* Raises dividend to
* Says share buyback possible
* Investment level seen unchanged at
* Raises output growth target to 3.5 pct/yr
* Shares up 1.7 pct(Recasts, adds management and analyst comments)
By Giancarlo Navach and Stephen Jewkes
Eni was the first oil major to cut its dividend three yearsago after a steep decline in the oil price forced the industryto tighten its belt.
But as crude prices recover, the focus of the world'sbiggest oil companies is slowly shifting from slashing jobs andinvestment to boosting shareholder returns and growth.
So far this year, Total has raised dividends, BPflagged a resumption of share buybacks and Shellscrapped its scrip dividend.
State-controlled Eni said in its new business plan to 2021that it would pay a dividend this year of
"All the work of the last three-four years is finally payingdividends. It's a much better company now," said AlessandroPozzi, oil analyst at Mediobanca.
Eni, the world's most successful explorer in recent yearsafter finds in
It said it aimed to increase production by 3.5 percent peryear, up from a 3 percent target in its previous plan. Outputwould grow by 4 percent this year.
"During the downturn we tripled our acreage and this is thebig potential Eni has," Chief Executive Claudio Descalzi said.
The company, the biggest foreign oil and gas producer in
Since taking over as CEO in 2014, oil veteran Descalzi hasstreamlined the company, sharpening its focus on finding oil andgas.
"We will be making the final investment decision on five keyprojects this year," added Chief Financial Officer MassimoMonduzzi.
The discovery of two world-class gas fields, in
It is working with Exxon on LNG development at itsgiant mamba field in
Eni, which currently generates around 80 percent of itsbusiness from upstream activities, also said it was looking todevelop its chemicals, refining and retail divisions.
"We have completed the transformation of mid-downstreambusinesses and now we are ready for their expansion and growthin value," Descalzi said.
Some investors have said Eni needs to bolster its midstreamand downstream businesses as a hedge against oil price swings.
At 1430 GMT, Eni shares were up 1.7 percent at
(