Salzano, P. 2013. Eni at the heart of Africa's development. GREAT Insights, Volume 2, Issue 2. February-March 2013. Maastricht: ECDPM
Africa is on the rise on the world scene. In recent years, its economy has grown faster than any other one in the world (except for China), thanks to the increasing global need of raw materials. The number of African countries becoming hydrocarbon producers is rising as well, and in the last five years oil resources have increased by 30%, while gas resources have more than doubled.
Against this background, it is little known that Eni has long been the main hydrocarbon producer in Africa, reaching in 2011, about 1 million barrels of oil equivalent (boe) per day, which represents 56% of Eni’s global production. Eni has worked in North Africa (Egypt, Libya, Tunisia and Algeria) for many years, but it is now increasingly present in Western and Southern Africa (Liberia, Ghana, Togo, Nigeria, Gabon, Congo, the DRC, Angola, South Africa, Kenya). Furthermore, in 2011-2012, Eni made the most important discovery in its history in Mozambique: a gas deposit that, on its own, could satisfy all European demand for five years.
One of the key secrets of Eni’s leadership in Africa is the traditional adherence to the principles of its founding father Enrico Mattei: the oil found in producer countries belongs to them. As an international company, Eni has a contractual right to extract resources and to benefit from an adequate return on its investments. But more importantly, the company never forgets that producer countries are the “owners” of the oil, and they therefore have the right to perceive the largest profits from it. From this philosophy descends a real commitment to supporting the countries where Eni acts.
In 2011, Eni invested about €70 million for development projects in countries where it operates. Out of this, more than €20 million was invested in Africa. As a member of the LEAD excellence programme for the social responsibility of companies organised by the United Nations, Eni is also committed to accompanying Africa to work towards achieving the UN’s Millennium Development Goals (MDGs).
Access to energy
In Eni’s view, moreover, there can be no development without electricity. Unfortunately today, two thirds of the 600 million inhabitants of oil and gas rich sub-Saharan Africa live without access to electricity.
Eni’s strategy includes the implementation of infrastructure for the development of local markets along with plans for the exploitation of energy resources. In this context, providing energy to people allows the company to pursue, directly and effectively, the MDGs. Eni therefore is currently involved in building efficient, clean, combined- cycle gas plants, that often use the gas associated with oil production, which otherwise would be burnt off (in technical terms “flared”) into the atmosphere. While producing energy, Eni also avoids gas flaring, with evident environmental benefits. Eni today reuses and revalorises 50% of the gas, which was flared in 2007: this positive trend is expected to continue.
Today in Nigeria, Eni produces 20% of the country’s electricity and as a result of significant investments, about 90% of associated gas is enhanced through conversion in LNG, power production and local distribution (it was 50% in 2000). Relevant flaring down projects have also been set up in Congo, where the company currently produces 60% of the country’s electricity.
Along this path, Eni is going to implement similar projects in other African countries, becoming one of the largest continental electricity producers. While many oil companies do not want their investments in dollars to be subject to electricity rates in local currency, as set by local governments, Eni considers such investments in producing electricity as a crucial investment which also enhances its reputation and image in the continent.
Eni has also a specific Foundation which, in line with the MDGs, implements several projects, notably for mother and childhood protection, the fight against transmissible diseases and the prevention of the mother-baby transmission of HIV.
In 2011, the projects underway in the Congo and Angola reached complete executive maturity. Acknowledged in the field as concrete and effective intervention models, developed alongside communities and local institutions, they have been able to implement new operational approaches in local health systems, destined to have lasting effects.
Three hundred thousand vaccines have so far been administered in addition to the 250,000 paediatric and children’s check-ups, 325,000 laboratory analyses, 17,000 antenatal consultancies and HIV screening tests, 11 thousand safe births, 61 thousand obstetrical check-ups, thousands of hours of training and the sensitisation of local health workers. This bears witness to the daily commitment of the men and women involved in the Foundation’s work, carried out with constant, silent devotion in cities just as in the most remote, isolated villages.
In 2011, the Foundation further broadened its horizons of solidarity and development, completing, in cooperation with local health authorities, the design of a new initiative in Ghana which, by improving health service conditions in the western region of the country, aims to reduce mother and infant mortality.
Numerous projects are currently on-going. For instance, in the Congo, the Salissa Mwana project (“Let’s protect children” initiated in 2008 in collaboration with the country’s Ministry of Health and the local non-governmental organisation Foundation Congo Assistance) aims to improve childrens healthcare in the isolated rural areas of the regions of Kouilou, Niari and Cuvette, through extensive vaccination programmes against the most common pathologies, to strengthen the basic peripheral healthcare structure, to train healthcare staff on various levels and to sensitise the population in terms of prevention.
Similarly, the Kento Mwana (“Mother-Child”) project, that first started in 2009 in collaboration with the local Ministry of Health, aims to reduce the mother-baby transmission of the HIV virus in HIV-positive pregnant women to 2-3%. It also offers counselling services and voluntary screening at the network of first level healthcare centres and, in the event of seropositivity, prophylaxis or treatment services at the maternity and children’s wards of reference hospitals.
Furthermore, in Angola, the Kilamba Kiaxi project, promoted with the Ministry of Health and the local non-governmental organisation Obra da Divina Providencia, aims to improve health in the mother-child population of the municipality of Kilamba Kiaxi, in Luanda. The intervention, which also enjoys the support of major international scientific institutions, aims to reduce the incidence of preventable diseases, including those caused by malnutrition, by strengthening peripheral healthcare structures, monitoring epidemics and developing vaccination programmes and dietary education.
In Ghana, the Foundation is now starting a €6.2 million, 3-year health project, aimed at strengthening maternal-infant medicine services in districts of the Western Region. The project, in line with the strategies of the local Ministry of Health, aims to support the action of the health authorities in achieving the MDGs, and in particular goals 4 and 5: respectively to reduce infant mortality and improve maternal health. The project envisages developing the extension of basic healthcare services in the least served areas, in line with the planning strategy and healthcare services on a community level promoted by the Ministry of Health. It also aims to strengthen maternal-infant medical services, as well as obstetric and newborn services on an intermediate level (community clinics and health centres). Other goals are the strengthening of in-patient and emergency services in relation to obstetric and newborn assistance in district hospitals; strengthening of the capacity to plan, monitor and assess and training of regional and district healthcare staff. The Eni Foundation finances the project and is responsible for its management.
Finally, in Mozambique, the Eni Foundation and the Ministry of Health are due to sign, in early 2013, under the High Patronage of First Lady H.E. Maria da Luz Guebuza, a Memorandum of Understanding to strengthen Maternal and Child Health Services in Palma District (Cabo Delgado Province). This €2.5 million, one-year project, aims at supporting the Minister of Health in the reduction of maternal and child mortality by improving the emergency health services of Palma District with particular regard to obstetric, neonatal and paediatric care.
All Eni foundation’s projects apply specific criteria, such as adherence to local health policies and programs, prevalent training and use of local health staff, focus also on operational & management aspects, in order to facilitate the handover to the local authorities, and to assure a long lasting sustainability and an impact within country’s national health system.
Eni’s commitment to supporting the countries where it operates is real and intense. From access to electricity to mother and childhood protection, from the fight against transmissible diseases to the prevention of the mother-baby transmission of HIV, etc, Eni is one of the most active actors promoting the development and ultimately the structural transformation of African countries. This is one of the key factors behind its growing success in the continent.
Pasquale Salzano is Vice-President for International Governmental Affairs, Eni.
This article was published in Great Insights Volume 2, Issue 2 (February-March 2013)