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Eni (E) to Decarbonize Aviation Industry Using HVO Biofuel

Zacks Equity Research
·4-min read

Eni SPA E and partner Aeroporti di Roma (or ADR) achieved a milestone in decarbonizing the aviation sector and accelerating clean energy transitions at airports.

Eni delivered 5,000 liters of pure hydrotreated vegetable oil (“HVO”) biofuel at the Fiumicino airport from its Venice biorefinery, located in Porto Marghera. This will significantly contribute to the decarbonization of road vehicles at the airport.

HVO is a high-quality biofuel, which is used in ADR-operated vehicles to carry passengers with low mobility around airports. It will be used in a fully refined form, as all impurities such as oxygen and sulfur are eliminated from the biofuel. Notably, HVO can reduce carbon dioxide emissions by 60-90% compared with conventional fuel, based on the type of biogenic feedstock.

Last year, Eni and ADR signed an agreement to introduce sustainable fuels for aviation (“SAF”). ADR, which has been carbon-neutral since 2013, has committed to eliminating all of its emissions by 2030. The latest accomplishment is a step forward for ADR in terms of sustainability.

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In the coming months, Eni will start producing SAFs at its Livorno refinery through the distillation of bio-components produced in its biorefineries. The raw materials used will be waste vegetable oils and fats only. The final product, Eni Biojet, will contain 100% biogenic components and include up to 50% of a blend with conventional jet fuel.

Since 2014, Eni has been producing HVO biofuel at its Venice and Gela bio-refineries with the help of its Ecofining technology. Eni has been converting its refineries in Italy to produce biofuels as part of its plans to become carbon-neutral by 2050. The company's net-zero emission strategy will make it possible to supply a variety of decarbonized products to help the aviation sector recover as a greener, more sustainable industry.

Company Profile & Price Performance

Headquartered in Rome, Italy, Eni is one of the leading integrated energy players in the world.

Shares of Eni have outperformed the industry in the past six months. The stock has gained 33.4% compared with the industry’s 30.2% growth.

Zacks Investment Research
Zacks Investment Research

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Zacks Rank & Other Stocks to Consider

Eni currently sports a Zack Rank #1 (Strong Buy).

Investors interested in the energy sector might also look at the following companies that also presently flaunt a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

TotalEnergies SE TTE has one of the best production growth profiles among the oil super majors, characterized by an upstream portfolio, with above industry-average exposure to the faster-growing hydrocarbon-producing regions of the world. TotalEnergies is making regular investments to expand the renewable operation and strives to achieve net-zero emission by 2050.

TotalEnergies is expected to see an earnings growth of 16.7% in 2022. TTE currently has a Zacks Style Score of A for Value, and B for Growth and Momentum. TotalEnergies manages long-term debt efficiently and tries to maintain the same at manageable levels. TTE’s debt to capital has been declining in the past few years.

PetroChina Company Limited PTR is the largest integrated oil company in China. PTR is one of the largest producers of crude oil and natural gas in the world. PetroChina’s natural gas business offers lucrative growth prospects in the coming years as China moves from coal to natural gas.

PetroChinais expected to see an earnings growth of 8.5% in 2022. PTRcurrently has a Zacks Style Score of A for both Value and Momentum. In the first nine months of 2021, PetroChina's upstream segment posted an operating income of RMB 58.4 billion, nearly tripling from the year-ago profit of RMB 20 billion.

Centennial Resource Development, Inc. CDEV is an independent oil and gas exploration and production company. In 2020, CDEV’s net production was recorded at 67,161 barrels of oil equivalent per day, of which oil contributed 53.7%, and natural gas and natural gas liquids accounted for the rest.

Centennial Resource is expected to see an earnings growth of 98.4% in 2022. CDEVcurrently has a Zacks Style Score of B for Growth and Momentum. At the end of third-quarter 2021, cash and cash equivalents increased to $5 million from the second-quarter level of $4.7 million. Long-term net debt outstanding amounted to $1,004.9 million, down from $1,054.3 million at the second quarter-end.


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