107      | )      |   | (123      | )      |   | (135      | )      |
|                                                                                                 |   | **3,650** |   |   | **3,800** |   |   | **4,004** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

**Average number of employees**The average number and break-down of employees by category ofEni’s subsidiaries were as follows:

| (number) |   | **2006** |   | **2007** |   | **2008** |
|----------|--------|----------|--------|----------|--------|----------|
|     |   |          |   |          |   |          |

| Senior managers        |   | 1,676      |   | 1,594      |   | 1,621      |
|------------------------|--------|------------|--------|------------|--------|------------|
| Junior        managers |   | 11,142     |   | 11,816     |   | 12,597     |
| Employees              |   | 34,671     |   | 35,725     |   | 36,766     |
| Workers                |   | 25,426     |   | 25,582     |   | 26,387     |
|                   |   | **72,915** |   | **74,717** |   | **77,371** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

The average number of employees was calculated as the averagebetween the number of employees at the beginning and end of theperiod. The average number of senior managers included managersemployed and operating in foreign countries, whose position iscomparable to a senior manager status.

**Stock-based compensation**

*Stock grant*In 2008 residual rights for stock grant were exercised bymanagers of Eni SpA and its subsidiaries as defined in Article2359 of the Civil Code as eligible to this compensation plan.Therefore at the balance sheet date there are not residual rightsgranted. Changes in the 2006, 2007 and 2008 stock grant plansconsisted of the following:

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   |   | Number of shares |   | Market price (a) (euro) |   | Number of shares |   | Market price (a) (euro) |   | Number of shares |   | Market price (a) (euro) |
|--------|--------|------------------|--------|-------------------------|--------|------------------|--------|-------------------------|--------|------------------|--------|-------------------------|
|   |   |                  |   |                         |   |                  |   |                         |   |                  |   |                         |

| **Stock grants outstanding as of January 1**   |   | **3,127,200** |   |   | **23.460** |   | **1,873,600** |   |   | **25.520** |   | **902,800** |   |   | **25.120** |
|------------------------------------------------|--------|---------------|--------|--------|------------|--------|---------------|--------|--------|------------|--------|-------------|--------|--------|------------|
| New rights        granted                      |   |          |   |   |       |   |          |   |   |       |   |        |   |   |       |
| Rights exercised in the period                 |   | (1,236,400    | )      |   | 23.933     |   | (966,000      | )      |   | 24.652     |   | (893,400    | )      |   | 21.832     |
| Rights        cancelled in the period          |   | (17,200       | )      |   | 23.338     |   | (4,800        | )      |   | 26.972     |   | (9,400      | )      |   | 22.683     |
| **Stock grants outstanding as of December 31** |   | **1,873,600** |   |   | **25.520** |   | **902,800**   |   |   | **25.120** |   |        |   |   |       |
| **of        which exercisable at December 31** |   | **156,700**   |   |   | **25.520** |   | **68,100**    |   |   | **25.120** |   |        |   |   |       |

|   |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--------------|--------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a)          |    | Market price        relating to new rights granted, rights exercised in the        period and rights cancelled in the period corresponds to        the average market value (arithmetic average of official        prices recorded on Mercato Telematico Azionario in the        month preceding: (i) the date of the Board of Directors        resolution regarding the stock grant assignment; (ii) the        date on which the emission/transfer of the shares granted        were recorded in the grantee’s securities account;        and (iii) the date of the unilateral termination of        employment for rights cancelled), weighted with the        number of shares. Market price of stock at the beginning        and end of the year is the price recorded at December 31. |

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*Stock option*Stock options plans are designed for managers of Eni SpA and itssubsidiaries as defined in Article 2359 of the Civil Code, whoare directly responsible for corporate results or for strategicpositions, making them participate to an effective incentiveplan.

*2002-2004 and 2005 plans*Stock options plans provide the right for the assignee topurchase treasury shares with a 1 to 1 ratio after the end of thethird year from the date of the grant (vesting period) and for amaximum period of five years. The strike price was determined tobe the arithmetic average of official prices registered on theMercato Telematico Azionario in the month preceding the grantdate or, from 2003 onwards, the average carrying amount oftreasury shares as of the day preceding the assignment, ifgreater.

*2006-2008 plan*The 2006-2008 stock option plan has introduced a performancecondition for the exercise of the options. At the end of eachthree-year period (vesting period) from the assignment, the Boardof Directors determines the percentage of exercisable options,from 0 to 100, in relation to the Total Shareholders’ Return(TSR) of Eni’s shares as benchmarked against the TSRdelivered by a panel of the six largest international oilcompanies for market capitalization. Options can be exercised fora maximum period of three years. The strike price is calculatedas the arithmetic average of official prices registered on theMercato Telematico Azionario in the month preceding assignment.

At December 31, 2008, 23,557,425 options were outstanding forthe purchase of 23,557,425 ordinary shares. The break-down ofoutstanding options was the following:

|   |   | **Rights outstanding         as of December 31** |   | **Average strike price**(euro) |
|--------|--------|--------------------------------------------------|--------|--------------------------------|
|   |   |                                                  |   |                                |

| Stock option plan 2002        |   | 97,000         |   | 15.216 |
|-------------------------------|--------|----------------|--------|--------|
| Stock        option plan 2003 |   | 231,900        |   | 13.743 |
| Stock option plan 2004        |   | 671,600        |   | 16.576 |
| Stock        option plan 2005 |   | 3,756,000      |   | 22.512 |
| Stock option plan 2006        |   | 5,954,250      |   | 23.119 |
| Stock        option plan 2007 |   | 5,492,375      |   | 27.451 |
| Stock option plan 2008        |   | 7,354,300      |   | 22.540 |
|                          |   | **23,557,425** |   |   |

|   |   |  |   |  |
|--------|--------|--|--------|--|

At December 31, 2008 the weighted-average remainingcontractual life of the plans at December 2002, 2003, 2004, 2005,2006, 2007 and 2008 was 1 year and 7 months, 2 years and 7months, 3 years and 7 months, 4 years and 7 months, 3 years and 7months, 4 years and 7 months and 5 years and 7 months,respectively. 

Changes of stock option plans in 2006, 2007 and 2008 consistedof the following:

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

|   |   | Number         of shares |   | Average strike price (euro) |   | Market price (a) (euro) |   | Number         of shares |   | Average strike price (euro) |   | Market price (a) (euro) |   | Number         of shares |   | Average strike price (euro) |   | Market price (a) (euro) |
|--------|--------|--------------------------|--------|-----------------------------|--------|-------------------------|--------|--------------------------|--------|-----------------------------|--------|-------------------------|--------|--------------------------|--------|-----------------------------|--------|-------------------------|
|   |   |                          |   |                             |   |                         |   |                          |   |                             |   |                         |   |                          |   |                             |   |                         |

| **Stock options as of January 1**               |   | **13,379,600** |   |   | **17.705** |   | **23.460** |   | **15,290,400** |   |   | **21.022** |   | **25.520** |   | **17,699,625** |   |   | **23.822** |   | **25.120** |
|-------------------------------------------------|--------|----------------|--------|--------|------------|--------|------------|--------|----------------|--------|--------|------------|--------|------------|--------|----------------|--------|--------|------------|--------|------------|
| New rights        granted                       |   | 7,050,000      |   |   | 23.119     |   | 23.119     |   | 6,128,500      |   |   | 27.451     |   | 27.447     |   | 7,415,000      |   |   | 22.540     |   | 22.538     |
| Rights exercised in the period                  |   | (4,943,200     | )      |   | 15.111     |   | 23.511     |   | (3,028,200     | )      |   | 16.906     |   | 25.338     |   | (582,100       | )      |   | 17.054     |   | 24.328     |
| Rights        cancelled in the period           |   | (196,000       | )      |   | 19.119     |   | 23.797     |   | (691,075       | )      |   | 24.346     |   | 24.790     |   | (975,100       | )      |   | 24.931     |   | 19.942     |
| **Stock options outstanding as of December 31** |   | **15,290,400** |   |   | **21.022** |   | **25.520** |   | **17,699,625** |   |   | **23.822** |   | **25.120** |   | **23,557,425** |   |   | **23.540** |   | **16.556** |
| **of        which exercisable at December 31**  |   | **1,622,900**  |   |   | **16.190** |   | **25.520** |   | **2,292,125**  |   |   | **18.440** |   | **25.120** |   | **5,184,250**  |   |   | **21.263** |   | **16.556** |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|--------------|--------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a)          |    | Market price        relating to new rights granted, rights exercised in the        period and rights cancelled in the period corresponds to        the average market value (arithmetic average of official        prices recorded on Mercato Telematico Azionario in the        month preceding: (i) the date of the Board of Directors        resolution regarding the stock grants assignment; (ii)        the date in which the emission/transfer of the shares        granted was recorded in the grantee’s securities        account; and (iii) the date in which the unilateral        termination of employment for rights was cancelled),        weighted with the number of shares. Market price of stock        at the beginning and end of the year is the price        recorded at December 31. |

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The fair value of stock options granted during the years 2002,2003, 2004 and 2005 was euro 5.39, euro 1.50, euro 2.01 and euro3.33 per share, respectively. For 2006, 2007 and 2008 theweighted average considering options granted was euro 2.89, euro2.98 and euro 2.60 per share, respectively.

The fair value was determined by applying the followingassumptions:

|   |   |   |   | **2002** |   | **2003** |   | **2004** |   | **2005** |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|--------|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|--------|----------|
|   |   |   |   |          |   |          |   |          |   |          |   |          |   |          |   |          |

| Risk-free interest rate   |   | (%)     |   | 3.5  |   | 3.2  |   | 3.2  |   | 2.5  |   | 4.0  |   | 4.7  |   | 4.9  |
|---------------------------|--------|---------|--------|------|--------|------|--------|------|--------|------|--------|------|--------|------|--------|------|
| Expected        life      |   | (years) |   | 8    |   | 8    |   | 8    |   | 8    |   | 6    |   | 6    |   | 6    |
| Expected volatility       |   | (%)     |   | 43.0 |   | 22.0 |   | 19.0 |   | 21.0 |   | 16.8 |   | 16.3 |   | 19.2 |
| Expected        dividends |   | (%)     |   | 4.5  |   | 5.4  |   | 4.5  |   | 4.0  |   | 5.3  |   | 4.9  |   | 6.1  |

|   |   |   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Costs of the year related to stock grant and stock optionplans amounted to euro 25 million (euro 20 million and euro 27million in 2006 and 2007, respectively).

**Compensation of key management**Compensation of persons responsible for key positions inplanning, direction and control functions of Eni Group, includingexecutive and non-executive officers, general managers andmanagers with strategic responsibility (key management) amount toeuro 23 million, euro 25 million and euro 25 million for 2006,2007 and 2008 respectively, and consisted of the following: 

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Wages and salaries              |   | 16     |   | 17     |   | 17     |
|---------------------------------|--------|--------|--------|--------|--------|--------|
| Post-employment        benefits |   | 1      |   | 1      |   | 1      |
| Other long-term benefits        |   | 3      |   | 3      |   | 3      |
| Stock        grant/option       |   | 3      |   | 4      |   | 4      |
|                            |   | **23** |   | **25** |   | **25** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

**Compensation of Directors and StatutoryAuditors**Compensation of Directors amounted to euro 8.7 million, euro 8.9million and euro 6.4 million for 2006, 2007 and 2008,respectively. Compensation of Statutory Auditors amounted to euro0.686, euro 0.678 million and euro 0.634 million in 2006, 2007and 2008, respectively. Compensation included emoluments and allother retributive and social security compensations due for thefunction of directors or statutory auditor assumed by Eni SpA orother companies included in the scope of consolidation,representing a cost for Eni. 

**Depreciation, depletion, amortization and impairments**Depreciation, depletion, amortization and impairments chargesconsisted of the following:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Depreciation, depletion and amortization:                                                          |   |      |   |   |      |   |   |      |   |
|----------------------------------------------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|
| - tangible        assets                                                                           |   | 4,694     |   |   | 4,935     |   |   | 5,994     |   |
| - intangible assets                                                                                |   | 1,462     |   |   | 2,096     |   |   | 2,436     |   |
|                                                                                               |   | **6,156** |   |   | **7,031** |   |   | **8,430** |   |
| Impairments:                                                                                       |   |      |   |   |      |   |   |      |   |
| - tangible        assets                                                                           |   | 231       |   |   | 140       |   |   | 1,343     |   |
| - intangible assets                                                                                |   | 54        |   |   | 67        |   |   | 53        |   |
|                                                                                               |   | **285**   |   |   | **207**   |   |   | **1,396** |   |
| less:                                                                                              |   |      |   |   |      |   |   |      |   |
| - reversal        of impairments - tangible assets                                                 |   | (17       | )      |   |      |   |   | (2        | )      |
| - reversal of impairment - intangible assets                                                       |   |      |   |   |      |   |   | (1        | )      |
| -        capitalized direct costs associated with self-constructed        assets - tangible assets |   | (1        | )      |   | (1        | )      |   | (4        | )      |
| - capitalized direct costs associated with        self-constructed assets - intangible assets      |   | (2        | )      |   | (1        | )      |   | (4        | )      |
|                                                                                               |   | **6,421** |   |   | **7,236** |   |   | **9,815** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

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**32 Financial income (expense)**Finance income (expense) consisted of the following:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| **Finance income (expense)**                    |   |     |   |   |     |   |   |     |   |
|-------------------------------------------------|--------|----------|--------|--------|----------|--------|--------|----------|--------|
| Finance        income                           |   | 3,749    |   |   | 4,445    |   |   | 7,985    |   |
| Finance expense                                 |   | (3,971   | )      |   | (4,554   | )      |   | (8,198   | )      |
|                                            |   | **(222** | **)**  |   | **(109** | **)**  |   | **(213** | **)**  |
| Gain (loss) on derivative financial instruments |   | 383      |   |   | 26       |   |   | (551     | )      |
|                                            |   | **161**  |   |   | **(83**  | **)**  |   | **(764** | **)**  |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Net finance income (expense) consisted of thefollowing:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| **Finance income (expense) related to net        borrowings**                                                   |   |     |   |   |     |   |   |     |   |
|-----------------------------------------------------------------------------------------------------------------|--------|----------|--------|--------|----------|--------|--------|----------|--------|
| Interest        due to banks and other financial institutions                                                   |   | (215     | )      |   | (445     | )      |   | (745     | )      |
| Interest and other finance expense on ordinary        bonds                                                     |   | (248     | )      |   | (258     | )      |   | (248     | )      |
| Interest        from banks                                                                                      |   | 194      |   |   | 236      |   |   | 87       |   |
| Interest and other income on financing        receivables and securities held for non-operating        purposes |   | 62       |   |   | 55       |   |   | 82       |   |
|                                                                                                            |   | **(207** | **)**  |   | **(412** | **)**  |   | **(824** | **)**  |
| **Exchange differences**                                                                                        |   |     |   |   |     |   |   |     |   |
| Positive        exchange differences                                                                            |   | 2,496    |   |   | 2,877    |   |   | 7,339    |   |
| Negative exchange differences                                                                                   |   | (2,648   | )      |   | (2,928   | )      |   | (7,133   | )      |
|                                                                                                            |   | **(152** | **)**  |   | **(51**  | **)**  |   | **206**  |   |
| **Other finance income (expense)**                                                                              |   |     |   |   |     |   |   |     |   |
| Income        from equity instruments                                                                           |   |     |   |   | 188      |   |   | 241      |   |
| Capitalized finance expense                                                                                     |   | 116      |   |   | 180      |   |   | 236      |   |
| Interest        and other income on financing receivables and securities        held for operating purposes     |   | 119      |   |   | 96       |   |   | 62       |   |
| Interest on tax credits                                                                                         |   | 17       |   |   | 31       |   |   | 37       |   |
| Finance        expense due to passage of time (accretion discount)        (a)                                   |   | (116     | )      |   | (186     | )      |   | (249     | )      |
| Other finance income                                                                                            |   | 1        |   |   | 45       |   |   | 78       |   |
|                                                                                                            |   | **137**  |   |   | **354**  |   |   | **405**  |   |
|                                                                                                            |   | **(222** | **)**  |   | **(109** | **)**  |   | **(213** | **)**  |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                         |
|--------------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------|
| (a)          |    | The item        related to the increase in provisions for contingencies        that are shown at present value in non-current        liabilities. |

Income from equity instruments of euro 241million (euro 188 million in 2007) relating to the contractualremuneration of 9.4% on the 20% interest in OAO Gazprom Neftaccording to the contractual arrangements between Eni and Gazprom(more information is included in Note 2 - Other financial assetsheld for trading or available for sale).

The fair value gain (loss) on derivativefinancial instruments consisted of the following:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Derivatives on exchange rate        |   | 313     |   |   | 120    |   |   | (300     | )     |
|-------------------------------------|--------|---------|--------|--------|--------|--------|--------|----------|-------|
| Derivatives        on interest rate |   | 61      |   |   | 35     |   |   | (127     | )     |
| Derivatives on commodities          |   | 9       |   |   | (129   | )      |   | (124     | )     |
|                                |   | **383** |   |   | **26** |   |   | **(551** | **)** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Net loss from derivatives of euro 551 million(euro 383 million and euro 26 million of net gain in 2006 and2007, respectively) was primarily due to the recognition in theprofit and loss account of the change in fair value ofderivatives that cannot be qualified as hedging instruments underIFRS. In fact, since these derivatives are entered 

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into for amounts corresponding to the netexposure to exchange rate risk, interest rate risk or commodityrisk, they cannot be linked to specific trade or financingtransactions.

The lack of these formal requirements in order toassess these derivatives as hedging instruments under IFRSprovides also the recognition in profit or loss of negativeexchange translation differences on assets and liabilitiesdenominated in currencies other than functional currency, asthese translation effects cannot be offset by changes in fairvalue of derivative contracts.

Losses on commodity derivatives amounted to euro124 million, included gain of euro 7 million related to theineffective portion of the change in fair value of cash flowhedging derivatives (time value component) entered into by theExploration & Production segment. Further information isgiven in Note 7 - Other current asset. The fair value ofderivative contracts is provided in Note 7 - Other current asset,Note 15 - Other non-current receivables, Note 20 - Other currentliabilities and Note 25 - Other non-current liabilities.

**33 Income from investments**

**Share of profit (loss) of equity-accounted investments**Share of profit (loss) of equity-accounted investmentsconsisted of the following:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Share of profit of equity-accounted investments                         |   | 887     |   |   | 906     |   |   | 761     |   |
|-------------------------------------------------------------------------|--------|---------|--------|--------|---------|--------|--------|---------|--------|
| Share of        loss of equity-accounted investments                    |   | (36     | )      |   | (135    | )      |   | (105    | )      |
| Decreases (increases) in the provision for        losses on investments |   | (56     | )      |   | 2       |   |   | (16     | )      |
|                                                                    |   | **795** |   |   | **773** |   |   | **640** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

More information is provided in Note 12 - Investments. 

**Other gain (loss) from investments**Other gain (loss) from investments consisted of the following:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Gains on disposals                 |   | 98      |   |   | 170     |   |   | 510     |   |
|------------------------------------|--------|---------|--------|--------|---------|--------|--------|---------|--------|
| Dividends                          |   | 25      |   |   | 301     |   |   | 218     |   |
| Losses on disposals                |   | (7      | )      |   | (1      | )      |   | (1      | )      |
| Other        income (expense), net |   | (8      | )      |   |    |   |   | 6       |   |
|                               |   | **108** |   |   | **470** |   |   | **733** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Dividends of euro 510 million primarily relatedto Nigeria LNG (euro 453 million) and Saudi EuropeanPetrochemical Co - Ibn Zahr (euro 34 million).

Gains on disposals of euro 218 million primarilyrelated to the sale of Gaztransport et Technigaz SAS (euro 185million), Agip España SA (euro 15 million) and PadanaAssicurazioni SpA (euro 10 million). Gains on disposals for 2007of euro 301 million primarily related to the sale of HaldorTopsøe AS (euro 265 million) and Camom SA (euro 25 million).Gains on disposals for 2006 of euro 25 million primarily relatedto the sale of Fiorentina Gas SpA and Toscana Gas SpA (euro 16million). 

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**34 Income taxes**Income taxes consisted of the following:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Current taxes:                                                            |   |       |   |   |      |   |   |       |   |
|---------------------------------------------------------------------------|--------|------------|--------|--------|-----------|--------|--------|------------|--------|
| - Italian        subsidiaries                                             |   | 2,007      |   |   | 2,380     |   |   | 1,916      |   |
| - foreign subsidiaries of the Exploration &        Production segment |   | 6,740      |   |   | 6,695     |   |   | 9,744      |   |
| - foreign        subsidiaries                                             |   | 529        |   |   | 482       |   |   | 426        |   |
|                                                                      |   | **9,276**  |   |   | **9,557** |   |   | **12,086** |   |
| Net        deferred taxes:                                                |   |       |   |   |      |   |   |       |   |
| - Italian subsidiaries                                                    |   | 230        |   |   | (582      | )      |   | (1,603     | )      |
| - foreign        subsidiaries of the Exploration & Production segment |   | 1,095      |   |   | 246       |   |   | (827       | )      |
| - foreign subsidiaries                                                    |   | (33        | )      |   | (2        | )      |   | 36         |   |
|                                                                      |   | **1,292**  |   |   | **(338**  | **)**  |   | **(2,394** | **)**  |
|                                                                      |   | **10,568** |   |   | **9,219** |   |   | **9,692**  |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Current income taxes of euro 1,916 million were in respect ofItalian subsidiaries for Ires (euro 1,408 million) and Irap (euro307 million) and of foreign taxes (euro 201 million).

The effective tax rate was 50.3% (51.8% and 46.0% in 2006 and2007, respectively) compared with a statutory tax rate of 38.2%(37.9% in 2006 and 2007, respectively) and calculated by applyinga 33.0%15 tax rate (Ires) to profit before incometaxes and 3.9% tax rate (Irap) to the net value of production asprovided for by Italian laws.

The difference between the statutory and effective tax ratewas due to the following factors:

| (%)    |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

| **Statutory tax rate**                                                                                                                        |   | **37.9** |   |   | **37.9** |   |   | **38.2** |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|--------|--------|----------|--------|--------|----------|--------|
| Items        increasing (decreasing) statutory tax rate:                                                                                      |   |     |   |   |     |   |   |     |   |
| - higher foreign subsidiaries tax rate                                                                                                        |   | 13.6     |   |   | 10.2     |   |   | 15.2     |   |
| - changes        in Italian statutory tax rate and adjustment of tax base        of amortizable assets for Italian subsidiaries               |   |     |   |   | (2.0     | )      |   |     |   |
| - impact pursuant to Law Decree No. 112 of June        25, 2008, the Budget Law 2008 and enactment of a renewed        tax framework in Libya |   |     |   |   |     |   |   | (3.8     | )      |
| -        permanent differences and other adjustments                                                                                          |   | 0.3      |   |   | (0.1     | )      |   | 0.7      |   |
|                                                                                                                                          |   | **13.9** |   |   | **8.1**  |   |   | **12.1** |   |
|                                                                                                                                          |   | **51.8** |   |   | **46.0** |   |   | **50.3** |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

The increase in the tax rate of foreign subsidiaries primarilyrelated to a 17.1 percentage points increase in the Exploration& Production segment (17.2% and 15% in 2006 and 2007,respectively).

The impact pursuant to Law Decree No. 112 of June 25, 2008,the Budget Law 2008 and enactment of a renewed tax framework inLibya of 3.8% consisted of the following: (i) utilization ofdeferred tax liabilities recognized on higher carrying amounts ofyear-end inventories of oil, gas and refined products stated atthe weighted-average cost with respect to their tax baseaccording to the last-in-first-out method (LIFO) (euro 528million). In fact, pursuant to the Law Decree No. 112 of June 25,2008 (become Law No. 133/2008), energy companies in Italy arerequired from 2008 to state inventories of hydrocarbons at theweighted-average cost for tax purposes as opposed to the previousLIFO evaluation and to recognize a one-off tax calculated byapplying a special tax with a 16% rate on the difference betweenthe two amounts. Accordingly, profit and loss benefited from thedifference between utilization of deferred tax liabilitiesaccrued on hydrocarbons inventories and the one-off tax (euro 229million), for a total positive impact of euro 176 million, whichconsider previously applicable statutory tax rate (Ires) of 33%pursuant to the Law Decree No. 112 of June 25, 2008 instead of27.5% of the previous tax regime. This one-off tax will be paidin three annual installments of same amount, due from 2009onwards; (ii) application of the Italian Budget Law for 2008 thatprovide an increase in limits whereby carrying amounts of assetsand liabilities of consolidated subsidiaries can be recognizedfor tax purposes by paying a one-off tax calculated by 

 

----

| (15) |   | Includes a        5.5% supplemental tax rate on taxable profit of energy        companies in Italy (whose primary activity is the        production and marketing of hydrocarbons and electricity        and with annual revenues in excess of euro 25 million)        effective January 1, 2008 and pursuant to the Law Decree        No. 112 of June 25, 2008. |
|------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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applying a special rate of 6% (positive impact on profit andloss of euro 370 million; euro 290 million net of the specialtax); (iii) enactment of a renewed tax framework in Libyaregarding oil companies operating in accordance with productionsharing schemes. Based on the new provisions, the tax base of theCompany’s Libyan oil properties has been reassessedresulting in the partial utilization of previously accrued taxliabilities of euro 173 million; and (iv) the impact of abovementioned Law Decree No. 112/2008 on energy companies calculatedby applying statutory tax rate (Ires) of 33% pursuant to the LawDecree No. 112 of June 25, 2008 instead of the previouslyapplicable statutory tax rate (Ires) of 27.5% (euro 94 million).

In 2006 the increase in the tax rate of foreign subsidiariesrelating the Exploration & Production segment included theapplication of a windfall tax introduced by the Algeriangovernment with effect starting from August 1, 2006 (1.6percentage points) and a supplemental tax rate introduced by thegovernment of the United kingdom relating to the North Seaproductions with effect starting from January 1, 2006 (1percentage point).

The adjustment to deferred tax assets and liabilities and tothe 2007 tax rate for Italian subsidiaries were recognized inconnection with certain amendments to the Italian tax regimeenacted by the 2008 Budget Law. These included an optionregarding the increase of the tax bases of certain tangible andother assets to their carrying amounts (euro 773 million) bypaying a special tax (euro 325 million) and a lower statutory taxrate (Ires from 33% to 27.5%, Irap from 4.25% to 3.9%, euro 54million).

In 2006 permanent differences mainly arose from certaincharges that are not deductible because taken in connection withrisk provisions arising from proceedings against the ItalianAntitrust and other regulatory Authorities (0.4 percentagepoints).

**35 Earnings per share attributable to Eni**Basic earnings per ordinary share are calculated by dividing netprofit for the year attributable to Eni’s shareholders bythe weighted average number of ordinary shares issued andoutstanding during the year, excluding treasury shares.

The average number of ordinary shares used forthe calculation of the basic earnings per share outstanding atDecember 31, 2006, 2007 and 2008, was 3,698,201,896,3,668,305,807 and 3,638,835,896 respectively.

Diluted earnings per share is calculated bydividing net profit for the year attributable to Eni’sshareholders by the weighted average number of sharesfully-diluted which includes issued and outstanding shares duringthe year, excluding treasury shares and including the number ofshares that could be issued potentially in connection withstock-based compensation plans.

The average number of shares fully diluted usedin the calculation of diluted earnings was 3,701,262,557,3,669,172,762 and 3,638,854,276 for the years ending December 31,2006, 2007 and 2008, respectively.

Reconciliation of the average number of sharesused for the calculation for both basic and diluted earning pershare was as follows:

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

| **Average number of shares used for the        calculation of the basic earnings per share**          |   |                    |   | **3,698,201,896** |   | **3,668,305,807** |   | **3,638,835,896** |
|-------------------------------------------------------------------------------------------------------|--------|-------------------------|--------|-------------------|--------|-------------------|--------|-------------------|
| Number of        potential shares following stock grant plans                                         |   |                    |   | 1,070,676         |   | 302,092           |   |              |
| Number of potential shares following stock        options plans                                       |   |                    |   | 1,989,985         |   | 564,863           |   | 18,380            |
| **Average        number of shares used for the calculation of the diluted        earnings per share** |   |                    |   | **3,701,262,557** |   | **3,669,172,762** |   | **3,638,854,276** |
| **Eni’s net profit**                                                                             |   | (euro        million)   |   | **9,217**         |   | **10,011**        |   | **8,825**         |
| **Basic        earning per share**                                                                    |   | (euro per share)        |   | **2.49**          |   | **2.73**          |   | **2.43**          |
| **Diluted earning per share**                                                                         |   | (euro        per share) |   | **2.49**          |   | **2.73**          |   | **2.43**          |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

 

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**36 Information by industrysegment and geographic financial information****Information by industry segment**

| (euro million) |   | **Exploration &        Production** |   | **Gas & Power** |   | **Refining & Marketing** |   | **Petrochemicals** |   | **Engineering &        Construction** |   | **Other activities** |   | **Corporate and financial        companies** |   | **Intra-Group        profits** |   | **Total** |
|----------------|--------|-----------------------------------------|--------|---------------------|--------|------------------------------|--------|--------------------|--------|-------------------------------------------|--------|----------------------|--------|----------------------------------------------|--------|--------------------------------|--------|-----------|
|           |   |                                         |   |                     |   |                              |   |                    |   |                                           |   |                      |   |                                              |   |                                |   |           |

| **2006**                                                      |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|---------------------------------------------------------------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Net sales        from operations (a)                          |   | 27,173  |   |   | 28,368 |   |   | 38,210 |   |   | 6,823  |   |   | 6,979  |   |   | 823    |   |   | 1,174  |   |   |   |   |   |   |   |
| Less: intersegment sales                                      |   | (18,445 | )      |   | (751   | )      |   | (1,300 | )      |   | (667   | )      |   | (771   | )      |   | (520   | )      |   | (991   | )      |   |   |   |   |   |   |
| Net sales        to customers                                 |   | 8,728   |   |   | 27,617 |   |   | 36,910 |   |   | 6,156  |   |   | 6,208  |   |   | 303    |   |   | 183    |   |   |   |   |   | 86,105 |   |
| Operating profit                                              |   | 15,580  |   |   | 3,802  |   |   | 319    |   |   | 172    |   |   | 505    |   |   | (622   | )      |   | (296   | )      |   | (133   | )      |   | 19,327 |   |
| Provisions        for contingencies                           |   | 153     |   |   | 197    |   |   | 264    |   |   | 30     |   |   | (13    | )      |   | 236    |   |   | (100   | )      |   |   |   |   | 767    |   |
| Depreciation, amortization and writedowns                     |   | 4,776   |   |   | 738    |   |   | 447    |   |   | 174    |   |   | 196    |   |   | 28     |   |   | 71     |   |   | (9     | )      |   | 6,421  |   |
| Share of        profit (loss) of equity-accounted investments |   | 28      |   |   | 509    |   |   | 194    |   |   | 2      |   |   | 66     |   |   | (4     | )      |   |   |   |   |   |   |   | 795    |   |
| Identifiable assets (b)                                       |   | 29,720  |   |   | 23,500 |   |   | 11,359 |   |   | 2,984  |   |   | 6,362  |   |   | 344    |   |   | 1,023  |   |   | (666   | )      |   | 74,626 |   |
| Unallocated        assets                                     |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 13,686 |   |
| Equity-accounted investments                                  |   | 258     |   |   | 2,214  |   |   | 874    |   |   | 11     |   |   | 483    |   |   | 46     |   |   |   |   |   |   |   |   | 3,886  |   |
| Identifiable        liabilities (c)                           |   | 9,119   |   |   | 5,284  |   |   | 4,712  |   |   | 806    |   |   | 3,869  |   |   | 1,940  |   |   | 1,619  |   |   |   |   |   | 27,349 |   |
| Unallocated liabilities                                       |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 19,764 |   |
| Capital        expenditures                                   |   | 5,203   |   |   | 1,174  |   |   | 645    |   |   | 99     |   |   | 591    |   |   | 72     |   |   | 88     |   |   | (39    | )      |   | 7,833  |   |
| **2007**                                                      |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net sales        from operations (a)                          |   | 27,278  |   |   | 27,633 |   |   | 36,401 |   |   | 6,934  |   |   | 8,678  |   |   | 205    |   |   | 1,313  |   |   |   |   |   |   |   |
| Less: intersegment sales                                      |   | (16,475 | )      |   | (760   | )      |   | (1,276 | )      |   | (363   | )      |   | (1,182 | )      |   | (31    | )      |   | (1,099 | )      |   |   |   |   |   |   |
| Net sales        to customers                                 |   | 10,803  |   |   | 26,873 |   |   | 35,125 |   |   | 6,571  |   |   | 7,496  |   |   | 174    |   |   | 214    |   |   |   |   |   | 87,256 |   |
| Operating profit                                              |   | 13,788  |   |   | 4,127  |   |   | 729    |   |   | 74     |   |   | 837    |   |   | (444   | )      |   | (217   | )      |   | (26    | )      |   | 18,868 |   |
| Provisions        for contingencies                           |   | 5       |   |   | 37     |   |   | 256    |   |   | 15     |   |   | 11     |   |   | 264    |   |   | 3      |   |   |   |   |   | 591    |   |
| Depreciation, amortization and writedowns                     |   | 5,626   |   |   | 687    |   |   | 491    |   |   | 116    |   |   | 248    |   |   | 10     |   |   | 68     |   |   | (10    | )      |   | 7,236  |   |
| Share of        profit (loss) of equity-accounted investments |   | 23      |   |   | 449    |   |   | 216    |   |   |   |   |   | 79     |   |   | 6      |   |   |   |   |   |   |   |   | 773    |   |
| Identifiable assets (b)                                       |   | 33,435  |   |   | 24,530 |   |   | 13,767 |   |   | 3,427  |   |   | 8,017  |   |   | 275    |   |   | 854    |   |   | (692   | )      |   | 83,613 |   |
| Unallocated        assets                                     |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 17,847 |   |
| Equity-accounted investments                                  |   | 1,926   |   |   | 2,152  |   |   | 1,267  |   |   | 15     |   |   | 230    |   |   | 49     |   |   |   |   |   |   |   |   | 5,639  |   |
| Identifiable        liabilities (c)                           |   | 11,480  |   |   | 5,390  |   |   | 5,420  |   |   | 939    |   |   | 4,349  |   |   | 1,827  |   |   | 1,380  |   |   |   |   |   | 30,785 |   |
| Unallocated liabilities                                       |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 27,808 |   |
| Capital        expenditures                                   |   | 6,625   |   |   | 1,366  |   |   | 979    |   |   | 145    |   |   | 1,410  |   |   | 59     |   |   | 108    |   |   | (99    | )      |   | 10,593 |   |

| **2008**                                                      |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |    |   |
|---------------------------------------------------------------|--------|---------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|---------|--------|
| Net sales from operations (a)                                 |   | 33,318  |   |   | 36,936 |   |   | 45,083 |   |   | 6,303  |   |   | 9,176  |   |   | 185    |   |   | 1,331  |   |   | 75     |   |   |    |   |
| Less: intersegment sales                                      |   | (19,067 | )      |   | (873   | )      |   | (1,496 | )      |   | (398   | )      |   | (1,219 | )      |   | (29    | )      |   | (1,177 | )      |   |   |   |   |    |   |
| Net sales to customers                                        |   | 14,251  |   |   | 36,063 |   |   | 43,587 |   |   | 5,905  |   |   | 7,957  |   |   | 156    |   |   | 154    |   |   | 75     |   |   | 108,148 |   |
| Operating profit                                              |   | 16,415  |   |   | 3,933  |   |   | (1,023 | )      |   | (822   | )      |   | 1,045  |   |   | (346   | )      |   | (686   | )      |   | 125    |   |   | 18,641  |   |
| Provisions for contingencies                                  |   | 155     |   |   | 237    |   |   | 206    |   |   | 2      |   |   | 36     |   |   | 99     |   |   | 165    |   |   |   |   |   | 900     |   |
| Depreciation, amortization and writedowns                     |   | 7,542   |   |   | 744    |   |   | 729    |   |   | 395    |   |   | 335    |   |   | 8      |   |   | 76     |   |   | (14)   |   |   | 9,815   |   |
| Share of profit (loss) of equity-accounted        investments |   | 173     |   |   | 413    |   |   | 16     |   |   | (9     | )      |   | 43     |   |   | 4      |   |   |   |   |   |   |   |   | 640     |   |
| Identifiable assets (b)                                       |   | 41,989  |   |   | 31,894 |   |   | 11,081 |   |   | 2,629  |   |   | 10,630 |   |   | 362    |   |   | 789    |   |   | (641   | )      |   | 98,733  |   |
| Unallocated assets                                            |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 17,857  |   |
| Equity-accounted investments                                  |   | 1,787   |   |   | 2,249  |   |   | 1,227  |   |   | 25     |   |   | 130    |   |   | 53     |   |   |   |   |   |   |   |   | 5,471   |   |
| Identifiable liabilities (c)                                  |   | 11,030  |   |   | 11,212 |   |   | 4,481  |   |   | 664    |   |   | 6,177  |   |   | 1,638  |   |   | 1,780  |   |   | (75    | )      |   | 36,907  |   |
| Unallocated liabilities                                       |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 31,173  |   |
| Capital expenditures                                          |   | 9,545   |   |   | 1,794  |   |   | 965    |   |   | 212    |   |   | 2,027  |   |   | 52     |   |   | 95     |   |   | (128   | )      |   | 14,562  |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                                       |
|--------------|--------------|-------------------------------------------------------------------------------------------------|
| (a)          |    | Before        elimination of intersegment sales.                                                |
| (b)          |    | Included        assets directly associated with the generation of        operating profit.      |
| (c)          |    | Included        liabilities directly associated with the generation of        operating profit. |

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Inter-segment sales were conducted on an arm’s lengthbasis.

**Geographic financial information***Assets and investments by geographic area of origin*

| (euro million) |   |   |   | **Italy** |   | **Other European Union** |   | **Rest of Europe** |   | **Americas** |   | **Asia** |   | **Africa** |   | **Other areas** |   | **Total** |
|----------------|--------|--------|--------|-----------|--------|--------------------------|--------|--------------------|--------|--------------|--------|----------|--------|------------|--------|-----------------|--------|-----------|
|           |   |   |   |           |   |                          |   |                    |   |              |   |          |   |            |   |                 |   |           |

| **2006**                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|--------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Identifiable        assets (a) |   | 37,339 |   | 10,037 |   | 3,200  |   | 2,987  |   | 6,341  |   | 14,190 |   | 532    |   | 74,626 |
| Capital expenditures           |   | 2,529  |   | 713    |   | 436    |   | 572    |   | 1,032  |   | 2,419  |   | 132    |   | 7,833  |
| **2007**                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Identifiable assets (a)        |   | 39,742 |   | 11,071 |   | 3,917  |   | 6,260  |   | 6,733  |   | 15,368 |   | 522    |   | 83,613 |
| Capital        expenditures    |   | 3,246  |   | 1,246  |   | 469    |   | 1,004  |   | 1,253  |   | 3,152  |   | 223    |   | 10,593 |
| **2008**                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Identifiable assets (a)        |   | 40,432 |   | 15,065 |   | 3,561  |   | 6,149  |   | 10,561 |   | 22,044 |   | 921    |   | 98,733 |
| Capital expenditures           |   | 3,674  |   | 1,660  |   | 582    |   | 1,240  |   | 1,777  |   | 5,153  |   | 476    |   | 14,562 |

|   |   |   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                             |
|--------------|--------------|---------------------------------------------------------------------------------------|
| (a)          |    | Includes        assets directly related to the generation of operating        profit. |

*Sales from operations by geographic area of destination*

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Italy                       |   | 36,343     |   | 37,346     |   | 42,909      |
|-----------------------------|--------|------------|--------|------------|--------|-------------|
| Other        European Union |   | 23,949     |   | 23,074     |   | 29,341      |
| Rest of Europe              |   | 6,975      |   | 5,507      |   | 7,125       |
| Americas                    |   | 6,250      |   | 6,447      |   | 7,218       |
| Asia                        |   | 5,595      |   | 5,840      |   | 8,916       |
| Africa                      |   | 5,949      |   | 8,010      |   | 12,331      |
| Other areas                 |   | 1,044      |   | 1,032      |   | 308         |
|                        |   | **86,105** |   | **87,256** |   | **108,148** |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

**37 Transactions with related parties******In the ordinary course of its business, Eni enters intotransactions regarding:

| a) |   | the exchange of goods,        provision of services and financing with joint ventures,        associates and non-consolidated subsidiaries;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| b) |   | the exchange of goods and        provision of services with entities directly and        indirectly owned or controlled by the Government;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| c) |   | transactions with the Cosmi        Holding Group related to Eni SpA through a member of the        Board of Directors related to certain acquisition of        engineering, construction and maintenance services.        Relevant transactions which were executed on an        arm’s length basis amounted to approximately euro 13        million, euro 18 million and euro 13 million in 2006,        2007 and 2008, respectively. At December 31, 2008 were        outstanding receivables for euro 4 million and payables        for euro 8 million;                                                                                                                                                                                                                                                                                                                                                                                                                    |
| d) |   | contributions to entities,        controlled by Eni with the aim to develop solidarity,        culture and research initiatives. In particular these        related to: (a) Eni Foundation established by Eni as a        non-profit entity with the aim of pursuing exclusively        solidarity initiatives in the fields of social        assistance, health, education, culture and environment as        well as research and development. Transactions with Eni        Foundation related to contribution of euro 200 million to        the solidarity fund pursuant to Italian Law Decree No.        112/2008 and the payable of euro 100 million related to        the part of the contribution that had not already been        paid. Transactions in the past periods were not material;        (b) Enrico Mattei Foundation established by Eni with the        aim of enhancing, through studies, research and training        initiatives, knowledge in the fields of |

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|   |   | economics, energy and        environment, both at the national and international        level. Transactions with Enrico Mattei Foundation were        not material. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Transactions with related parties were conducted in theinterest of Eni companies and, with exception of those withentities with the aim to develop solidarity, culture and researchinitiatives, on an arm’s length basis.

Trade and other transactions with joint ventures, associatesand non-consolidated subsidiaries as well as with entitiesdirectly and indirectly owned or controlled by the Government inthe 2006, 2007 and 2008, respectively, consisted of thefollowing:

| (euro        million) |   | **Dec. 31, 2006** |   | **2006** |
|-----------------------|--------|-------------------|--------|----------|
|                  |   |                   |   |          |

|   | Costs |   | Revenues |
|--------|-------|--------|----------|
|   |       |   |          |

| Name |    | Receivables and other assets |    | Payables and other liabilities |    | Guarantees |    | Goods |    | Services |    | Goods |    | Services |
|------|--------------|------------------------------|--------------|--------------------------------|--------------|------------|--------------|-------|--------------|----------|--------------|-------|--------------|----------|
|      |         |                              |         |                                |         |            |         |       |         |          |         |       |         |          |

| **Joint ventures and associates**                              |   |    |   |      |   |      |   |      |   |      |   |      |   |    |
|----------------------------------------------------------------|--------|---------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|---------|
| ASG Scarl                                                      |   | 7       |   | 40        |   | 80        |   |      |   | 88        |   | 1         |   | 1       |
| Azienda Energia e Servizi Torino SpA                           |   | 1       |   | 22        |   |      |   |      |   | 64        |   | 1         |   | 1       |
| Bernhard        Rosa Inh. Ingeborg Plöchinger GmbH        |   | 10      |   |      |   |      |   |      |   |      |   | 96        |   |    |
| Blue Stream Pipeline Co BV                                     |   | 34      |   | 19        |   |      |   |      |   | 193       |   |      |   | 1       |
| Bronberger        & Kessler Und Gilg & Schweiger GmbH  |   | 11      |   |      |   |      |   |      |   |      |   | 113       |   |    |
| CAM Petroli Srl                                                |   | 103     |   |      |   |      |   |      |   |      |   | 310       |   |    |
| CEPAV        (Consorzio Eni per l’Alta Velocità) Uno |   | 87      |   | 87        |   | 5,654     |   | 16        |   | 2         |   |      |   | 304     |
| Charville - Consultores e Serviços Lda                    |   | 7       |   |      |   | 85        |   |      |   |      |   | 4         |   | 11      |
| Eni Oil Co        Ltd                                          |   | 5       |   | 96        |   |      |   |      |   | 59        |   |      |   |    |
| Fox Energy SpA                                                 |   | 35      |   |      |   |      |   |      |   |      |   | 125       |   |    |
| Gasversorgung        Süddeutschland GmbH                  |   | 14      |   |      |   |      |   |      |   | 1         |   | 123       |   | 19      |
| Gruppo Distribuzione Petroli Srl                               |   | 19      |   |      |   |      |   |      |   |      |   | 54        |   |    |
| Karachaganak        Petroleum Operating BV                     |   | 23      |   | 70        |   |      |   | 29        |   | 129       |   |      |   | 7       |
| Mangrove Gas Netherlands BV                                    |   |    |   | 1         |   | 52        |   |      |   |      |   |      |   |    |
| Mellitah        Oil & Gas BV                               |   | 28      |   | 90        |   |      |   | 7         |   | 72        |   | 8         |   | 2       |
| Petrobel Belayim Petroleum Co                                  |   |    |   | 3         |   |      |   |      |   | 181       |   |      |   |    |
| Promgas        SpA                                             |   | 44      |   | 39        |   |      |   | 375       |   |      |   | 419       |   |    |
| Raffineria di Milazzo ScpA                                     |   | 9       |   | 12        |   |      |   |      |   | 237       |   | 109       |   |    |
| Rodano        Consortile Scarl                                 |   | 3       |   | 14        |   |      |   |      |   | 54        |   |      |   | 1       |
| RPCO Enterprises Ltd                                           |   | 13      |   |      |   | 104       |   |      |   |      |   |      |   | 12      |
| Supermetanol        CA                                         |   |    |   | 13        |   |      |   | 91        |   |      |   |      |   |    |
| Super Octanos CA                                               |   |    |   | 13        |   |      |   | 257       |   |      |   |      |   |    |
| Trans        Austria Gasleitung GmbH                           |   | 7       |   | 78        |   |      |   | 53        |   | 138       |   |      |   | 56      |
| Transitgas AG                                                  |   |    |   | 8         |   |      |   |      |   | 64        |   |      |   |    |
| Transmediterranean        Pipeline Co Ltd                      |   |    |   | 7         |   |      |   |      |   | 80        |   |      |   |    |
| Unión Fenosa Gas SA                                       |   | 1       |   | 7         |   | 61        |   | 93        |   | 7         |   |      |   |    |
| Other (*)                                                      |   | 72      |   | 169       |   | 168       |   | 75        |   | 188       |   | 119       |   | 66      |
|                                                           |   | **533** |   | **788**   |   | **6,204** |   | **996**   |   | **1,557** |   | **1,482** |   | **481** |
| **Unconsolidated        entities controlled by Eni**           |   |    |   |      |   |      |   |      |   |      |   |      |   |    |
| Agip Kazakhstan North Caspian Operating Co NV                  |   | 27      |   | 132       |   |      |   | 18        |   | 16        |   |      |   | 57      |
| Eni BTC        Ltd                                             |   |    |   |      |   | 185       |   |      |   |      |   |      |   |    |
| Eni Timor Leste SpA                                            |   |    |   |      |   | 102       |   |      |   |      |   |      |   |    |
| Other (*)                                                      |   | 20      |   | 30        |   | 8         |   | 1         |   | 4         |   | 8         |   | 4       |
|                                                           |   | **47**  |   | **162**   |   | **295**   |   | **19**    |   | **20**    |   | **8**     |   | **61**  |
|                                                           |   | **580** |   | **950**   |   | **6,499** |   | **1,015** |   | **1,577** |   | **1,490** |   | **542** |
| **Entities owned or controlled by the        Government**      |   |    |   |      |   |      |   |      |   |      |   |      |   |    |
| Gruppo        Alitalia                                         |   | 12      |   |      |   |      |   |      |   |      |   | 354       |   |    |
| Gruppo Enel                                                    |   | 162     |   | 42        |   |      |   | 47        |   | 33        |   | 1,068     |   | 383     |
| Other (*)                                                      |   | 42      |   | 29        |   |      |   | 4         |   | 44        |   | 136       |   | 1       |
|                                                           |   | **216** |   | **71**    |   |      |   | **51**    |   | **77**    |   | **1,558** |   | **384** |
|                                                           |   | **796** |   | **1,021** |   | **6,499** |   | **1,066** |   | **1,654** |   | **3,048** |   | **926** |
|                                                           |   |         |   |           |   |           |   |           |   |           |   |           |   |         |

|    |    |                                                                             |
|--------------|--------------|---------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein does not exceed euro 50        million. |

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----

##### Table of Contents

| (euro        million) |   | **Dec. 31, 2007** |   | **2007** |
|-----------------------|--------|-------------------|--------|----------|
|                  |   |                   |   |          |

|   | Costs |   | Revenues |
|--------|-------|--------|----------|
|   |       |   |          |

| Name |    | Receivables and other assets |    | Payables and other liabilities |    | Guarantees |    | Goods |    | Services |    | Goods |    | Services |
|------|--------------|------------------------------|--------------|--------------------------------|--------------|------------|--------------|-------|--------------|----------|--------------|-------|--------------|----------|
|      |         |                              |         |                                |         |            |         |       |         |          |         |       |         |          |

| **Joint ventures and associates**                              |   |      |   |      |   |      |   |    |   |      |   |      |   |    |
|----------------------------------------------------------------|--------|-----------|--------|-----------|--------|-----------|--------|---------|--------|-----------|--------|-----------|--------|---------|
| ASG Scarl                                                      |   | 6         |   | 43        |   | 121       |   |    |   | 108       |   |      |   | 3       |
| Bernhard Rosa Inh. Ingeborg Plöchinger GmbH               |   | 11        |   |      |   |      |   |    |   |      |   | 86        |   |    |
| Blue        Stream Pipeline Co BV                              |   | 19        |   |      |   |      |   |    |   | 183       |   |      |   | 1       |
| Bronberger & Kessler und Gill &        Schweiger GmbH  |   | 18        |   |      |   |      |   |    |   |      |   | 106       |   |    |
| CEPAV        (Consorzio Eni per l’Alta Velocità) Uno |   | 84        |   | 70        |   | 5,870     |   |    |   |      |   |      |   | 263     |
| CEPAV (Consorzio Eni per l’Alta Velocità)        Due |   | 1         |   | 1         |   | 64        |   |    |   | 1         |   |      |   | 1       |
| Eni Oil Co        Ltd                                          |   | 7         |   | 60        |   |      |   |    |   | 141       |   | 1         |   |    |
| Fox Energy SpA                                                 |   | 49        |   |      |   |      |   |    |   |      |   | 139       |   |    |
| Gasversorgung        Süddeutschland GmbH                  |   | 54        |   |      |   |      |   |    |   |      |   | 195       |   | 4       |
| Gruppo Distribuzione Petroli Srl                               |   | 26        |   |      |   |      |   |    |   |      |   | 50        |   |    |
| Karachaganak        Petroleum Operating BV                     |   | 43        |   | 102       |   |      |   | 24      |   | 301       |   |      |   | 7       |
| Mellitah Oil & Gas BV                                      |   | 10        |   | 137       |   |      |   |    |   | 105       |   | 1         |   | 6       |
| OOO        "EniNeftegaz"                             |   | 215       |   |      |   |      |   |    |   |      |   |      |   | 1       |
| Petrobel Belayim Petroleum Co                                  |   |      |   | 60        |   |      |   |    |   | 211       |   |      |   |    |
| Raffineria        di Milazzo ScpA                              |   | 17        |   | 21        |   |      |   |    |   | 245       |   | 118       |   | 5       |
| Supermetanol CA                                                |   |      |   | 11        |   |      |   | 78      |   |      |   |      |   | 1       |
| Super        Octanos CA                                        |   |      |   | 18        |   |      |   | 201     |   |      |   |      |   | 1       |
| Trans Austria Gasleitung GmbH                                  |   | 6         |   | 80        |   |      |   | 43      |   | 147       |   |      |   | 47      |
| Transitgas        AG                                           |   |      |   | 8         |   |      |   |    |   | 64        |   |      |   |    |
| Transmediterranean Pipeline Co Ltd                             |   |      |   | 6         |   |      |   |    |   | 70        |   |      |   | 1       |
| Unión        Fenosa Gas SA                                |   | 1         |   |      |   | 61        |   |    |   |      |   | 193       |   |    |
| Other (*)                                                      |   | 120       |   | 127       |   | 56        |   | 76      |   | 374       |   | 172       |   | 118     |
|                                                           |   | **687**   |   | **744**   |   | **6,172** |   | **422** |   | **1,950** |   | **1,011** |   | **459** |
| **Unconsolidated entities controlled by Eni**                  |   |      |   |      |   |      |   |    |   |      |   |      |   |    |
| Agip        Kazakhstan North Caspian Operating Co NV           |   | 49        |   | 111       |   |      |   | 11      |   | 534       |   |      |   | 52      |
| Eni BTC Ltd                                                    |   |      |   |      |   | 138       |   |    |   |      |   |      |   | 1       |
| Other (*)                                                      |   | 23        |   | 8         |   | 11        |   | 2       |   | 18        |   | 5         |   | 18      |
|                                                           |   | **72**    |   | **119**   |   | **149**   |   | **13**  |   | **552**   |   | **5**     |   | **71**  |
|                                                           |   | **759**   |   | **863**   |   | **6,321** |   | **435** |   | **2,502** |   | **1,016** |   | **530** |
| **Entities owned or controlled by the        Government**      |   |      |   |      |   |      |   |    |   |      |   |      |   |    |
| Gruppo        Alitalia                                         |   | 4         |   |      |   |      |   |    |   |      |   | 363       |   | 1       |
| Gruppo Enel                                                    |   | 384       |   | 8         |   |      |   |    |   | 245       |   | 894       |   | 408     |
| GSE -        Gestore Servizi Elettrici                         |   | 124       |   | 63        |   |      |   | 239     |   | 37        |   | 870       |   | 7       |
| Terna SpA                                                      |   | 19        |   | 69        |   |      |   | 106     |   | 105       |   |      |   | 31      |
| Other (*)                                                      |   | 45        |   | 79        |   |      |   | 19      |   | 89        |   | 75        |   | 3       |
|                                                           |   | **576**   |   | **219**   |   |      |   | **364** |   | **476**   |   | **2,202** |   | **450** |
|                                                           |   | **1,335** |   | **1,082** |   | **6,321** |   | **799** |   | **2,978** |   | **3,218** |   | **980** |

|  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                             |
|--------------|--------------|---------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein does not exceed euro 50        million. |

F-93

----

##### Table of Contents

| (euro        million) |   | **Dec. 31, 2008** |   | **2008** |
|-----------------------|--------|-------------------|--------|----------|
|                  |   |                   |   |          |

|   | Costs |   | Revenues |
|--------|-------|--------|----------|
|   |       |   |          |

| Name |    | Receivables and other assets |    | Payables and other liabilities |    | Guarantees |    | Goods |    | Services |    | Other |    | Goods |    | Services |    | Other |
|------|--------------|------------------------------|--------------|--------------------------------|--------------|------------|--------------|-------|--------------|----------|--------------|-------|--------------|-------|--------------|----------|--------------|-------|
|      |         |                              |         |                                |         |            |         |       |         |          |         |       |         |       |         |          |         |       |

| **Joint ventures and associates**                              |   |      |   |      |   |      |   |      |   |      |   |    |   |      |   |      |   |   |
|----------------------------------------------------------------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|---------|--------|-----------|--------|-----------|--------|--------|
| Agiba        Petroleum                                         |   |      |   | 11        |   |      |   |      |   | 60        |   |    |   |      |   |      |   |   |
| Altergaz SA                                                    |   | 30        |   |      |   |      |   |      |   |      |   |    |   | 135       |   |      |   |   |
| ASG Scarl                                                      |   | 2         |   | 25        |   | 49        |   |      |   | 57        |   |    |   |      |   |      |   |   |
| Bayernoil Raffineriegesellschaft mbH                           |   | 3         |   | 4         |   | 1         |   | 6         |   | 62        |   |    |   | 4         |   |      |   |   |
| Bernhard        Rosa Inh. Ingeborg Plöchinger GmbH        |   | 5         |   |      |   |      |   |      |   |      |   |    |   | 98        |   |      |   |   |
| Blue Stream Pipeline Co BV                                     |   | 23        |   | 17        |   |      |   |      |   | 171       |   |    |   |      |   | 1         |   |   |
| Bronberger        & Kessler und Gilg & Schweiger GmbH  |   | 12        |   |      |   |      |   |      |   |      |   |    |   | 175       |   |      |   |   |
| CEPAV (Consorzio Eni per l’Alta Velocità)        Uno |   | 95        |   | 37        |   | 6,001     |   |      |   | 17        |   | 3       |   |      |   | 397       |   |   |
| CEPAV        (Consorzio Eni per l’Alta Velocità) Due |   | 4         |   | 1         |   | 64        |   |      |   | 1         |   |    |   |      |   | 1         |   |   |
| Eni Oil Co Ltd                                                 |   | 9         |   | 28        |   |      |   |      |   | 660       |   |    |   |      |   | 6         |   |   |
| Fox Energy        SpA                                          |   | 37        |   |      |   |      |   | 2         |   |      |   |    |   | 329       |   | 1         |   |   |
| FPSO Mystras - Produção de Petroleo Lda              |   |      |   |      |   |      |   | 94        |   |      |   | 10      |   |      |   |      |   |   |
| Gasversorgung        Süddeutschland GmbH                  |   | 64        |   |      |   |      |   |      |   |      |   |    |   | 337       |   | 18        |   |   |
| Gruppo Distribuzione Petroli Srl                               |   | 20        |   |      |   |      |   |      |   |      |   |    |   | 111       |   |      |   |   |
| InAgip doo                                                     |   | 24        |   | 45        |   |      |   |      |   | 116       |   |    |   | 3         |   | 35        |   |   |
| Karachaganak Petròleum Operating BV                       |   | 72        |   | 207       |   |      |   | 874       |   | 380       |   | 25      |   |      |   | 12        |   |   |
| Mellitah        Oil & Gas BV                               |   | 10        |   | 121       |   |      |   |      |   | 329       |   |    |   | 2         |   | 4         |   |   |
| Petrobel Belayim Petroleum Co                                  |   |      |   | 77        |   |      |   |      |   | 181       |   |    |   |      |   |      |   |   |
| Raffineria        di Milazzo ScpA                              |   | 11        |   | 4         |   |      |   |      |   | 276       |   |    |   | 135       |   | 3         |   |   |
| Saipon Snc                                                     |   | 4         |   |      |   | 58        |   |      |   |      |   |    |   |      |   | 12        |   |   |
| Super        Octanos CA                                        |   |      |   | 24        |   |      |   | 286       |   |      |   |    |   |      |   |      |   |   |
| Supermetanol CA                                                |   |      |   | 5         |   |      |   | 90        |   |      |   |    |   |      |   |      |   |   |
| Trans        Austria Gasleitung GmbH                           |   | 8         |   | 78        |   |      |   | 60        |   | 153       |   |    |   |      |   | 64        |   |   |
| Transitgas AG                                                  |   |      |   | 5         |   |      |   |      |   | 1         |   | 64      |   |      |   |      |   |   |
| Unión        Fenosa Gas SA                                |   | 1         |   | 25        |   | 62        |   | 25        |   |      |   |    |   | 257       |   | 1         |   |   |
| Other (*)                                                      |   | 231       |   | 115       |   | 18        |   | 36        |   | 319       |   | 46      |   | 71        |   | 129       |   | 8      |
|                                                           |   | **655**   |   | **829**   |   | **6,253** |   | **1,473** |   | **2,783** |   | **148** |   | **1,657** |   | **684**   |   | **8**  |
| **Unconsolidated entities controlled by Eni**                  |   |      |   |      |   |      |   |      |   |      |   |    |   |      |   |      |   |   |
| Agip        Kazakhstan North Caspian Operating Co NV           |   | 144       |   | 166       |   |      |   |      |   | 720       |   | 11      |   | 1         |   | 367       |   | 10     |
| Eni BTC Ltd                                                    |   |      |   |      |   | 146       |   |      |   |      |   |    |   |      |   |      |   |   |
| Other (*)                                                      |   | 22        |   | 18        |   | 4         |   | 2         |   | 20        |   | 2       |   | 4         |   | 6         |   | 4      |
|                                                           |   | **166**   |   | **184**   |   | **150**   |   | **2**     |   | **740**   |   | **13**  |   | **5**     |   | **373**   |   | **14** |
|                                                           |   | **831**   |   | **1,013** |   | **6,403** |   | **1,475** |   | **3,523** |   | **161** |   | **1,662** |   | **1,057** |   | **22** |
| **Entities owned or controlled by the        Government**      |   |      |   |      |   |      |   |      |   |      |   |    |   |      |   |      |   |   |
| Ferrovie        dello Stato                                    |   | 4         |   |      |   |      |   |      |   |      |   |    |   | 417       |   | 2         |   |   |
| Gruppo Alitalia                                                |   | 153       |   | 12        |   |      |   | 13        |   | 223       |   |    |   | 941       |   | 380       |   |   |
| Gruppo        Enel                                             |   | 19        |   | 7         |   |      |   |      |   | 27        |   | 1       |   | 57        |   |      |   |   |
| GSE - Gestore Servizi Elettrici                                |   | 92        |   | 63        |   |      |   | 315       |   |      |   | 79      |   | 347       |   | 16        |   | 6      |
| Terna SpA                                                      |   | 33        |   | 35        |   |      |   | 14        |   | 128       |   |    |   | 12        |   | 83        |   | 10     |
| Other (*)                                                      |   | 28        |   | 72        |   |      |   | 33        |   | 88        |   | 5       |   | 72        |   | 2         |   | 1      |
|                                                           |   | **329**   |   | **189**   |   |      |   | **375**   |   | **466**   |   | **85**  |   | **1,846** |   | **483**   |   | **17** |
|                                                           |   | **1,160** |   | **1,202** |   | **6,403** |   | **1,850** |   | **3,989** |   | **246** |   | **3,508** |   | **1,540** |   | **39** |

|  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                             |
|--------------|--------------|---------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein does not exceed euro 50        million. |

Most significant transactions with joint ventures, associatesand non-consolidated subsidiaries concerned:

- transactions related to the planning and the construction        of the tracks for high speed/high capacity trains from        Milan to Bologna with ASG Scarl, CEPAV (Consorzio Eni per        l’Alta Velocità) Uno, and related guarantees;

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##### Table of Contents

- acquisition of refining services from Bayernoil        Raffineriegesellschaft mbH and Raffineria di Milazzo ScpA        in relation to incurred costs;
- supply of oil products to Bernhard Rosa Inh. Ingeborg        Plöchinger GmbH, Bronberger & Kessler und Gilg &        Schweiger GmbH, Fox Energy Srl, Gruppo Distribuzione        Petroli Srl and Raffineria di Milazzo ScpA on the basis        of prices referred to the quotations on international        markets of the main oil products, as they would be        conducted on an arm’s length basis;
- acquisition of FPSO from FPSO Mystras - Produção de        Petròleo Lda;
- acquisition of natural gas transport services outside        Italy from Blue Stream Pipeline Co BV, Trans Austria        Gasleitung GmbH and Transitgas AG;
- guarantees issued on behalf of CEPAV (Consorzio Eni per        l’Alta Velocità) Due in relation to contractual        commitments related to the execution of project planning        and realization;
- provision of specialized services in upstream activities        and payables for investment activities from Agip        Kazakhstan North Caspian Operating Co NV, Agiba Petroleum        Co, Eni Oil Co Ltd, InAgip doo, Karachaganak Petroleum        Operating BV, Mellitah Oil & Gas BV, Petrobel Belayim        Petroleum Co and, only for Karachaganak Petroleum        Operating BV supply of oil products; services are        invoiced on the basis of incurred costs;
- sale of natural gas to Altergaz SA and Gasversorgung        Süddeutschland GmbH;
- acquisition of petrochemical products from Supermetanol        CA and Super Octanos CA on the basis of prices referred        to the quotations on international markets of the main        products;
- performance guarantees given on behalf of Unión Fenosa        Gas SA in relation to contractual commitments related to        the results of operations;
- guarantees issued in relation to the construction of an        oil pipeline on behalf of Eni BTC Ltd.

Most significant transactions with entities owned orcontrolled by the Government concerned:

- sale of oil products with Alitalia and Ferrovie dello        Stato;
- sale and transportation of natural gas, the sale of fuel        oil and the sale and purchase of electricity and the        acquisition of electricity transmission service with        Enel;
- sale and purchase of electricity with GSE - Gestore        Servizi Elettrici;
- sale and purchase of electricity and the acquisition of        domestic electricity transmission service jointly with        Terna SpA.

Financing transactions with joint ventures, associates andnon-consolidated subsidiaries as well as with entities directlyand indirectly owned or controlled by the Government in the 2006,2007 and 2008, respectively, consisted of the following:

| (euro        million) |   | **Dec. 31, 2006** |   | **2006** |
|-----------------------|--------|-------------------|--------|----------|
|                  |   |                   |   |          |

| Name |    | Receivables |    | Payables |    | Guarantees |    | Charges |    | Gains |
|------|--------------|-------------|--------------|----------|--------------|------------|--------------|---------|--------------|-------|
|      |         |             |         |          |         |            |         |         |         |       |

| **Joint ventures and associates**             |   |    |   |    |   |      |   |   |   |   |
|-----------------------------------------------|--------|---------|--------|---------|--------|-----------|--------|--------|--------|--------|
| Blue        Stream Pipeline Co BV             |   |    |   | 3       |   | 794       |   | 4      |   | 26     |
| Raffineria di Milazzo ScpA                    |   |    |   |    |   | 57        |   |   |   |   |
| Spanish        Egyptian Gas Co SAE            |   |    |   |    |   | 323       |   |   |   |   |
| Trans Austria Gasleitung GmbH                 |   | 41      |   |    |   |      |   |   |   | 6      |
| Transmediterranean        Pipeline Co Ltd     |   | 147     |   |    |   |      |   |   |   | 11     |
| Other (*)                                     |   | 88      |   | 81      |   | 39        |   | 13     |   | 11     |
|                                          |   | **276** |   | **84**  |   | **1,213** |   | **17** |   | **54** |
| **Unconsolidated entities controlled by Eni** |   |    |   |    |   |      |   |   |   |   |
| Other (*)                                     |   | 95      |   | 25      |   | 2         |   | 1      |   | 4      |
|                                          |   | **95**  |   | **25**  |   | **2**     |   | **1**  |   | **4**  |
|                                          |   | **371** |   | **109** |   | **1,215** |   | **18** |   | **58** |

|  |   |  |   |  |   |  |   |  |   |  |
|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                             |
|--------------|--------------|---------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein does not exceed euro 50        million. |

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| (euro        million) |   | **Dec. 31, 2007** |   | **2007** |
|-----------------------|--------|-------------------|--------|----------|
|                  |   |                   |   |          |

| Name |    | Receivables |    | Payables |    | Guarantees |    | Charges |    | Gains |    | Derivative financial        instruments |
|------|--------------|-------------|--------------|----------|--------------|------------|--------------|---------|--------------|-------|--------------|-----------------------------------------|
|      |         |             |         |          |         |            |         |         |         |       |         |                                         |

| **Joint ventures and associates**                         |   |    |   |    |   |    |   |   |   |   |   |   |
|-----------------------------------------------------------|--------|---------|--------|---------|--------|---------|--------|--------|--------|--------|--------|--------|
| Blue        Stream Pipeline Co BV                         |   |    |   | 1       |   | 711     |   |   |   | 20     |   |   |
| Raffineria di Milazzo ScpA                                |   |    |   |    |   | 60      |   |   |   |   |   |   |
| Trans        Austria Gasleitung GmbH                      |   | 65      |   |    |   |    |   |   |   | 3      |   |   |
| Transmediterranean Pipeline Co Ltd                        |   | 97      |   |    |   |    |   |   |   | 9      |   |   |
| Other (*)                                                 |   | 108     |   | 120     |   | 52      |   | 19     |   | 11     |   |   |
|                                                      |   | **270** |   | **121** |   | **823** |   | **19** |   | **43** |   |   |
| **Unconsolidated        entities controlled by Eni**      |   |    |   |    |   |    |   |   |   |   |   |   |
| Other (*)                                                 |   | 114     |   | 26      |   | 1       |   | 1      |   | 6      |   |   |
|                                                      |   | **114** |   | **26**  |   | **1**   |   | **1**  |   | **6**  |   |   |
| **Entities owned or controlled by the        Government** |   |    |   |    |   |    |   |   |   |   |   |   |
| GSE -        Gestore Servizi Elettrici                    |   |    |   |    |   |    |   |   |   |   |   | 10     |
|                                                      |   |    |   |    |   |    |   |   |   |   |   | **10** |
|                                                      |   | **384** |   | **147** |   | **824** |   | **20** |   | **49** |   | **10** |

|  |   |  |   |  |   |  |   |  |   |  |   |  |
|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                             |
|--------------|--------------|---------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein does not exceed euro 50        million. |

 

| (euro        million) |   | **Dec. 31, 2008** |   | **2008** |
|-----------------------|--------|-------------------|--------|----------|
|                  |   |                   |   |          |

| Name |    | Receivables |    | Payables |    | Guarantees |    | Charges |    | Gains |    | Derivative financial        instruments |
|------|--------------|-------------|--------------|----------|--------------|------------|--------------|---------|--------------|-------|--------------|-----------------------------------------|
|      |         |             |         |          |         |            |         |         |         |       |         |                                         |

| **Joint ventures and associates**                         |   |    |   |    |   |    |   |   |   |   |   |   |
|-----------------------------------------------------------|--------|---------|--------|---------|--------|---------|--------|--------|--------|--------|--------|--------|
| Bayernoil        Raffineriegesellschaft mbH               |   | 131     |   |    |   |    |   |   |   |   |   |   |
| Blue Stream Pipeline Co BV                                |   |    |   |    |   | 752     |   |   |   | 14     |   |   |
| PetroSucre        SA                                      |   | 153     |   |    |   |    |   |   |   |   |   |   |
| Raffineria di Milazzo ScpA                                |   |    |   |    |   | 70      |   |   |   |   |   |   |
| Trans        Austria Gasleitung GmbH                      |   | 186     |   |    |   |    |   |   |   | 7      |   |   |
| Transmediterranean Pipeline Co Ltd                        |   | 103     |   |    |   |    |   |   |   | 6      |   |   |
| Other (*)                                                 |   | 123     |   | 124     |   | 27      |   | 16     |   | 9      |   |   |
|                                                      |   | **696** |   | **124** |   | **849** |   | **16** |   | **36** |   |   |
| **Unconsolidated        entities controlled by Eni**      |   |    |   |    |   |    |   |   |   |   |   |   |
| Other (*)                                                 |   | 115     |   | 38      |   | 1       |   | 1      |   | 6      |   |   |
|                                                      |   | **115** |   | **38**  |   | **1**   |   | **1**  |   | **6**  |   |   |
| **Entities owned or controlled by the        Government** |   |    |   |    |   |    |   |   |   |   |   |   |
| GSE -        Gestore Servizi Elettrici                    |   |    |   |    |   |    |   |   |   |   |   | 58     |
|                                                      |   |    |   |    |   |    |   |   |   |   |   | **58** |
|                                                      |   | **811** |   | **162** |   | **850** |   | **17** |   | **42** |   | **58** |

|  |   |  |   |  |   |  |   |  |   |  |   |  |
|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                             |
|--------------|--------------|---------------------------------------------------------------------------------------|
| (*)          |    | Each        individual amount included herein does not exceed euro 50        million. |

Most significant transactions with joint ventures, associatesand non-consolidated subsidiaries included:

- bank debt guarantee issued on behalf of Blue Stream        Pipeline Co BV and cash deposit at Eni’s financial        companies;
- bank debt guarantee issued on behalf of Raffineria di        Milazzo ScpA;
- financing loan to Bayernoil Raffineriegesellschaft mbH;
- receivable from PetroSucre SA following the contribution        of Corocoro activities, still to be defined, in the new        mixed company;
- the financing of the Austrian section of the gasline from        the Russian Federation to Italy and the construction of        natural gas transmission facilities and transport        services with Trans Austria Gasleitung GmbH and        Transmediterranean Pipeline Co Ltd, respectively.

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Most significant transactions with entities owned orcontrolled by the Government concerned the fair value ofderivative financial instruments included in prices ofelectricity related to sale/purchase transactions with GSE -Gestore Servizi Elettrici.

**Impact of transactions and positions with relatedparties on the balance sheet, net profit and cash flows**The impact of transactions and positions with relatedparties on the balance sheet, net profit and cash flows consistedof the following:

|   |   | **Dec. 31, 2006** |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|--------|--------|-------------------|--------|-------------------|--------|-------------------|
|   |   |                   |   |                   |   |                   |

| (euro        million) |   | Total |   | Related parties |   | Impact % |   | Total |   | Related parties |   | Impact % |   | Total |   | Related parties |   | Impact % |
|-----------------------|--------|-------|--------|-----------------|--------|----------|--------|-------|--------|-----------------|--------|----------|--------|-------|--------|-----------------|--------|----------|
|                  |   |       |   |                 |   |          |   |       |   |                 |   |          |   |       |   |                 |   |          |

| Trade and other receivables                                 |   | 18,799 |   | 1,027  |   | 5.46   |   | 20,676 |   | 1,616  |   | 7.82   |   | 22,222 |   | 1,539 |   | 6.93  |
|-------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|-------|--------|-------|
| Other        current assets                                 |   | 855    |   | 4      |   | 0.47   |   | 1,080  |   |   |   |   |   | 2,349  |   | 59    |   | 2.51  |
| Other non-current financial assets                          |   | 805    |   | 136    |   | 16.89  |   | 923    |   | 87     |   | 9.43   |   | 1,134  |   | 356   |   | 31.39 |
| Other        non-current assets                             |   | 994    |   |   |   |   |   | 1,110  |   | 16     |   | 1.44   |   | 1,401  |   | 21    |   | 1.50  |
| Current financial liabilities                               |   | 3,400  |   | 92     |   | 2.71   |   | 7,763  |   | 131    |   | 1.69   |   | 6,359  |   | 153   |   | 2.41  |
| Trade and        other payables                             |   | 15,995 |   | 961    |   | 6.01   |   | 17,116 |   | 1,021  |   | 5.97   |   | 20,515 |   | 1,253 |   | 6.11  |
| Other liabilities                                           |   | 634    |   | 4      |   | 0.63   |   | 1,556  |   | 4      |   | 0.26   |   | 4,319  |   | 4     |   | 0.09  |
| Long-term        debt and current portion of long-term debt |   | 8,299  |   | 17     |   | 0.20   |   | 12,067 |   | 16     |   | 0.13   |   | 14,478 |   | 9     |   | 0.06  |
| Other non-current liabilities                               |   | 418    |   | 56     |   | 13.40  |   | 2,031  |   | 57     |   | 2.81   |   | 2,538  |   | 53    |   | 2.09  |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

The impact of transactions with related parties on the profitand loss accounts consisted of the following:

|   |   | **Dec. 31, 2006** |   | **Dec. 31, 2007** |   | **Dec. 31, 2008** |
|--------|--------|-------------------|--------|-------------------|--------|-------------------|
|   |   |                   |   |                   |   |                   |

| (euro        million) |   | Total |   | Related parties |   | Impact % |   | Total |   | Related parties |   | Impact % |   | Total |   | Related parties |   | Impact % |
|-----------------------|--------|-------|--------|-----------------|--------|----------|--------|-------|--------|-----------------|--------|----------|--------|-------|--------|-----------------|--------|----------|
|                  |   |       |   |                 |   |          |   |       |   |                 |   |          |   |       |   |                 |   |          |

| Net sales from operations                              |   | 86,105 |   |   | 3,974  |   |   | 4.62 |   |   | 87,256 |   |   | 4,198  |   |   | 4.81  |   |   | 108,148 |   |   | 5,048 |   |   | 4.67 |   |
|--------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|------|--------|--------|--------|--------|--------|--------|--------|--------|-------|--------|--------|---------|--------|--------|-------|--------|--------|------|--------|
| Other        income and revenues                       |   | 783    |   |   |   |   |   | ..   |   |   | 827    |   |   |   |   |   | ..    |   |   | 720     |   |   | 39    |   |   | 5.42 |   |
| Purchases, services and other                          |   | 57,490 |   |   | 2,720  |   |   | 4.73 |   |   | 58,179 |   |   | 3,777  |   |   | 6.49  |   |   | 76,408  |   |   | 6,298 |   |   | 8.24 |   |
| Financial        income                                |   | 3,749  |   |   | 58     |   |   | 1.55 |   |   | 4,445  |   |   | 49     |   |   | 1.10  |   |   | 7,985   |   |   | 42    |   |   | 0.53 |   |
| Financial expense                                      |   | (3,971 | )      |   | (18    | )      |   | 0.45 |   |   | (4,554 | )      |   | (20    | )      |   | 0.44  |   |   | (8,198  | )      |   | (17   | )      |   | 0.21 |   |
| Gain        (loss) on derivative financial instruments |   | 383    |   |   |   |   |   | ..   |   |   | 26     |   |   | 10     |   |   | 38.46 |   |   | (551    | )      |   | 58    |   |   | ..   |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

Transactions with related parties concerned the ordinarycourse of Eni’s business and were mainly conducted on anarm’s length basis.

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Main cash flows with related parties were as follows:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Revenues and other income                                        |   | 3,974     |   |   | 4,198    |   |   | 5,087      |   |
|------------------------------------------------------------------|--------|-----------|--------|--------|----------|--------|--------|------------|--------|
| Costs and        other expenses                                  |   | (2,720    | )      |   | (3,777   | )      |   | (6,298     | )      |
| Net change in trade and other receivables and        liabilities |   | 162       |   |   | (492     | )      |   | 351        |   |
| Dividends        and net interests                               |   | 790       |   |   | 620      |   |   | 798        |   |
| **Net cash provided from operating activities**                  |   | **2,206** |   |   | **549**  |   |   | **(62**    | **)**  |
| Capital        expenditures in tangible and intangible assets    |   | (733      | )      |   | (779     | )      |   | (2,022     | )      |
| Investments                                                      |   | (20       | )      |   | 8        |   |   |       |   |
| Change in        accounts payable in relation to investments     |   | (276      | )      |   | (8       | )      |   | 27         |   |
| Change in financial receivables                                  |   | 343       |   |   | (43      | )      |   | 397        |   |
| **Net        cash used in investing activities**                 |   | **(686**  | **)**  |   | **(822** | **)**  |   | **(1,598** | **)**  |
| Change in financial liabilities                                  |   | (57       | )      |   | 20       |   |   | 14         |   |
| **Net        cash used in financing activities**                 |   | **(57**   | **)**  |   | **20**   |   |   | **14**     |   |
| **Total financial flows to related parties**                     |   | **1,463** |   |   | **(253** | **)**  |   | **(1,646** | **)**  |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

The impact of cash flows with related parties consisted of thefollowing:

|   |   | **2006** |   | **2007** |   | **2008** |
|--------|--------|----------|--------|----------|--------|----------|
|   |   |          |   |          |   |          |

| (euro        million) |   | Total |   | Related parties |   | Impact % |   | Total |   | Related parties |   | Impact % |   | Total |   | Related parties |   | Impact % |
|-----------------------|--------|-------|--------|-----------------|--------|----------|--------|-------|--------|-----------------|--------|----------|--------|-------|--------|-----------------|--------|----------|
|                  |   |       |   |                 |   |          |   |       |   |                 |   |          |   |       |   |                 |   |          |

| Cash provided from operating activities  |   | 17,001 |   |   | 2,206 |   |   | 12.98 |   |   | 15,517  |   |   | 549  |   |   | 3.54 |   |   | 21,801  |   |   | (62    | )      |   | ..   |   |
|------------------------------------------|--------|--------|--------|--------|-------|--------|--------|-------|--------|--------|---------|--------|--------|------|--------|--------|------|--------|--------|---------|--------|--------|--------|--------|--------|------|--------|
| Cash used        in investing activities |   | (7,051 | )      |   | (686  | )      |   | 9.73  |   |   | (20,097 | )      |   | (822 | )      |   | 4.09 |   |   | (16,958 | )      |   | (1,598 | )      |   | 9.42 |   |
| Cash used in financing activities        |   | (7,097 | )      |   | (57   | )      |   | 0.80  |   |   | 2,909   |   |   | 20   |   |   | 0.69 |   |   | (5,025  | )      |   | 14     |   |   | ..   |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

**38 Significant non-recurring events and operations**Non-recurring incomes (charges) consisted of thefollowing:

| (euro million) |   | **2006** |   | **2007** |   | **2008** |
|----------------|--------|----------|--------|----------|--------|----------|
|           |   |          |   |          |   |          |

| Curtailment of post-retirement benefits for        Italian employees                         |   |     |   |   | 83     |   |   |    |   |
|----------------------------------------------------------------------------------------------|--------|----------|--------|--------|--------|--------|--------|---------|--------|
| Risk        provisions for proceedings against Antitrust authorities                         |   | (184     | )      |   | (130   | )      |   | (21     | )      |
| Risk provisions for proceedings against the        Italian Authority for Electricity and Gas |   | (55      | )      |   | 39     |   |   |    |   |
|                                                                                         |   | **(239** | **)**  |   | **(8** | **)**  |   | **(21** | **)**  |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

Non-recurring income related to a gain deriving from thecurtailment of the provisions accrued by Italian companies foremployee termination indemnities ("TFR") following thechanges introduced by Italian Budget Law for 2007 and relateddecrees (euro 83 million). Non recurring charges for 2007concerned risk provisions related to ongoing antitrustproceedings against the European Antitrust authorities (euro 130million) in the fields of paraffin and elastomers.

In 2006 a risk provision was made in connection with aproceeding against the Italian Antitrust authority regarding thefield of supplies of jet fuel (euro 109 million). In addition arisk provision was made for an inquiry before the EuropeanAntitrust authorities in the field of elastomers (euro 75million). In 2006 certain fines were imposed by the Authority forElectricity and Gas regarding an inquiry relating to the use ofstorage capacity in thermal year 2005-2006 (euro 45 million) andan inquiry relating to an information requirement on natural gassupplying prices (euro 10 million).

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**39 Positions or transactions derivingfrom atypical and/or unusual operations**In 2006, 2007 and in 2008 no transactions deriving fromatypical and/or unusual operations were reported.

**Recent developments**

On April 7, 2009 Gazprom exercised its call option to purchasea 20% interest in OAO Gazprom Neft held by Eni followingagreements between the two partners. The 20% interest in GazpromNeft was acquired by Eni on April 4, 2007 as part of a bidprocedure for the assets of bankrupt Russian company Yukos. Theexercise price of the call option is equal to the bid price (U.S.$ 3.7 billion) as adjusted by subtracting dividends distributedand adding the contractual yearly remuneration of 9.4% on thecapital employed and related financing expenses. At the sametime, Eni and Gazprom signed new cooperation agreements targetingcertain development projects to be conducted jointly in Russiaand other countries of interest. Terms of the call option grantedto Gazprom to purchase a 51% interest in the share capital of OOOSeverEnergia, which owns 100% of the three abovementioned Russiancompanies engaging in gas development, are currently under reviewby Eni, Enel and Gazprom.

On March 19, 2009, a mandatory tender offer on the minoritiesof Distrigas was finalized. Shareholders representing 41.61% ofthe share capital of Distrigas tendered 292,390 shares onEni’s offer. Publigaz Scrl tendered its entire interest(31.25%). The transaction has been accounted in Eni financialstatements as at March 31, 2009. On April 8, 2009 Eni paid tothose shareholders cash consideration amounting to euro 1,991million. Following the tender offer, Eni owns 98.86% of the sharecapital of Distrigas. The squeeze-out on the residual 1.14% ofthe share capital has been completed early in May. ConsequentlyEni holds all the shares of Distrigas except for one sharebelonging to the Belgian State with special powers. Distrigasshares has been delisted from Euronext Brussels. For furtherdetails on this transaction see "Item 4 – Gas &Power".

On February 12, 2009, Eni’s Board of Directors approvedthe divestment of 100% of Italgas SpA and Stoccaggi Gas ItaliaSpA (Stogit) to Snam Rete Gas (50.03% owned by Eni) for totalcash consideration of euro 4,720 million (euro 3,070 million andeuro 1,650 million, respectively). The transaction will befinanced by Snam Rete Gas through: (i) a rights issue up for amaximum of euro 3.5 billion (Eni has already committed tosubscribe its relative share of the rights issue); and (ii) newmedium to long-term financing for euro 1.3 billion. The mainimpacts expected on Eni's consolidated financial statements whenthe transaction closes will be: (i) a decrease of euro 1.5billion in net borrowings and a corresponding increase in totalequity as a consequence of the pro-quota subscription of the SnamRete Gas capital increase by the minority shareholders; and (ii)a decrease in Eni’s net profit equal to 45% of the aggregatenet profit of Italgas and Stogit, with a corresponding increasein net profit attributable to minorities. From an industrialperspective the transaction, expected to close in July 2009, willcreate significant synergies in the regulated businesses segmentand maximize the value of Italgas and Stogit due to the highervisibility of regulated businesses as a part of Snam Rete Gas.For further details on this transaction see "Item 4 –Gas & Power".

By the end of May 2008, based on the approval of the full yeardividend proposal made by the Company’s Annual GeneralShareholders Meeting on April 30, 2009, Eni expects to pay thebalance of the dividend for fiscal year 2008 amounting to euro0.65 per share. Total cash out is estimated at euro 2.36 billion.

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**Supplemental oil and gas information(unaudited)**The following information pursuant to"International Financial Reporting Standards" (IFRS) ispresented in accordance with Statement of Financial AccountingStandards No. 69, "Disclosures about Oil & Gas ProducingActivities". Amounts related to minority interests are notsignificant.*Capitalized costs*Capitalized costs represent the total expenditures for proved andunproved mineral interests and related support equipment andfacilities utilized in oil and gas exploration and productionactivities, together with related accumulated depreciation,depletion and amortization. Capitalized costs by geographicalarea consist of the following:

| (euro        million) |   | **Italy** |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian Area**(1) |   | **Rest of World** |   | **Total consolidated subsidiaries** |   | **Total joint ventures and associates**(2) |
|-----------------------|--------|-----------|--------|------------------|--------|-----------------|--------|---------------|--------|---------------------|--------|-------------------|--------|-------------------------------------|--------|--------------------------------------------|
|                  |   |           |   |                  |   |                 |   |               |   |                     |   |                   |   |                                     |   |                                            |

| **December 31, 2007**                                       |   |       |   |   |       |   |   |       |   |   |      |   |   |      |   |   |       |   |   |        |   |   |      |   |
|-------------------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|--------|-------------|--------|--------|-----------|--------|
| Proved        mineral interests                             |   | 10,571     |   |   | 8,118      |   |   | 8,506      |   |   | 8,672     |   |   | 1,447     |   |   | 7,718      |   |   | **45,032**  |   |   | 790       |   |
| Unproved mineral interests                                  |   | 32         |   |   | 120        |   |   | 1,030      |   |   | 330       |   |   | 35        |   |   | 2,582      |   |   | **4,129**   |   |   | 1,089     |   |
| Support        equipment and facilities                     |   | 279        |   |   | 1,125      |   |   | 443        |   |   | 16        |   |   | 41        |   |   | 59         |   |   | **1,963**   |   |   | 10        |   |
| Incomplete wells and other                                  |   | 726        |   |   | 562        |   |   | 1,078      |   |   | 75        |   |   | 1,852     |   |   | 808        |   |   | **5,101**   |   |   | 112       |   |
| **Gross        capitalized costs**                          |   | **11,608** |   |   | **9,925**  |   |   | **11,057** |   |   | **9,093** |   |   | **3,375** |   |   | **11,167** |   |   | **56,225**  |   |   | **2,001** |   |
| Accumulated depreciation, depletion and        amortization |   | (7,440     | )      |   | (4,960     | )      |   | (5,340     | )      |   | (5,670    | )      |   | (445      | )      |   | (4,909     | )      |   | **(28,764** | **)**  |   | (345      | )      |
| **Net        capitalized costs******(a) (b)                 |   | **4,168**  |   |   | **4,965**  |   |   | **5,717**  |   |   | **3,423** |   |   | **2,930** |   |   | **6,258**  |   |   | **27,461**  |   |   | **1,656** |   |
| **December 31, 2008**                                       |   |       |   |   |       |   |   |       |   |   |      |   |   |      |   |   |       |   |   |        |   |   |      |   |
| Proved mineral interests                                    |   | 10,772     |   |   | 10,116     |   |   | 11,368     |   |   | 7,499     |   |   | 2,130     |   |   | 8,954      |   |   | **50,839**  |   |   | 813       |   |
| Unproved mineral interests                                  |   | 32         |   |   | 638        |   |   | 2,267      |   |   | 316       |   |   | 1,051     |   |   | 2,908      |   |   | **7,212**   |   |   | 928       |   |
| Support equipment and facilities                            |   | 283        |   |   | 1,205      |   |   | 520        |   |   | 16        |   |   | 51        |   |   | 71         |   |   | **2,146**   |   |   | 14        |   |
| Incomplete wells and other                                  |   | 1,374      |   |   | 1,006      |   |   | 1,443      |   |   | 159       |   |   | 2,631     |   |   | 1,797      |   |   | **8,410**   |   |   | 267       |   |
| **Gross capitalized costs**                                 |   | **12,461** |   |   | **12,965** |   |   | **15,598** |   |   | **7,990** |   |   | **5,863** |   |   | **13,730** |   |   | **68,607**  |   |   | **2,022** |   |
| Accumulated depreciation, depletion and        amortization |   | (7,943     | )      |   | (6,318     | )      |   | (7,027     | )      |   | (5,132    | )      |   | (858      | )      |   | (6,932     | )      |   | **(34,210** | **)**  |   | (441      | )      |
| **Net capitalized costs**(a) (b)                            |   | **4,518**  |   |   | **6,647**  |   |   | **8,571**  |   |   | **2,858** |   |   | **5,005** |   |   | **6,798**  |   |   | **34,397**  |   |   | **1,581** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| i   | i | i                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|-----|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | i | The amounts        include net capitalized financial charges totaling euro        441 million in 2007 and euro 537 million in 2008.                                                                                                                                                                                                                                                                                                                                                                                                                        |
| (b) | i | The amounts        do not include costs associated with exploration        activities which are capitalized in order to reflect        their investment nature and amortized in full when        incurred. The application of the "Successful Effort        Method" would have led to an increase in net        capitalized costs of euro 2,547 million in 2007 and euro        3,308 million in 2008 for the consolidated companies and        of euro 94 million in 2007 and euro 48 million in 2008        for joint ventures and associates. |

| (1) | i | Eni's        capitalized costs of the Kashagan field are determined        based on Eni's share of 16.81% as of December 31, 2008        and 18.52% in the previous year.                                                                     |
|-----|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | The amounts        of joint ventures and associates as at December 31, 2007        and December 31, 2008 include 60% of the three Russian        companies former Yukos purchased in 2007, for which        Gazprom has a call option of 51%. |

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##### Table of Contents

*Costs incurred*Costs incurred represent amounts both capitalized and expensed inconnection with oil and gas producing activities. Costs incurredby geographical area consist of the following:

| (euro        million) |   | **Italy** |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian        Area**(1) |   | **Rest of World** |   | **Total consolidated subsidiaries** |   | **Total joint ventures and associates**(2) |
|-----------------------|--------|-----------|--------|------------------|--------|-----------------|--------|---------------|--------|----------------------------|--------|-------------------|--------|-------------------------------------|--------|--------------------------------------------|
|                  |   |           |   |                  |   |                 |   |               |   |                            |   |                   |   |                                     |   |                                            |

| **2006**                                |   |      |   |      |   |      |   |      |   |      |   |      |   |       |   |      |
|-----------------------------------------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|--------|------------|--------|-----------|
| Proved        property acquisitions     |   | 139       |   | 10        |   |      |   |      |   |      |   |      |   | **149**    |   |      |
| Unproved property acquisitions          |   |      |   |      |   |      |   |      |   |      |   | 3         |   | **3**      |   |      |
| Exploration                             |   | 128       |   | 270       |   | 471       |   | 174       |   | 25        |   | 280       |   | **1,348**  |   | 26        |
| Development (a)                         |   | 1,120     |   | 892       |   | 956       |   | 478       |   | 595       |   | 766       |   | **4,807**  |   | 31        |
| **Total        costs incurred**         |   | **1,387** |   | **1,172** |   | **1,427** |   | **652**   |   | **620**   |   | **1,049** |   | **6,307**  |   | **57**    |
| **2007**                                |   |      |   |      |   |      |   |      |   |      |   |      |   |       |   |      |
| Proved        property acquisitions (b) |   |      |   | 11        |   | 451       |   |      |   |      |   | 1,395     |   | **1,857**  |   | 187       |
| Unproved property acquisitions (b)      |   |      |   |      |   | 510       |   |      |   |      |   | 1,417     |   | **1,927**  |   | 1,086     |
| Exploration        (b)                  |   | 104       |   | 380       |   | 298       |   | 193       |   | 36        |   | 1,181     |   | **2,192**  |   | 42        |
| Development (a) (b)                     |   | 320       |   | 1,047     |   | 1,425     |   | 518       |   | 744       |   | 1,185     |   | **5,239**  |   | 156       |
| **Total        costs incurred**         |   | **424**   |   | **1,438** |   | **2,684** |   | **711**   |   | **780**   |   | **5,178** |   | **11,215** |   | **1,471** |
| **2008**                                |   |      |   |      |   |      |   |      |   |      |   |      |   |       |   |      |
| Proved property acquisitions (b)        |   |      |   | 626       |   | 413       |   |      |   | 173       |   | 83        |   | **1,295**  |   |      |
| Unproved property acquisitions (b)      |   |      |   | 384       |   | 655       |   | 33        |   | 647       |   |      |   | **1,719**  |   |      |
| Exploration (b)                         |   | 135       |   | 421       |   | 581       |   | 214       |   | 144       |   | 719       |   | **2,214**  |   | 48        |
| Development (a) (b)                     |   | 644       |   | 1,388     |   | 1,884     |   | 850       |   | 1,208     |   | 1,593     |   | **7,567**  |   | 163       |
| **Total costs incurred**                |   | **779**   |   | **2,819** |   | **3,533** |   | **1,097** |   | **2,172** |   | **2,395** |   | **12,795** |   | **211**   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| i   | i | i                                                                                                                                                                                                                                           |
|-----|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | i | Eni’s        costs incurred of the Kashagan field are determined based        on Eni’s share of 16.81% as of December 31, 2008 and        18.52% in the previous year.                                                            |
| (2) | i | The amounts        of joint ventures and associates for December 31, 2007        and December 31, 2008 include 60% of the three Russian        companies former Yukos purchased in 2007, for which        Gazprom has a call option of 51%. |
| (a) | i | Includes the        abandonment costs of the assets for euro 1,170 million in        2006, euro 173 million in 2007 and euro 628 million in        2008 and euro 16 million for joint ventures and        associates.                       |
| (b) | i | Of which        business combination:                                                                                                                                                                                                       |

| (euro        million) |   | **Italy** |   | **North        Africa** |   | **West        Africa** |   | **North        Sea** |   | **Caspian        Area** |   | **Rest        of World** |   | **Total        consolidated subsidiaries** |   | **Total joint        ventures and associates** |
|-----------------------|--------|-----------|--------|-------------------------|--------|------------------------|--------|----------------------|--------|-------------------------|--------|--------------------------|--------|--------------------------------------------|--------|------------------------------------------------|
|                  |   |           |   |                         |   |                        |   |                      |   |                         |   |                          |   |                                            |   |                                                |

| **2007**                            |   |   |   |    |   |      |   |   |   |      |   |      |   |      |   |      |
|-------------------------------------|--------|--------|--------|---------|--------|-----------|--------|--------|--------|-----------|--------|-----------|--------|-----------|--------|-----------|
| Proved        property acquisitions |   |   |   |    |   | 451       |   |   |   |      |   | 1,395     |   | **1,846** |   | 187       |
| Unproved property acquisitions      |   |   |   |    |   | 510       |   |   |   |      |   | 1,334     |   | **1,844** |   | 1,086     |
| Exploration                         |   |   |   |    |   | 59        |   |   |   |      |   | 474       |   | **533**   |   |      |
| Development                         |   |   |   |    |   | 10        |   |   |   |      |   | 345       |   | **355**   |   | 101       |
| **Total**                           |   |   |   |    |   | **1,030** |   |   |   |      |   | **3,548** |   | **4,578** |   | **1,374** |
| **2008**                            |   |   |   |    |   |      |   |   |   |      |   |      |   |      |   |      |
| Proved property acquisitions        |   |   |   |    |   | 298       |   |   |   | 173       |   | 83        |   | **554**   |   |      |
| Unproved property acquisitions      |   |   |   | 384     |   | 560       |   | 33     |   | 647       |   |      |   | **1,624** |   |      |
| Exploration                         |   |   |   | 23      |   | 115       |   |   |   | 116       |   | 42        |   | **296**   |   |      |
| Development                         |   |   |   | 132     |   | 4         |   | 52     |   | 156       |   | 77        |   | **421**   |   |      |
| **Total**                           |   |   |   | **539** |   | **977**   |   | **85** |   | **1,092** |   | **202**   |   | **2,895** |   |      |

*Results of operations from oil and gas producingactivities*Results of operations from oil and gas producing activities,including gas storage services used to modulate the seasonalvariation of demand, represent only those revenues and expensesdirectly associated with such activities, including operatingoverheads. These amounts do not include any allocation ofinterest expense or general corporate overhead and, therefore,are not necessarily indicative of the contributions toconsolidated net earnings of Eni. Related income taxes arecomputed by applying the local income tax rates to the pre-taxincome from producing activities. Eni is a party to certainProduction Sharing Agreements (PSAs), whereby a portion ofEni’s share of oil and gas production is withheld and soldby its joint venture partners which are state-owned entities,with proceeds being remitted to the state in satisfaction ofEni’s PSA-related tax liabilities. Revenue and income taxesinclude such taxes owed by Eni but paid by state-owned entitiesout of Eni’s share of oil and gas production.

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##### Table of Contents

Results of operations from oil and gas producingactivities by geographical area consist of the following:

| (euro        million) |   | **Italy** |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian        Area**(1) |   | **Rest of World** |   | **Total consolidated subsidiaries** |   | **Total joint ventures and associates**(2) |
|-----------------------|--------|-----------|--------|------------------|--------|-----------------|--------|---------------|--------|----------------------------|--------|-------------------|--------|-------------------------------------|--------|--------------------------------------------|
|                  |   |           |   |                  |   |                 |   |               |   |                            |   |                   |   |                                     |   |                                            |

| **2006**                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |       |   |   |    |   |
|-------------------------------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|--------|---------|--------|
| **Revenues**                                                |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |       |   |   |    |   |
| Sales to consolidated entities                              |   | 3,601     |   |   | 4,185     |   |   | 4,817     |   |   | 3,295     |   |   | 261       |   |   | 712       |   |   | **16,871** |   |   |    |   |
| Sales to        third parties                               |   | 184       |   |   | 3,012     |   |   | 967       |   |   | 983       |   |   | 721       |   |   | 1,873     |   |   | **7,740**  |   |   | 120     |   |
| **Total revenues**                                          |   | **3,785** |   |   | **7,197** |   |   | **5,784** |   |   | **4,278** |   |   | **982**   |   |   | **2,585** |   |   | **24,611** |   |   | **120** |   |
| Operation        costs                                      |   | (249      | )      |   | (496      | )      |   | (475      | )      |   | (481      | )      |   | (147      | )      |   | (191      | )      |   | **(2,039** | **)**  |   | (18     | )      |
| Production taxes                                            |   | (181      | )      |   | (95       | )      |   | (475      | )      |   |      |   |   |      |   |   | (82       | )      |   | **(833**   | **)**  |   | (3      | )      |
| Exploration        expenses                                 |   | (137      | )      |   | (273      | )      |   | (186      | )      |   | (160      | )      |   | (25       | )      |   | (293      | )      |   | **(1,074** | **)**  |   | (26     | )      |
| D.D. & A. and provision for abandonment        (a)      |   | (457      | )      |   | (795      | )      |   | (737      | )      |   | (684      | )      |   | (80       | )      |   | (895      | )      |   | **(3,648** | **)**  |   | (43     | )      |
| Other        income and (expenses)                          |   | (315      | )      |   | (569      | )      |   | (190      | )      |   | 57        |   |   | (89       | )      |   | (283      | )      |   | **(1,389** | **)**  |   | 8       |   |
| **Pretax income from producing activities**                 |   | **2,446** |   |   | **4,969** |   |   | **3,721** |   |   | **3,010** |   |   | **641**   |   |   | **841**   |   |   | **15,628** |   |   | **38**  |   |
| Income        taxes                                         |   | (909      | )      |   | (2,980    | )      |   | (2,133    | )      |   | (1,840    | )      |   | (223      | )      |   | (381      | )      |   | **(8,466** | **)**  |   | (31     | )      |
| **Results of operations from E&P activities**(b)        |   | **1,537** |   |   | **1,989** |   |   | **1,588** |   |   | **1,170** |   |   | **418**   |   |   | **460**   |   |   | **7,162**  |   |   | **7**   |   |
| **2007**                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |       |   |   |    |   |
| **Revenues**                                                |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |       |   |   |    |   |
| Sales to        consolidated entities                       |   | 3,171     |   |   | 3,000     |   |   | 4,439     |   |   | 3,125     |   |   | 296       |   |   | 512       |   |   | **14,543** |   |   |    |   |
| Sales to third parties                                      |   | 163       |   |   | 4,793     |   |   | 693       |   |   | 755       |   |   | 833       |   |   | 2,260     |   |   | **9,497**  |   |   | 176     |   |
| **Total        revenues**                                   |   | **3,334** |   |   | **7,793** |   |   | **5,132** |   |   | **3,880** |   |   | **1,129** |   |   | **2,772** |   |   | **24,040** |   |   | **176** |   |
| Operation costs                                             |   | (248      | )      |   | (542      | )      |   | (499      | )      |   | (579      | )      |   | (142      | )      |   | (271      | )      |   | **(2,281** | **)**  |   | (27     | )      |
| Production        taxes                                     |   | (188      | )      |   | (91       | )      |   | (473      | )      |   |      |   |   |      |   |   | (28       | )      |   | **(780**   | **)**  |   | (6      | )      |
| Exploration expenses                                        |   | (108      | )      |   | (385      | )      |   | (291      | )      |   | (193      | )      |   | (36       | )      |   | (764      | )      |   | **(1,777** | **)**  |   | (42     | )      |
| D.D. &        A. and provision for abandonment (a)      |   | (499      | )      |   | (768      | )      |   | (685      | )      |   | (729      | )      |   | (76       | )      |   | (989      | )      |   | **(3,746** | **)**  |   | (51     | )      |
| Other income and (expenses)                                 |   | (283      | )      |   | (627      | )      |   | (297      | )      |   | (45       | )      |   | (72       | )      |   | (243      | )      |   | **(1,567** | **)**  |   | (18     | )      |
| **Pretax        income from producing activities**          |   | **2,008** |   |   | **5,380** |   |   | **2,887** |   |   | **2,334** |   |   | **803**   |   |   | **477**   |   |   | **13,889** |   |   | **32**  |   |
| Income taxes                                                |   | (746      | )      |   | (3,102    | )      |   | (1,820    | )      |   | (1,419    | )      |   | (284      | )      |   | (241      | )      |   | **(7,612** | **)**  |   | (49     | )      |
| **Results        of operations from E&P activities**(b) |   | **1,262** |   |   | **2,278** |   |   | **1,067** |   |   | **915**   |   |   | **519**   |   |   | **236**   |   |   | **6,277**  |   |   | **(17** | )      |
| **2008**                                                    |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |       |   |   |    |   |
| **Revenues**                                                |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |      |   |   |       |   |   |    |   |
| Sales to consolidated entities                              |   | 3,956     |   |   | 2,622     |   |   | 5,013     |   |   | 3,691     |   |   | 360       |   |   | 629       |   |   | **16,271** |   |   |    |   |
| Sales to third parties                                      |   | 126       |   |   | 7,286     |   |   | 1,471     |   |   | 121       |   |   | 1,288     |   |   | 2,928     |   |   | **13,220** |   |   | 265     |   |
| **Total revenues**                                          |   | **4,082** |   |   | **9,908** |   |   | **6,484** |   |   | **3,812** |   |   | **1,648** |   |   | **3,557** |   |   | **29,491** |   |   | **265** |   |
| Operation costs                                             |   | (260      | )      |   | (528      | )      |   | (609      | )      |   | (515      | )      |   | (173      | )      |   | (326      | )      |   | **(2,411** | **)**  |   | (34     | )      |
| Production taxes                                            |   | (195      | )      |   | (32       | )      |   | (616      | )      |   |      |   |   |      |   |   | (35       | )      |   | **(878**   | **)**  |   | (53     | )      |
| Exploration expenses                                        |   | (135      | )      |   | (425      | )      |   | (529      | )      |   | (215      | )      |   | (57       | )      |   | (697      | )      |   | **(2,058** | **)**  |   | (48     | )      |
| D.D. & A. and provision for abandonment (a)             |   | (551      | )      |   | (1,120    | )      |   | (1,115    | )      |   | (782      | )      |   | (331      | )      |   | (1,490    | )      |   | **(5,389** | **)**  |   | (84     | )      |
| Other income and (expenses)                                 |   | (420      | )      |   | (936      | )      |   | (279      | )      |   | (63       | )      |   | (286      | )      |   | (270      | )      |   | **(2,254** | **)**  |   | (15     | )      |
| **Pretax income from producing activities**                 |   | **2,521** |   |   | **6,867** |   |   | **3,336** |   |   | **2,237** |   |   | **801**   |   |   | **739**   |   |   | **16,501** |   |   | **31**  |   |
| Income taxes                                                |   | (924      | )      |   | (4,170    | )      |   | (2,262    | )      |   | (1,581    | )      |   | (315      | )      |   | (435      | )      |   | **(9,687** | **)**  |   | (49     | )      |
| **Results of operations from E&P activities******(b)    |   | **1,597** |   |   | **2,697** |   |   | **1,074** |   |   | **656**   |   |   | **486**   |   |   | **304**   |   |   | **6,814**  |   |   | **(18** | )      |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| i   | i | i                                                                                                                                                                                                                                                                                                                                                                                           |
|-----|---|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) | i | Includes        asset impairments amounting to euro 130 million in 2006,        euro 91 million in 2007 and euro 770 million in 2008.                                                                                                                                                                                                                                                       |
| (b) | i | The        "Successful Effort Method" application would        have led to an increase in results of operations of euro        220 million in 2006, euro 438 million in 2007 and euro        408 million in 2008 for the consolidated companies and of        euro 15 million in 2006, euro 26 million in 2007 and no        variation in 2008 for joint ventures and associates. |

| (1) | i | Eni's results        of operations of the Kashagan field are determined based        on Eni’s share of 16.81% as of December 31, 2008 and        18.52% in the previous year.                                                                    |
|-----|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | The amounts        of joint ventures and associates for December 31, 2007        and December 31, 2008 include 60% of the three Russian        companies formerly part of Yukos purchased in 2007, for        which Gazprom has a call option of 51%. |

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##### Table of Contents

*Average sale prices and production costs per unit ofproduction*

| (euro        million) | **Italy** |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian Area** |   | **Rest of World** |   | **Total** |
|-----------------------|-----------|--------|------------------|--------|-----------------|--------|---------------|--------|------------------|--------|-------------------|--------|-----------|
|                  |           |   |                  |   |                 |   |               |   |                  |   |                   |   |           |

| **2006**                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|-----------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Average sales        prices             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Oil and condensates per BBL             |   | ($)    |   | 55.22  |   | 60.99  |   | 61.55  |   | 62.18  |   | 53.18  |   | 57.15  |   | 60.09  |
| Natural gas.        per KCF             |   |   |   | 8.23   |   | 4.17   |   | 1.05   |   | 6.89   |   | 0.39   |   | 5.09   |   | 5.29   |
| Average production costs per BOE        |   |   |   | 6.36   |   | 3.87   |   | 9.02   |   | 6.03   |   | 5.02   |   | 4.52   |   | 5.79   |
| **2007**                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average sales prices                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Oil and        condensates per BBL      |   | ($)    |   | 62.47  |   | 67.86  |   | 69.77  |   | 69.40  |   | 59.34  |   | 68.63  |   | 67.70  |
| Natural gas. per KCF                    |   |   |   | 8.58   |   | 4.60   |   | 1.21   |   | 6.53   |   | 0.41   |   | 5.53   |   | 5.42   |
| Average        production costs per BOE |   |   |   | 7.89   |   | 4.22   |   | 11.53  |   | 8.56   |   | 4.90   |   | 5.33   |   | 6.90   |
| **2008**(a)                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average sales prices                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Oil and condensates per BBL             |   | ($)    |   | 84.87  |   | 84.71  |   | 91.58  |   | 71.90  |   | 80.43  |   | 82.06  |   | 84.05  |
| Natural gas. per KCF                    |   |   |   | 13.06  |   | 7.14   |   | 1.50   |   | 10.21  |   | 0.53   |   | 7.56   |   | 8.01   |
| Average production costs per BOE        |   |   |   | 9.40   |   | 3.66   |   | 15.25  |   | 8.99   |   | 5.79   |   | 6.92   |   | 7.77   |
|                                    |   |   |   |        |   |        |   |        |   |        |   |        |   |        |   |        |

|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a)    |   | In 2008        Eni’s liquid realizations amounted to $84.05 per        barrel and were reduced by approximately $4.13 per barrel        due to the settlement of certain commodity derivatives        relating to the sale of 46 mmBBL in the year. This was        part of a derivative transaction the Company entered into        to hedge exposure to variability in future cash flows        expected from the sale of a portion of the Company’s        proved reserves for an original amount of approximately        125.7 mmBBL in the 2008-2011 period, decreasing to 79.7        mmBBL by the end of December 2008. |

*Oil and natural gas reserves*Proved oil and gas reserves are the estimated quantities of crudeoil, natural gas and natural gas liquids which geological andengineering data demonstrate with reasonable certainty to berecoverable in future years from known reservoirs undertechnical, contractual, economic and operating conditionsexisting at the time. Prices include consideration of changes inexisting prices provided only by contractual arrangements, butnot of increases based upon future conditions.

Net proved reserves exclude royalties and interests owned byothers.

Proved developed oil and gas reserves are proved reserves thatcan be estimated to be recovered through existing wells,equipment and operating methods.

Proved undeveloped oil and gas reserves are reserves that areexpected to be recovered from new wells on undrilled acreage, orfrom existing wells where a relatively major expenditure isrequired for completion.

Additional oil and gas reserves expected to be obtainedthrough the application of fluid injection or other improvedrecovery techniques for supplementing natural forces andmechanisms of primary recovery are included as proved developedreserves only after testing by a pilot project or after theoperation of an installed program has confirmed, throughproduction response, that increased recovery will be achieved.

Eni’s proved reserves have been estimated on the basis ofthe applicable U.S. Securities & Exchange Commissionregulation, Rule 4-10 of Regulation S-X and its interpretationsand have been disclosed in accordance with Statement of FinancialAccounting Standard No. 69. The estimates of proved reserves,developed and undeveloped, for the years ended December 31, 2006,2007 and 2008 are based on data prepared by Eni. Since 1991 Enihas requested qualified independent oil engineering companies tocarry out an independent evaluation16 of its provedreserves on a rotation basis. Eni believes these independentevaluators to be experienced and qualified in the marketplace. Inthe preparation of their reports, these independent evaluatorsrelied, without independent verification, upon informationfurnished by Eni with respect to property interest, production,current cost of operation and development, agreements relating tofuture operations and sale prices and other information and datathat were accepted as represented by the independent evaluators.This information was the same used by Eni in determining provedreserves and include: log, directional surveys, core and PVTanalysis, maps, oil/gas/water production/injection data of wells,reservoirs and fields, reservoir studies, technical analysisrelevant to field performance, reservoir performance, budget dataper field, long-term development plans, future capital andoperating costs. In order to calculate the economic value ofreserve NPV, actual prices received from hydrocarbon sales,instructions on future prices, and other pertinent informationare provided. Accordingly, the work performed 

 

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| (16) |   | From 1991 to        2002 by DeGolyer and MacNaughton, from 2003 also by Ryder        Scott Company. |
|------|--------|-----------------------------------------------------------------------------------------------------|

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by the independent evaluators is an evaluation of Eni’sproved reserves carried out in parallel with the internal one.The circumstance that the independent evaluations achieved thesame results as those of the Company for the vast majority offields support the management’s confidence that thecompany’s booked reserves meet the regulatory definition ofproved reserves which are reasonably certain to be produced inthe future. When the assessment of independent engineers is lowerthan internal evaluations, Eni revises its estimates based oninformation provided by independent evaluators. In particular, in2008, a total of 1.5 BBOE of proved reserves, or about 22% ofEni’s total proved reserves at December 31, 2008, have beenevaluated. The results of this independent evaluation haveessentially confirmed, as in previous years, the internalassessment. In the 2006-2008 three-year period, 77% of Eni’stotal proved reserves were subject to independent evaluations. Inthe last three years, the most important of Eni’s propertiesas at December 31, 2008 which were not subject to an independentevaluation were: Bouri and Bu Attifel (Libya), Barbara (Italy),M’Boundi (Congo) and Elgin-Franklin (UK).

Eni operates under Production Sharing Agreements (PSAs) inseveral of the foreign jurisdictions where it has oil and gasexploration and production activities. Reserves of oil andnatural gas to which Eni is entitled under PSA arrangements areshown in accordance with Eni’s economic interest in thevolumes of oil and natural gas estimated to be recoverable infuture years. Such reserves include estimated quantitiesallocated to Eni for recovery of costs, income taxes owed by Enibut settled by its joint venture partners (which are state-ownedentities) out of Eni’s share of production and Eni’snet equity share after cost recovery.

Proved oil and gas reserves associated with PSAs represented53%, 46% and 54% of total proved reserves as of year-end 2006,2007 and 2008, respectively, on an oil-equivalent basis.

Proved reserves associated with service and"Buy-Back" represented 2%, 1% and 2% of total provedreserves on an oil-equivalent basis as of year-end 2006, 2007 and2008, respectively.

Oil and gas reserve quantities include: (i) oil and naturalgas quantities in excess of cost recovery which the company hasan obligation to purchase under certain PSAs with governments orauthorities, whereby the company serves as producer of reserves.Reserve volumes associated with oil and gas deriving from suchobligations represent 1.1%, 1.8% and 0.1% of total provedreserves as of year-end 2006, 2007 and 2008, respectively, on anoil-equivalent basis; (ii) volumes of natural gas used for ownconsumption; and (iii) volumes of natural gas held in certain ofEni’s storage fields in Italy. Proved reserves attributableto these fields include: (a) the residual natural gas volumes ofthe reservoirs and (b) natural gas volumes from other Eni fieldsinput into these reservoirs in subsequent periods. Provedreserves do not include volumes owned by or acquired by thirdparties. Gas withdrawn from storage is produced and therebyremoved from proved reserves when sold.

Numerous uncertainties are inherent in estimating quantitiesof proved reserves and in projecting future rates of productionand timing of development expenditures. The accuracy of anyreserve estimate is a function of the quality of available dataand engineering and geological interpretation and judgment.Results of drilling, testing and production after the date of theestimate may require substantial upward or downward revision. Inaddition, changes in oil and natural gas prices have an effect onthe quantities of Eni’s proved reserves since estimates ofreserves are based on prices and costs relevant at the date whensuch estimates are made. Consequently, reserves evaluation couldalso diverge significantly from oil and natural gas volumes whichwill be actually produced.

The following table presents yearly changes in estimatedproved reserves, developed and undeveloped, of crude oil(including condensate and natural gas liquids) and natural gasfor the years 2006, 2007 and 2008.

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*Crude oil (including condensate and natural gas liquids)*

| **Proved oil reserves** |   | **Italy** |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian        Area**(1) |   | **Rest of World** |   | **Total consolidated subsidiaries** |   | **Total joint ventures and associates**(2) |
|-------------------------|--------|-----------|--------|------------------|--------|-----------------|--------|---------------|--------|----------------------------|--------|-------------------|--------|-------------------------------------|--------|--------------------------------------------|

| (mmBBL) |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|---------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| **Reserves at December 31, 2005**          |   | **228** |   |   | **961** |   |   | **936** |   |   | **433** |   |   | **778** |   |   | **412** |   |   | **3,748** |   |   | **25**  |   |
|--------------------------------------------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|---------|--------|--------|-----------|--------|--------|---------|--------|
| Revisions        of Previous Estimates (a) |   | 15      |   |   | 61      |   |   | (85     | )      |   | 20      |   |   | 72      |   |   | (19     | )      |   | **64**    |   |   | 1       |   |
| Improved Recovery                          |   |    |   |   | 49      |   |   | 41      |   |   |    |   |   | 14      |   |   |    |   |   | **104**   |   |   | 1       |   |
| Extensions        and Discoveries          |   |    |   |   | 30      |   |   | 11      |   |   |    |   |   | 52      |   |   | 10      |   |   | **103**   |   |   |    |   |
| Production                                 |   | (28     | )      |   | (119    | )      |   | (117    | )      |   | (65     | )      |   | (23     | )      |   | (38     | )      |   | **(390**  | **)**  |   | (3      | )      |
| Sales of        Minerals in Place (b)      |   |    |   |   |    |   |   |    |   |   | (2      | )      |   |    |   |   | (170    | )      |   | **(172**  | **)**  |   |    |   |
| **Reserves at December 31, 2006**          |   | **215** |   |   | **982** |   |   | **786** |   |   | **386** |   |   | **893** |   |   | **195** |   |   | **3,457** |   |   | **24**  |   |
| Purchase        of Minerals in Place       |   |    |   |   |    |   |   | 32      |   |   |    |   |   |    |   |   | 54      |   |   | **86**    |   |   | 101     |   |
| Revisions of Previous Estimates            |   | 28      |   |   | (35     |   |   | (26     | )      |   | 14      |   |   | (114    | )      |   | (31     | )      |   | **(164**  | **)**  |   | 20      |   |
| Improved        Recovery                   |   |    |   |   | 9       |   |   | 12      |   |   | 1       |   |   |    |   |   |    |   |   | **22**    |   |   | 1       |   |
| Extensions and Discoveries                 |   |    |   |   | 43      |   |   | 22      |   |   | 1       |   |   |    |   |   | 29      |   |   | **95**    |   |   | 1       |   |
| Production                                 |   | (28     | )      |   | (121    | )      |   | (101    | )      |   | (57     | )      |   | (26     | )      |   | (36     | )      |   | **(369**  | **)**  |   | (5      | )      |
| **Reserves at December 31, 2007**          |   | **215** |   |   | **878** |   |   | **725** |   |   | **345** |   |   | **753** |   |   | **211** |   |   | **3,127** |   |   | **142** |   |
| Purchase of Minerals in Place              |   |    |   |   |    |   |   | 32      |   |   |    |   |   | 32      |   |   | 4       |   |   | **68**    |   |   |    |   |
| Revisions of Previous Estimates            |   | (8      | )      |   | 56      |   |   | 80      |   |   | (31     | )      |   | 238     |   |   | 56      |   |   | **391**   |   |   | 4       |   |
| Improved Recovery                          |   |    |   |   | 7       |   |   | 25      |   |   |    |   |   |    |   |   |    |   |   | **32**    |   |   | 1       |   |
| Extensions and Discoveries                 |   | 4       |   |   | 4       |   |   | 26      |   |   | 13      |   |   | 2       |   |   | 3       |   |   | **52**    |   |   |    |   |
| Production                                 |   | (25     | )      |   | (122    | )      |   | (105    | )      |   | (51     | )      |   | (30     | )      |   | (38     | )      |   | **(371**  | **)**  |   | (5      | )      |
| Sales of Minerals in Place                 |   |    |   |   |    |   |   |    |   |   |    |   |   | (56     | )      |   |    |   |   | **(56**   | **)**  |   |    |   |
| **Reserves at December 31, 2008**          |   | **186** |   |   | **823** |   |   | **783** |   |   | **276** |   |   | **939** |   |   | **236** |   |   | **3,243** |   |   | **142** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

 

| **Proved developed oil        reserves** |   | **Italy** |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian        Area**(1) |   | **Rest of World** |   | **Total consolidated subsidiaries** |   | **Total joint ventures and associates**(2) |
|------------------------------------------|--------|-----------|--------|------------------|--------|-----------------|--------|---------------|--------|----------------------------|--------|-------------------|--------|-------------------------------------|--------|--------------------------------------------|

| (mmBBL) |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|---------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| Reserves at December 31, 2005        |   | 149 |   | 697 |   | 568 |   | 353 |   | 266 |   | 298 |   | **2,331** |   | 19 |
|--------------------------------------|--------|-----|--------|-----|--------|-----|--------|-----|--------|-----|--------|-----|--------|-----------|--------|----|
| Reserves        at December 31, 2006 |   | 136 |   | 713 |   | 546 |   | 329 |   | 262 |   | 140 |   | **2,126** |   | 18 |
| Reserves at December 31, 2007        |   | 133 |   | 649 |   | 511 |   | 299 |   | 219 |   | 142 |   | **1,953** |   | 26 |
| Reserves        at December 31, 2008 |   | 111 |   | 613 |   | 576 |   | 222 |   | 321 |   | 166 |   | **2,009** |   | 33 |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| i   | i |                                                                                                       |
|-----|---|------------------------------------------------------------------------------------------------------------|
| (a) | i | Includes the        redetermination of Eni’s share in the Val        d’Agri concession in Italy. |
| (b) | i | Includes 170        mmBBL related to unilateral termination of OSA for        Dación field by PDVSA.  |

| (1) | i | Eni’s        proved reserves of the Kashagan field are determined        based on Eni's share of 16.81% as of December 31, 2008        and 18.52% in previous years.                                                                            |
|-----|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | i | Reserves of        joint ventures and associates as at December 31, 2007 and        December 31, 2008 include 60% of the three Russian        companies formerly part of Yukos purchased in 2007, for        which Gazprom has a call option of 51%. |

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*Natural gas*

| **Proved natural gas        reserves** |   | **Italy**        (a) |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian        Area**(1) |   | **Rest of World** |   | **Total consolidated subsidiaries** |   | **Total joint ventures and associates**(2) |
|----------------------------------------|--------|----------------------|--------|------------------|--------|-----------------|--------|---------------|--------|----------------------------|--------|-------------------|--------|-------------------------------------|--------|--------------------------------------------|

| (BCF) |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|-------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| **Reserves at December 31, 2005**    |   | **3,676** |   |   | **6,117** |   |   | **1,965** |   |   | **1,864** |   |   | **1,774** |   |   | **2,105** |   |   | **17,501** |   |   | **90**    |   |
|--------------------------------------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|--------|-----------|--------|
| Purchase        of Minerals in Place |   |      |   |   |      |   |   |      |   |   | 4         |   |   |      |   |   |      |   |   | **4**      |   |   |      |   |
| Revisions of Previous Estimates      |   | 36        |   |   | 154       |   |   | 31        |   |   | 53        |   |   | 183       |   |   | 47        |   |   | **504**    |   |   | (7        | )      |
| Extensions        and Discoveries    |   | 19        |   |   | 146       |   |   | 34        |   |   | 1         |   |   |      |   |   | 132       |   |   | **332**    |   |   | 8         |   |
| Production                           |   | (340      | )      |   | (471      | )      |   | (103      | )      |   | (218      | )      |   | (83       | )      |   | (222      | )      |   | **(1,437** | **)**  |   | (15       | )      |
| Sales of        Minerals in Place    |   |      |   |   |      |   |   |      |   |   | (7        | )      |   |      |   |   |      |   |   | **(7**     | **)**  |   |      |   |
| **Reserves at December 31, 2006**    |   | **3,391** |   |   | **5,946** |   |   | **1,927** |   |   | **1,697** |   |   | **1,874** |   |   | **2,062** |   |   | **16,897** |   |   | **68**    |   |
| Purchase        of Minerals in Place |   |      |   |   |      |   |   | 5         |   |   |      |   |   |      |   |   | 395       |   |   | **400**    |   |   | 2,963     |   |
| Revisions of Previous Estimates      |   | (53       | )      |   | 250       |   |   | 74        |   |   | 67        |   |   | (222      | )      |   | 6         |   |   | **122**    |   |   | 5         |   |
| Improved        Recovery             |   |      |   |   |      |   |   |      |   |   | 3         |   |   |      |   |   |      |   |   | **3**      |   |   |      |   |
| Extensions and Discoveries           |   | 4         |   |   | 89        |   |   | 213       |   |   | 7         |   |   | 205       |   |   | 89        |   |   | **607**    |   |   |      |   |
| Production                           |   | (285      | )      |   | (534      | )      |   | (97       | )      |   | (216      | )      |   | (87       | )      |   | (261      | )      |   | **(1,480** | **)**  |   | (14       | )      |
| **Reserves at December 31, 2007**    |   | **3,057** |   |   | **5,751** |   |   | **2,122** |   |   | **1,558** |   |   | **1,770** |   |   | **2,291** |   |   | **16,549** |   |   | **3,022** |   |
| Purchase of Minerals in Place        |   |      |   |   |      |   |   | 6         |   |   | 8         |   |   |      |   |   | 114       |   |   | **128**    |   |   |      |   |
| Revisions of Previous Estimates      |   | 56        |   |   | 1,163     |   |   | 45        |   |   | (51       | )      |   | 773       |   |   | 55        |   |   | **2,041**  |   |   | 6         |   |
| Improved Recovery                    |   |      |   |   |      |   |   | 4         |   |   |      |   |   |      |   |   |      |   |   | **4**      |   |   |      |   |
| Extensions and Discoveries           |   | 5         |   |   | 38        |   |   | 2         |   |   | 25        |   |   |      |   |   | 42        |   |   | **112**    |   |   |      |   |
| Production                           |   | (274      | )      |   | (641      | )      |   | (95       | )      |   | (204      | )      |   | (90       | )      |   | (300      | )      |   | **(1,604** | **)**  |   | (13       | )      |
| Sales of Minerals in Place           |   |      |   |   |      |   |   |      |   |   |      |   |   | (16       | )      |   |      |   |   | **(16**    | **)**  |   |      |   |
| **Reserves at December 31, 2008**    |   | **2,844** |   |   | **6,311** |   |   | **2,084** |   |   | **1,336** |   |   | **2,437** |   |   | **2,202** |   |   | **17,214** |   |   | **3,015** |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

 

| **Proved developed        natural gas reserves** |   | **Italy**(a) |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian        Area**(1) |   | **Rest of World** |   | **Total consolidated subsidiaries** |   | **Total joint ventures and associates**(2) |
|--------------------------------------------------|--------|--------------|--------|------------------|--------|-----------------|--------|---------------|--------|----------------------------|--------|-------------------|--------|-------------------------------------|--------|--------------------------------------------|

| (BCF) |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|-------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| Reserves at December 31, 2005        |   | 2,704 |   | 3,060 |   | 1,289 |   | 1,484 |   | 1,618 |   | 1,004 |   | **11,159** |   | 70  |
|--------------------------------------|--------|-------|--------|-------|--------|-------|--------|-------|--------|-------|--------|-------|--------|------------|--------|-----|
| Reserves        at December 31, 2006 |   | 2,449 |   | 3,042 |   | 1,447 |   | 1,395 |   | 1,511 |   | 1,105 |   | **10,949** |   | 48  |
| Reserves at December 31, 2007        |   | 2,304 |   | 3,065 |   | 1,469 |   | 1,293 |   | 1,580 |   | 1,256 |   | **10,967** |   | 428 |
| Reserves        at December 31, 2008 |   | 2,031 |   | 3,537 |   | 1,443 |   | 1,065 |   | 2,006 |   | 1,056 |   | **11,138** |   | 420 |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                                                                                                                            |
|--------------|--------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a)          |    | Including        approximately 760, 754, 749 and 746 BCF of natural gas        held in storage at December 31, 2005, 2006, 2007 and        2008, respectively.                                                                                       |
| (1)          |    | Eni’s        proved reserves of the Kashagan field are determined        based on Eni's share of 16.81% as of December 31, 2008        and 18.52% in previous years.                                                                            |
| (2)          |    | Reserves of        joint ventures and associates as at December 31, 2007 and        December 31, 2008 include 60% of the three Russian        companies formerly part of Yukos purchased in 2007, for        which Gazprom has a call option of 51%. |

*Standardized measure of discounted future net cash flows*Estimated future cash inflows represent the revenues that wouldbe received from production and are determined by applyingyear-end prices of oil and gas to the estimated future productionof proved reserves. Future price changes are considered only tothe extent provided by contractual arrangements. Estimated futuredevelopment and production costs are determined by estimating theexpenditures to be incurred in developing and producing theproved reserves at the end of the year. Neither the effects ofprice and cost escalations nor expected future changes intechnology and operating practices have been considered.

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

Future cash flows as of December 31, 2006, 2007 and 2008include amounts that Eni’s Gas & Power segment and othergas companies pay for storage services, required to supportmarket demand flexibility needs.

Future production costs include the estimated expendituresrelated to the production of proved reserves plus any productiontaxes without consideration of future inflation. Futuredevelopment costs include the estimated costs of drillingdevelopment wells and installation of production facilities, plusthe net costs associated with dismantlement and abandonment ofwells and facilities, under the assumption that year-end costscontinue without considering future inflation. Future incometaxes were calculated in accordance with the tax laws of thecountries in which Eni operates.

The standardized measure of discounted future net cash flows,related to the preceding proved oil and gas reserves, iscalculated in accordance with the requirements of Statement ofFinancial Accounting Standard No. 69. The standardized measuredoes not purport to reflect realizable values or fair marketvalue of Eni’s proved reserves. An estimate of fair valuewould also take into account, among other things, hydrocarbonresources other than proved 

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reserves, anticipated changes in future prices and costs and adiscount factor representative of the risks inherent in the oiland gas exploration and production activity.

The standardized measure of discounted future net cash flowsby geographical area consists of the following:

| (euro        million) |   | **Italy** |   | **North Africa** |   | **West Africa** |   | **North Sea** |   | **Caspian        Area**(1) |   | **Rest of World** |   | **Total consolidated subsidiaries** |   | **Total joint ventures and associates**(2) |
|-----------------------|--------|-----------|--------|------------------|--------|-----------------|--------|---------------|--------|----------------------------|--------|-------------------|--------|-------------------------------------|--------|--------------------------------------------|

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

| **At December 31, 2006**                                            |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |        |   |   |      |   |
|---------------------------------------------------------------------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|------------|--------|--------|-------------|--------|--------|-----------|--------|
| Future        cash inflows                                          |   | 43,495     |   |   | 64,381     |   |   | 34,935     |   |   | 24,821     |   |   | 33,825     |   |   | 14,766     |   |   | **216,223** |   |   | 1,038     |   |
| Future production costs                                             |   | (6,086     | )      |   | (9,707     | )      |   | (8,028     | )      |   | (6,426     | )      |   | (4,162     | )      |   | (1,753     | )      |   | **(36,162** | **)**  |   | (224      | )      |
| Future        development and abandonment costs                     |   | (6,739     | )      |   | (5,383     | )      |   | (2,865     | )      |   | (2,265     | )      |   | (3,103     | )      |   | (1,473     | )      |   | **(21,828** | **)**  |   | (79       | )      |
| **Future cash inflow before income tax**                            |   | **30,670** |   |   | **49,291** |   |   | **24,042** |   |   | **16,130** |   |   | **26,560** |   |   | **11,540** |   |   | **158,233** |   |   | **735**   |   |
| Future        income tax                                            |   | (10,838    | )      |   | (24,639    | )      |   | (14,141    | )      |   | (10,901    | )      |   | (7,649     | )      |   | (3,824     | )      |   | **(71,992** | **)**  |   | (227      | )      |
| **Future net cash flows**                                           |   | **19,832** |   |   | **24,652** |   |   | **9,901**  |   |   | **5,229**  |   |   | **18,911** |   |   | **7,716**  |   |   | **86,241**  |   |   | **508**   |   |
| 10%        discount factor                                          |   | (11,493    | )      |   | (10,631    | )      |   | (2,994     | )      |   | (1,392     | )      |   | (13,878    | )      |   | (2,626     | )      |   | **(43,014** | **)**  |   | (154      | )      |
| **Standardized measure of discounted future net        cash flows** |   | **8,339**  |   |   | **14,021** |   |   | **6,907**  |   |   | **3,837**  |   |   | **5,033**  |   |   | **5,090**  |   |   | **43,227**  |   |   | **354**   |   |
| **At        December 31, 2007**                                     |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |        |   |   |      |   |
| Future cash inflows                                                 |   | 47,243     |   |   | 73,456     |   |   | 48,283     |   |   | 29,610     |   |   | 42,710     |   |   | 20,359     |   |   | **261,661** |   |   | 7,135     |   |
| Future        production costs                                      |   | (5,926     | )      |   | (11,754    | )      |   | (9,875     | )      |   | (6,670     | )      |   | (4,997     | )      |   | (2,782     | )      |   | **(42,004** | **)**  |   | (1,249    | )      |
| Future development and abandonment costs                            |   | (7,218     | )      |   | (4,643     | )      |   | (3,013     | )      |   | (2,461     | )      |   | (3,374     | )      |   | (2,459     | )      |   | **(23,168** | **)**  |   | (1,721    | )      |
| **Future        cash inflow before income tax**                     |   | **34,099** |   |   | **57,059** |   |   | **35,395** |   |   | **20,479** |   |   | **34,339** |   |   | **15,118** |   |   | **196,489** |   |   | **4,165** |   |
| Future income tax                                                   |   | (10,778    | )      |   | (29,083    | )      |   | (23,083    | )      |   | (14,375    | )      |   | (9,977     | )      |   | (5,397     | )      |   | **(92,693** | **)**  |   | (2,009    | )      |
| **Future        net cash flows**                                    |   | **23,321** |   |   | **27,976** |   |   | **12,312** |   |   | **6,104**  |   |   | **24,362** |   |   | **9,721**  |   |   | **103,796** |   |   | **2,156** |   |
| 10% discount factor                                                 |   | (13,262    | )      |   | (11,143    | )      |   | (3,953     | )      |   | (1,600     | )      |   | (17,480    | )      |   | (3,356     | )      |   | **(50,794** | **)**  |   | (1,265    | )      |
| **Standardized        measure of discounted future net cash flows** |   | **10,059** |   |   | **16,833** |   |   | **8,359**  |   |   | **4,504**  |   |   | **6,882**  |   |   | **6,365**  |   |   | **53,002**  |   |   | **891**   |   |
| **At December 31, 2008**                                            |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |       |   |   |        |   |   |      |   |
| Future cash inflows                                                 |   | 46,458     |   |   | 62,785     |   |   | 22,344     |   |   | 16,056     |   |   | 22,199     |   |   | 13,622     |   |   | **183,464** |   |   | 4,782     |   |
| Future production costs                                             |   | (5,019     | )      |   | (10,673    | )      |   | (6,715     | )      |   | (3,414     | )      |   | (6,380     | )      |   | (2,715     | )      |   | **(34,916** | **)**  |   | (1,104    | )      |
| Future development and abandonment costs                            |   | (6,805     | )      |   | (6,153     | )      |   | (3,868     | )      |   | (2,166     | )      |   | (5,114     | )      |   | (1,897     | )      |   | **(26,003** | **)**  |   | (1,845    | )      |
| **Future cash inflow before income tax**                            |   | **34,634** |   |   | **45,959** |   |   | **11,761** |   |   | **10,476** |   |   | **10,705** |   |   | **9,010**  |   |   | **122,545** |   |   | **1,833** |   |
| Future income tax                                                   |   | (11,329    | )      |   | (27,800    | )      |   | (5,599     | )      |   | (7,621     | )      |   | (2,781     | )      |   | (1,901     | )      |   | **(57,031** | **)**  |   | (1,032    | )      |
| **Future net cash flows**                                           |   | **23,305** |   |   | **18,159** |   |   | **6,162**  |   |   | **2,855**  |   |   | **7,924**  |   |   | **7,109**  |   |   | **65,514**  |   |   | **801**   |   |
| 10% discount factor                                                 |   | (13,884    | )      |   | (8,639     | )      |   | (2,155     | )      |   | (869       | )      |   | (6,272     | )      |   | (2,243     | )      |   | **(34,062** | **)**  |   | (763      | )      |
| **Standardized measure of discounted future net        cash flows** |   | **9,421**  |   |   | **9,520**  |   |   | **4,007**  |   |   | **1,986**  |   |   | **1,652**  |   |   | **4,866**  |   |   | **31,452**  |   |   | **38**    |   |

|   |   |  |   |  |   |  |   |  |   |  |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|--------|--|

|    |    |                                                                                                                                                                                                                                               |
|--------------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)          |    | Eni's        standardized measure of discounted future of net cash        flows of the Kashagan field is determined based on        Eni’s share of 16.81% as of December 31, 2008 and        18.52% in previous years.                             |
| (2)          |    | The amounts        of joint ventures and associates as at December 31, 2007        and December 31, 2008 include 60% of the three Russian        companies formerly part of Yukos purchased in 2007, for        which Gazprom has a call option of 51%. |

F-107

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##### Table of Contents

*Changes in standardized measure of discounted future netcash flows*

Changes in standardized measure of discounted future net cashflows for the years 2006, 2007 and 2008.

| (euro        million) |   | **2006** |   | **2007** |   | **2008** |
|-----------------------|--------|----------|--------|----------|--------|----------|
|                  |   |          |   |          |   |          |

|                                                                                                   |   |        |   |   |       |   |   |        |   |
|--------------------------------------------------------------------------------------------------------|--------|-------------|--------|--------|------------|--------|--------|-------------|--------|
| ****Beginning of year****                                                                              |   | **55,722**  |   |   | **43,581** |   |   | **53,893**  |   |
| Beginning        of year related to joint venture and associates                                       |   | (371        | )      |   | (354       | )      |   | (891        | )      |
| ****Beginning of year consolidated****                                                                 |   | **55,351**  |   |   | **43,227** |   |   | **53,002**  |   |
| Increase        (decrease):                                                                            |   |        |   |   |       |   |   |        |   |
| - sales, net of production costs                                                                       |   | (21,739     | )      |   | (20,979    | )      |   | (26,202     | )      |
| - net        changes in sales and transfer prices, net of production        costs                      |   | 4,097       |   |   | 34,999     |   |   | (39,699     | )      |
| - extensions, discoveries and improved recovery,        net of future production and development costs |   | 3,629       |   |   | 3,982      |   |   | 1,110       |   |
| - changes        in estimated future development and abandonment costs                                 |   | (6,964      | )      |   | (4,000     | )      |   | (6,222      | )      |
| - development costs incurred during the period        that reduced future development costs            |   | 3,558       |   |   | 4,682      |   |   | 6,584       |   |
| -        revisions of quantity estimates                                                               |   | 383         |   |   | (2,995     | )      |   | 5,835       |   |
| - accretion of discount                                                                                |   | 9,489       |   |   | 7,968      |   |   | 10,538      |   |
| - net        change in income taxes                                                                    |   | 3,060       |   |   | (17,916    | )      |   | 21,359      |   |
| - purchase of reserves in-place                                                                        |   | 10          |   |   | 3,521      |   |   | 476         |   |
| - sale of        reserves in-place                                                                     |   | (1,252      | )      |   |       |   |   | 25          |   |
| - changes in production rates (timing) and other                                                       |   | (6,395      | )      |   | 513        |   |   | 4,646       |   |
| ****Net        increase (decrease)****                                                                 |   | **(12,124** | **)**  |   | **9,775**  |   |   | **(21,550** | **)**  |
| ****Standardized measure of discounted        future net cash flows consolidates****                   |   | **43,227**  |   |   | **53,002** |   |   | **31,452**  |   |
| Standardized        measure of discounted future net cash flows joint        ventures and associates   |   | 354         |   |   | 891        |   |   | 38          |   |
| ****Standardized measure of discounted        future net cash flows****                                |   | **43,581**  |   |   | **53,893** |   |   | **31,490**  |   |

|   |   |  |   |  |   |  |
|--------|--------|--|--------|--|--------|--|

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##### Table of Contents

**EXHIBIT 1**

**Eni SpA By-laws**

> 
***Part I - Establishment - Name -    Registered Office and Duration of the Company***

**ARTICLE 1**

| 1.1 |   | "Eni        SpA" resulting from the transformation of Ente        Nazionale Idrocarburi, a public law agency, established        by Law 136 of February 10, 1953, is regulated by these        by-laws. |
|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**ARTICLE 2**

| 2.1 |   | The        registered head office of the company is located in Rome,        Italy and the company’s two branches in San Donato        Milanese (MI).   |
|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.2 |   | Main        representative offices, affiliates and branches may be        established and/or wound up in Italy or abroad in        compliance with the law. |

**ARTICLE 3**

| 3.1 |   | The company        is expected to exist until December 31, 2100. Its        duration may be extended one or more times by resolution        of the shareholders’ meeting. |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

> 
***Part II - Company Objects***

**ARTICLE 4**

| 4.1 |   | The company        objects are the direct and/or indirect management, by way        of shareholdings in companies, agencies or businesses, of        activities in the field of hydrocarbons and natural        vapours, such as exploration and development of        hydrocarbon fields, construction and operation of        pipelines for transporting the same, processing,        transformation, storage, utilisation and trade of        hydrocarbons and natural vapours, all in respect of        concessions provided by law.        The company also has the object of direct and/or indirect        management, by way of shareholdings in companies,        agencies or businesses, of activities in the fields of        chemicals, nuclear fuels, geothermy and renewable energy        sources, in the sector of engineering and construction of        industrial plants, in the mining sector, in the        metallurgy sector, in the textile machinery sector, in        the water sector, including derivation, drinking water,        purification, distribution and reuse of waters; in the        sector of environmental protection and treatment and        disposal of waste, as well as in every other business        activity that is instrumental, supplemental or        complementary with the aforementioned activities.        The company also has the object of managing the technical        and financial co-ordination of subsidiaries and        affiliated companies as well as providing financial        assistance on their behalf.        The company may perform any operations necessary or        useful for the achievement of the company objects; by way        of example, it may initiate operations involving real        estate, moveable goods, trade and commerce, industry,        finance and banking asset and liability operations, as        well as any action that is in any way connected with the        company objects with the exception of public fund raising        and the performance of investment services as regulated        by Legislative Decree No. 58 of February 24, 1998.        The company may take shareholdings and interests in other        companies or businesses with objects similar, comparable        or complementary to its own or those of companies in        which it has holdings, either in Italy or abroad, and it        may provide real and or personal bonds for its own and        others’ obligations, especially guarantees. |
|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

> 
***Part III - Capital -    Shareholdings - Bonds***

**ARTICLE 5**

| 5.1 |   | The company        capital is euro 4,005,358,876.00 (four billion five        million three hundred and fifty-eight thousand eight        hundred and seventy-six) represented by 4,005,358,876        (four billion five million three hundred and fifty-eight        thousand eight hundred and seventy-six) shares of        ordinary stock with a nominal value of euro 1 (one) each. |
|-----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 5.2 |   | Shares may        not be split up and each share is entitled to one vote.                                                                                                                                                                                                                                                                                                                 |
| 5.3 |   | The fact of        being a Shareholder in itself constitutes approval of        these by-laws.                                                                                                                                                                                                                                                                                            |

**ARTICLE 6**

| 6.1 |   | Pursuant to        Article 3 of Law Decree 332 of May 31, 1994, converted        with amendments into Law 474 of July 30, 1994, no one, in        any capacity, may own company shares that entail a        holding of more than 3 per cent of voting share capital.        Such maximum shareholding limit is calculated by taking        into account the aggregate shareholding held by the        controlling entity, either a physical or legal person or        company; its directly or indirectly controlled entities,        as well as entities controlled by the same controlling        entity; affiliated entities as well as people related to        the second degree by blood or marriage, also in the case        of a legally separated spouse. |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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##### Table of Contents

|   |   | Control        exists, with reference also to entities other than        companies, in the cases envisaged by Article 2359,        paragraphs 1 and 2 of the Civil Code.        Affiliation exists in the case set forth in Article 2359,        paragraph 3, of the Civil Code as well as between        entities that directly or indirectly, by way of        subsidiaries, other than those managing investment funds,        are bound, even with third parties, in agreements        regarding the exercise of voting rights or the transfer        of shares or portions of third companies or, in any        event, in agreements or pacts as per Article 122 of        Legislative Decree No. 58 of February 24, 1998 regarding        third party companies if said agreements or pacts concern        at least 10 per cent of the voting capital, if they are        listed companies, or 20 per cent if they are unlisted        companies.        The aforementioned shareholding limit (3 per cent) is        calculated by taking into account shares held by any        fiduciary nominee or intermediary.         Any voting rights and any other non-financial rights        attributable to voting capital held or controlled in        excess of the maximum limit indicated in the foregoing        cannot be exercised and the voting rights of each entity        to whom such limit on shareholding applies are reduced in        proportion, unless otherwise jointly provided in advance        by the parties involved. In the event that shares        exceeding this limit are voted, any Shareholders’        resolution adopted pursuant to such a vote may be        challenged pursuant to Article 2377 of the Civil Code, if        the required majority had not been reached without the        votes exceeding the aforementioned maximum limit.        Shares not entitled to vote are included in the        determination of the quorum at shareholders’        meetings. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 6.2    |   | Pursuant to        Article 2, paragraph 1 of Law Decree 332 of May 31, 1994,        converted with amendments into Law 474 of July 30, 1994,        as modified by Article 4, paragraph 227, of Law December        24, 2003, No. 350, the Minister of Economy and Finance        retains the following special powers to be exercised in        agreement with the Minister of the Economic Development        and according to the criteria contained in the Decree        issued by the President of the Council of Ministers on        June 10, 2004:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

|   |   | a) |   | opposition        with respect to the acquisition of material shareholdings        by entities affected by the shareholding limit as set        forth in Article 3 of Law Decree 332 of May 31, 1994,        converted with amendments into Law 474 of July 30, 1994,        by which – as per Decree issued by the Minister of        Treasury on October 16, 1995 – are meant those        representing at least 3% of share capital with the right        to vote at the ordinary shareholders’ meeting. The        opposition is expressed within ten days of the date of        the notice to be filed by the Board of Directors at the        time request is made for registration in the        Shareholders’ Register if the Minister considers        that such an acquisition may prejudice the vital        interests of the Italian State. Until the ten-day term is        not lapsed, the voting rights and the non-asset linked        rights connected with the shares representing a material        shareholding may not be exercised. If the opposition        power is exercised, through a duly motivated act in        connection with the prejudice that may be caused by the        operation to the vital interests of the Italian State,        the transferee may not exercise the voting rights and the        other non-asset linked rights connected with the shares        representing a material shareholding and must sell said        shares within one year. Failing to comply, the law court,        upon request of the Minister of Economy and Finance, will        order the sale of the shares representing a material        shareholding according to the procedures set forth in        Article 2359-ter of the Civil Code. The act through which        the opposition power is exercised may be sued by the        transferee before the Regional Administrative Court of        Latium within sixty days as of its issue;                                                                                               |
|--------|--------|----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | b) |   | opposition        with respect to the subscription of Shareholders’        pacts or agreements as per Article 122 of Legislative        Decree No. 58 of February 24, 1998, involving – as        per Decree issued by the Minister of Treasury on October        16, 1995 – at least 3% of the share capital with the        right to vote at ordinary shareholders’ meetings. In        order to allow the exercise of the above mentioned        opposition power, Consob notifies the Minister of Economy        and Finance of the relevant pacts or agreements        communicated to it pursuant to the aforementioned Article        122 of Legislative Decree No. 58 of February 24, 1998.        The opposition power may be exercised within ten days as        of the date of the notice by Consob. Until the ten-day        term is not lapsed, the voting right and the other        non-asset linked rights connected with the shares held by        the shareholders who have subscribed the above mentioned        pacts or agreements may not be exercised. If the        opposition power is exercised through the issue of an act        that shall be duly motivated in consideration of the        prejudice that may be caused by said pacts or agreements        to the vital interests of the Italian State, the        shareholders pacts or agreements shall be null and void.        If in the shareholders’ meetings the shareholders        who have signed shareholders’ pacts or agreements        behave as if those pacts or agreements disciplined by        Article 122 of Legislative Decree No. 58 of February 24,        1998 were still in effect, the resolutions approved with        their vote, if determining for the approval, may be sued.        The act through which the opposition power is exercised        may be sued by the shareholders who joined the above        mentioned pacts or agreements before the Regional        Administrative Court of Latium within sixty days as of        its issue; |
|   |   | c) |   | veto power        with respect to resolutions to dissolve the company, to        transfer the business, to merge, to demerge, to transfer        the company’s registered office abroad, to change        the company objects and to amend the by-laws cancelling        or modifying the powers indicated in this Article. The        act through which the veto power is exercised shall be        duly motivated in consideration of the prejudice the        related resolution may cause to the vital interests of        the Italian State and may be sued by the dissenting        Shareholders before the Regional Administrative Court of        Latium within sixty days as of its issue;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

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##### Table of Contents

|   |   | d) |   | appointment        of one Board member with no voting rights. Should such        appointed Director lapse, the Minister of Economy and        Finance in agreement with the Minister of the Economic        Development will appoint his substitute. |
|--------|--------|----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**ARTICLE 7**

| 7.1 |   | When shares        are fully paid, and if the law so allows, they may be        issued to the bearer. Bearer shares may be converted into        registered shares and vice versa. Conversion operations        are performed at the Shareholder’s expense. |
|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**ARTICLE 8**

| 8.1 |   | In the event,        and for whatever reason, a share belongs to more than one        person, the rights relating to said share may not be        exercised by other than one person or by a proxy for all        co-owners. |
|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**ARTICLE 9**

| 9.1 |   | The        shareholders’ meeting may resolve to increase the        company capital and establish terms, conditions and means        thereof.                                                                                               |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 9.2 |   | The        shareholders’ meeting may resolve to increase the        company capital by issuing shares, including shares of        different classes, to be assigned for no consideration        pursuant to Article 2349 of the Civil Code. |

**ARTICLE 10**

| 10.1 |   | Payments on        shares are requested by the Board of Directors in one or        more times.                                                                                                                                         |
|------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.2 |   | Shareholders        who are late in payment are charged an interest        calculated at the official discount rate established by        the Bank of Italy besides the provisions envisaged in        Article 2344 of the Civil Code. |

**ARTICLE 11**

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

> 
***Part IV - Shareholders’ meeting***

**ARTICLE 12**

| 12.1 |   | Ordinary and        extraordinary shareholders’ meetings are usually        held at the company registered office unless otherwise        resolved by the Board of Directors, provided however they        are held in Italy. |
|------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 12.2 |   | Ordinary        shareholders’ meetings must be called at least once        a year to approve the financial statements within 120        days of the end of the business year.                                                 |

**ARTICLE 13**

| 13.1 |   | Shareholders’        meetings are convened through a notice to be published on        the Italian Official Gazette or the following newspapers:        "Il Sole 24 Ore", "Corriere della        Sera" and "Financial Times", according to        the current legislation and in compliance with the rules        in force regulating the exercise of the vote by mail.        The Shareholders that, severally or jointly, represent at        least one fortieth of Eni share capital, may ask, within        five days as of the date of publication of the        shareholders’ meeting notice, to add other items in        the agenda. The request shall contain the matters to be        proposed to the shareholders’ meeting. Said faculty        may not be exercised on the matters upon which, pursuant        to the applicable legislation, the shareholders’        meeting resolves on the basis of a proposal of the Board        of Directors or on the basis of a project or report of        the Board. The integrations accepted by the Board shall        be published at least ten days before the        shareholders’ meeting date, through a notice to be        published as indicated above. |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 13.2 |   | Admission to        the shareholders’ meeting is subject to the        delivery, also for registered shares, of the        communication issued by financial intermediaries at least        two labour days before the date of the shareholders’        meeting on first call.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

**ARTICLE 14**

| 14.1 |   | Each        Shareholder entitled to attend the meeting may also be        represented in compliance with the law by a person        appointed by written proxy. Incorporated entities and        companies may attend the meeting by way of a person        appointed by written proxy. In order to simplify        collection of proxies issued by Shareholders who are        employees of the company or its subsidiaries and members        of Shareholders associations incorporated under and        managed pursuant to current legislation regulating        proxies collection, notice boards for communications and        rooms to allow proxies collection are made available to        said associations according to terms and conditions        agreed from time to time by the company with the        associations representatives. |
|------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 14.2 |   | The Chairman        of the meeting has to assure the regularity of written        proxies and, in general, the right to attend the meeting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| 14.3 |   | The right to        vote may also be exercised by mail according to the laws        and regulations in force concerning this matter.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 14.4 |   | Eni SpA        shareholders’ meetings are disciplined by Eni        SpA’s shareholders’ meeting Regulation approved        by the ordinary shareholders’ meeting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |

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##### Table of Contents

**ARTICLE 15**

| 15.1 |   | The meeting        is chaired by the Chairman of the Board of Directors, or        in the event of absence or impediment, by the Chief        Executive Officer; in absence of both, by another person,        duly delegated by the Board of Directors, failing which        the meeting may elect its own Chairman. |
|------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 15.2 |   | The Chairman        of the meeting is assisted by a Secretary, who need not        be a Shareholder, to be designated by the Shareholders        present, and may appoint one or more scrutineers.                                                                                                                    |

**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.                   |
|------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 16.2 |   | Resolutions        either at ordinary or extraordinary meetings, either on        first, second or third call, must be taken with the        majority required by the law in each case. |
| 16.3 |   | Resolutions        of the meeting taken in compliance with the law and these        by-laws are binding for all Shareholders even if absent        or dissenting.                       |
| 16.4 |   | The minutes        of ordinary meetings must be signed by the Chairman and        the Secretary.                                                                                        |
| 16.5 |   | The minutes        of extraordinary meetings must be drawn up by a notary        public.                                                                                                |

> 
***Part V - The Board of Directors***

**ARTICLE 17**

| 17.1 |   | The company        is managed by a Board of Directors consisting of no fewer        than three and no more than nine members. The        shareholders’ meeting determines the number within        these limits. The Minister of Economy and Finance in        agreement with the Minister of the Economic Development        may appoint another member, with no voting rights,        pursuant to Article 6, second paragraph, letter d), of        the by-laws.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 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 |   | The Board of Directors, except for the member        appointed pursuant to Article 6.2, letter d) of these        by-laws, is appointed by the shareholders’ meeting        on the basis of lists presented by Shareholders and by        the Board of Directors; in such lists the candidates must        be listed in numerical order. Should the retiring Board        of Directors present its own candidate list, it must be        deposited at the company’s registered office****and        published in at least three Italian newspapers of general        circulation, two of them business dailies, at least        twenty days before the date set for the first call of the        shareholders’ meeting. Candidate lists presented by        Shareholders must be deposited and published as indicated        in the foregoing at least ten days before the date set        for the first call of the shareholders’ meeting.        Each Shareholder may present or take part in the        presenting of only one candidate list and vote only one        candidate list. Those who are controlling or controlled        entities or are under common control, as defined by        Article 93 of Legislative Decree No. 58 issued on        February 24, 1998, by the same entity of the shareholder        presenting a list shall not present nor take part in the        presentation of another candidate list, nor vote them,        also through intermediaries or fiduciaries. Each        candidate may appear in one list only or he will be        ineligible. Only those Shareholders who, alone or        together with other Shareholders, represent at least 1        per cent****of voting share capital at the ordinary        shareholders’ meeting may present candidate lists.        In order to demonstrate the title on the number of shares        necessary to present candidate lists, the Shareholders        must present and/or deliver with****the        company’s registered office a copy of the        communication 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.        At least one Board member, if the Board members are no        more than five, or at least three Board members if the        Board members****are more than five, shall have the        independence requirements set for the Board of Statutory        Auditors members of listed companies. The independent        candidates shall be expressly indicated in each list.        All candidates shall also have the honorability        qualifications set forth by the applicable legislation.        Together with the deposit of each list, in order to        assure its validity, the following documents shall be        deposited: (i) the curriculum of each candidate; (ii)        statements of each candidate to****accept his        nomination and attest, in his own responsibility, that        causes for his ineligibility and incompatibility are non        existing and that he possesses the aforementioned        honorability and,****if any, independence        requirements.        The Directors appointed shall communicate to the Company        if they have lost the above mentioned independence and        honorability requirements and if situations of        ineligibility or incompatibility have arisen.        The Board of Directors evaluates periodically the        independence and the honorability of its members and if        situations of ineligibility or incompatibility have        arisen.        If the honorability or independence****requirements        declared and set forth by the legislation in force are        not present or elapse for a Board member or if situations        of ineligibility or incompatibility have arisen, the        Board of Directors removes said Board member and resolves        upon his substitution or invites him to remove the        situation of incompatibility within the term set by the        Board itself; if this last condition is not met, the        Director will be removed from office. |

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##### Table of Contents

|   |   | Board members        will be elected in the following manner: |
|--------|--------|---------------------------------------------------------------|

|   |   | a) |   | seven tenths        of the members to be elected will be drawn out from the        candidate list that receives the majority of votes        expressed by the Shareholders in the numerical order in        which they appear on the list, rounded off in the event        of a fractional number to the next lower number;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|--------|--------|----|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | b) |   | the remaining        Board members will be drawn out from the other candidate        lists; said lists shall not be linked in any way, neither        indirectly, to the shareholders who have presented or        voted the list that has obtained the highest number of        votes; to this purpose the votes obtained by each        candidate list will be divided by one or two depending on        the number of the members to be elected. The quotients        thus obtained will be assigned progressively to        candidates of each said list in the order given in the        lists themselves. Quotients thus assigned to candidates        of said lists will be set in one decreasing numerical        order. Those who obtain the highest quotients will be        elected.        In the event that more than one candidate obtains the        same quotient, the candidate elected will be the one of        the list that has not hitherto had a Board member elected        or that has elected the least number of Board members.        In the event that none of the lists has yet elected a        Board member or that all of them have elected the same        number of Board members, the candidate from all such        lists who has obtained the largest number of votes will        be elected. In the event of equal list votes and equal        quotient, a new vote will be taken by the entire        shareholders’ meeting and the candidate elected will        be the one who obtains a simple majority of the votes; |
|   |   | c) |   | if through        the procedure described above the minimum number of        independent Directors set by these by-laws is not        elected, the quotient is calculated according to letter        b) above in order to be assigned to the candidates        present in each list; the independent candidates not yet        drawn from the lists pursuant to letters a) and b) above,        who have got the highest quotients will be elected in        order to meet the provision of the by-laws on the number        of the independent Directors. The Directors so appointed        will replace the non independent Directors to whom the        lowest quotients have been assigned. If the number of        independent candidates is lower than the minimum limit        set by the by-laws, the shareholders’ meeting will        make a resolution with the majorities prescribed by the        law to substitute the not independent candidates who have        got the lowest quotients;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   |   | d) |   | to appoint        Board members for any reason not covered by the terms of        the aforementioned procedure, the shareholders’        meeting will make a resolution with the majorities        prescribed by the law****in order, however, to assure        that the Board composition complies with the current        legislation and the by-laws.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |

|   |   | The vote by        list procedure shall apply only in case of appointment of        the entire Board of Directors.                                                                                                                                                                                                                                                                                                                                                           |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.4   |   | The        shareholders’ meeting may, even during the        Board’s term of office, change the number of members        of the Board of Directors, always within the limits set        forth in paragraph 17.1 above, and make the relating        appointments. Board members so elected will expire at the        same time as the rest of the Board.                                                                                                           |
| 17.5   |   | If during the        term of office one or more members leave the Board,        action will be taken in compliance with Article 2386 of        the Civil Code with exception of the Board member        appointed pursuant to Article 6.2 letter d) of these        by-laws. If a majority of members leaves the Board, the        whole Board will be considered lapsed and the Board must        promptly call a shareholders’ meeting to appoint a        new Board. |
| 17.6   |   | The Board may        establish Board Committees that shall have advisory and        consulting tasks on specific items.                                                                                                                                                                                                                                                                                                                                                      |

**ARTICLE 18**

| 18.1 |   | If the        shareholders’ meeting has not appointed a Chairman,        the Board will elect one of its members. The Director        appointed pursuant to Article 6, second paragraph, letter        d) of the by-laws cannot be appointed as Chairman. |
|------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 18.2 |   | The Board, at        the Chairman’s proposal, appoints a Secretary, who        need not belong to the company.                                                                                                                                            |

**ARTICLE 19**

| 19.1 |   | The Board        meets in the place indicated in the notice whenever the        Chairman or, in case of absence or impediment, the Chief        Executive Officer deems necessary, or when written        application has been made by the majority of the members.        The Board of Directors may be convened also pursuant to        Article 28.4 of the by-laws. 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. |
|------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 19.2 |   | Usually        notice is given at least five days in advance. In cases        of urgency notice may be sent earlier. The Board of        Directors decides on how to convene its meetings.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 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.                                                                                                                                                                                                                                                                                                                                                                                                                                             |

**ARTICLE 20**

| 20.1 |   | The Chairman        of the Board or, in his absence, the oldest Board member        in attendance chairs the meeting. |
|------|--------|-----------------------------------------------------------------------------------------------------------------------|

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##### Table of Contents

**ARTICLE 21**

| 21.1 |   | A majority of        members of the Board having a voting right must be        present for a Board meeting to be valid.                                                                                |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 21.2 |   | Resolutions        are taken with the majority of votes of the Board members        having a voting right present; should votes be equal, the        person who chairs the meeting has a casting vote. |

**ARTICLE 22**

| 22.1 |   | Resolutions        of the Board are entered in the minutes, which are        recorded in a book kept for that purpose pursuant to the        law, and said minutes are signed by the Chairman of the        meeting and by the Secretary. |
|------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 22.2 |   | Copies of the        minutes are bona fide if they are signed by the Chairman        or the person acting for him and countersigned by the        Secretary.                                                                              |

**ARTICLE 23**

| 23.1 |   | The Board of        Directors is invested with the fullest powers for        ordinary and extraordinary management of the company and,        in particular, the Board has the power to perform all        acts it deems advisable for the implementation and        achievement of the company objects, except for the acts        that the law or these by-laws reserve for the        shareholders’ meeting.                                                                                                                                                                                                 |
|------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 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;        - the amendment to the by-laws in order to comply with        the current legislation.                                                                                                                                                                                                                                                                                          |
| 23.3 |   | The Board of        Directors and the Chief Executive Officer 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 Chief Executive        Officer report to the Board of Statutory Auditors on        operations entailing an interest on their behalf or on        behalf of third parties. |

**ARTICLE 24**

| 24.1   |   | The Board of Directors delegates its powers to        one of its members with the exception of the Director        appointed pursuant to Article 6, second paragraph, letter        d) of the by-laws, in compliance with the limits set        forth in Article 2381 of the Civil Code. In addition the        Board of Directors may delegate powers to the Chairman        for researching and promoting integrated projects and        strategic international agreements. The Board of        Directors may at any time withdraw the delegations of        powers hereon; if the Board of Directors withdraws powers        delegated to the Chief Executive Officer, a new Chief        Executive Officer is simultaneously appointed.        The Board of Directors, upon proposal of the Chairman and        in agreement with the Chief Executive Officer, may confer        powers for single acts or categories of acts to other        members of the Board of Directors with the exception of        the Director appointed pursuant to Article 6, second        paragraph, letter d) of the by-laws. The Chairman and the        Chief Executive Officer, in compliance with the limits of        their delegations, may delegate and empower company        employees or persons not belonging to the company to        represent the company for single acts or specific        categories of acts.        Further, upon proposal of the Chief Executive Officer and        in agreement with the Chairman, the Board of Directors        may also appoint one or more General Managers and        determines the powers to be conferred to them. In order        to make the appointment effective, the Board of Directors        shall verify if the General Manager to be appointed has        the honorability requirements set by the current        legislation. The Board of Directors shall periodically        verify said honorability requirements. The General        Managers without said requirement shall be removed.        Upon proposal of the Chief Executive Officer presented        and in agreement with the Chairman, the Board of        Directors appoints the Manager responsible for the        preparation of financial reporting documents. The        appointment is subject to the favourable opinion of the        Board of Statutory Auditors. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | The Manager        responsible for the preparation of financial reporting        documents is chosen among people who, for at least three        years, have exercised:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |

|   |   | a) |   | administration        or control activities or directive tasks in companies        listed on regulated stock exchanges in Italy or other        European Union countries or other countries member of        OECD with a share capital not less than two million euro        or |
|--------|--------|----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | b) |   | audit        activities in the companies mentioned in letter a) above,        or                                                                                                                                                                                                |
|   |   | c) |   | professional        activities or teaching activities in universities in the        financial or accounting sectors, or                                                                                                                                                         |
|   |   | d) |   | managerial        functions in public or private bodies in the financial,        accounting, or control sectors.                                                                                                                                                                |

|   |   | The Board of        Directors assures that the Manager responsible for the        preparation of financial reporting documents is given        adequate powers and means to execute his or her tasks and        to respect the administrative and accounting procedures. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**ARTICLE 25**

| 25.1 |   | Legal        representation towards any judicial or administrative        authority and towards third parties, together with the        company signature, are vested either onto the Chairman or        the Chief Executive Officer. |
|------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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##### Table of Contents

**ARTICLE 26**

| 26.1 |   | The Chairman        and the members of the Board are remunerated in an amount        established by the ordinary shareholders’ meeting.        Said resolution, once taken, will remain valid for        subsequent business years until the shareholders’        meeting decides otherwise. |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**ARTICLE 27**

| 27.1 |   | The Chairman: |
|------|--------|---------------|

|   |   | a) |   | represents        the company according to the provisions of Article 25.1;                                               |
|--------|--------|----|--------|--------------------------------------------------------------------------------------------------------------------------|
|   |   | b) |   | chairs the        shareholders’ meeting pursuant to Article 15.1;                                                   |
|   |   | c) |   | convenes and        chairs meetings of the Board of Directors pursuant to        Articles 19.1 and 20.1;                 |
|   |   | d) |   | ascertains        whether Board resolutions have been implemented;                                                       |
|   |   | e) |   | exercises the        powers delegated to him by the Board of Directors        pursuant to Article 24.1 of these by-laws. |

> 
***Part VI - Board of Statutory Auditors***

**ARTICLE 28**

| 28.1 |   | The Board of        Statutory Auditors consists of five effective members and        two alternate members. The Auditors shall have the        professional and honour requirements set forth by the        Ministerial Decree No. 162, dated March 30, 2000 issued        by the Ministry of Justice.        Pursuant to the aforementioned Ministerial Decree, the        matters strictly connected to those of interest of the        Company are: companies law, business economics and        corporate finance.        Pursuant to said Ministerial Decree, the sectors strictly        connected with those of interest of the Company are the        engineering and geological sectors.        The Statutory Auditors may be appointed members of        administration and control bodies in other companies        within the limits set by Consob regulation.        Until those provisions do not come in force, 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 SpA subsidiaries may not be        appointed Statutory Auditor; if elected, they will lapse.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 28.2 |   | The Board of        Statutory Auditors is appointed by the shareholders’        meeting on the basis of lists presented by the        Shareholders; in such lists candidates are listed in        numerical order.        For the presentation, deposit and publication of        candidate lists the procedures set forth in Article 17.3        shall apply and according to the rules set forth by        Consob.        Lists shall be divided into two sections: the first one        for the candidates to be appointed effective Auditors and        the second one for the candidates to be appointed        alternate Auditors. At least the first candidate of each        section shall be chartered accountant and have exercised        audit activities for not less than three years.        Three effective Auditors and one alternate Auditor will        be drawn from the list that obtains the majority of        votes. The other two effective Auditors and the other        alternate Auditor will be appointed pursuant to Article        17.3, letter b) of the by-laws. The procedure described        in this last Article shall be applied to each section of        the lists involved separately.        The shareholders’ meeting appoints the Chairman of        the Board of Statutory Auditors among the effective        Auditors appointed according to Article 17.3 letter b) of        these by-laws.        To appoint effective or alternate Auditors for any reason        not elected according to the terms of the aforementioned        procedure, the shareholders’ meeting will resolve        with the majorities prescribed by the law.        The vote by list procedure shall apply only in case of        appointment of the entire Board of Statutory Auditors.        Should an effective Auditor drawn out from the candidate        list that receives the majority of votes expressed by the        Shareholders be replaced, he will be succeeded by the        alternate Auditor drawn out from the same candidate list;        should an effective Auditor drawn out from the other        candidate list be replaced, he will be substituted by the        Alternate Auditor drawn by those other lists. |
| 28.3 |   | Retiring        Auditors may be reelected.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| 28.4 |   | Subject to a        previous communication to the Chairman of the Board of        Directors, the Board of Statutory Auditors is empowered        to convene the shareholders’ meeting and the Board        of Directors. At least two effective Auditors are        empowered to convene the shareholders’ meetings and        at least one effective Auditor is empowered to convene        the Board meetings.        The Board of Statutory Auditors’ 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

> 
***Part VII - Financial Statements and    Profits***

**ARTICLE 29**

| 29.1 |   | The business        year ends on December 31 every year. |
|------|--------|----------------------------------------------------------|

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| 29.2 |   | At the end of        each business year, the Board of Directors sees to the        preparation of the company financial statements in        conformity with the law. |
|------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 29.3 |   | The Board of        Directors may, during the course of the business year,        pay interim dividends to the Shareholders.                                          |

**ARTICLE 30**

| 30.1 |   | Dividends not        collected within five years of the day on which they are        payable will be prescribed in favour of the company and        allocated to reserves. |
|------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

> 
***Part VIII - Winding Up and    Liquidation of the Company***

**ARTICLE 31**

| 31.1 |   | In the event        the company is wound up, the shareholders’ meeting        will decide the manner of liquidation, appoint one or        more liquidators and determine their powers and        remuneration. |
|------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

> 
***Part IX - General Provisions***

**ARTICLE 32**

| 32.1 |   | For matters        not expressly regulated by these by-laws, the norms of        the Civil Code and specific laws concerning these matters        will apply.                                                                                                                                                                                         |
|------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 32.2 |   | Pursuant to        Article 3, paragraph 2, of Law Decree 332 of May 31,        1994, converted with amendments into Law 474 of July 30,        1994, Article 6.1, paragraph sixth, of these bylaws does        not apply to the share owned by the Ministry of Economy        and Finance, by public bodies or by entities controlled        thereby. |

**ARTICLE 33**

| 33.1 |   | The company        retains all assets and liabilities held before its        transformation by the public law agency Ente Nazionale        Idrocarburi. |
|------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

 

 

 

 

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##### Table of Contents

**EXHIBIT 8**

**List of Eni’ssubsidiaries for year 2008**

| Subsidiary |   | Country        of Incorporation |   | Eni’s        share of net profit (%) |
|------------|--------|---------------------------------|--------|-------------------------------------------|
|       |   |                            |   |                                      |

| EXPLORATION & PRODUCTION                                                |   |                   |   |   |
|-----------------------------------------------------------------------------|--------|------------------------|--------|--------|
|                                                                        |   |                   |   |   |
| Eni Angola SpA                                                              |   | Italy                  |   | 100.00 |
| Eni East Africa SpA                                                         |   | Italy                  |   | 100.00 |
| Eni Mediterranea Idrocarburi        SpA                                     |   | Italy                  |   | 100.00 |
| Eni Timor Leste SpA                                                         |   | Italy                  |   | 100.00 |
| Ieoc SpA                                                                    |   | Italy                  |   | 100.00 |
| Società Oleodotti        Meridionali - SOM SpA                         |   | Italy                  |   | 70.00  |
| Società Petrolifera        Italiana SpA                                |   | Italy                  |   | 99.96  |
| Stoccaggi Gas Italia SpA -        Stogit SpA                                |   | Italy                  |   | 100.00 |
| Tecnomare - Società per lo        Sviluppo delle Tecnologie Marine SpA |   | Italy                  |   | 100.00 |
| Agip Caspian Sea BV                                                         |   | Netherlands            |   | 100.00 |
| Agip Energy & Natural        Resources (Nigeria) Ltd                    |   | Nigeria                |   | 100.00 |
| Agip Karachaganak BV                                                        |   | Netherlands            |   | 100.00 |
| Agip Oil Ecuador BV                                                         |   | Netherlands            |   | 100.00 |
| Astrakhan Gas and Oil Co                                                    |   | Russia                 |   | 3.00   |
| Burren Energy (Bermuda) Ltd                                                 |   | Bermuda                |   | 100.00 |
| Burren Energy (Buguruslan)        Ltd                                       |   | Cyprus                 |   | 100.00 |
| Burren Energy (Congo) Ltd                                                   |   | British Virgin Islands |   | 100.00 |
| Burren Energy Drilling        Services Ltd (in liquidation)                 |   | UK                     |   | 100.00 |
| Burren Energy (Egypt) Ltd                                                   |   | UK                     |   | 100.00 |
| Burren Energy India Ltd                                                     |   | UK                     |   | 100.00 |
| Burren Energy Ltd                                                           |   | Cyprus                 |   | 100.00 |
| Burren Energy New Ventures        Ltd                                       |   | UK                     |   | 100.00 |
| Burren Energy (Oman) Ltd                                                    |   | UK                     |   | 100.00 |
| Burren Energy Plc                                                           |   | UK                     |   | 100.00 |
| Burren Energy (Services) Ltd                                                |   | UK                     |   | 100.00 |
| Burren Energy (Yemen) Ltd                                                   |   | UK                     |   | 100.00 |
| Burren Resources Petroleum        Ltd                                       |   | Bermuda                |   | 100.00 |
| Burren Shakti Ltd                                                           |   | Bermuda                |   | 100.00 |
| Eni AEP Ltd                                                                 |   | UK                     |   | 100.00 |
| Eni Algeria Exploration BV                                                  |   | Netherlands            |   | 100.00 |
| Eni Algeria Ltd Sàrl                                                   |   | Luxembourg             |   | 100.00 |
| Eni Algeria Production BV                                                   |   | Netherlands            |   | 100.00 |
| Eni Ambalat Ltd                                                             |   | UK                     |   | 100.00 |
| Eni America Ltd                                                             |   | USA                    |   | 100.00 |
| Eni Angola Exploration BV                                                   |   | Netherlands            |   | 100.00 |
| Eni Angola Production BV                                                    |   | Netherlands            |   | 100.00 |
| Eni Australia BV                                                            |   | Netherlands            |   | 100.00 |
| Eni Australia Ltd                                                           |   | UK                     |   | 100.00 |
| Eni BB Petroleum Inc                                                        |   | USA                    |   | 100.00 |
| Eni Bukat Ltd                                                               |   | UK                     |   | 100.00 |
| Eni Bulungan BV                                                             |   | Netherlands            |   | 100.00 |
| Eni Canada Holding Ltd                                                      |   | Canada                 |   | 100.00 |
| Eni China BV                                                                |   | Netherlands            |   | 100.00 |
| Eni Congo Holding BV                                                        |   | Netherlands            |   | 100.00 |
| Eni Congo SA                                                                |   | Congo                  |   | 100.00 |
| Eni Croatia BV                                                              |   | Netherlands            |   | 100.00 |
| Eni Dación BV                                                          |   | Netherlands            |   | 100.00 |
| Eni Denmark BV                                                              |   | Netherlands            |   | 100.00 |
| Eni Elgin/Franklin Ltd                                                      |   | UK                     |   | 100.00 |
| Eni Energy Ltd (in        liquidation)                                      |   | UK                     |   | 100.00 |
| Eni Energy Russia BV                                                        |   | Netherlands            |   | 100.00 |
| Eni Ganal Ltd                                                               |   | UK                     |   | 100.00 |
| Eni Gas & Power LNG        Australia BV                                 |   | Netherlands            |   | 100.00 |

E-9

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##### Table of Contents

| Eni Grand Maghreb BV                           |   | Netherlands           |   | 100.00 |
|------------------------------------------------|--------|-----------------------|--------|--------|
| Eni Hewett Ltd                                 |   | UK                    |   | 100.00 |
| Eni India Ltd                                  |   | UK                    |   | 100.00 |
| Eni Indonesia Ltd                              |   | UK                    |   | 100.00 |
| Eni International NA NV        Sàrl       |   | Luxembourg            |   | 100.00 |
| Eni Investments Plc                            |   | UK                    |   | 100.00 |
| Eni Iran BV                                    |   | Netherlands           |   | 100.00 |
| Eni Ireland BV                                 |   | Netherlands           |   | 100.00 |
| Eni JPDA 03-13 Ltd                             |   | UK                    |   | 100.00 |
| Eni JPDA 06-105 Pty Ltd                        |   | Australia             |   | 100.00 |
| Eni Krueng Mane Ltd                            |   | UK                    |   | 100.00 |
| Eni Lasmo Plc                                  |   | UK                    |   | 100.00 |
| Eni LNS Ltd                                    |   | UK                    |   | 100.00 |
| Eni Mali BV                                    |   | Netherlands           |   | 100.00 |
| Eni Marketing Inc                              |   | USA                   |   | 100.00 |
| Eni MHH Ltd (in liquidation)                   |   | UK                    |   | 100.00 |
| Eni Middle East BV                             |   | Netherlands           |   | 100.00 |
| Eni Middle East Ltd                            |   | UK                    |   | 100.00 |
| Eni MOG Ltd (in liquidation)                   |   | UK                    |   | 100.00 |
| Eni Morocco BV                                 |   | Netherlands           |   | 100.00 |
| Eni Muara Bakau BV                             |   | Netherlands           |   | 100.00 |
| Eni Norge AS                                   |   | Norway                |   | 100.00 |
| Eni North Africa BV                            |   | Netherlands           |   | 100.00 |
| Eni Oil Algeria Ltd                            |   | UK                    |   | 100.00 |
| Eni Oil do Brasil SA                           |   | Brazil                |   | 100.00 |
| Eni Oil & Gas Inc                          |   | USA                   |   | 100.00 |
| Eni Oil Holdings BV                            |   | Netherlands           |   | 100.00 |
| Eni Pakistan Ltd                               |   | UK                    |   | 100.00 |
| Eni Pakistan (M) Ltd Sàrl                 |   | Luxembourg            |   | 100.00 |
| Eni Papalang Ltd                               |   | UK                    |   | 100.00 |
| Eni Petroleum Co Inc                           |   | USA                   |   | 100.00 |
| Eni Petroleum US Llc                           |   | USA                   |   | 100.00 |
| Eni PetroRussia BV                             |   | Netherlands           |   | 100.00 |
| Eni Popodi Ltd                                 |   | UK                    |   | 100.00 |
| Eni Rapak Ltd                                  |   | UK                    |   | 100.00 |
| Eni Resources Ltd                              |   | UK                    |   | 100.00 |
| Eni Securities Ltd                             |   | UK                    |   | 100.00 |
| Eni TNS Ltd                                    |   | UK                    |   | 100.00 |
| Eni Trasportation Ltd                          |   | UK                    |   | 100.00 |
| Eni Trinidad and Tobago Ltd                    |   | Trinidad & Tobago |   | 100.00 |
| Eni TTO Ltd                                    |   | UK                    |   | 100.00 |
| Eni Tunisia BEK BV                             |   | Netherlands           |   | 100.00 |
| Eni Tunisia BV                                 |   | Netherlands           |   | 100.00 |
| Eni UFL Ltd                                    |   | UK                    |   | 100.00 |
| Eni UHL Ltd                                    |   | UK                    |   | 100.00 |
| Eni UKCS Ltd                                   |   | UK                    |   | 100.00 |
| Eni UK Holding Plc                             |   | UK                    |   | 100.00 |
| Eni UK Ltd                                     |   | UK                    |   | 100.00 |
| Eni ULT Ltd                                    |   | UK                    |   | 100.00 |
| Eni ULX Ltd                                    |   | UK                    |   | 100.00 |
| Eni USA Gas Marketing Llc                      |   | USA                   |   | 100.00 |
| Eni USA Inc                                    |   | USA                   |   | 100.00 |
| Eni US Operating Co Inc                        |   | USA                   |   | 100.00 |
| Eni Venezuela BV                               |   | Netherlands           |   | 100.00 |
| Eni West Timor Ltd                             |   | UK                    |   | 100.00 |
| First Calgary Petroleums LP                    |   | USA                   |   | 100.00 |
| First Calgary Petroleums Ltd                   |   | Canada                |   | 100.00 |
| First Calgary Petroleums        Partner Co ULC |   | Canada                |   | 100.00 |
| First Calgary Petroleums UK        Ltd         |   | UK                    |   | 100.00 |
| Hindustan Oil Exploration Co        Ltd        |   | India                 |   | 47.18  |
| Ieoc Exploration BV                            |   | Netherlands           |   | 100.00 |
| Ieoc Production BV                             |   | Netherlands           |   | 100.00 |
| Lasmo Sanga Sanga Ltd                          |   | Bermuda               |   | 100.00 |

E-10

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##### Table of Contents

| Nigerian Agip Exploration        Ltd                                                                                                                             |   | Nigeria         |   | 100.00 |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------|--------|--------|
| Nigerian Agip Oil Co Ltd                                                                                                                                         |   | Nigeria         |   | 100.00 |
| OOO ‘Eni Energhia’                                                                                                                                     |   | Russia          |   | 100.00 |
|                                                                                                                                                             |   |            |   |   |
|                                                                                                                                                             |   |            |   |   |
| GAS & POWER                                                                                                                                                  |   |            |   |   |
|                                                                                                                                                             |   |            |   |   |
| Acqua Campania SpA                                                                                                                                               |   | Italy           |   | 47.62  |
| Compagnia Napoletana di        Illuminazione e Scaldamento col Gas SpA                                                                                           |   | Italy           |   | 99.69  |
| Eni Gas & Power Belgium        SpA                                                                                                                           |   | Italy           |   | 100.00 |
| Eni Gas Transport        Deutschland SpA                                                                                                                         |   | Italy           |   | 100.00 |
| Eni Hellas SpA                                                                                                                                                   |   | Italy           |   | 100.00 |
| EniPower Mantova SpA                                                                                                                                             |   | Italy           |   | 86.50  |
| EniPower SpA                                                                                                                                                     |   | Italy           |   | 100.00 |
| EniPower Trasmissione SpA                                                                                                                                        |   | Italy           |   | 100.00 |
| GNL Italia SpA                                                                                                                                                   |   | Italy           |   | 55.59  |
| LNG Shipping SpA                                                                                                                                                 |   | Italy           |   | 100.00 |
| Snam Rete Gas SpA                                                                                                                                                |   | Italy           |   | 55.59  |
| Società EniPower Ferrara        Srl                                                                                                                         |   | Italy           |   | 51.00  |
| Società Italiana per il Gas        pA                                                                                                                       |   | Italy           |   | 100.00 |
| Toscana Energia Clienti SpA                                                                                                                                      |   | Italy           |   | 79.22  |
| Adriaplin Podjetje za        distribucijo zemeljskega plina doo Ljubljana                                                                                        |   | Slovenia        |   | 51.00  |
| Distribuidora de Gas Cuyana        SA                                                                                                                            |   | Argentina       |   | 45.60  |
| Distrigas NV                                                                                                                                                     |   | Belgium         |   | 57.24  |
| Distri RE SA                                                                                                                                                     |   | Luxembourg      |   | 57.24  |
| Eni Gas & Power Belgium        SA                                                                                                                            |   | Belgium         |   | 100.00 |
| Eni Gas & Power GmbH                                                                                                                                         |   | Germany         |   | 100.00 |
| Eni Gas Transport GmbH (ex        Eni Gas & Power GmbH)                                                                                                      |   | Germany         |   | 100.00 |
| Eni Gas Transport        International SA                                                                                                                        |   | Switzerland     |   | 100.00 |
| Eni G&P France BV                                                                                                                                            |   | Netherlands     |   | 100.00 |
| Eni G&P Trading BV                                                                                                                                           |   | Netherlands     |   | 100.00 |
| Finpipe GIE                                                                                                                                                      |   | Belgium         |   | 36.24  |
| Gas Brasiliano Distribuidora        SA                                                                                                                           |   | Brazil          |   | 100.00 |
| GreenStream BV                                                                                                                                                   |   | Netherlands     |   | 75.00  |
| Inversora de Gas Cuyana SA                                                                                                                                       |   | Argentina       |   | 76.00  |
| Société de Financement et        de Participation SA                                                                                                   |   | Belgium         |   | 57.13  |
| Société de Service du        Gazoduc Transtunisien SA - Sergaz SA                                                                                      |   | Tunisia         |   | 66.67  |
| Société pour la        Construction du Gazoduc Transtunisien SA - Scogat SA                                                                            |   | Tunisia         |   | 100.00 |
| Tigáz-Dso Földgázelosztó        Korlátolt Felelossegu Tarsasag                                                                          |   | Hungary         |   | 50.08  |
| Tigáz Tiszántúli        Gázszolgáltató Zártkörûen Mûködõ        Részvénytársaság |   | Hungary         |   | 50.08  |
| Transfin SA                                                                                                                                                      |   | Belgium         |   | 57.13  |
| Trans Tunisian Pipeline Co        Ltd                                                                                                                            |   | Channel Islands |   | 100.00 |
|                                                                                                                                                             |   |            |   |   |
|                                                                                                                                                             |   |            |   |   |
| REFINING & MARKETING                                                                                                                                         |   |            |   |   |
|                                                                                                                                                             |   |            |   |   |
| AgipFuel Nord SpA                                                                                                                                                |   | Italy           |   | 100.00 |
| Agip Rete SpA                                                                                                                                                    |   | Italy           |   | 100.00 |
| Costiero Gas Livorno SpA                                                                                                                                         |   | Italy           |   | 65.00  |
| Ecofuel SpA                                                                                                                                                      |   | Italy           |   | 100.00 |
| Eni Trading & Shipping        SpA                                                                                                                            |   | Italy           |   | 100.00 |
| Petrolig Srl                                                                                                                                                     |   | Italy           |   | 70.00  |
| Petroven Srl                                                                                                                                                     |   | Italy           |   | 68.00  |
| Raffineria di Gela SpA                                                                                                                                           |   | Italy           |   | 100.00 |
| Agip Austria GmbH                                                                                                                                                |   | Austria         |   | 100.00 |
| Agip Benelux BV                                                                                                                                                  |   | Netherlands     |   | 100.00 |
| Agip Ceská Republika Sro                                                                                                                                    |   | Czech Republic  |   | 100.00 |
| Agip Deutschland GmbH                                                                                                                                            |   | Germany         |   | 100.00 |
| Agip Ecuador SA                                                                                                                                                  |   | Ecuador         |   | 100.00 |
| Agip France Sàrl                                                                                                                                            |   | France          |   | 100.00 |
| Agip Hungaria Zrt                                                                                                                                                |   | Hungary         |   | 100.00 |
| Agip Iberia SLU (ex Eni        España Comercializadora de Gas SA)                                                                                           |   | Spain           |   | 100.00 |
| Agip Lubricantes SA                                                                                                                                              |   | Argentina       |   | 100.00 |
| Agip Oil Ceská Republika        Sro                                                                                                                         |   | Czech Republic  |   | 100.00 |

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##### Table of Contents

| Agip Oil Slovensko Spol Sro                                                                                  |   | Slovakia               |   | 100.00 |
|--------------------------------------------------------------------------------------------------------------|--------|------------------------|--------|--------|
| Agip Olaj Magyarország        Kereskedelmi Korlátolt Felelõsségû Társaság |   | Hungary                |   | 100.00 |
| Agip Romania Srl                                                                                             |   | Romania                |   | 100.00 |
| Agip Schmiertechnik GmbH                                                                                     |   | Germany                |   | 100.00 |
| Agip Slovenija doo                                                                                           |   | Slovenia               |   | 100.00 |
| Agip Slovensko Spol Sro                                                                                      |   | Slovakia               |   | 100.00 |
| Agip Suisse SA                                                                                               |   | Switzerland            |   | 100.00 |
| American Agip Co Inc                                                                                         |   | USA                    |   | 100.00 |
| Eni Trading & Shipping        BV (ex Eni Trading BV)                                                     |   | Netherlands            |   | 100.00 |
| Eni Trading & Shipping        Inc                                                                        |   | USA                    |   | 100.00 |
| Esain SA                                                                                                     |   | Ecuador                |   | 100.00 |
|                                                                                                         |   |                   |   |   |
|                                                                                                         |   |                   |   |   |
| PETROCHEMICALS                                                                                               |   |                   |   |   |
|                                                                                                         |   |                   |   |   |
| Polimeri Europa SpA                                                                                          |   | Italy                  |   | 100.00 |
| Dunastyr Polisztirolgyártó        Zártkoruen Mukodo Részvénytársaság      |   | Hungary                |   | 100.00 |
| Polimeri Europa Benelux SA                                                                                   |   | Belgium                |   | 100.00 |
| Polimeri Europa France SAS                                                                                   |   | France                 |   | 100.00 |
| Polimeri Europa GmbH                                                                                         |   | Germany                |   | 100.00 |
| Polimeri Europa Ibérica SA                                                                              |   | Spain                  |   | 100.00 |
| Polimeri Europa UK Ltd                                                                                       |   | UK                     |   | 100.00 |
|                                                                                                         |   |                   |   |   |
|                                                                                                         |   |                   |   |   |
| ENGINEERING &        CONSTRUCTION                                                                        |   |                   |   |   |
|                                                                                                         |   |                   |   |   |
| Intermare Sarda SpA                                                                                          |   | Italy                  |   | 43.55  |
| Saipem Energy Italia SpA                                                                                     |   | Italy                  |   | 43.55  |
| Saipem Energy Services SpA        (ex Energy Maintenance Services SpA)                                       |   | Italy                  |   | 43.55  |
| Saipem SpA                                                                                                   |   | Italy                  |   | 43.55  |
| Snamprogetti Chiyoda SAS di        Saipem SpA                                                                |   | Italy                  |   | 43.51  |
| Snamprogetti Sud SpA                                                                                         |   | Italy                  |   | 43.55  |
| Andromeda Consultoria        Tecnica e Representações Ltda                                         |   | Brazil                 |   | 43.55  |
| BOSCONGO SA                                                                                                  |   | Congo                  |   | 43.55  |
| BOS Investment Ltd                                                                                           |   | UK                     |   | 43.55  |
| BOS - UIE Ltd                                                                                                |   | UK                     |   | 43.55  |
| Delong Hersent - Estudos,        Construções Maritimas e Participações, Unipessoal Lda   |   | Portugal               |   | 43.55  |
| Entreprise Nouvelle        Marcellin SA                                                                      |   | France                 |   | 43.55  |
| ER SAI Caspian Contractor        Llc                                                                         |   | Kazakhstan             |   | 21.78  |
| ERS - Equipment Rental &        Services BV                                                              |   | Netherlands            |   | 43.55  |
| European Marine Contractors        Ltd                                                                       |   | UK                     |   | 43.55  |
| European Marine Investments        Ltd                                                                       |   | UK                     |   | 43.55  |
| European Maritime Commerce        BV                                                                         |   | Netherlands            |   | 43.55  |
| Frigstad Discoverer Invest        Ltd                                                                        |   | British Virgin Islands |   | 43.55  |
| Firgstad Discoverer Invest        (S) Pte Ltd                                                                |   | Singapore              |   | 43.55  |
| Global Petroprojects        Services AG                                                                      |   | Switzerland            |   | 43.55  |
| Katran-K Llc                                                                                                 |   | Russia                 |   | 43.55  |
| Moss Arctic Offshore AS                                                                                      |   | Norway                 |   | 43.55  |
| Moss Maritime AS                                                                                             |   | Norway                 |   | 43.55  |
| Moss Maritime Inc                                                                                            |   | USA                    |   | 43.55  |
| Moss Offshore AS                                                                                             |   | Norway                 |   | 43.55  |
| North Caspian Services Co                                                                                    |   | Kazakhstan             |   | 43.55  |
| Petrex SA                                                                                                    |   | Peru                   |   | 43.55  |
| Petromar Lda                                                                                                 |   | Angola                 |   | 30.49  |
| PT Saipem Indonesia                                                                                          |   | Indonesia              |   | 43.55  |
| Saibos Construções        Maritimas Ltda                                                           |   | Portugal               |   | 43.55  |
| Saigut SA De Cv                                                                                              |   | Mexico                 |   | 43.55  |
| Saimexicana SA De Cv                                                                                         |   | Mexico                 |   | 43.55  |
| Saipem America Inc                                                                                           |   | USA                    |   | 43.55  |
| Saipem Asia Sdn Bhd                                                                                          |   | Malaysia               |   | 43.55  |
| Saipem (Beijing) Technical        Services Co Ltd                                                            |   | China                  |   | 43.55  |
| Saipem Contracting Algerie        SpA                                                                        |   | Algeria                |   | 43.55  |
| Saipem Contracting (Nigeria)        Ltd                                                                      |   | Nigeria                |   | 42.66  |
| Saipem do Brasil Serviçõs        de Petroleo Ltda                                                  |   | Brazil                 |   | 43.55  |

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##### Table of Contents

| Saipem Holding France SAS                                                                      |   | France               |   | 43.55  |
|------------------------------------------------------------------------------------------------|--------|----------------------|--------|--------|
| Saipem India Projects Ltd        (ex Saipem India Project Services Ltd)                        |   | India                |   | 43.55  |
| Saipem International BV                                                                        |   | Netherlands          |   | 43.55  |
| Saipem Logistics Services        Ltd                                                           |   | Nigeria              |   | 43.55  |
| Saipem Luxembourg SA                                                                           |   | Luxembourg           |   | 43.55  |
| Saipem (Malaysia) Sdn Bhd                                                                      |   | Malaysia             |   | 18.02  |
| Saipem Maritime Asset        Management Luxembourg Sàrl                                   |   | Luxembourg           |   | 43.55  |
| Saipem Mediteran Usluge doo                                                                    |   | Croatia              |   | 43.55  |
| Saipem Misr for Petroleum        Services SAE                                                  |   | Egypt                |   | 43.55  |
| Saipem (Nigeria) Ltd                                                                           |   | Nigeria              |   | 38.94  |
| Saipem Perfurações e        Construções Petroliferas Unipessoal Lda        |   | Portugal             |   | 43.55  |
| Saipem (Portugal) Comércio        Marítimo, Sociedade Unipessoal Lda                 |   | Portugal             |   | 43.55  |
| Saipem (Portugal) - Gestão        de Participações SGPS Sociedade Unipessoal SA |   | Portugal             |   | 43.55  |
| Saipem SA                                                                                      |   | France               |   | 43.55  |
| Saipem Services México SA        De Cv                                                    |   | Mexico               |   | 43.55  |
| Saipem Services SA                                                                             |   | Belgium              |   | 43.55  |
| Saipem Singapore Pte Ltd                                                                       |   | Singapore            |   | 43.55  |
| Saipem UK Ltd                                                                                  |   | UK                   |   | 43.55  |
| Saipem Ukraine Llc                                                                             |   | Ukraine              |   | 43.55  |
| SAS Port de Tanger                                                                             |   | France               |   | 43.55  |
| Saudi Arabian Saipem Ltd                                                                       |   | United Arab Emirates |   | 26.13  |
| Services et Equipements        Gaziers et Petroliers SA                                        |   | France               |   | 43.48  |
| Sigurd Rück AG                                                                            |   | Switzerland          |   | 43.55  |
| Snamprogetti Canada Inc                                                                        |   | Canada               |   | 43.55  |
| Snamprogetti Engineering BV                                                                    |   | Netherlands          |   | 43.55  |
| Snamprogetti France Sàrl                                                                  |   | France               |   | 43.55  |
| Snamprogetti Ltd                                                                               |   | UK                   |   | 43.55  |
| Snamprogetti Lummus Gas Ltd                                                                    |   | Malta                |   | 43.12  |
| Snamprogetti Management        Services SA                                                     |   | Switzerland          |   | 43.55  |
| Snamprogetti Netherlands BV                                                                    |   | Netherlands          |   | 43.55  |
| Snamprogetti Romania Srl                                                                       |   | Romania              |   | 43.55  |
| Snamprogetti Saudi Arabia Co        Ltd Llc (ex Snamprogetti Saudi Arabia Ltd)                 |   | United Arab Emirates |   | 43.55  |
| Snamprogetti USA Inc                                                                           |   | USA                  |   | 43.55  |
| Société de Construction        d’Oleoducs Snc                                   |   | France               |   | 43.48  |
| Sofresid Engineering SA                                                                        |   | France               |   | 43.55  |
| Sofresid SA                                                                                    |   | France               |   | 43.55  |
| Sonsub AS                                                                                      |   | Norway               |   | 43.55  |
| Sonsub International Pty Ltd                                                                   |   | Australia            |   | 43.55  |
| Sonsub Ltd (in liquidation)                                                                    |   | UK                   |   | 43.55  |
| Star Gulf FZ Co                                                                                |   | United Arab Emirates |   | 43.55  |
| Varisal - Serviços De        Consultadoria e Marketing Lda                                |   | Portugal             |   | 43.55  |
|                                                                                           |   |                 |   |   |
|                                                                                           |   |                 |   |   |
| OTHER ACTIVITIES                                                                               |   |                 |   |   |
|                                                                                           |   |                 |   |   |
| Ing. Luigi Conti Vecchi SpA                                                                    |   | Italy                |   | 100.00 |
| Syndial SpA - Attività        Diversificate                                               |   | Italy                |   | 100.00 |
|                                                                                           |   |                 |   |   |
|                                                                                           |   |                 |   |   |
| CORPORATE AND FINANCIAL        COMPANIES                                                       |   |                 |   |   |
|                                                                                           |   |                 |   |   |
| Agenzia Giornalistica Italia        SpA                                                        |   | Italy                |   | 100.00 |
| Eni Corporate University SpA                                                                   |   | Italy                |   | 100.00 |
| EniServizi SpA                                                                                 |   | Italy                |   | 100.00 |
| Serfactoring SpA                                                                               |   | Italy                |   | 48.81  |
| Servizi Aerei SpA                                                                              |   | Italy                |   | 100.00 |
| Società Finanziamenti        Idrocarburi - Sofid - SpA                                    |   | Italy                |   | 99.61  |
| Banque Eni SA                                                                                  |   | Belgium              |   | 100.00 |
| Eni Coordination Center SA                                                                     |   | Belgium              |   | 100.00 |
| Eni Insurance Ltd                                                                              |   | Ireland              |   | 100.00 |
| Eni International Bank Ltd                                                                     |   | Bahamas              |   | 100.00 |
| Eni International BV                                                                           |   | Netherlands          |   | 100.00 |
| Eni International Resources        Ltd                                                         |   | UK                   |   | 100.00 |

 

 

 

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##### Table of Contents

**EXHIBIT 11**

**Code of Ethics**

Approved by the Board of Directors of Eni SpAon March 14, 2008The English text is a translation of the Italian official"Code of Ethics"For any conflict or discrepancies between the two texts theItalian text shall prevail

 

TABLE OF CONTENTS

Foreword

**I. GENERAL PRINCIPLES: SUSTAINABILITY AND CORPORATERESPONSIBILITY**

**II. BEHAVIOUR RULES AND RELATIONS WITH STAKEHOLDERS1. Ethics, transparency, fairness, professionalism2. Relations with shareholders and with the Market**2.1. Value for shareholders, efficiency, transparency2.2. Self-Regulatory Code2.3. Company information2.4. Privileged information2.5. Media**3. Relations with institutions, associations, localcommunities**3.1. Authorities and Public Institutions3.2. Political organizations and trade unions3.3. Development of local Communities3.4. Promotion of "non profit" activities**4. Relations with customers and suppliers**4.1. Customers and consumers4.2. Suppliers and external collaborators**5. Eni’s management, employees, collaborators**5.1. Development and protection of Human Resources5.2. Knowledge Management5.3. Corporate security5.4. Harassment or mobbing in the workplace5.5. Abuse of alcohol or drugs and no smoking

**III. TOOLS FOR IMPLEMENTING THE CODE OF ETHICS1. System of internal control**1.1. Conflicts of interest1.2. Transparency of accounting records**2. Health, safety, environment and public safety protection3. Research, innovation and intellectual property protection4. Confidentiality**4.1. Protection of business secret4.2. Protection of privacy4.3. Membership in associations, participation in initiatives,events or external meetings

**IV. CODE OF ETHICS SCOPE OF APPLICATION AND REFERENCESTRUCTURES1. Obligation to know the Code and to report any possibleviolation thereof2. Reference structures and supervision**2.1. Guarantor of the Code of Ethics2.2. Code Promotion Team**3. Code review4. Contractual value of the Code**

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##### Table of Contents

**FOREWORD**

Eni1 is an internationally orientedindustrial group which, because of its size and the importance ofits activities, plays a significant role in the marketplace andin the economic development and welfare of the individuals whowork or collaborate with Eni and of the communities where it ispresent.

The complexity of the situations in which Enioperates, the challenges of sustainable development and the needto take into consideration the interests of all people having alegitimate interest in the corporate business("Stakeholders"), strengthen the importance to clearlydefine the values that Eni accepts, acknowledges and shares aswell as the responsibilities it assumes, contributing to a betterfuture for everybody.

For this reason the new Eni’s Code ofEthics ("Code" or "Code of Ethics") has beendevised.

Compliance with the Code by Eni’sdirectors, statutory auditors, management and employees as wellas by all those who operate in Italy and abroad for achievingEni’s objectives ("Eni’s People"), eachwithin their own functions and responsibilities, is of paramountimportance – also pursuant to legal and contractualprovisions governing the relationship with Eni – forEni’s efficiency, reliability and reputation, which are allcrucial factors for its success and for improving the socialsituation in which Eni operates.

Eni undertakes to promote knowledge of the Codeamong Eni’s People and the other Stakeholders, and to accepttheir constructive contribution to the Code’s principles andcontents. Eni undertakes to take into consideration anysuggestions and remarks of Stakeholders, with the objective ofconfirming or integrating the Code.

Eni carefully checks for compliance with theCode by providing suitable information, prevention and controltools and ensuring transparency in all transactions andbehaviours by taking corrective measures if and as required.

The Watch Structure of each Eni companyperforms the functions of guarantor of the Code of Ethics("Guarantor").

The Code is brought to the attention of everyperson or body having business relations with Eni.

 

 

 

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| (1) |   | "Eni"        means Eni SpA and its direct and indirect subsidiaries,        in Italy and abroad. |
|-----|--------|------------------------------------------------------------------------------------------------------------|

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**I. GENERAL PRINCIPLES:SUSTAINABILITY AND CORPORATE RESPONSIBILITY**

Compliance with the law, regulations, statutoryprovisions, self-regulatory codes, ethical integrity andfairness, is a constant commitment and duty of all Eni’sPeople, and characterizes the conduct of Eni’s entireorganization.Eni’s business and corporate activities has to be carriedout in a transparent, honest and fair way, in good faith, and infull compliance with competition protection rules.Eni undertakes to maintain and strengthen a governance system inline with international best practice standards, able to dealwith the complex situations in which Eni operates, and with thechallenges to face for sustainable development.Systematic methods for involving Stakeholders are adopted,fostering dialogue on sustainability and corporateresponsibility.In conducting both its activities as an international company andthose with its partners, Eni stands up for the protection andpromotion of human rights – inalienable and fundamentalprerogatives of human beings and basis for the establishment ofsocieties founded on principles of equality, solidarity,repudiation of war, and for the protection of civil and politicalrights, of social, economic and cultural rights and the so-calledthird generation rights (selfdetermination right, right to peace,right to development and protection of the environment).Any form of discrimination, corruption, forced or child labor isrejected. Particular attention is paid to the acknowledgement andsafeguarding of the dignity, freedom and equality of humanbeings, to protection of labor and of the freedom of trade unionassociation, of health, safety, the environment and biodiversity,as well as the set of values and principles concerningtransparency, energy efficiency and sustainable development, inaccordance with International Institutions and Conventions.In this respect Eni operates within the reference framework ofthe United Nations Universal Declaration of Human Rights, theFundamental Conventions of the ILO – International LaborOrganization – and the OECD Guidelines on MultinationalEnterprises.All Eni’s People, without any distinction or exceptionwhatsoever, respect the principles and contents of the Code intheir actions and behaviours while performing their functions andaccording to their responsibilities, because compliance with theCode is fundamental for the quality of their working andprofessional performance. Relationships among Eni’s People,at all levels, must be characterized by honesty, fairness,cooperation, loyalty and mutual respect.The belief that one is acting in favor or to the advantage of Enican never, in any way, justify – not even in part – anybehaviours that conflict with the principles and contents of theCode.

 

**II. BEHAVIOUR RULES ANDRELATIONS WITH STAKEHOLDERS**

**1. ETHICS, TRANSPARENCY, FAIRNESS,PROFESSIONALISM**

In conducting its business, Eni is inspired byand complies with the principles of loyalty, fairness,transparency, efficiency and an open market, regardless of theimportance level of the transaction in question.Any action, transaction and negotiation performed and, generally,the conduct of Eni’s People in the performance of theirduties is inspired by the highest principles of fairness,completeness and transparency of information and legitimacy, bothin form and substance, as well as clarity and truthfulness of allaccounting documents, in compliance with the applicable laws inforce and internal regulations.All Eni’s activities have to be performed with the utmostcare and professional skill, with the duty to provide skills andexpertise adequate to the tasks assigned, and to act in a waycapable to protect Eni’s image and reputation. Corporateobjectives, as well as the proposal and implementation ofprojects, investments and actions, have to be aimed at improvingthe company’s assets, management, technological andinformation level in the long term, and at creating value andwelfare for all Stakeholders.Bribes, illegitimate favours, collusion, requests for personalbenefits for oneself or others, either directly or through thirdparties, are prohibited without any exception.It is prohibited to pay or offer, directly or indirectly, moneyand material benefits and other advantages of any kind to thirdparties, whether representatives of governments, public officersand public servants or private employees, in order to influenceor remunerate the actions of their office.Commercial courtesy, such as small gifts or forms of hospitality,is only allowed when its value is small and it does notcompromise the integrity and reputation of either party, andcannot be construed by an impartial observer as aimed atobtaining undue advantages. In any case, these expenses mustalways be authorized by the designated managers as per existinginternal rules, and be accompanied by appropriate documentation.It is forbidden to accept money from individuals or companiesthat have or intend to have business relations with Eni. Anyonewho receives proposals of gifts or special or hospitalitytreatment that cannot be considered as commercial courtesy ofsmall value, or requests therefore by third parties, shall rejectthem and immediately inform their superior, or the body theybelong to, as well as the Guarantor.Eni shall properly inform all third parties about the commitmentsand obligations provided for in the Code, require third partiesto respect the principles of the Code relevant to theiractivities and take proper internal actions and, if the matter iswithin its own competence, external actions in the event that anythird party should fail to comply with the Code.

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**2. RELATIONS WITH SHAREHOLDERS AND WITH THEMARKET**

**2.1.Value for shareholders, efficiency,transparency**The internal structure of Eni and the relations with theparties directly and indirectly taking part in its activities areorganized according to rules able to ensure managementreliability and a fair balance between the management’spowers and the interests of shareholders and of the otherStakeholders in general as well as transparency and markettraceability of management decisions and general corporate eventswhich may considerably influence the market value of thefinancial instruments issued.Within the framework of the initiatives aimed at maximizing thevalue for shareholders and at guaranteeing transparency of themanagement’s work, Eni defines, implements and progressivelyadjusts a coordinated and homogeneous set of behaviour rulesconcerning both its internal organizational structure andrelations with shareholders and third parties, in compliance withthe highest corporate governance standards at national andinternational level, based on the awareness that thecompany’s capacity to impose efficient and effectivefunctioning rules upon itself is a fundamental tool forstrengthening its reputation in terms of reliability andtransparency as well as Stakeholders’ trust.Eni deems it necessary that shareholders are enabled toparticipate in decisions which come within the limits of theircompetence and make informed choices. Therefore, Eni undertakesto ensure maximum transparency and timeliness of informationcommunicated to shareholders and to the market – by means ofthe corporate internet site, too – in compliance with thelaws and regulations applicable to listed companies. Moreover,Eni undertakes to keep in due consideration the legitimateremarks expressed by shareholders whenever they are entitled todo so.

**2.2. Self-Regulatory Code**The main corporate governance rules of Eni are contained inthe Self-Regulatory Code of Eni SpA, adopted in compliance withthe Code promoted by Borsa Italiana SpA, which is referred toherein as far as applicable.

**2.3. Company information**Eni ensures the correct management of company information, bymeans of suitable procedures for in-house management andcommunication to the outside.

**2.4. Privileged information**All Eni’s People are required, while performing thetasks entrusted to them, to properly manage privilegedinformation such as to know and comply with corporate proceduresreferring to market abuse. Insider trading and any behaviour thatmay promote insider trading are expressly forbidden. In any case,the purchase or sale of shares of Eni or of companies outside Enishall always be based on absolute and transparent fairness.

**2.5. Media**Eni undertakes to provide outside parties with true, prompt,transparent and accurate information.Relations with the media are exclusively dealt with by thedepartments and managers specifically appointed to do so;information to be supplied to media representatives, as well asthe undertaking to provide such information, have to be agreedupon beforehand by Eni’s People with the relevant EniCorporate structure.

**3. RELATIONS WITH INSTITUTIONS, ASSOCIATIONS,LOCAL COMMUNITIES**

Eni encourages dialogue with Institutions andwith organized associations of civil society in all the countrieswhere it operates.

**3.1. Authorities and Public Institutions**Eni, through its People, actively and fully cooperates withAuthorities.Eni’s People, as well as external collaborators whoseactions may somehow be referred to Eni, must have behaviourstowards the Public Administration characterized by fairness,transparency and traceability. These relations have to beexclusively dealt with by the departments and individualsspecifically appointed to do so, in compliance with approvedplans and corporate procedures.The departments of the subsidiaries concerned shall coordinatewith the relevant Eni Corporate structure for assessing thequality of the interventions to be carried out and for thesharing, implementing and monitoring of their actions.It is forbidden to make, induce or encourage false statements toAuthorities.

**3.2. Political organizations and tradeunions**Eni does not make any direct or indirect contributions inwhatever form to political parties, movements, committees,political organizations and trade unions, nor to theirrepresentatives and candidates, except those specificallycontemplated by applicable laws and regulations.

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**3.3. Development of local Communities**Eni is committed to actively contribute to promoting thequality of life, the socio-economic development of thecommunities where Eni operates and to the development of theirhuman resources and capabilities, while conducting its businessactivities according to standards that are compatible with faircommercial practices.Eni’s activities are carried out in the awareness of thesocial responsibility that Eni has towards all of itsStakeholders and in particular the local communities in which itoperates, in the belief that the capacity for dialogue andinteraction with civil society constitutes an important asset forthe company. Eni respects the cultural, economic and socialrights of the local communities in which it operates andundertakes to contribute, as far as possible, to their exercise,with particular reference to the right to adequate nutrition,drinking water, the highest achievable level of physical andmental health, decent dwellings, education, abstaining fromactions that may hinder or prevent the exercise of such rights.Eni promotes transparency of the information addressed to localcommunities, with particular reference to the topics that theyare most interested in. Forms of continuous and informedconsultancy are either promoted, through the relevant Enistructures, in order to take into due consideration thelegitimate expectations of local communities in conceiving andconducting corporate activities and in order to promote a properredistribution of the profits deriving from such activities.Eni, therefore, undertakes to promote the knowledge of itscorporate values and principles, at every level of itsorganization, also through adequate control procedures, and toprotect the rights of local communities, with particularreference to their culture, institutions, ties and life styles.Within the framework of their respective responsibilities,Eni’s People are required to participate in the definitionof single initiatives in compliance with Eni’s policies andintervention programs, to implement them according to criteria ofabsolute transparency and support them as an integral part ofEni’s objectives.

**3.4. Promotion of "non profit"activities**The philanthropic activity of Eni is in line with its visionand attention to sustainable development.Therefore, Eni undertakes to foster and support, as well as topromote among its People, its "non profit" activitieswhich demonstrate the company’s commitment to help meet theneeds of those communities where it operates.

**4. RELATIONS WITH CUSTOMERS AND SUPPLIERS**

**4.1 Customers and consumers**Eni pursues its business success on markets by offeringquality products and services under competitive conditions whilerespecting the rules protecting fair competition.Eni undertakes to respect the right of consumers not to receiveproducts harmful to their health and physical integrity and toget complete information on the products offered to them.Eni acknowledges that the esteem of those requesting products orservices is of primary importance for success in business.Business policies are aimed at ensuring the quality of goods andservices, safety and compliance with the precautionary principle.Therefore, Eni’s People shall:

| • |   | comply with        in-house procedures concerning the management of        relations with customers and consumers;                                                                                                             |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | supply, with        efficiency and courtesy, within the limits set by the        contractual conditions, high-quality products meeting the        reasonable expectations and needs of customers and        consumers;         |
| • |   | supply        accurate and exhaustive information on products and        services and be truthful in advertisements or other kind        of communication, so that customers and consumers can        make informed decisions. |

**4.2. Suppliers and external collaborators**Eni undertakes to look for suppliers and externalcollaborators with suitable professionalism and committed tosharing the principles and contents of the Code and promotes theestablishment of long-lasting relations for the progressiveimprovement of performances while protecting and promoting theprinciples and contents of the Code.In relationships regarding tenders, procurement and, generally,the supply of goods and/or services and of externalcollaborations (including consultants, agents, etc.), Eni’sPeople shall:

| • |   | follow        internal procedures concerning selection and relations        with suppliers and external collaborators and abstain        from excluding any supplier meeting requirements from        bidding for Eni’s orders; adopt appropriate and        objective selection methods, based on established,        transparent criteria; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| • |   | secure the        cooperation of suppliers and external collaborators in        guaranteeing the continuous satisfaction of Eni’s        customers and consumers, to an extent adequate to that        legitimately expected by them, in terms of quality, costs        and delivery times; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | use as much        as possible, in compliance with the laws in force and the        criteria for legality of transactions with related        parties, products and services supplied by Eni companies        at arm’s length and market conditions;                                        |
| • |   | state in        contracts the Code acknowledgement and the obligation to        comply with the principles contained therein;                                                                                                                                                                    |
| • |   | comply with,        and demand compliance with, the conditions contained in        contracts;                                                                                                                                                                                                    |
| • |   | maintain a        frank and open dialogue with suppliers and external        collaborators in line with good commercial practice;        promptly inform superiors, and the Guarantor, about any        possible violations of the Code;                                                         |

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| • |   | inform the        relevant Eni Corporate structure about any serious        problems that may arise with a particular supplier or        external collaborator, in order to evaluate possible        consequences for Eni. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

The remuneration to be paid shall beexclusively proportionate to the services to be rendered anddescribed in the contract and payments shall not be allowed toany party different from the contract party nor in a thirdCountry different from the one of the parties or where thecontract has to be performed.

**5. ENI’S MANAGEMENT, EMPLOYEES, COLLABORATORS**

**5.1. Development and protection of HumanResources**People are basic components in the company’s life. Thededication and professionalism of management and employeesrepresent fundamental values and conditions for achievingEni’s objectives.Eni is committed to developing the abilities and skills ofmanagement and employees so that their energy and creativity canhave full expression for the fulfilment of their potential intheir working performance, such as to protect working conditionsas regards both mental and physical health and dignity. Unduepressure or discomfort is not allowed, while appropriate workingconditions promoting development of personality andprofessionalism are fostered.Eni undertakes to offer, in full compliance with applicable legaland contractual provisions, equal opportunities to all itsemployees, making sure that each of them receives a fairstatutory and wage treatment exclusively based on merit andexpertise, without discrimination of any kind. Competentdepartments shall:

| • |   | adopt in any        situation criteria of merit and ability (and anyhow        strictly professional) in all decisions concerning human        resources;                              |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | select, hire,        train, compensate and manage human resources without        discrimination of any kind;                                                                           |
| • |   | create a        working environment where personal characteristics or        beliefs do not give rise to discrimination and which        allows the serenity of all Eni’s People. |

Eni wishes that Eni’s People, at everylevel, cooperate in maintaining a climate of common respect for aperson’s dignity, honour and reputation. Eni shall do itsbest to prevent attitudes that can be considered as offensive,discriminatory or abusive. In this regard, any behaviours outsidethe working place which are particularly offensive to publicsensitivity are also deemed relevant.In any case, any behaviours constituting physical or moralviolence are forbidden without any exception.

**5.2. Knowledge Management**Eni promotes culture and the initiatives aimed atdisseminating knowledge within its structures, and at pointingout the values, principles, behaviours and contributions in termsof innovation of professional families in connection with thedevelopment of business activities and to the company’ssustainable growth.Eni undertakes to offer tools for interaction among the membersof professional families, working groups and communities ofpractice, as well as for coordination and access to know-how, andshall promote initiatives for the growth, dissemination andsystematization of knowledge relating to the core competences ofits structures and aimed at defining a reference frameworksuitable for guaranteeing operating consistency.All Eni’s People shall actively contribute to KnowledgeManagement as regards the activities that they are in charge of,in order to optimize the system for knowledge sharing anddistribution among individuals.

**5.3. Corporate security**Eni engages in the study, development and implementation ofstrategies, policies and operational plans aimed at preventingand overcoming any intentional or non-intentional behaviour whichmay cause direct or indirect damage to Eni’s People and/orto the tangible and intangible resources of the company.Preventive and defensive measures, aimed at minimizing the needfor an active response – always in proportion to the attack– to threats to people and assets, are favored.All Eni’s People shall actively contribute to maintaining anoptimal corporate security standard, abstaining from unlawful ordangerous behaviours, and reporting any possible activitiescarried out by third parties to the detriment of Eni’sassets or human resources to superiors or to the body they belongto, as well as to the relevant Eni Corporate structure.In any case requiring particular attention to personal safety, itis compulsory to strictly follow the indications in this regardsupplied by Eni, abstaining from behaviours which may endangerone’s own safety or the safety of others, promptly reportingany danger for one’s own safety, or the safety of thirdparties, to one’s superior.

**5.4. Harassment or mobbing in the workplace**Eni supports any initiatives aimed at implementing workingmethods for the achievement of a better organization.Eni demands that there shall be no harassment or mobbingbehaviours in personal working relationships either inside oroutside the company. Such behaviours are all forbidden, withoutexceptions, and are:

| • |   | the creation        of an intimidating, hostile, isolating or in any case        discriminatory environment for individual employees or        groups of employees;                     |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | unjustified        interference in the work performed by others;                                                                                                                        |
| • |   | the placing        of obstacles in the way of the work prospects and        expectations of others merely for reasons of personal        competitiveness or because of other employees. |

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Any form of violence or harassment, eithersexual harassment or harassment based on personal and culturaldiversity, is forbidden. Such harassment is for instance:

| • |   | subordinating        decisions on someone’s working life to the        acceptance of sexual attentions, or personal and cultural        diversity; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | obtaining        sexual attentions using the influence of one’s role;                                                                              |
| • |   | proposing        private interpersonal relations despite the        recipient’s explicit or reasonably clear distaste;                             |

| • |   | alluding to        disabilities and physical or psychic impairment, or to        forms of cultural, religious or sexual diversity. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------|

**5.5. Abuse of alcohol or drugs and nosmoking**All Eni’s People shall personally contribute topromoting and maintaining a climate of common respect in theworkplace; particular attention is paid to respect of thefeelings of others.Eni will therefore consider individuals who work under the effectof alcohol or drugs, or substances with similar effect, duringthe performance of their work activities and in the workplace, asbeing aware of the risk they cause. Chronic addiction to suchsubstances, when it affects work performance, shall be consideredsimilar to the above mentioned events in terms of contractualconsequences; Eni is committed to favour social action in thisfield as provided for by employment contracts.It is forbidden to:

| • |   | hold,        consume, offer or give for whatever reason, drugs or        substances with similar effect, at work and in the        workplace;                                                                                                                                                                                                                                                                                                           |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | smoke in the        workplace. Eni supports voluntary initiatives addressed        to People to help them quit smoking and, in identifying        possible smoking areas, shall take into particular        consideration the condition of those suffering physical        discomfort from exposure to smoke in the workplace shared        with smokers and requesting to be protected from        "passive smoking" in their place of work. |

 

**III. TOOLS FOR IMPLEMENTINGTHE CODE OF ETHICS**

**1. SYSTEM OF INTERNAL CONTROL**

Eni undertakes to promote and maintain anadequate system of internal control, i.e. all the necessary oruseful tools for addressing, managing and checking activities inthe company, aimed at ensuring compliance with corporate laws andprocedures, at protecting corporate assets, efficiently managingactivities and providing precise and complete accounting andfinancial information.The responsibility for implementing an effective system ofinternal control is shared at every level of Eni’sorganizational structure; therefore, all Eni’s People,according to their functions and responsibilities, shall defineand actively participate in the correct functioning of the systemof internal control.Eni promotes the dissemination, at every level of itsorganization, of policies and procedures characterized byawareness of the existence of controls and by an informed andvoluntary control oriented mentality; consequently, Eni’smanagement in the first place and all Eni’s People in anycase shall contribute to and participate in Eni’s system ofinternal control and, with a positive attitude, involve itscollaborators in this respect.Each employee shall be held responsible for the corporatetangible and intangible assets relevant to his/her job. Noemployee can make, or let others make, improper use of assets andequipment belonging to Eni.Any practices and attitudes linked to the perpetration or to theparticipation in the perpetration of frauds are forbidden withoutany exception.Control and supervisory bodies, Eni Internal Audit department andappointed auditing companies shall have full access to all data,documents and information necessary to perform their own relevantactivities.

**1.1. Conflicts of interest**Eni acknowledges and respects the right of its People to takepart in investments, business and other kinds of activities otherthan the activity performed in the interest of Eni, provided thatsuch activities are permitted by law and are compatible with theobligations assumed towards Eni. The Self-Regulatory Code of EniSpA governs any possible conflict of interest of directors andstatutory auditors of Eni SpA.Eni’s management and employees shall avoid and report anyconflicts of interest between personal and family economicactivities and their tasks within the company. In particular,everyone shall point out any specific situations and activitiesof economic or financial interest (owner or member) to them or,as far as they know, of economic or financial interest torelatives of theirs or relatives by marriage within the 2nddegree of kinship, or to persons actually living with them, alsoinvolving suppliers, customers, competitors, third parties, orthe relevant controlling companies or subsidiaries, and shallpoint whether they perform corporate administration or control ormanagement functions therein.Moreover, conflicts of interest are determined by the followingsituations:

| • |   | use of        one’s position in the company, or of information, or        of business opportunities acquired during one’s        work, to one’s undue benefit or to the undue benefit        of third parties; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| • |   | the        performing of any type of work for suppliers,        sub-suppliers and competitors by employees and/or their        relatives. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|

In any case, Eni’s management andemployees shall avoid any situation and activity where a conflictwith the Company’s interests may arise, or which caninterfere with their ability to make impartial decisions in thebest interests of Eni and in full accordance with the principlesand contents of the Code, or in general with their ability tofully comply with their functions and responsibilities. Anysituation that may constitute or give rise to a conflict ofinterest shall be immediately reported to one’s superiorwithin management, or to the body one belongs to, and to theGuarantor. Furthermore, the party concerned shall abstain fromtaking part in the operational/decision-making process, and therelevant superior within management, or the relevant body, shall:

| • |   | identify the        operational solutions suitable for ensuring, in the        specific case, transparency and fairness of behaviours in        the performance of activities;   |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | transmit to        the parties concerned – and for information to        one’s superior, as well as to the Guarantor –        the necessary written instructions; |
| • |   | file the        received and transmitted documentation.                                                                                                                          |

**1.2.Transparency of accounting records**Accounting transparency is grounded on the use of true,accurate and complete information which form the basis for theentries in the books of accounts. Each member of company bodies,of management or employee shall cooperate, within their own fieldof competence, in order to have operational events properly andtimely registered in the books of accounts.It is forbidden to behave in a way that may adversely affecttransparency and traceability of the information within financialstatements.For each transaction, the proper supporting evidence has to bemaintained in order to allow:

| • |   | easy and        punctual accounting entries;                                                                                     |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------|
| • |   | identification        of different levels of responsibility, as well as of task        distribution and segregation;             |
| • |   | accurate        representation of the transaction so as to avoid the        probability of any material or interpretative error. |

Each record shall reflect exactly what is shownby the supporting evidence. All Eni’s People shall causethat the documentation can be easily traced and filed accordingto logical criteria.Eni’s People who become aware of any omissions, forgery,negligence in accounting or in the documents on which accountingis based, shall bring the facts to the attention of theirsuperior, or to the body they belong to, and to the Guarantor.

**2. HEALTH, SAFETY, ENVIRONMENT AND PUBLIC SAFETY PROTECTION**

Eni’s activities shall be carried out incompliance with applicable worker health and safety,environmental and public safety protection agreements,international standards and laws, regulations, administrativepractices and national policies of the Countries where itoperates.Eni actively contributes as appropriate to the promotion ofscientific and technological development aimed at protecting theenvironment and natural resources. The operative management ofsuch activities shall be carried out according to advancedcriteria for the protection of the environment and energyefficiency, with the aim of creating better working conditionsand protecting the health and safety of employees as well as theenvironment.Eni’s People shall, within their areas of responsibility,actively participate in the process of risk prevention as well asenvironmental, public safety and health protection forthemselves, their colleagues and third parties.

**3. RESEARCH, INNOVATION AND INTELLECTUAL PROPERTY PROTECTION**

Eni promotes research and innovation activitiesby management and employees, within their functions andresponsibilities. Any intellectual assets generated by suchactivities are an important and fundamental heritage of Eni.Research and innovation focus in particular on the promotion ofproducts, tools, processes and behaviours supporting energyefficiency, reduction of environmental impact, attention tohealth and safety of employees, of customers and of the localcommunities where Eni operates, and in general sustainability ofbusiness activities.Eni’s People shall actively contribute, within theirfunctions and responsibilities, to managing intellectual propertyin order to allow its development, protection and enhancement.

**4. CONFIDENTIALITY**

**4.1. Protection of business secret**Eni’s activities constantly require the acquisition,storing, processing, communication and dissemination ofinformation, documents and other data regarding negotiations,administrative proceedings, financial transactions, and know-how(contracts, deeds, reports, notes, studies, drawings, pictures,software, etc.) that may not be disclosed to the 

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outside pursuant to contractual agreements, orwhose inopportune or untimely disclosure may be detrimental tocorporate interest.Without prejudice to the transparency of the activities carriedout and to the information obligations imposed by the provisionsin force, Eni’s People shall ensure the confidentialityrequired by the circumstances for each piece of news they havegot to know of because of their working function.Any information, knowledge and data acquired or processed duringone’s work or because of one’s tasks at Eni, belong toEni and may not be used, communicated or disclosed withoutspecific authorization of one’s superior within managementin compliance with specific procedures.

**4.2. Protection of privacy**Eni is committed to protecting information concerning itsPeople and third parties, whether generated or obtained insideEni or in the conduct of Eni’s business, and to avoidingimproper use of any such information.Eni intends to guarantee that processing of personal data withinits structures respects fundamental rights and freedoms, as wellas the dignity of the parties concerned, as contemplated by thelegal provisions in force.Personal data must be processed in a lawful and fair way and, inany case, the data collected and stored is only that which isnecessary for certain, explicit and lawful purposes. Data shallbe stored for a period of time no longer than necessary for thepurposes of collection.Eni undertakes moreover to adopt suitable preventive safetymeasures for all databases storing and keeping personal data, inorder to avoid any risks of destruction and losses or ofunauthorized access or unallowed processing.Eni’s People shall:

| • |   | obtain and        process only data that are necessary and adequate to the        aims of their work and responsibilities;                                                                            |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | obtain and        process such data only within specified procedures, and        store said data in a way that prevents unauthorized        parties from having access to it;                         |
| • |   | represent and        order data in a way ensuring that any party with access        authorization may easily get an outline thereof which is        as accurate, exhausting and truthful as possible; |

| • |   | disclose such        data pursuant to specific procedures or subject to the        express authorization by their superior and, in any case,        only after having checked that such data may be        disclosed, also making reference to absolute or relative        constraints concerning third parties bound to Eni by a        relation of whatever nature and, if applicable, after        having obtained their consent. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**4.3. Membership in associations,participation in initiatives, events or external meetings**Membership in associations, participation in initiatives,events or external meetings is supported by Eni if compatiblewith the working or professional activity provided. Membershipand participation considered as such are:

| • |   | membership in        associations, participation in conferences, workshops,        seminars, courses; |
|--------|--------|-------------------------------------------------------------------------------------------------------|
| • |   | drawing up of        articles, papers and publications in general;                                    |
| • |   | participation        in public events in general.                                                     |

In this regard, Eni’s management andemployees in charge of illustrating, or providing to the outsidedata or news concerning Eni’s objectives, aims, results andpoints of view, shall not only comply with corporate proceduresrelating to market abuse, but also obtain the necessaryauthorization from their superior within management for the linesof action to follow and the texts as well as reports drawn up,such as to agree on contents with the relevant Eni Corporatestructure.

 

**IV. CODE OF ETHICS SCOPE OFAPPLICATION AND REFERENCE STRUCTURES**

The principles and contents of the Code applyto Eni’s People and activities.Any listed subsidiaries and power & gas sector subsidiariessubject to unbundling shall receive the Code and adopt it,adjusting it – if necessary – to the characteristics oftheir company, consistently with their management independence.The representatives indicated by Eni in the company bodies ofpartially owned companies, in consortia and in joint venturesshall promote the principles and contents of the Code withintheir own respective areas of competence.Directors and management must be the first to give concrete formto the principles and contents of the Code, by assumingresponsibility for them both towards the inside and the outsideand by enhancing trust, cohesion and a sense of team-work, aswell as providing a behaviour model for their collaborators inorder to have them comply with the Code and make questions andsuggestions on specific provisions.To achieve full compliance with the Code, each of Eni’sPeople may even apply directly to the Guarantor.

**1. OBLIGATION TO KNOW THE CODE AND TO REPORT ANY POSSIBLEVIOLATION THEREOF**

Each of Eni’s People is expected to knowthe principles and contents of the Code as well as the referenceprocedures governing own functions and responsibilities.Each of Eni’s People shall:

| • |   | refrain from        all conduct contrary to such principles, contents and        procedures; |
|--------|--------|----------------------------------------------------------------------------------------------|

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| • |   | carefully        select, as long as within their field of competence,        their collaborators, and have them fully comply with the        Code;                                                                                                                                                                                                                                                                                                                                         |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | require any        third parties having relations with Eni to confirm that        they know the Code;                                                                                                                                                                                                                                                                                                                                                                                      |
| • |   | immediately        report to their superiors or the body they belong to, and        to the Guarantor, any remarks of theirs or information        supplied by Stakeholders concerning a possible violation        or any request to violate the Code; reports of possible        violations shall be sent in compliance with conditions        provided for by the specific procedures established by        the Board of Statutory Auditors and by the Watch        Structure of Eni SpA; |
| • |   | cooperate        with the Guarantor and with the relevant departments        according to the applicable specific procedures in        ascertaining any violations;                                                                                                                                                                                                                                                                                                                        |
| • |   | adopt prompt        corrective measures whenever necessary, and in any case        prevent any type of retaliation.                                                                                                                                                                                                                                                                                                                                                                        |

Eni’s People are not allowed to conductpersonal investigations, nor to exchange information, except totheir superiors, or to the body that they belong to, and to theGuarantor. If, after notifying a supposed violation any ofEni’s People feels that he or she has been subject toretaliation, then he or she may directly apply to the Guarantor.

**2. REFERENCE STRUCTURES AND SUPERVISION**

Eni is committed to ensuring, even through theGuarantor’s appointment:

| • |   | the widest        dissemination of the principles and contents of the Code        among Eni’s People and the other Stakeholders,        providing any possible tools for understanding and        clarifying the interpretation and the implementation of        the Code, as well as for updating the Code as required to        meet evolving civil sensibility and relevant laws;                                  |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | the execution        of checks on any notice of violation of the Code        principles and contents or of reference procedures; an        objective evaluation of the facts and, if necessary, the        adoption of appropriate sanctions; that no one may suffer        any retaliation whatsoever for having provided        information regarding possible violations of the Code or        of reference procedures. |

**2.1. Guarantor of the Code of Ethics**The Code of Ethics is, among other things, a compulsorygeneral principle of the Organizational, Management and ControlModel adopted by Eni SpA according to the Italian provision onthe "administrative liability of legal entities derivingfrom offences" contained in Legislative Decree No. 231 ofJune 8, 2001.Eni SpA assigns the functions of Guarantor to the Watch Structureestablished pursuant to the above mentioned Model. Each direct orindirect subsidiary, in Italy and abroad, entrusts the functionof Guarantor to its own Watch Structure by formal deed of therelevant corporate body.The Guarantor is entrusted with the task of:

| • |   | promoting the        implementation of the Code and the issue of reference        procedures; reporting and proposing to the CEO of the        company the useful initiatives for a greater        dissemination and knowledge of the Code, also in order to        prevent any recurrences of violations;                                                                                             |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | promoting        specific communication and training programs for        Eni’s management and employees;                                                                                                                                                                                                                                                                                          |
| • |   | investigating        reports of any violation of the Code by initiating proper        inquiry procedures; taking action at the request of        Eni’s People in the event of receiving reports that        violations of the Code have not been properly dealt with        or in the event of being informed of any retaliation        against Eni’s people for having reported violations; |
| • |   | notifying        relevant structures of the results of investigations        relevant to the adoption of possible penalties; informing        the relevant line/area structures about the results of        investigations relevant to the adoption of the necessary        measures.                                                                                                                  |

Moreover, the Guarantor of Eni SpA submits tothe Internal Control Committee and to the Board of StatutoryAuditors as well as to the Chairman and to the Chief ExecutiveOfficer, which report about it to the Board of Directors, asix-monthly report on the implementation and possible need forupdating the Code.For the performance of its tasks, the Guarantor of Eni SpA availsitself of "Technical Secretariat of the Watch Structure 231of Eni SpA" that reports thereto and is supported by therelevant Structures of Eni SpA. The Technical Secretariat isresponsible for starting and maintaining an adequate reportingand communication flow to and from the Guarantors ofsubsidiaries.Each information flow is to be sent to the following emailaddress:organismo_di_vigilanza@eni.it

**2.2. Code Promotion Team**The Code is made available to Eni’s People in compliancewith applicable standards, and is also available on the internetand intranet sites of Eni SpA and of subsidiaries.In order to promote the knowledge and facilitate theimplementation of the Code, a Code Promotion Team reporting tothe Guarantor of Eni SpA has been established. The Team makesavailable within Eni all possible tools for understanding andclarifying the interpretation and the implementation of the Code.The members of the Team are chosen by the Chief Executive Officerof Eni SpA upon proposal of the Guarantor of Eni SpA.

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**3. CODE REVIEW**

The Code review is approved by the Board ofDirectors of Eni SpA, upon proposal of the Chief ExecutiveOfficer with the agreement of the Chairman, after hearing theopinion of the Board of Statutory Auditors.The proposal is made taking into consideration theStakeholders’ evaluation with reference to the principlesand contents of the Code, promoting active contribution andnotification of possible deficiencies by Stakeholders themselves.

**4. CONTRACTUAL VALUE OF THE CODE**

Respect of the Code’s rules is anessential part of the contractual obligations of all Eni’sPeople pursuant to and in accordance with applicable law.Any violation of the Code’s principles and contents may beconsidered as a violation of primary obligations under labourrelations or of the rules of discipline and can entail theconsequences provided for by law, including termination of thework contract and compensation for damages arising out of anyviolation.

 

 

 

 

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Certifications as separate documents filedas exhibits

**EXHIBIT 12.1**

**Certification**

 

I, Paolo Scaroni, certify that:

|   | 1. |   | I have reviewed this annual        report on Form 20-F of Eni SpA; |
|--------|----|--------|--------------------------------------------------------------------|

|   | 2. |   | Based on my knowledge, this        report does not contain any untrue statement of a        material fact or omit to state a material fact necessary        to make the statements made, in light of the        circumstances under which such statements were made, not        misleading with respect to the period covered by this        report; |
|--------|----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. |   | Based on my knowledge, the        financial statements, and other financial information        included in this report, fairly present in all material        respects the financial condition, results of operations        and cash flows of the company as of, and for, the periods        presented in this report; |
|--------|----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 4. |   | The company’s other        certifying officer and I are responsible for establishing        and maintaining disclosure controls and procedures (as        defined in Exchange Act Rules 13a-15(e) and 15d-15(e))        and internal control over financial reporting (as defined        in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the        company and have: |
|--------|----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) |   | Designed such disclosure        controls and procedures, or caused such disclosure        controls and procedures to be designed under our        supervision, to ensure that material information relating        to the company, including its consolidated subsidiaries,        is made known to us by others within those entities,        particularly during the period in which this report is        being prepared; |
|--------|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) |   | Designed such internal        control over financial reporting, or caused such internal        control over financial reporting to be designed under our        supervision, to provide reasonable assurance regarding        the reliability of financial reporting and the        preparation of financial statements for external purposes        in accordance with generally accepted accounting        principles; |
|--------|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) |   | Evaluated the effectiveness        of the company’s disclosure controls and procedures        and presented in this report our conclusions about the        effectiveness of the disclosure controls and procedures,        as of the end of the period covered by this report based        on such evaluation; and |
|--------|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) |   | Disclosed in this report any        change in the company’s internal control over        financial reporting that occurred during the period        covered by the annual report that has materially        affected, or is reasonably likely to materially affect,        the company’s internal control over financial        reporting; and |
|--------|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 5. |   | The company’s other        certifying officer and I have disclosed, based on our        most recent evaluation of internal control over financial        reporting, to the company’s auditors and the audit        committee of the company’s board of directors (or        persons performing the equivalent functions): |
|--------|----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) |   | All significant deficiencies        and material weaknesses in the design or operation of        internal control over financial reporting which are        reasonably likely to adversely affect the company’s        ability to record, process, summarize and report        financial information; and |
|--------|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) |   | Any fraud, whether or not        material, that involves management or other employees who        have a significant role in the company’s internal        control over financial reporting. |
|--------|-----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Date: May 14, 2009

| /s/PAOLO SCARONI                                    |
|-----------------------------------------------------|
|                                                     |
| Paolo Scaroni        Title: Chief Executive Officer |

 

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**EXHIBIT 12.2**

**Certification**

 

I, Alessandro Bernini, certify that:

|   | 1. |   | I have reviewed this annual        report on Form 20-F of Eni SpA; |
|--------|----|--------|--------------------------------------------------------------------|

|   | 2. |   | Based on my knowledge, this        report does not contain any untrue statement of a        material fact or omit to state a material fact necessary        to make the statements made, in light of the        circumstances under which such statements were made, not        misleading with respect to the period covered by this        report; |
|--------|----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 3. |   | Based on my knowledge, the        financial statements, and other financial information        included in this report, fairly present in all material        respects the financial condition, results of operations        and cash flows of the company as of, and for, the periods        presented in this report; |
|--------|----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 4. |   | The company’s other        certifying officer and I are responsible for establishing        and maintaining disclosure controls and procedures (as        defined in Exchange Act Rules 13a-15(e) and 15d-15(e))        and internal control over financial reporting (as defined        in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the        company and have: |
|--------|----|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) |   | Designed such disclosure        controls and procedures, or caused such disclosure        controls and procedures to be designed under our        supervision, to ensure that material information relating        to the company, including its consolidated subsidiaries,        is made known to us by others within those entities,        particularly during the period in which this report is        being prepared; |
|--------|-----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) |   | Designed such internal        control over financial reporting, or caused such internal        control over financial reporting to be designed under our        supervision, to provide reasonable assurance regarding        the reliability of financial reporting and the        preparation of financial statements for external purposes        in accordance with generally accepted accounting        principles; |
|--------|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) |   | Evaluated the effectiveness        of the company’s disclosure controls and procedures        and presented in this report our conclusions about the        effectiveness of the disclosure controls and procedures,        as of the end of the period covered by this report based        on such evaluation; and |
|--------|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) |   | Disclosed in this report any        change in the company’s internal control over        financial reporting that occurred during the period        covered by the annual report that has materially        affected, or is reasonably likely to materially affect,        the company’s internal control over financial        reporting; and |
|--------|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 5. |   | The company’s other        certifying officer and I have disclosed, based on our        most recent evaluation of internal control over financial        reporting, to the company’s auditors and the audit        committee of the company’s board of directors (or        persons performing the equivalent functions): |
|--------|----|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (a) |   | All significant deficiencies        and material weaknesses in the design or operation of        internal control over financial reporting which are        reasonably likely to adversely affect the company’s        ability to record, process, summarize and report        financial information; and |
|--------|-----|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) |   | Any fraud, whether or not        material, that involves management or other employees who        have a significant role in the company’s internal        control over financial reporting. |
|--------|-----|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Date: May 14, 2009

 

| /s/ALESSANDRO BERNINI                                    |
|----------------------------------------------------------|
|                                                          |
| Alessandro Bernini        Title: Chief Financial Officer |

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**EXHIBIT 13.1**

 

**Certification Pursuant to 18U.S.C. Section 1350**

 

For purposes of 18 U.S.C. Section 1350, the undersignedofficer of Eni SpA, a company incorporated under the laws ofItaly (the "Company"), hereby certifies, to suchofficer’s knowledge, that:

> 
(i) the Annual Report on Form 20-F of the Company for the    year ended December 31, 2008 (the "Report") fully    complies with the requirements of section 13(a) or 15(d) as    applicable, of the Securities Exchange Act of 1934; and

(ii) the information contained in the Report fairly    presents, in all material respects, the financial condition    and results of operations of the Company.

Date: May 14, 2009

 

| /s/PAOLO SCARONI                                    |
|-----------------------------------------------------|
|                                                     |
| Paolo Scaroni        Title: Chief Executive Officer |

 

The foregoing certification is not deemed filed for purpose ofSection 18 of the Exchange Act and not incorporated by referencewith any filing under the Securities Act.

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**EXHIBIT 13.2**

 

**Certification Pursuant to 18U.S.C. Section 1350**

 

For purposes of 18 U.S.C. Section 1350, the undersignedofficer of Eni SpA, a company incorporated under the laws ofItaly (the "Company"), hereby certifies, to suchofficer’s knowledge, that:

> 
(i) the Annual Report on Form 20-F of the Company for the    year ended December 31, 2008 (the "Report") fully    complies with the requirements of section 13(a) or 15(d) as    applicable, of the Securities Exchange Act of 1934; and

(ii) the information contained in the Report fairly    presents, in all material respects, the financial condition    and results of operations of the Company.

Date: May 14, 2009

 

| /s/ALESSANDRO BERNINI                                    |
|----------------------------------------------------------|
|                                                          |
| Alessandro Bernini        Title: Chief Financial Officer |

 

The foregoing certification is not deemed filed for purpose ofSection 18 of the Exchange Act and not incorporated by referencewith any filing under the Securities Act.

 

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