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Property, plant and equipment | 12 Months Ended
--- | ---
Dec. 31, 2017
Property Plant And Equipment |
Disclosure of property, plant and equipment [text block] | 16 Property, plant and equipment
(€ million) |  | Land |  | Buildings |  | Plant and machinery |  | Industrial and commercial equipment |  | Other assets |  | Tangible assets in progress and advances |  | Total
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net book amount at the beginning of the year |  |  | 448 |  |  |  | 810 |  |  |  | 50,270 |  |  |  | 300 |  |  |  | 309 |  |  |  | 18,656 |  |  |  | 70,793 |
Additions |  |  | 2 |  |  |  | 20 |  |  |  | 153 |  |  |  | 27 |  |  |  | 52 |  |  |  | 8,236 |  |  |  | 8,490 |
Depreciation |  |  |  |  |  |  | (71 | ) |  |  | (6,996 | ) |  |  | (63 | ) |  |  | (69 | ) |  |  |  |  |  |  | (7,199 | )
Net (impairments) reversals |  |  | (5 | ) |  |  | (5 | ) |  |  | 436 |  |  |  | (1 | ) |  |  | (5 | ) |  |  | (213 | ) |  |  | 207 |
Disposals |  |  | (12 | ) |  |  | (3 | ) |  |  | 3 |  |  |  |  |  |  |  | (6 | ) |  |  | (1,430 | ) |  |  | (1,448 | )
Write-off |  |  |  |  |  |  |  |  |  |  | (3 | ) |  |  | (2 | ) |  |  |  |  |  |  | (234 | ) |  |  | (239 | )
Currency translation differences |  |  | (2 | ) |  |  | (3 | ) |  |  | (5,272 | ) |  |  | (8 | ) |  |  | (18 | ) |  |  | (1,722 | ) |  |  | (7,025 | )
Other changes |  |  | 47 |  |  |  | 87 |  |  |  | 10,571 |  |  |  | (17 | ) |  |  | (2 | ) |  |  | (11,107 | ) |  |  | (421 | )
Net book amount at the end of the year |  |  | 478 |  |  |  | 835 |  |  |  | 49,162 |  |  |  | 236 |  |  |  | 261 |  |  |  | 12,186 |  |  |  | 63,158 |
Gross book amount at the end of the year |  |  | 571 |  |  |  | 3,490 |  |  |  | 160,751 |  |  |  | 1,264 |  |  |  | 1,954 |  |  |  | 15,747 |  |  |  | 183,777 |
Provisions for depreciation and impairments |  |  | 93 |  |  |  | 2,655 |  |  |  | 111,589 |  |  |  | 1,028 |  |  |  | 1,693 |  |  |  | 3,561 |  |  |  | 120,619 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net book amount at the beginning of the year |  |  | 510 |  |  |  | 818 |  |  |  | 40,667 |  |  |  | 326 |  |  |  | 403 |  |  |  | 25,281 |  |  |  | 68,005 |
Additions |  |  | 1 |  |  |  | 22 |  |  |  | 204 |  |  |  | 32 |  |  |  | 42 |  |  |  | 8,766 |  |  |  | 9,067 |
Depreciation |  |  |  |  |  |  | (66 | ) |  |  | (7,087 | ) |  |  | (66 | ) |  |  | (89 | ) |  |  |  |  |  |  | (7,308 | )
Net (impairments) reversals |  |  | (64 | ) |  |  | (3 | ) |  |  | 345 |  |  |  | (1 | ) |  |  | (17 | ) |  |  | (174 | ) |  |  | 86 |
Write-off |  |  |  |  |  |  |  |  |  |  | (198 | ) |  |  | (2 | ) |  |  |  |  |  |  | (89 | ) |  |  | (289 | )
Currency translation differences |  |  | 1 |  |  |  | 1 |  |  |  | 1,329 |  |  |  |  |  |  |  | 4 |  |  |  | 551 |  |  |  | 1,886 |
Reclassification to assets held for sale |  |  | (8 | ) |  |  | (2 | ) |  |  | (1 | ) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (11 | )
Other changes |  |  | 8 |  |  |  | 40 |  |  |  | 15,011 |  |  |  | 11 |  |  |  | (34 | ) |  |  | (15,679 | ) |  |  | (643 | )
Net book amount at the end of the year |  |  | 448 |  |  |  | 810 |  |  |  | 50,270 |  |  |  | 300 |  |  |  | 309 |  |  |  | 18,656 |  |  |  | 70,793 |
Gross book amount at the end of the year |  |  | 537 |  |  |  | 3,416 |  |  |  | 167,007 |  |  |  | 1,415 |  |  |  | 2,160 |  |  |  | 22,737 |  |  |  | 197,272 |
Provisions for depreciation and impairments |  |  | 89 |  |  |  | 2,606 |  |  |  | 116,737 |  |  |  | 1,115 |  |  |  | 1,851 |  |  |  | 4,081 |  |  |  | 126,479 |
A breakdown by segment of capital expenditures is provided below:
(€ million) |  | 2017 |  | 2016
Capital expenditures |  |  |  |  |  |  |  |
Exploration & Production |  |  | 7,638 |  |  |  | 8,217 |
Gas & Power |  |  | 87 |  |  |  | 66 |
Refining & Marketing and Chemical |  |  | 712 |  |  |  | 655 |
Corporate and other activities |  |  | 69 |  |  |  | 42 |
Elimination of intragroup profits |  |  | (16 | ) |  |  | 87 |
|  |  | 8,490 |  |  |  | 9,067 |
Capital expenditures included capitalized finance expenses of  €72 million (€105 million in 2016) related to the Exploration & Production segment (€56 million). The interest rates used for capitalizing finance expense ranged from 1.6% to 2.7% (2.7% to 5.3% at December 31, 2016). The main depreciation rates used were substantially unchanged from the previous year and ranged as follows:
(%) |  |
Buildings |  |  | 2 - 10 |
Mineral exploration wells and plants |  |  | UOP |
Refining and chemical plants |  |  | 2 - 17 |
Gas pipelines and compression stations |  |  | 2 - 12 |
Power plants |  |  | 5 |
Other plant and machinery |  |  | 6 - 12 |
Industrial and commercial equipment |  |  | 5 - 25 |
Other assets |  |  | 10 - 20 |
The criteria adopted by Eni for determining net (impairments) reversals is reported in note 19 — Impairment/reversal of tangible and intangible assets. Disposals of €1,448 million included the disposal of a 40% interest in the Zohr asset in Egypt for €1,328 million to BP (10%) and Rosneft (30%) with a gain of € 1,281 million. The deferred consideration amounted to €553 million ($663 million), of which €442 million ($530 million) will be collected by June 2018 (Notes 11 — Trade and other receivables and note 23 — Other non-current assets). Write-off of  €239 million (€289 million in 2016) related for €237 million to the Exploration & Production (€93 million in 2016), of which €217 million relating to suspended exploration wells that did not encountered enough quantities of commercial hydrocarbons to justify their completion as productive wells in particular in Egypt, Norway and Ivory Coast. The amount of €7,025 million relates to currency translations from U.S. dollar for €6,533 million. Other negative changes of €421 million included the net effect of the divestment to ExxonMobil of a 35.7% interest in the joint operation Mozambique Rovuma Venture SpA (former Eni East Africa SpA), concessionaire of the Area 4 offshore Mozambique where development is underway, for €648 million. This effect was partially offset by an increase in capitalized asset retirement costs in the Exploration & Production segment amounting to €355 million (€665 million at December 31, 2016) mainly due to a decrease in the discount rate curve, especially for the U.S. dollar, to the recognition of new retirement obligations and the revision of cost estimates. Property, plant and equipment include costs related to exploration activities and appraisal and tangible assets in progress and advances of the Exploration & Production segment:
(€ million) |  | Exploratory wells in progress |  | Exploratory wells completed and being evaluated |  | Exploratory successful wells in progress |  | Exploration activity and appraisal |  | Unproved mineral interest |  | Wells and installments in progress |  | Abandonment costs |  | Other tangible assets in progress |  | Total
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Book amount at the beginning of the year |  |  | 221 |  |  |  | 1,684 |  |  |  | 913 |  |  |  | 2,818 |  |  |  | 2,450 |  |  |  | 11,690 |  |  |  | 82 |  |  |  | 14,222 |  |  |  | 17,040 |
Additions |  |  | 351 |  |  |  |  |  |  |  |  |  |  |  | 351 |  |  |  | 112 |  |  |  | 7,190 |  |  |  |  |  |  |  | 7,302 |  |  |  | 7,653 |
Net (impairments) reversals |  |  |  |  |  |  |  |  |  |  | (13 | ) |  |  | (13 | ) |  |  | 147 |  |  |  | (111 | ) |  |  |  |  |  |  | 36 |  |  |  | 23 |
Write-off |  |  | (11 | ) |  |  | (217 | ) |  |  |  |  |  |  | (228 | ) |  |  |  |  |  |  | (2 | ) |  |  |  |  |  |  | (2 | ) |  |  | (230 | )
Reclassifications |  |  | (438 | ) |  |  | 173 |  |  |  | (117 | ) |  |  | (382 | ) |  |  | (7 | ) |  |  | (9,538 | ) |  |  | (11 | ) |  |  | (9,556 | ) |  |  | (9,938 | )
Other changes and currency translation differences |  |  | (15 | ) |  |  | (377 | ) |  |  | (294 | ) |  |  | (686 | ) |  |  | (312 | ) |  |  | (2,676 | ) |  |  | (34 | ) |  |  | (3,022 | ) |  |  | (3,708 | )
Book amount at the end of the year |  |  | 108 |  |  |  | 1,263 |  |  |  | 489 |  |  |  | 1,860 |  |  |  | 2,390 |  |  |  | 6,553 |  |  |  | 37 |  |  |  | 8,980 |  |  |  | 10,840 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Book amount at the beginning of the year |  |  | 93 |  |  |  | 1,737 |  |  |  | 807 |  |  |  | 2,637 |  |  |  | 2,212 |  |  |  | 19,458 |  |  |  |  |  |  |  | 21,670 |  |  |  | 24,307 |
Additions |  |  | 402 |  |  |  |  |  |  |  |  |  |  |  | 402 |  |  |  | 2 |  |  |  | 7,777 |  |  |  |  |  |  |  | 7,779 |  |  |  | 8,181 |
Net (impairments) reversals |  |  |  |  |  |  |  |  |  |  | (5 | ) |  |  | (5 | ) |  |  | 190 |  |  |  | (210 | ) |  |  |  |  |  |  | (20 | ) |  |  | (25 | )
Write-off |  |  |  |  |  |  | (109 | ) |  |  |  |  |  |  | (109 | ) |  |  |  |  |  |  | (6 | ) |  |  | 27 |  |  |  | 21 |  |  |  | (88 | )
Reclassifications |  |  | (282 | ) |  |  | 6 |  |  |  | 78 |  |  |  | (198 | ) |  |  | (35 | ) |  |  | (15,699 | ) |  |  |  |  |  |  | (15,734 | ) |  |  | (15,932 | )
Other changes and currency translation differences |  |  | 8 |  |  |  | 50 |  |  |  | 33 |  |  |  | 91 |  |  |  | 81 |  |  |  | 370 |  |  |  | 55 |  |  |  | 506 |  |  |  | 597 |
Book amount at the end of the year |  |  | 221 |  |  |  | 1,684 |  |  |  | 913 |  |  |  | 2,818 |  |  |  | 2,450 |  |  |  | 11,690 |  |  |  | 82 |  |  |  | 14,222 |  |  |  | 17,040 |
Reclassifications of €9,938 million mainly related to: (i) development wells and plants in progress for €9,538 million; (ii) exploratory successful wells for €382 million following the production start-up of the underlying projects during 2017 in Angola, Ghana, Indonesia and Egypt. Changes in exploration and appraisal activities comprised: (i) reclassifications of  €438 million of exploratory wells in progress to completed exploration wells that are suspended pending final determination; (ii) write-offs of  €228 million related to unsuccessful exploration wells. The following information relates to the stratification of the suspended wells pending final determination (aging):
(€ million) |  | 2017 |  | 2016 |  | 2015
Costs for exploratory wells suspended at the beginning of the period |  |  | 1,684 |  |  |  | 1,737 |  |  |  | 1,568 |
Increases for which is ongoing the determination of proved reserves |  |  | 451 |  |  |  | 282 |  |  |  | 550 |
Amounts previously capitalized and expensed in the period |  |  | (217 | ) |  |  | (109 | ) |  |  | (501 | )
Reclassification to successful exploratory wells following the estimation of proved reserves |  |  | (278 | ) |  |  | (276 | ) |  |  | (30 | )
Disposals |  |  | (199 | ) |  |  |  |  |  |  | (4 | )
Currency translation differences |  |  | (178 | ) |  |  | 50 |  |  |  | 154 |
Costs for exploratory wells suspended at the end of the period |  |  | 1,263 |  |  |  | 1,684 |  |  |  | 1,737 |
|  | 2017 |  | 2016 |  | 2015
|  | (€ million) |  | (number of wells in Eni’s interest) |  | (€ million) |  | (number of wells in Eni’s interest) |  | (€ million) |  | (number of wells in Eni’s interest)
Costs capitalized and suspended for exploratory well activity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- within 1 year |  |  | 222 |  |  |  | 7.95 |  |  |  | 16 |  |  |  | 1.05 |  |  |  | 368 |  |  |  | 5.32 |
- between 1 and 3 years |  |  | 241 |  |  |  | 3.87 |  |  |  | 609 |  |  |  | 10.25 |  |  |  | 634 |  |  |  | 11.14 |
- beyond 3 years |  |  | 800 |  |  |  | 21.44 |  |  |  | 1,059 |  |  |  | 21.55 |  |  |  | 735 |  |  |  | 18.97 |
|  |  | 1,263 |  |  |  | 33.26 |  |  |  | 1,684 |  |  |  | 32.85 |  |  |  | 1,737 |  |  |  | 35.43 |
Costs capitalized for suspended wells |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- fields including wells drilled over the last 12 months |  |  | 148 |  |  |  | 5.88 |  |  |  | 9 |  |  |  | 0.55 |  |  |  | 368 |  |  |  | 5.32 |
- fields for which the delineation campaign is in progress |  |  | 261 |  |  |  | 4.69 |  |  |  | 251 |  |  |  | 3.51 |  |  |  | 228 |  |  |  | 4.13 |
- fields including commercial discoveries that proceeds to sanctioning |  |  | 854 |  |  |  | 22.69 |  |  |  | 1,424 |  |  |  | 28.79 |  |  |  | 1,141 |  |  |  | 25.98 |
|  |  | 1,263 |  |  |  | 33.26 |  |  |  | 1,684 |  |  |  | 32.85 |  |  |  | 1,737 |  |  |  | 35.43 |
Unproved mineral interests include costs allocated to unproved reserves following business combinations or costs incurred to acquire individual properties. Unproved mineral interests were as follows:
(€ million) |  | Congo |  | Nigeria |  | Turkmenistan |  | USA |  | Algeria |  | Egypt |  | Total
2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Book amount at the beginning of the year |  |  | 1,254 |  |  |  | 938 |  |  |  | 138 |  |  |  | 113 |  |  |  |  |  |  |  | 7 |  |  |  | 2,450 |
Additions |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 112 |  |  |  |  |  |  |  | 112 |
Net (impairments) reversals |  |  | 72 |  |  |  |  |  |  |  | 75 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 147 |
Reclassification to proved mineral interest |  |  | (7 | ) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (7 | )
Other changes and currency translation differences |  |  | (157 | ) |  |  | (113 | ) |  |  | (21 | ) |  |  | (14 | ) |  |  | (7 | ) |  |  |  |  |  |  | (312 | )
Book amount at the end of the year |  |  | 1,162 |  |  |  | 825 |  |  |  | 192 |  |  |  | 99 |  |  |  | 105 |  |  |  | 7 |  |  |  | 2,390 |
2016 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Book amount at the beginning of the year |  |  | 1,021 |  |  |  | 908 |  |  |  | 165 |  |  |  | 109 |  |  |  |  |  |  |  | 9 |  |  |  | 2,212 |
Additions |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2 |  |  |  | 2 |
Net (impairments) reversals |  |  | 190 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 190 |
Reclassification to proved mineral interest |  |  |  |  |  |  |  |  |  |  | (31 | ) |  |  |  |  |  |  |  |  |  |  | (4 | ) |  |  | (35 | )
Other changes and currency translation differences |  |  | 43 |  |  |  | 30 |  |  |  | 4 |  |  |  | 4 |  |  |  |  |  |  |  |  |  |  |  | 81 |
Book amount at the end of the year |  |  | 1,254 |  |  |  | 938 |  |  |  | 138 |  |  |  | 113 |  |  |  |  |  |  |  | 7 |  |  |  | 2,450 |
Unproved mineral interest of  €2,390 million comprised a property known as Oil Prospecting License 245 (“OPL 245”), located offshore Nigeria, with a net book value of  €818 million, which corresponded to the price paid to the Nigeria Government to acquire a 50% interest in OPL 245, with the partner Shell acquiring the remaining 50%. As of December 31, 2017, the net book value of the property was €1,107 million, including capitalized exploration costs and pre-development costs. The acquisition of OPL 245 is subject to judicial proceedings in Italy and in Nigeria for alleged corruption and money laundering in respect of the Resolution Agreement signed on April 29, 2011, relating to the purchase of the license by Eni and Shell. Those proceedings are disclosed in note 38 — Guarantees, Commitments and Risks. Additions of the year of  €112 million related to the extension of an oil contract in Algeria. Accumulated provisions for impairments amounted to €16,005 million (€17,558 million at December 31, 2016). At December 31, 2017, Eni pledged property, plant and equipment for €24 million primarily as collateral against certain borrowings (same amount as of December 31, 2016). Government grants recorded as a decrease of property, plant and equipment amounted to €110 million (€90 million at December 31, 2016). Assets acquired under financial lease agreements amounted to €29 million (same amount as of December 31, 2016) and related to service stations of the Refining & Marketing business line. Contractual commitments related to the purchase of property, plant and equipment are disclosed in note 38 — Guarantees, commitments and risks — Liquidity risk. Property, plant and equipment under concession arrangements are described in note 38 — Guarantees, commitments and risks — Assets under concession arrangements. Property, plant and equipment by segment
(€ million) |  | December 31, 2017 |  | December 31, 2016
Property, plant and equipment, gross |  |  |  |  |  |  |  |
Exploration & Production |  |  | 152,608 |  |  |  | 165,559 |
Gas & Power |  |  | 5,333 |  |  |  | 6,276 |
Refining & Marketing and Chemical |  |  | 24,554 |  |  |  | 24,119 |
Corporate and other activities |  |  | 1,866 |  |  |  | 1,886 |
Elimination of intragroup profits |  |  | (584 | ) |  |  | (568 | )
|  |  | 183,777 |  |  |  | 197,272 |
Accumulated depreciation, amortization and impairment losses |  |  |  |  |  |  |  |
Exploration & Production |  |  | 95,775 |  |  |  | 101,131 |
Gas & Power |  |  | 3,954 |  |  |  | 4,584 |
Refining & Marketing and Chemical |  |  | 19,625 |  |  |  | 19,477 |
Corporate and other activities |  |  | 1,525 |  |  |  | 1,518 |
Elimination of intragroup profits |  |  | (260 | ) |  |  | (231 | )
|  |  | 120,619 |  |  |  | 126,479 |
Property, plant and equipment, net |  |  |  |  |  |  |  |
Exploration & Production |  |  | 56,833 |  |  |  | 64,428 |
Gas & Power |  |  | 1,379 |  |  |  | 1,692 |
Refining & Marketing and Chemical |  |  | 4,929 |  |  |  | 4,642 |
Corporate and other activities |  |  | 341 |  |  |  | 368 |
Elimination of intragroup profits |  |  | (324 | ) |  |  | (337 | )
|  |  | 63,158 |  |  |  | 70,793 |

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