Good morning, and welcome to the Vista Investor Day. Today's call is being recorded. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. You may submit online questions at any time today using the window on the webcast, and they will be answered during the Q&A session. Dial-in participants may ask a question by pressing star then one on your telephone keypad. To withdraw your question, please press star then two. I would now like to turn the conference over to Vista's Strategic Planning and Investor Relations Officer, Mr. Alejandro Cherñacov. Please go ahead.
Good morning, everyone. We are happy you could join us today, and extremely pleased to be hosting our second Investor Day. Today, we will update you on our company's performance and our new targets for 2024-2026. Before we go into the agenda for the day, let me very briefly remind everyone that our remarks today, including the answers to your questions, may include forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results to be materially different from expectations contemplated by these remarks. Our financial figures are stated in U.S. dollars and in accordance with International Financial Reporting Standards. However, during these presentations, we may discuss certain non-IFRS adjusted EBITDA. reconciliation of historical measures to the closest IFRS measures can be found in our annual reports and earnings releases publicly available.
During today's presentations, we will also be using the term previous targets to refer to targets previously set in our strategic plan disclosed during our 2021 Investor Day. We will refer as new or updated targets to the targets set by the updated plan that we will present today. Please visit slide 2 in the presentation file today for the full text of our safe harbor statement. Today, our CEO and management team members will present an update to Vista's 2024-2026 strategic plan. We'll kick off with Miguel Galuccio, Chairman of the Board, CEO, and Founder of Vista, who will be showcasing the company we have built during our first five years of operations. He will then describe our forward-facing strategy to deliver even higher growth and value with a larger, more efficient, and more sustainable company.
Next, Gabriela Prete, our Sustainability and QHSE Manager, will talk about how we are reinforcing our 2026 Scope 1 and 2 Net Zero ambition, even as we project to deliver higher growth. She will show you how we are progressing with the decarbonization of our operations and the execution of our Nature-Based Solutions project. Juan Garoby, our Chief Operating Officer and Vista's Co-Founder, will then walk you through our operational excellence achievements and their contribution to growth, efficiency and value. Juan will give the floor to Matías Weissel, our Operations Manager, so he can tell you more about how we prepare the company to deliver higher growth and explain our updated operational plan, which includes a material ramp-up in new well activity and our new production and cost targets.
Next, Pablo Vera Pinto, Vista's Chief Financial Officer and Co-Founder, will describe our solid financial performance during our first five years of operations, which led to a robust balance sheet that lays a strong foundation for future growth. He will review our capital allocation priorities and explain why we consider them fundamental to maximize shareholder return and build a higher growth, higher returns company we now envision for 2026 and beyond. Finally, I will share our financial projections through 2026, including new targets, uses of cash, and sensitivities to crude oil prices. We will close the day with a Q&A session, and before we get started, just a few housekeeping items. One, we expect our presentation to be 50 minutes long in total. After that, we will move to Q&A. Two, dial-in participants will have a chance to ask live questions during the Q&A session.
You will also be able to submit your questions to me by typing them in the question box under the video screen. Three, lastly, you will find today's slides and the video to replay on demand on our website, vistaenergy.com. I'll now leave you with Miguel.
Thank you, Ale. Hello, everyone. I'm very pleased to welcome you to our second Investor Day. During today's presentation, I will be discussing how we have created shareholder value at Vista, making the company we envisioned 5 years ago a reality. We have succeeded in establishing a highly efficient, lower carbon intensity, profitable, and cash flow generating company, capable of delivering even more value than we project back in 2018. In the second half of 2021, we hosted our inaugural Investor Day, in which we unveiled Vista's strategic plan to deliver superior shareholder value from 2022 to 2026.... As a result of the robust execution, we are well on track on exceeding those target.
Moreover, given the increased scale of proven quality of our Vaca Muerta shale asset, the outstanding team we have consolidated, the drilling and completion performance, the treatment and evacuation capacity we have secured, we are now in prime position to significantly raise the bar for future shareholder value creation. With this in mind, I will share an updated, accelerated version of our strategic plan through 2026. The numbers speak for themselves. We have built the company we envisioned five years ago. We are well on track to deliver the adjusted EBITDA we projected in april 2018, even with the significant volatility experienced by our sector since then. Production have more than doubled, and we anticipate reaching our target of 65,000 BOEs per day by year-end.
We also expect to reach an annualized run adjusted EBITDA margins that are already above 65%. This remarkable delivery, now fully focused on Vaca Muerta, have allowed us to expand our P1 reserve valuation by five times since 2018. Our successful de-risking of the original asset, as well as the expansion of our asset base through our creative business development activity, has quadrupled our Vaca Muerta acreage expanding potential for future growth. We believe Vista is facing a more positive context, as global energy demand will continue to grow, driven by population increase and improving living standard in emerging market in a complex geopolitical landscape. Therefore, the need for a growing supply of energy that is first, reliable, second, affordable, and third, lower carbon, have never been stronger.
To excel in an environmental performance is a mandate. Our laser focus on reducing Vista carbon footprint, along with our ambition to reach net zero by 2026, provide us with a clear competitive advantage. The foundation of our strategic plan are fit for this context, and have not changed since our 2021 Investor Day. A deep, ready-to-drill short cycle well inventory, our peer and leading operating performance, a robust balance sheet, and last, a sustainable focused culture. Over the past decade, Vaca Muerta's production grew at a compound rate of 56% per annum. This has offset the production decline of all other Argentine plays combined and boosted light oil exports. Vaca Muerta represent almost 50% of the country oil production in the first half of 2023, and 70% of its oil exports.
Vaca Muerta shifted the country's energy paradigm from a view of scarcity to one of abundance. It has proven it can generate significant incremental export, potentially creating a virtuous cycle of foreign currency inflows and growing investment, and contributing to a healthier macroeconomic perspective for Argentina. After an initial period of incorporating the technology required for unconventional development, progressing along the learning curve and adopting best practices, the average well productivity in Vaca Muerta now exceeds its shale peers in United States. Additionally, Vaca Muerta carbon footprint intensity is considerably below the global average, and also below that of most of the oil and gas-producing country. Therefore, Vaca Muerta export have the potential to provide growing volumes of reliable, affordable, and lower carbon energy to the world. Over the past five years, we have multiplied by four our de-risked Vaca Muerta acreage.
The significant expansion in our high-quality asset base was driven by two factors. Firstly, the de-risking of the originally acquired Vaca Muerta acreage, even beyond Bajada del Palo Oeste, which was our original development target. The outstanding execution of our technical and operational teams has de-risked our high-quality asset, expanding Bajada del Palo Oeste, Bajada del Palo Oeste, and Coirón Amargo Norte. These shale oil blocks were part of the initial business combination, and today hold 134,000 net acres and an inventory of 750 wells. Secondly, we executed accretive business development transactions, which enabled us to increase our shale oil asset base, adding Águila Mora, Aguada Federal, and Bandurria Norte. This transaction added 72,000 net acres and 400 wells to our inventory, building further scalability and optionality into our premium asset portfolio.
In addition, early this year, we closed an agreement to transfer the legacy conventional assets. This allow us to fully focus on the development of our shale asset, leading to a company with lower cost, higher margins, and greater cash flow generation. We remain fully committed to developing our premium asset base to its full potential. Juan Garoby, co-founder and COO, and Matías Weissel, our operations manager, will provide further insight on these topics. Let's focus on the five key milestones achieved since our December 2021 Investor Day, that underscore my confidence in accelerating activity going forward.... We are well ahead in operational results for the first two years of our plan disclosed in 2021. I want to stress that this outstanding performance was driven by everyone at Vista, a team that is fully focused on results, is committed to people, and innovate to excel.
We strengthen our balance sheet, consistently reducing leverage and ratios, extending maturities, and lowering the cost of our debt. We secure drilling and completion capacity to increase new well activity. Importantly, we put the right contracts in place with the right partners and adequate incentive to ensure accelerated value creation through our One Team Model. We have contractually secured 100,000 barrels per day of evacuation capacity and are expanding treatment facilities to increase production well above 2021 Investor Day target. Finally, we have consolidated our export-oriented strategy by becoming the largest exporter of light crude oil in the country, with a consistently increasing share of exports. In summary, we are extremely well positioned to raise the bar for Vista's future targets. We are stepping up activity to maximize total shareholder return.
Our new production target for 2026 is 100,000 barrels of oil equivalent per day, a 25% increase relative to the target set by 2021 adjusted EBITDA target for 2026, at $1.7 billion, is 55% higher than the one we set in 2021, driven by additional production volumes, a higher share of oil exports, and lower lifting costs. The updated target of our strategic plan are based on maximizing efficiency of the drilling and completion equipment we have been running since 2018, which significantly reduce the risk of execution. Consistent with our 2021 plan, we expect to maintain total cumulative cash flow of $1 billion at an updated realization price of $65 per barrel.
In line with our capital allocation priorities, we have allocated excess cash generation to additional growth, which, driven by consistently higher return of our drilling and completion activities, generate incremental total shareholder returns. We are reaffirming our ambition to become net zero by 2026. We expect to reach that target by lowering our carbon intensity to 7 kg of CO2 equivalent per BOE and offsetting the remaining emissions through the carbon credits generated by NBS projects executed by our subsidiary, Aike. The updated strategic plan is expected to generate more than $500 million of free cash flow per year by 2026, assuming realized oil prices of $65 per barrel. By the end of 2026, we forecast to have remaining inventory approximately of 900 wells.
This means we expect to have the balance sheet, the inventory, and execution capabilities in place to continue growing profitably to generate superior total shareholder returns. Five years ago, we envisioned a 65,000 BOE per day company. Today, our vision is to become a 150,000 BOE per day company by 2030. I will now turn the floor to the team to provide more details on our updated strategic plan.
Thank you, Miguel. Good morning, everybody. Over the past 2 years, we have made significant progress in decarbonizing our operations. We now have one third of the Scope 1 and 2 carbon emissions intensity of 2020, having recorded a reduction from 39 kilograms of CO2 equivalent per BOE to 14 kilograms of CO2 equivalent per BOE in the first quarter of 2022. Emissions reduction in our operation is the result of solid execution of operational decarbonization projects, which include installing vapor recovery units, blanketing gas in our storage tanks, improving operational parameters in the glycol dehydration process, and replacing gas with compressed air instrumentation. We plan to further reduce our Scope 1 and 2 GHG emissions by continuing to execute investment projects prioritized through our Carbon Abatement Curve.
Ongoing projects include full rollout of compressor instrumentation, electrification of our compression systems, incorporation of renewable energy to power our field operations, as well as electrification of our drilling rig. Given the level of progress in our decarbonization efforts and the expected results of ongoing projects, we have lowered our 2026 carbon intensity target by 22%, from our previous target of 9 kilos of CO2 equivalent per BOE to a new target of 7 kilograms of CO2 equivalent per BOE. I want to emphasize that all our decarbonization projects are in line with the capital allocation defined in our 2021 Investor Day, and also have a positive internal rate of return with our carbon price set at $50 per ton.
As mentioned by Miguel, we are well on track to deliver on our Scope 1 and 2 Net Zero ambition, even after having raised our production target by 25% from 80,000 to 100,000 BOEs per day for 2026. Today, we reinforce our Scope 1 and 2 Net Zero roadmap, which combines the significant reduction of operational carbon footprint I just explained, with a portfolio of our own nature-based solutions to offset remaining emissions. In 2022, we launched our new venture called Aike, to design, manage, and execute Vista's portfolio of nature-based solutions, a solution also recently made available for third parties. Our carbon offset inventory model shows that by the end of 2026, we should have enough carbon credits from the NBS projects we are currently executing to offset all residual emissions, leading to a Net Zero operation.
After 18 months of operation, Aike is already running NBS projects that span over 19,000 hectares in seven different locations, distributed across four provinces in Argentina. We purchased 6,000 hectares of land in the province of Corrientes, where we have already planted more than 2 million trees over 2,200 hectares. We have also signed a binding commitment to acquire 5,000 hectares for a forest conservation project in the province of Salta, where very evident and imminent deforestation risk existed. In addition, we have signed sustainable farming and livestock agreements covering a total of 8,000 hectares in the province of Córdoba, Santa Fe, and Salta.
Generating our own carbon credits gives us all full confidence in their quality, and allows us to also get involved to ensure all our projects generate positive and sustainable social environmental impact, both from a community and a biodiversity angle. It also represents actionable and cost-effective paths to reach net zero in a short time frame. Argentina's abundant natural resources, biodiversity, and diverse ecosystems are ideal for the execution of NBS projects, ranging from afforestation and reforestation on degraded lands and conservation of pristine native forest, to the implementation of sustainable practices in the agricultural and cattle farming sector. Aike strives to ensure cross-cut social environmental management, with aims of conserving, restoring, and preserving local biodiversity while positively engaging with local communities.
Aike is staffed with leading local experts, capable of transforming land and forest into efficient carbon sequestration projects, which will provide us with a credit inventory forecasted in our models. Let me share with you a brief video portraying our initial landmark afforestation project in province of Corrientes.
Welcome to Rolón Cué, province of Corrientes, in the northeast of Argentina. In this location, Vista initiated its first nature-based solution project back in September 2022. This is an afforestation project, where more than 15 native and exotic species were planted in degraded grasslands, with the objective of growing woodlands that naturally capture carbon from the air and store it in trees, simulating the nearby native forests. Rolón Cué extends across 3,300 hectares. Vista has successfully planted 2.2 million trees, achieving high growth rates and a survival rate above 90%. Once the project is finalized, 42% of the hectares will be left standing in perpetuity with native species, and the remaining 58% with exotics. Vista NBS projects aim at generating carbon credits of the highest quality, meaning that their impact is measurable, additional, permanent, and positive for local communities and biodiversity.
This project is undergoing VCS and CCB certification processes under the Verra standard.
Hello, and welcome to the operations segment of our strategic update. In this section, I will discuss how we achieve operational excellence and how we expect this to continue driving further growth, efficiency, and value. As a result of our solid operational performance and focus on the development of our assets in Vaca Muerta, we doubled production and quadrupled reserves since we started operations in 2018. Our strong production growth also resulted in over-delivery on our 2022 production target by 6% vis-a-vis the plan disclosed in our previous Investor Day. A safe and healthy work environment constitutes one of our top priorities. We're very proud that we have achieved this growth level with a total recordable incident rate consistently below 1 since 2020, in line with best industry practices.
Our laser focus on operational efficiency allowed us to significantly reduce the time it takes to construct and put in production a forward pad. Today, it takes just 88 days to deliver a forward pad, a material improvement from 130 days back in 2019. This was mainly driven by increases of 75% in drilling speed and 25% in completion speed.... Several factors have contributed to these efficiency gains. We developed a culture of being relentless in achieving results. We hired and trained an extremely experienced operational team in developing Vaca Muerta since its origins. We constantly innovate in our processes. We implemented offline operations, ROP optimization processes, batch drilling, and sand and water logistics optimization, among others. We deployed the latest technology available, for instance, rotary steerable drilling, rig automation, sandboxes, dissolvable plugs.
We developed a novel One Team contracting model, which provides alignment with and incentives for key suppliers covering drilling, completion, and production. These efficiency gains resulted in a reduction of 23% in drilling and completion cost between 2019 and 2022. Through the combined effect of scale and efficiency, we have cut in half total operating unit cost from $32 per BOE in 2018 to $16 per BOE in the second quarter of 2023. During this period, we achieved 65% savings in lifting costs per BOE. Firstly, cost reduction was initially driven by implementing a new operational model after acquiring the assets, with constant focus on savings and efficiency. The transfer of the conventional asset earlier this year allowed us to focus exclusively on shale operations, further reducing cost.
Secondly, by doubling total production, we have further diluted fixed cost per BOE and gained scale, negotiate better contracting terms. Development cost reduction was also very significant, 40% over the same period of time. This was mainly achieved through the combination of two factors: well cost reduction, as explained earlier, and 50% increase in our well EUR to 1.5 million BOEs. The average production performance of the 84 wells we have tied in to date has confirmed so far our EUR estimation. This performance confirms our success in establishing Vista as a globally competitive, low-cost producer. We have tied in 82 new wells in our development hub since 2019. These wells have consistently shown solid productivity, performing 4% above our type curve for the first 90 days and 8% above our type curve for the first 2 years of cumulative production.
This performance has driven shale production growth from nil in 2018 to 43,000 BOEs per day in August 2023. During our first five years, we have built a high-quality asset portfolio with an inventory of 1,150 wells through the successful de-risking of our acreage and accretive asset acquisitions. The successful results in our first two 4-well pads, completed in 2019, combined with the geological models ran for the block, allowed us to confirm our initial view of 400 wells inventory in Bajada del Palo Oeste. This only considered two landing zones, La Cocina and Orgánico. In 2021, we added another 150 wells to our inventory by de-risking the Lower Carbonate, a third landing zone in the same block. The acquisition of Aguada Federal and Bandurria Norte blocks added 300 additional wells to our inventory.
In 2022 and 2023, we drilled pilots in Bajada del Palo Oeste and Águila Mora. Based on the successful results of the wells drilled, we added 300 more wells, including 50 in Coirón Amargo Norte, an area that neighbors Bajada del Palo Oeste, for a total of 1,150 wells. The size and quality of our inventory provides significant growth potential. We have consolidated operations in our core development hub, which we operate as a single production cluster. This development hub includes four blocks: Bajada del Palo Oeste, Aguada Federal, Bajada del Palo Oeste, and Coirón Amargo Norte. The growth plan through 2026 we are presenting today is entirely based on new activity in this core hub.
Let me now give the floor to Matías Weissel, our operations manager, who will present our updated operational projections that reflects higher growth and lower cost through 2026.
Good morning, everyone. I'm here today to discuss with you how we plan to deliver on the targets of our high growth, high return strategic plan. We have made significant progress in securing drilling and completion, treatment, and evacuation capacity. With the free drilling rig and the completion set we currently have under contract and have operated for more than 4 years, we project we can increase new well activity from 31 tie-ins in 2023 to 46 tie-ins per year during 2024. At the end of this quarter, we'll finalize the expansion of the oil treatment plant in our development hub, which is expected to increase our treatment capacity by 23% to 77 barrels of oil per day....
Our plan going forward is to continue implementing modular facilities expansions to gather and treat incremental production, leading to 100,000 barrels of oil per day of capacity by 2026. Importantly, our facilities expansion plan has the flexibility to add further expansions, should we decide to accelerate production growth beyond our new targets. Finally, over the last year, we made significant progress in securing evacuation capacity. As disclosed in our last earnings call, we have been contractually awarded 31.5 thousand barrels of oil per day incremental capacity in the Oldelval expansion, and 37.4 thousand barrels of oil per day of capacity in the OT port facility expansion. We recently initiated exports to Chile through the OTASA OTC pipeline, and expect to increase our capacity for our 8% stake in the Vaca Muerta Norte pipeline.
Combining our current capacity available under open access and newly contracted future capacity, we have secured 100,000 barrels of oil per day by the end of 2025, which will allow us to evacuate the production we are targeting under our updated plan. With the aim of accelerating growth, we plan to increase CapEx to fund new well activity starting in the second half of 2023. We're adding 2 new wells to be tied in during the fourth quarter of 2023, for a total of 31 tie-ins for the year. We are also drilling an additional path, which will be completed and tied in during the first quarter of 2024. Finally, as I just mentioned, during this semester, we're executing 2 projects to expand our treatment capacity to accommodate the production growth of the coming years.
In summary, we're increasing our 2023 CapEx guidance from $600 million to $725 million. We expect to substantially increase new well activity to 36 tie-ins per year, starting 2024. Between 2024 and 2026, we therefore expect to put on production 138 new wells, 34 more than in the previous plan, an increase of 33%. Our updated CapEx plan calls for $900 million to be invested in 2024, as we front-load our treatment capacity expansion. In 2025 and 2026, we plan to invest $800 million per year. After doubling production in the first five years of operations, we now expect to double production again in a shorter period of three years.
Our new production target for 2026 is 100,000 BOEs per day, implying a 22% CAGR on 2023 production, and 25% higher than our previous target of 80,000 BOEs per day for 2026. Production growth is expected to generate further efficiency gains, reducing lifting costs from $5.5 per BOE in 2023 to $4 per BOE in 2026. This implies a significant improvement of 33% compared to the $6 per BOE target we set during the previous Investor Day. We also want to share with you a perspective beyond the timeframe of this updated strategic plan. By 2026, we expect to hold significant remaining inventory that underpins further growth.
We project to have more than 900 wells in our inventory by the end of 2026, approximately 70% still in our core development hub, and the remaining wells in Bandurria Norte and Águila Mora. This leaves us well-positioned to continue building an even larger company, which we envision could be producing 150 thousand BOEs per day by 2030, as explained by Miguel earlier today. I will now leave you with our CFO, Pablo Vera Pinto, who will present our strong financial performance in our first five years of operation, and share insights into how we have prepared our company to raise the bar for our 2026 targets.
Hello, everyone. To finalize today's presentation, Alejandro and I will share with you our path to continue delivering superior total shareholder return, with most targets well above the ones we presented two years ago. Our updated strategic plan is built on strong foundations, supported by a robust growth trajectory since inception. In only five years, we have built the second-largest Vaca Muerta shale oil operator. During the first half of 2023, we were responsible for 14% of the shale oil produced in the basin. Argentina, driven by the production growth of Vaca Muerta, has become a structural exporter of Medanito oil, which is now well-established as a light, low sulfur crude oil in international markets. In 2020, we were first movers in exporting Medanito oil via tankers out of Bahía Blanca to clients in South America, North America, and the Caribbean.
This year, we were part of the consortium responsible for reopening crude oil exports via pipeline to Chile. Driven by our outstanding production growth, Vista is now the top exporter of Medanito crude oil, on track to deliver an estimated 9 million barrels to export market during 2023. By the end of this year, our exports will have tripled vis-à-vis 2020, and should represent up to 55% of our total crude oil sales volume... and we expect this share to continue growing through 2026. Apart from strong growth, more importantly, we have adjusted EBITDA quadrupled between 2018 and 2022, reaching $765 million last year, 39% higher than the target of $550 million set in our previous Investor Day.
adjusted EBITDA margin of 67% in 2022 was 4 percentage points above our target, positioning Vista as an industry leader in terms of profitability. Our return on average capital employed metric showed significant expansion in the last two years. ROCE reached 40% in 2022 and exceeded by 8 percentage points the average of our industry peers. Our solid financial performance has strengthened our balance sheet. Our current debt profile provides us with more flexibility to support future growth. We reduced our net leverage adjusted EBITDA in 2020 to 0.5 times in Q2 2023, and improved our debt maturity profile with yearly principal repayments projected to represent not more than 10% of EBITDA through 2026. The progress achieved in reshaping our debt profile was relevant in three major aspects.
First, we significantly reduced cross-border debt from 56% of total debt in 2019 to 22% in the second quarter of 2023. Second, we reduced the average interest rate on our debt from 8.9% in 2020 to 3% in the second quarter of this year. And third, we extended the average life of our debt from 2.5 years in 2021 to 3 years in Q2 2023. As a result of this progress, Moody's and Fitch upgraded our local credit rating to AAA, up from our initial rating of A+. Our total shareholder return-focused strategy is based on the same capital allocation priorities we presented in our 2021 Investor Day, but delivering more growth, even lower carbon intensity, and a stronger financial profile, all of which will provide us with increased strategic flexibility.
Our confidence in delivering future growth is supported by the cost efficiency and productivity consistently achieved in our past drilling campaigns. We have also secured the needed evacuation capacity to further grow production and exports. Benefiting from our vast ready-to-drill inventory, we will continue to prioritize investments in high return, short cycle projects to generate profitable export-driven growth. We reduced greenhouse gas emissions from operations by 64% and launched Aike, our now fully operational NBS venture. By continuing to invest in operational decarbonization projects as well as in nature-based carbon offsets, we can reaffirm our ambition to become Scope 1 and 2 Net Zero by 2026. Maintaining a strong balance sheet has been and will continue to be a priority.
Our evolution in terms of debt profile with extended maturities, lower cost of debt, and a reduced share of cross-border obligations are a consequence of our prudent and proactive financial management. We understand flexibility as a competitive advantage. We believe that quickly identifying opportunities and being able to swiftly allocate the cash generated to its best use at each point in time generates industry-leading shareholder returns. As we have done in recent past, we plan to allocate cash generation to incremental organic growth projects, selective, highly accretive M&A activity, share buybacks or dividends. Since 2021, we have executed $29 million in share buybacks, and we have acquired Vaca Muerta blocks Aguada Federal and Bandurria Norte in two transactions, which expanded our development acreage and granted us further development optionality. In that respect, our priorities remain unchanged. Alejandro will now present our updated projections.
Hello again. I will now talk about our updated financial projections through 2026. We expect total revenues to grow, driven by the increasing production volume sold to the export market. According to our projections, revenues should double to $2.35 billion in 2026, assuming a realized oil price of $65 per barrel in real terms. This is 42% of our previous target of $1.65 billion for such year. ... More importantly, we expect our export-driven growth to allow us to lower costs through scale, supporting even higher profitability going forward. Our new financial projections significantly raise the bar on previous targets. We adjusted EBITDA to $1.7 billion by adjusted EBITDA than the previously expected $1.1 billion.
We expect to adjusted EBITDA target 2 years earlier in adjusted EBITDA margin to be 72% in 2026, 5 percentage points higher than our previous target of 67%, which was already reached in 2022. We also project to deliver higher returns on the capital we employ. As Pablo just explained, we have an industry-leading ROCE. We expect to increase ROCE by 4 percentage points to 40% in 2026. We project to deliver these results while maintaining a healthy balance sheet, with growth leverage ratio target for 2026 maintained at 0.4 times total debt to the EBITDA. We are focused on executing a high-growth, high-return strategic plan, delivering superior total shareholder return.
Based on our updated projections, we plan to generate $5 billion in operating cash between 2022 and 2026, compared to $3.4 billion in the previous plan. This additional cash will enable us to increase CapEx to $3.8 billion, up from $2.3 billion in the previous plan. It has also enabled us to fund $140 million in asset acquisitions and $168 million of upfront payments in evacuation capacity, neither of which were included in the projections of our previous Investor Day. More importantly, our updated targets maintain the cash generation target at $1 billion for the period, to be accumulated between 2024 and 2026.
By the end of 2026, we expect to have a company generating north of $500 million of cash flow per year, which leaves us in an excellent position to deliver on our 2030 vision. Our projections assume a realized oil price of $65 per barrel. So assuming a realized average oil price of $75 per barrel for the next three years, we forecast cash flow generation to be $1.6 billion. On the other hand, assuming an average realized oil price of $55 per barrel, we forecast $400 million of cash flow generation through 2026. So for each $1 per barrel variation in realized oil price, cumulative cash flow varies $60 million through 2026. These sensitivities are evidence of both the inherent upside and the resilience of our strategy and of our company.
With this, we conclude today's presentation. We will now move to Q&A.
We will take a two-minute break before we start the Q&A session. We will now begin the question and answer session. Dial-in participants may ask a question by pressing star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. We kindly request you to ask one question with a follow-up. If you have further questions, you can go back to the queue by pressing star then one on your telephone keypad. You may submit online questions at any time using the window on the webcast. Make sure to mute your webcast when you are joined by phone. Our first question today comes from Bruno Montanari with Morgan Stanley. Please go ahead.
Good morning, everyone. Thanks for hosting this event, and congratulations on the execution and the new targets, which look very robust. Thanks for taking my questions. I have two questions, if I may. First one, since 2018, we have seen a major evolution in Vista's well productivity, which over the years led to upgrades on the shale well type curves. So I wanted to know if you believe the company reached a state-of-the-art, if you will, in the type curve, or if there could be additional upside surprises in terms of productivity? And the second question: Looking at the 2026 targets, could you provide us a bit more color on the equipment requirement to reach 100,000 barrels per day?
Specifically, if you plan to add more drilling rigs and when that would be necessary. Also, given that the company has been able to execute above and beyond expectations, do you see potential upside to the 100,000 barrels per day figure? Thank you very much.
Thank you, and good morning, Bruno. Thank you for your question. I will start answering probably the first part of your question related to the productivity and well types, and then I'm going to let Matías to answer about production and probably additional equipment that we will require. As shown in the presentation that we just did, our well type currently are performing 8% above type curve. The type curve that we have today is 1.5 million barrel oil per day. This is after 720 days of two years. We are seeing also a robust performance on gas lift, which is boosting production after 12 and 10 years, confirming that this was not only a very good technical decision from the point of view of productivity and also lifting costs.
With that, I will let Matías to answer the second part of your question.
Thank you, Miguel. Well, our plan is to move forward with 36 wells per year. If we construct a curve till 2026, we'll be moving forward from 55 thousand BOE per day in 2023 to 70, 85, and 100 thousand BOE per day. Okay. We feel very confident in Bajada del Palo Oeste. That's the reason why we're drilling and performing vis-a-vis with type curve. We have the treatment capacity. We have a plan that is focused on modular facilities, so we have the capacity in order to keep on growing beyond 100 thousand BOE per day capacity of treatment evacuation.
Thank you, Mati.
Thank you very much.
You're welcome, Bruno.
Our next question today comes from... Apologies. Our next question comes from Walter Chiarvesio with Santander. Please go ahead.
Hi, good morning. Congratulations for the performance so far, and thank you for taking my question. I have two questions related to each other. The first, related to the longer term, let's say, after 2026. My first one, and I know that, as you mentioned, your commitment to the best allocation of capital, in the company. But if you have to be more accurate, or, what do you envision, the company in terms of cash flow management? You—I guess that you have either two options, with this strong cash flow in the future. It's either distributing, dividends with, if you think there could be some specific dividend policy in the future, or either you ambitions to accelerate growth even, above what you just mentioned in the presentation.
If you have to say, what do you think your ambition could be after 2026? Related to that, what are the challenges after 2026 in terms of CapEx, evacuation needs, if we need more of the plants that we are seeing for the country, and also in your facilities, investment facilities? Because according to my math, is that you need to accelerate drilling wells more than 45 per year after 2026 to reach your target. Those are my two questions. Thank you.
Thank you very much, Walter, for your question, and again, I will probably answer the first part related to cash or capital allocation, and then I will let Juan Garoby to comment on our plans 2026 onwards and requirements in facilities and equipment. We expect to generate around $500 million in 2026, and the capital allocation or our capital allocation remain exactly the same. First of all, growth due to our deep pool of inventory that we have in terms of wells, and now we are giving an indication what we could do 2026 onward. Second, deleveraging, and third, and not in a specific order, shareholder return. Specifically in shareholder return, we've been having a policy of... Not a policy.
We've been doing buybacks all the way up to here, and we will continue doing so, but also depend on the context, and we believe the context it will be positive for us. At some point of time, we will have a dividend policy when that really apply, and we continue, and we will be always looking at that. With that, I will let Juan to comment on 2026, so 6 onwards in term of production plan, CapEx, and equipment.
Thank you, Miguel. We have, at the moment, secured all the contracts and required to get to 2026, and this 100,000 barrels production. Going forward, if we were to increase production even further and reach 150,000 barrels by 2030, we would require two additional rigs, and we will also require to negotiate additional contracts with for evacuation and build additional facilities to treat that production. But at the moment, we have all the contracts in place, two drilling rigs and one spudder rig, and we have all the facilities planned, you know, and evacuation contracts in order to achieve those 100,000 barrels per day in 2026.
Thank you very much. Just to follow up, do you think that the possibility of bringing new rigs depends more on the industry conditions or the macroeconomic condition of the country in general?
Do we have today for our plan, as I mentioned before, and the plan be contracted under the current situation that we are today. So for us, additional spuds is something that we have in hand. Due to our special relationship on this One Team approach that we have with Nabors and with Schlumberger, we have been able to secure the equipment that we require to execute the plan toward 2026. I will say, in general speaking, the service industry also is looking for a change in the terms of contracts for importation and also repatriation of dividends, as you probably know. And of course, that is bringing certain constraint that is not affecting us at the moment, but I think it's affecting the industry overall in Vaca Muerta.
Perfect. Thank you very much for your answers.
You're very welcome.
Thank you. Our next question today comes from Alejandro Demichelis with Jefferies. Please go ahead.
Good morning, guys. Congratulations with the new targets. Just a follow-up question on the infrastructure side. On that kind of 2030 path on infrastructure, do you think that can be achieved with the infrastructure that is in the country at the moment? Or do we need to see some of the new projects really materializing for you to get to that number?
Thank you, Ale. I will leave Mati probably to take over the question in terms of treatment, and then Pablo can give you an overview on evacuation, where we are today and where we're going.
Thank you, Miguel. In terms of internal upstream capacity of oil, we have several projects on the portfolio and in the field. For example, during the next three years, we're commissioning the second and the first stage revamp of Charco Bayo facility, central facility, that we're going to gain around 90,000 oil per day of capacity, raw capacity. Then we have a concept that is modular facility that's called baterías for unconventional resources that fit for purpose design facilities. We are just commissioning one by the end of the next quarter of next year. That's called Batería number three, and this is due to be linked to the Vaca Muerta Norte pipeline.
If we need more, we are going to put above 2026 other two batteries that will be linked to all the pipeline that goes to the Atlantic and to the Pacific Ocean, will be crucial for us for the exports.
Good. Thank you, Alejandro, for your question. Complementing what Mati just said, to get to our 2025 target, we will add the open access capacity we're already using now, plus the Oldelval and OT expansion that we are already funding. Those projects are progressing quite well. To that, you need to add our exports to Chile that will start flowing through Vaca Muerta Norte in the coming weeks, in a few months. And with that, we have secured our capacity for our 100,000 barrels per day target in 2025. If we want to grow beyond that, which is our vision, we will most likely need to add new evacuation pipelines and potentially a new export port.
As you may know, there are ongoing discussions among industry players to build that new trunk pipeline and to build a new deep sea port that will give us access to larger ships, probably to VLCCs. And that will be a very important part of our plan after 2026. It will probably provide us with lower discounts and access to new markets. We believe the government and all industry players are very well aligned in making those expansions happen. It's not something that is urgently needed, but it's something we are discussing and will most likely be part of our plan after 2026.
Okay, that's great. Thank you. As a follow-up question, how do you see the cost, both on the drilling and completion side and on the lifting cost side evolving from here? Because if I look at your new CapEx target, so $720 million for next year, 46 wells tied in, that's about $15 million per well, yeah?
Yeah, we, I mean, as we said in the presentation, we don't see an issue on the development cost and in the lifting cost. We've been very upfront that we believe we will land in 2026 in $4 per barrel lifting cost, why? You know where we come from. We have a huge reduction, both in terms of CapEx and reserve, but we have faced inflation during the last two years. We believe we have reached a point where the CapEx is fixed for the wells, and I will see in a change of context of the evaluation or whatever happened next in Argentina, we see probably more of a positive effect than a negative effect.
Okay, that's fantastic. Thank you very much.
You're welcome.
Thank you. We have no further questions via phone. I would like to turn the conference back over to Mr. Alejandro Cherñacov, who will be reading additional questions from the webcast.
Thank you. We have a few questions from, from online, from the online platform. I'll start with the first one that comes from Alejandra Aranda, from Itaú, which is: What are the risks in terms of equipment? What could delay the plan, and what could make you accelerate? Do you rely on imports to execute the plan? Those are the... That's, that's the questions from Alejandra.
All right, Alejandra, thank you for your question, and I will probably tackle the first part of the question, and then I will let Juan to discuss where we are with the term of equipment and how we are going to tackle what we put in the plan. First of all, I will say internationally, we have a very contracted view in term of on Brent. We've been vocal about that, and we don't see any changes in the medium term. So that, of course, is encouraging us. And we today don't see any showstoppers from Argentina politics. As you know, we are going through election today, but when you take the views of the three candidates related to Vaca Muerta, and particularly Vaca Muerta oil, I think it's very consistent.
All of them see Vaca Muerta as a solution and not as a problem, and they are very keen on tapping into the proceeds that come from exportation. And of course, they are very aware that the only way to move forward and continue growing in Vaca Muerta and continue incentivizing the activity, we will require some flexibility for some of them immediately. For some of them, it will take probably a few months in terms of access to cross-border proceeds. So therefore, I mean, we believe our plan in the medium term, 2026, is a very realistic one, and we are very keen on what we can do from here to 2030.
Juan, probably you could comment about the risks and equipment that we will require.
Yes. On the operational side, we see no risk on equipment to achieve the plan. We have already contracts in place for two drilling rigs and one spud rig. The frack set is already contracted as well. So with this capacity, we'll be able to drill 46 wells per year. That is what we have in our plan. As far as importation, only spares and some parts that will be required to maintain those equipment will have to be imported, but nothing major to achieve this plan. As we said before, to accelerate further after 2026, we will need to contract one or two additional rigs, but that is beyond 2026.
Alejandro, also, related to your comment, if you will have the cash to accelerate, definitely, I mean, as, as it's shown in the presentation, we will accumulate around $1 billion of cash from now to 2026. That has not changed from our previous plan, and we will generate about half, five hundred million dollars in 2026. So definitely, we will have the cash to accelerate. We will have the resources to accelerate because we will just consume a very small part of our portfolio. So the decision to use that cash farther, to farther grow our activity, will mainly depend on the context.
Thank you, Miguel. I will move to the second question from the online platform, which comes from an anonymous investor and says, "Vista has an inventory of more than 20 years, and the management and the skills to continue drilling Vaca Muerta even further. In case that there is evacuation availability, what are your thoughts around making a JV with another player which should, let's say, pay the CapEx and OpEx cost and share incremental production above the guided plans?
All right. Well, thank you very much for your question, and we've been very innovative on that front. So I will let Pablo, who leads the business development as part of his role as CFO, to answer this question.
Perfect. Thank you, Miguel. We have a strong track record of generating value through business development activity. Just to give two examples, we entered into a quite creative structure with Trafigura to accelerate our growth and improve the returns on our investments. We also acquired, at very competitive, terms-
... additional blocks, including Águila Mora, Bandurria Norte, and Aguada Federal, and that has expanded our portfolio, and generated value in the long term. That activity will continue being part, it's part of our DNA, and when we look specifically at Bandurria Norte and at Águila Mora blocks, those two developments are not part of our core strategic plan that we just presented. So they provide upsides to accelerate even beyond or to provide growth after 2026. We think it will make sense to entertain discussions around JVs in either one of those two blocks or potentially even both blocks, and that is definitely a way to generate more value, to make it tangible in the medium term, and to improve our, our returns. So yes, that will probably be part of our plan going forward.
Thank you, Pablo. Any more question, Ale?
Let me check. One more question from anonymous investor again, and says, "How do you expect development costs to evolve in the next few years?
As you know, development cost has two parts. One is the ultimate recovery per well, and that is the type curve that Matías has just explained, where we do see some area for improvement, but we think we're probably at the point where we are okay with that type curve as of today. The other area is well cost, where we do see an opportunity to further reduce well cost.
We will, we do have a continuous improvement process that we put together from the very beginning, and we also, the normalization of the macro may help us in reducing well cost as well, as it has played against us in the last two years. So we do see a room for improvement in well cost, and that will further reduce the development cost by probably 5%-10% in the coming years.
Thank you, Juan. I think we have a last question, again, from an anonymous investor, that, refers to: "Can you give more detail on the plan to decarbonize operations?
Thank you, Ale. Yes, we will continue to deploy a refined portfolio of projects like we have been doing since 2021. This has helped us to reduce our carbon intensity from 39 kilograms of CO2 equivalent to an exit point of 14 by the end of 2022. Going forward, we will aim to be at the top of the quartile among the oil and gas industry, reaching at 7 kilograms of CO2 equivalent per BOE. We have again to continue deploying the set of projects. Those include, for example, the electrification of the compression systems, the electrification of the drilling rigs, which is pioneering initiative in Argentina.
We will also continue introducing vapor recovery units for all our new facilities, eliminating blanketing gas, and also including air instrumentation for the rest of the facilities. All these projects have got a positive internal rate of return, setting obviously the carbon tax that we have decided to put at $50 per ton of CO2 abated. And the abatement cost, in average, is around $30 per ton, which is extremely competitive when compared with the global market.
Thank you, Gabi.
Okay, and with this, we have a last question, that is: "How will the upcoming change in government potentially affect Vista?
Well, I think I mentioned that before. I mean, as you know, I mean, we are well established here, and Vista is not what was five years ago. So it's a company that is the second largest producer in conventional oil in Vaca Muerta today. And therefore, of course, everything that we think and is taking in consideration for the country moving forward. We have contact with the three candidates to President of Argentina, and they have been very explicit on what they think and on the importance of Vaca Muerta for Argentina moving forward.
To help the country macroeconomic-wise, exporting is a key priority, and when you look at what Argentina can export today, about what we are exporting today, in terms of scale and in terms of actionability, Vaca Muerta oil is probably first in the list. Of course, in that sense, everybody want to incentivize what we are doing. When I mean we, not just Vista, but the whole industry. Therefore, they are very positive on what we require to accelerate further our development. So, I'm positive about what will be the next chapter of Argentina and Vaca Muerta in the next five, six, seven years.
Okay. Thank you, Miguel. With this, we conclude the presentation, so for concluding remarks, Miguel, please.
Well, Lucas, thank you very much, first of all, for escorting us all the way to here. It has been five very successful year, and I would like to take the opportunity not just, not just to thank you, but to thank all the people that work at Vista that have made this possible. This would have required not only hard work, but also a lot of innovation and professionalism in everything that we do every day at the field and also in our offices. Thank you very much to everybody, and have a good day.
Thank you. The event is now concluded. Thank you for attending today's presentation. You may now disconnect.