THESIS DEFENSE

Candidate: Sofia Tagliavini

Social Licence to Operate:

assessing Eni's legitimacy, credibility and trust in the Val d'Agri concession

Batch 11 - Academic Year 2022-2023

Supervisor: Prof. Alberto Diantini

Basilicata, a small southern Italian region, has become a strategic hotspot in European and Italian development. Responsible for the production of 82.11% of Italy's crude oil for the year 2022, Basilicata is home to the biggest onshore oilfield in Italy and continental Europe, the Val d’Agri concession, located in an area of great socio-environmental relevance.

Study Area

Lucanian extractive landscape

encompassing differt actors such as Legambiente, COVA Contro, Libera etc.

Val d'Agri Environmental Observatory and Regional Agency for Environmental Protection

Associations

Environemtal & territorial actors

energy company operating in hydrocarbon extraction sector

Eni S.p.A

Val d'Agri Residents

Basilicata region, Potenza province and municipalities

Local Administation

Stakeholders

Theoretical Framework

+ info

SLO

Social Licence to Operate can be difined as the ongoing acceptance and approval of a development by local community members and other stakeholders that can affect its profitability (Thomson & Boutilier, 2011)

Environmental Conflict

from the perspective of political ecology, conflicts are identifiable by the presence of unequal power relations in a resource economy in which conflict emerges as violence in the broadest sense, in its physical, structural, and symbolic forms (Perreault et al., 2015).

Research aims

Aim 1

SLO underlying concepts

Determine wheather SLO underlying concepts of legitimacy, credibility, and trust could be easily applied in the specific case of Val d’Agri concessions

Aim 2

SLO underlying concepts

Considering the study context, define the specificities of these underlying concepts

Aim 3

Political Ecology

Understand if Social License to Operate could be considered a meaningful and useful conceptual tool to analyse conflict

Grounded Theory

Comparison of materials resulting in the articulation of three steps: open, axial and selective coding

Methodology

Qualitative approach

Methodological orientation based on collection of data through a bottom-up and close-up process

Semi- structured interviews

A total of fourteen interviews were conducted through the use of thematic guidelines

Snowball Sampling

Reduced in size sample to prioritize in-depth exploration of perceptions and opinions

Inductive approach

Generating new theories or hypotheses based on empirical observations

Fieldwork

The empirical material produced consists of:

• a field notebook with notes from ethnographic observation and interviews
• 12 interview recordings later transcribed.

February

Preparatory Phase 1

February 15th - 18th

Fieldwork mission 1

April-June

Preparatory Phase 2

June 5th - 12th

Fieldwork mission 2

June-July

Data Processing Phase

Participation

Transparency

Monitoring

Employement & depopulation

Environmental & health conditions

Royalties and services

Distribution of benefits

Findings

Socio-economic aspects

Community relationships

Even with some criticism, sufficient socio-political legitimacy

Discussion

Legitimacy

• Evidence of provision of services and economic inputs
• feeling of mismanagement and lack of long-term socio-economic planning
• Shared responsabilities

Credibility

Believability is minimal: what the company says was not fully matching with participants' perceptions

• Perceptions differ from company’s declarations
• Deficiencies in stakeholders engagement
• Doubts related to monitoring process
• Shaken credibility due to trails

Trust

Efforts to gain trust are being made, still, Eni seems to have achieved a low level of trust

• Eni statements towards the process of trust-gaining
• No sense of co- ownership or psychological identification
• separate identities: us vs them

Conflict

Conflict factors emerged from the use of legitimacy, credibility, and trust as interpretative lenses

• identification of latent forms of conflicts
• divergences and mismatches of interests
• parties perceive that their interests are being opposed or negatively affected by anothers

Conclusions

+ Developments

+ Limitations

SLO concept emerged to be useful, and its elements of legitimacy, credibility and trust were easily applied to the Val d’Agri helping recognize the context-related dynamics.

Underlying concepts had their own, context sensible specificities: - Legitimacy was established - Trust and credibility were not fully achieved Eni obtained acceptance but could not be regarded as having either approval or psychological identification from all stakeholders

The findings suggest the use of SLO may contribute to the identification of factors of conflict.

Bibliographic References

Prenzel, P. V., & Vanclay, F. (2014). How social impact assessment can contribute to conflict management. Environmental Impact Assessment Review, 45, 30–37. Doi: https://doi.org/10.1016/j.eiar.2013.11.003

Jijelava, D., & Vanclay, F. (2017). Legitimacy, credibility, and trust as the key components of a social licence to operate: An analysis of BP’s projects in Georgia. Journal of Cleaner Production, 140, 1077–1086. Doi: https://doi.org/10.1016/j.jclepro.2016.10.070

Thomson, I., & Joyce, S. (2008). The social licence to operate: What it is and why does it seem so difficult to obtain? In Prospectors and Developers Association of Canada Convention, Toronto, Ontario, Canada.

Moffat, K., & Zhang, A. (2014). The paths to social licence to operate: An integrative model explaining community acceptance of mining. Resources Policy, 39(1), 61–70. Doi: https://doi.org/10.1016/j.resourpol.2013.11.003

Thomson, I., & Boutilier, R. (2011). The social license to operate. In P. Darling (Ed.), SME Mining Engineering Handbook, pp. 1779–1796. Society for Mining Metallurgy and Exploration.

Perreault, Tom, Bridge, Gavin, McCarthy, & James. (2015). The Routledge Handbook of Political ecology (1st ed.). London; Routledge.

Thank You

Conflicts are identifiable by the presence of unequal power relations in a resource economy in which conflict emerges as violence in the broadest sense, in its physical, structural, and symbolic forms (Perreault et al., 2015)

Credibility is the quality of being believed, the capacity to elicit belief (Thomson & Joyce, 2008)

COVA processing center and nearby Viggiano city seen from COVA's main entrance

Distribution of Benefits

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Royalties & Services

High levels of trust are revealed when project proponents and local communities’ interests are aligned. SLO trust, as a form of strong credibility, is built over mutually respectful dialogue as an interactional trust (Thomson & Boutilier, 2011)

Reinjection well Costa Molina 2, Montemurro (Pz)

Social Licence to Operate should not be understood as unitary: communities are never homogenous and consequently, multiple SLOs will always be required.The conclusions drawn from the applicability of SLO are related to a specific SLO that may and must probably vary over time and community.

SLO concept

The research had limits related to time and academic restrints; further and in-depth analysis should be carried forward in order to provide an extensive analysis stakeholders’ perception.

Limitations

Research

Social Licence to Operate pyramidal continuum

Employement and depopulation

Transparency

COVA processing center and Viggiano seen from Grumento Nova (Pz)

Socio-political legitimacy, on the other hand, is the step necessary to provide acceptance of the project by the community in the SLO model pyramid and boils down to provision and fairness, of distribution and process (Jijelava & Vanclay, 2017)

It could be innovative the recruitment and engagement of consulting companies for SLO assessment that could help with:

• developing functional services for policy design, implementation and monitoring
• incentivising a market for consultancy for social responsibility, justice, reduction and prevention of conflicts
• creating external body fro SLO assessment (external to companies and communities) to elude SLO biases.

Developments

Solve SLO issues, assess problems & strenghten policies

Well area MONTE ENOC 4, Viggiano (Pz)

Environmental and health conditions

Monitoring

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The opinions expressed regarding community participation ranged from the total absence of discussions with citizenship, which "was not asked to participate" (Sara, lawyer), to the existence of attempts by Eni, the institutions, and citizens to establish dialogues during the years of activity. The cases were hard to verify.

Participation