Eni breaks silence over potential refinery conversion

Italian integrated energy firm Eni said it is "investigating the opportunity" to construct a hydrotreated vegetable oil (HVO) plant at the site of its 88,400 b/d Livorno refinery in Tuscany. It follows a long period of speculation surrounding the refinery's future, although Eni insists a final decision has yet to be made.

The company said today that it is considering building a 500,000 t/yr HVO unit at Livorno, alongside a feedstock pre-treatment plant and a facility to produce hydrogen from methane. Construction "could take place by 2025", it said. The company has two existing HVO plants in Venice and Gela on Sicily, both of which were converted from traditional refineries.

Today's announcement follows a long period of uncertainty over the future of the Livorno refinery. The company has been mulling whether to stop oil refining at Livorno since the end of 2020, but it has declined to speak about its plans publicly. The FILCTEM-CGIL union said last October it had been told by Eni that Livorno will stop producing fuels permanently from 2022. And the company met government and trade union officials in March this year to discuss a possible conversion into a biofuels plant.

Eni said it is just "studying the conversion" at this stage, "so it is not correct" to assume conventional oil refining at Livorno will cease.

Argus tracking showed no crude deliveries to Livorno in the first quarter of this year. Eni said the refinery had been undergoing maintenance and would restart, but oil deliveries have since remained inconsistent.

If the construction of an HVO plant at Livorno were to be completed in 2025, it would still leave Eni short of its stated target of 2mn t/yr of HVO output by that year. Eni's two existing HVO plants have 1.1mn t/yr of nameplate capacity combined, but neither has come close to running flat out. Eni said in February it failed to make a profit from its HVO operations in 2021. The firm said today that it wants to hit 6mn t/yr of HVO capacity "in the next decade". It has previously considered opening an HVO plant in the US.

A halt to crude refining at Livorno would be in line with Eni's longer-term ambition, to close all its domestic oil refineries by 2050 at the latest. Eni's other Italian refineries comprise the 210,500 b/d Sannazzaro and 88,400 b/d Taranto plants, as well as the 241,000 b/d Milazzo refinery which it operates in a 50:50 venture with Kuwait's state-owned KPC.

By Adam Porter