Eni’s Hydrogen Strategy 2026: Why Blue Hydrogen and Biofuels Define the Transition

Eni’s Dual Hydrogen Projects: A Shift from Pilots to Commercial Scale

In 2025, Eni accelerated its hydrogen strategy by shifting from smaller-scale green hydrogen pilots announced in prior years to large, commercially-focused blue hydrogen and biorefinery projects, signaling a pragmatic focus on leveraging existing assets and infrastructure.

• Between 2021 and 2024, Eni‘s hydrogen focus centered on foundational green hydrogen projects in Italy, such as the planned 20 MW electrolyzer at the Gela biorefinery and the 10 MW unit in Taranto, both in partnership with Enel Green Power. These initiatives represented an entry into green hydrogen production at a pilot scale, supported by EU funding.
• The strategic emphasis changed in 2025 with the Final Investment Decision (FID) for the carbon storage backbone of the Hy Net Northwest industrial cluster in the UK. This project, designed to store 4.5 million tonnes of CO₂ annually, marks a decisive move to enable commercial-scale blue hydrogen production by leveraging Eni‘s subsurface expertise.
• Simultaneously, Eni committed to creating captive demand for hydrogen through biorefining. The €500 million financing agreement with the European Investment Bank (EIB) in July 2025 to convert the Livorno refinery, along with the FID for the Sannazzaro conversion, prioritizes the production of hydrogenated biofuels (HVO) and Sustainable Aviation Fuel (SAF) at scale.

Capital Allocation: Eni Prioritizes CCS and Biorefineries

Eni’s 2025 investment decisions reveal a clear capital priority for large-scale infrastructure that enables blue hydrogen and biofuel production, dwarfing earlier commitments to standalone green hydrogen pilots.

• The most significant financial signal in 2025 was the commitment to award approximately £2 billion in supply chain contracts for the Hy Net Northwest carbon capture project. This tangible capital deployment underpins the entire blue hydrogen strategy in the UK.
• The €500 million EIB loan secured in July 2025 for the Livorno biorefinery conversion provides dedicated, large-scale funding for creating a major hydrogen offtaker. This targeted financing moves beyond the general strategic guidance of the previous period, where approximately 25% of the company’s total CAPEX was allocated to a broad range of low-carbon activities.
• These 2025 financial milestones contrast with the pre-2025 period, which was characterized by reliance on public funding mechanisms like the EU’s IPCEI Hy 2 Use program to de-risk smaller electrolyzer projects. The scale of direct and leveraged capital in 2025 indicates a new level of commercial confidence in the chosen pathways.

Table: Eni’s Key Hydrogen and Low-Carbon Investments

Strategic Alliances: Eni’s Hydrogen Network Matures in 2025

In 2025, Eni’s partnerships evolved from foundational technology and pilot-scale collaborations to securing international supply chains and integrating waste-to-hydrogen pathways.

• The company’s partnership strategy expanded geographically in 2025. It signed an Mo U with Saudi Arabia’s ACWA Power for renewables and green hydrogen, and collaborated with Enel in Tunisia to explore green hydrogen for Mediterranean energy integration. This contrasts with the 2021-2024 period, which was more focused on domestic pilots with Enel Green Power.
• A new strategic element was introduced in February 2025 through a collaboration with engineering group MAIRE and multi-utility company Iren. This partnership aims to develop a circular methanol and hydrogen plant from non-recyclable waste, adding a waste-valorization pillar to its hydrogen portfolio.
• While earlier partnerships, such as the November 2021 agreement with Air Liquide, targeted downstream market creation in mobility, the 2025 alliances with companies like Petronas are focused on the industrial feedstock requirements for producing biofuels, reflecting a more immediate and scalable use case for hydrogen.

Table: Evolution of Eni’s Hydrogen and Decarbonization Partnerships

Geographic Focus: UK and Italy Dominate Eni’s Hydrogen Execution

While Eni‘s early hydrogen exploration spanned multiple regions, its 2025 execution is concentrated in the UK for blue hydrogen and Italy for green hydrogen-linked biorefining, establishing these two countries as its core operational hubs.

• The UK became the undisputed center of Eni‘s blue hydrogen strategy in 2025. The FID on Hy Net Northwest moved the project from the planning phase, marked by the October 2024 Agreement for Lease with The Crown Estate, to active, large-scale commercial development.
• Italy remains the nexus for applying hydrogen in biorefining. The 2025 investment decisions for the Livorno and Sannazzaro conversions build upon the foundational green hydrogen pilot projects announced for Gela and Taranto in 2022, creating an integrated domestic market.
• Regions like North Africa (Egypt, Tunisia) and the Middle East (Saudi Arabia) are positioned as strategic sources for future green hydrogen supply. However, as of 2025, activities there remain in the Mo U and feasibility study stage, in contrast to the concrete project execution underway in Europe.

Technology Deployment: CCS and Biorefining Reach Commercial Scale

Eni‘s 2025 strategy validates Carbon Capture and Storage (CCS) and hydrogenated biofuel production as commercially ready technologies, while large-scale green hydrogen electrolysis remains in the advanced pilot stage.

Blue Hydrogen Dominates 2025 Investment Decisions

This chart illustrates a massive spike in blue hydrogen projects reaching final investment decisions in 2025, validating the trend of this technology reaching commercial scale, as seen in Eni’s strategy.

(Source: pv magazine USA)

• The FID for the Hy Net project and the launch of a dedicated CCS satellite company in 2025 move CCS from a planned technology to a commercial-scale infrastructure build-out. This is a critical validation point that directly enables Eni‘s blue hydrogen ambitions.
• The deployment of Eni’s proprietary Ecofining™ technology at the Livorno and Sannazzaro refineries represents the commercial scaling of hydrogen use in industrial processes. This moves beyond the smaller, pre-commercial scale of the Gela and Taranto electrolyzer projects.
• This progression shows a clear technology maturity hierarchy within Eni‘s portfolio. CCS and biorefining are deemed mature enough for large capital deployment in 2025, while its green hydrogen electrolysis projects, though significant, remain at a sub-100 MW scale focused on decarbonizing specific assets rather than serving a broad market.

SWOT Analysis: Eni’s Pragmatic Hydrogen Strategy

Eni‘s key strength lies in leveraging its legacy assets for blue hydrogen and biofuels, but its cautious investment level compared to its total CAPEX remains a weakness, while the maturing CCS market presents a major opportunity.

Hydrogen Connects Legacy Assets to New Markets

This diagram shows hydrogen’s central role in the energy system, illustrating the strategy discussed in the SWOT analysis where Eni can leverage its legacy assets for new opportunities.

(Source: Sandia National Laboratories)

• Strengths: Eni successfully monetizes its core oil and gas competencies in subsurface management and large project execution through its CCS and biorefinery projects.
• Weaknesses: Despite large project commitments, low-carbon spending remains a minority share of total CAPEX, and the company has not published firm, long-term hydrogen production volume targets.
• Opportunities: Favorable regulatory environments in the UK and EU, combined with available public and private financing, de-risk large capital projects like Hy Net and the Livorno conversion.
• Threats: Competitors like Snam are making massive investments (€12.4 billion) in hydrogen-ready infrastructure, potentially creating pressure on network access and market share.

Table: SWOT Analysis for Eni’s Hydrogen Strategy

2026 Outlook: Monitoring Hy Net’s Execution and Green Hydrogen FIDs

The success of Eni‘s hydrogen strategy in 2026 will be determined by its ability to execute the Hy Net CCS project on time and budget, and whether it converts its international green hydrogen Mo Us into Final Investment Decisions.

Hydrogen Project Pipeline Faces Execution Challenge

This chart highlights the gap between announced hydrogen projects and those reaching execution, which directly supports the 2026 outlook of monitoring whether Eni will convert MoUs into Final Investment Decisions.

(Source: Nature)

• If Eni successfully awards the £2 billion in Hy Net contracts and construction proceeds without major delays, it will validate its blue hydrogen model as a near-term, large-scale decarbonization tool. Progress reports on these contracts and construction milestones are key signals to watch.
• A critical indicator for 2026 will be a potential FID on a green hydrogen project in Tunisia (with Enel) or Saudi Arabia (with ACWA Power). This would mark a significant expansion of its strategy, moving from exploration to execution in its international green hydrogen ambitions.
• The operational performance of the newly converted biorefineries at Livorno and Sannazzaro will provide a crucial proof point for its H 2-for-biofuels model, demonstrating its ability to create and serve a captive market for hydrogen.
• While these low-carbon initiatives advance, Eni‘s gas division remains a strategic priority. Its efforts to secure financing for the Argentina LNG project will shape its overall capital structure and could influence the pace of investment in its energy transition, a dynamic affecting global LNG supply chains.

Frequently Asked Questions

What was the major change in Eni’s hydrogen strategy in 2025?

In 2025, Eni shifted its focus from smaller, pilot-scale green hydrogen projects (like the 10-20 MW electrolyzers in Italy) to large, commercially-focused blue hydrogen and biorefinery projects. This was signaled by the Final Investment Decision for the HyNet Northwest carbon storage project in the UK and major financing for refinery-to-biorefinery conversions in Italy.

Why is Eni focusing on blue hydrogen and biofuels?

Eni’s strategy prioritizes technologies that are commercially ready and can be scaled up quickly by leveraging its existing assets. Blue hydrogen production, enabled by the HyNet carbon capture project, utilizes Eni’s subsurface expertise. Simultaneously, converting refineries to produce hydrogenated biofuels (HVO) and Sustainable Aviation Fuel (SAF) creates a large, immediate ‘captive demand’ for hydrogen within Eni’s own industrial processes.

What are Eni’s most significant hydrogen-related investments in 2025?

The two most significant investments were the commitment to award approximately £2 billion in supply chain contracts for the HyNet Northwest carbon capture backbone, which enables blue hydrogen production, and securing a €500 million loan from the European Investment Bank (EIB) to convert the Livorno refinery into a biorefinery that will be a major hydrogen consumer.

What is the difference between Eni’s approach to blue and green hydrogen?

As of 2025, Eni is deploying blue hydrogen at a commercial scale, with the HyNet project in the UK representing a major capital commitment. In contrast, its green hydrogen initiatives are either smaller-scale pilots in Italy (Gela, Taranto) designed to decarbonize specific assets, or are in the exploratory Memorandum of Understanding (MoU) phase for future international supply (e.g., with ACWA Power in Saudi Arabia and Enel in Tunisia).

According to the SWOT analysis, what is a key weakness in Eni’s hydrogen strategy?

A primary weakness is that despite its large project announcements, low-carbon spending remains a minority share of Eni’s total capital expenditure, which is still dominated by its traditional oil and gas business. The analysis also notes that the company has not published firm, long-term hydrogen production volume targets, making it difficult to gauge the full scale of its ambition.