Country Report

Italy upstream summary

30 October 2020

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30 October 2020

Italy upstream summary

Report summary

Italy is southern Europe's largest oil and gas producer. Oil production will exceed 100,000 b/d in 2020 thanks to the long-awaited start-up of Total's Tempa Rossa field. Future output is underpinned by this and the largest field - Eni's Val d'Agri. Together, these deposits will account for almost 90% of Italian liquids by the mid-2020s. Gas production will remain around 500 mmcfd before increasing once Eni's Cassiopea project, offshore Sicily, comes onstream. Chronic regulatory and bureaucratic issues have intensified since 2018. New upstream and midstream projects have adapted in scope and scale to lower both their perceived environmental impact and the regulatory burden. This has led to a delay in first production of Tempa Rossa. FID at Cassiopea was deferred from 2014 and 2018. Val d'Agri Future Development is back in FEED, with FID expected in the early 2020s.

Executive summary
Key facts
Location maps
Key companies
- Eni
- Energean (buyer of Edison's assets)
- Other investors
  - Majors
  - Other international operators
  - Other Italian operators
  - Small E&P operators
Geology
- Introduction
- Hydrocarbon provinces
- Thrust belts of the Alps and Apennines
  - Overview
  - Source rocks
  - Reservoirs
- Folded foredeeps
  - Overview
  - Source rocks
  - Reservoirs
- Apulian platform foreland
  - Overview
  - Source rocks
  - Reservoirs
  - Extensions / sub-basins
- Post-Orogenic neogene basins
  - Overview
Exploration
- Licensing
- Key current issues
  - Exploration and appraisal (E&A) moratorium (2019-21)
  - E&A ban within 12 nautical miles of coast (2016 onwards)
  - Licensing procedure
- Drilling
  - Drilling activity
- Future activity
  - Key future E&A activity
- Historical activity
  - Onshore
  - Offshore
Reserves and resources
- Reserves by sector and basin
- Reserves by report
Production
- Liquids
  - Future production
  - Historical production
- Gas
  - Future production
  - Historical production
Infrastructure
- Oil infrastructure
  - Pipelines
  - Crude tanker ports
  - Refineries
- Gas infrastructure
- Overview
- Domestic pipelines
  - Current
  - Future: Adriatica line
- International pipelines
- Pipelines from North Africa
  - Current
  - Proposed
- Pipelines from Central Europe
  - Current
- Southern Gas Corridor
  - Current
  - Proposed
- LNG projects
- Underground gas storage (UGS)
Costs
- Introduction
- Capital costs
  - Capital expenditure by location
Policy and regulation
- Key legislation
- Recent legislation
  - Decommissioning of marine platforms (Decree No. 57/2019, February 2019)
  - Exploration and appraisal (E&A) moratorium (Decree No. 135/2018, converted (with amendments) into Law No. 12/2019, February 2019)
  - E&A ban within 12 nautical miles of coast (Decree dated December 2016, enshrined into law in April 2017)
- Environmental legislation
- Overview of other legislation
  - Post-1990
  - Pre-1990
- Regulatory body
- State oil company
  - Eni restructuring and privatisation
  - Corporate history
- State participation
- Licensing
  - Licence zones
  - Allocation process
  - Licence types
Fiscal terms
- Overview
  - Upstream
  - Midstream / downstream
- Historical background
  - Royalty
  - Offshore
  - Onshore peninsula
  - Onshore Sicily
  - Corporate income tax (CIT)
  - Sample cash flow