Good afternoon, ladies and gentlemen, and a very warm welcome to our 2026 Capital Markets Day. It is a great pleasure to greet those of you here with us in Petrom City, and a warm welcome to everybody who is joining us online. For those of you here in Petrom City, we will just have a short safety moment. We do not have a fire exercise planned for today, so in case there is a fire alarm, it is real. We will evacuate through the exits at the back of the room, and we will leave the building through the front door that you came in when you arrived, and we will gather outside in the visitors area MP12 in the front of the building in the parking, and be assured we will escort you there.
Before entering into our presentation, let me draw your attention to the cautionary note regarding forward-looking statements at the beginning of this presentation. I am here today with my board colleagues, Cristi Hubati, Franck Neel, Radu Căprău, and Alina Popa, and together we will update you on the progress of our Strategy 2030. In a context shaped by energy market volatility, geopolitical uncertainty, and an evolving pace of transition, we will show today how OMV Petrom has continued to execute its Strategy 2030 with discipline and is transforming for a resilient future. What is transformation for resilient growth? Firstly and foremost, we are growing the company with an additional 50% of EBIT by 2030. Our growth is underpinned by integration that strengthens our resilience, connecting traditional energy, regional gas, power, and sustainable transportation into a portfolio built for changing markets.
We are decarbonizing our products in a measured and pragmatic way, in line with market expectations, allocating 25% of our CAPEX to low and zero-carbon projects with strong returns. In doing all of this, we are growing total shareholder returns, having delivered already 160% of total shareholder return during 2022 to 2025. What connects all these elements is discipline. Discipline in capital allocation, discipline in execution, discipline in costs, and discipline in how we balance growth, resilience, and returns. Thus, today, we will walk you through the progress in executing our Strategy 2030 and reconfirm our investment proposition. We are now halfway through the execution of our Strategy 2030. What started in 2021 as a bold plan is now, through tangible delivery, transforming OMV Petrom. Our Strategy 2030 provides for three areas of strategic growth. First, Black Sea gas.
Neptun Deep is advancing towards first gas in the first half of 2027. We are also pursuing Black Sea exploration opportunities to further strengthen our position and support the region's energy security. Natural gas remains central to our growth in Southeast Europe, providing secure, diversified supply with lower emissions. Second, integrated power. On the generation side, we are bringing together renewables, battery storage, and our flexible gas-fired capacity at Brazi Power Plant. This balanced portfolio will improve our market positioning and enhance value captured across multiple markets. We are targeting to enrich our offering towards customers supporting the region's decarbonization. Third, under the umbrella of sustainable transportation, we are developing a solid position in sustainable aviation fuel and hydrotreated vegetable oil, products obtained using renewable feedstock. The new unit under construction in Petrobrazi will position us as one of the largest sustainable fuel producers in Southeast Europe.
This, together with our e-mobility investments, supports tangible lower-carbon options for our customers and contributes to the regulatory-led decarbonization of road and air transportation in the region. Our transformation is anchored in our strong, integrated traditional business, which provides the cash flow needed to invest in future growth. To deliver on these growth priorities, we are strengthening the capabilities that support execution. We are becoming faster, more efficient, and more digital while continuing to stay focused on operational excellence and disciplined cost management. Our robust execution is translating directly into financial strength. Strong cash generation and disciplined capital allocation allow us to invest in our transformation while delivering attractive shareholder returns. Strategy 2030 is reshaping our asset base and, with that, increasing our cash flow.
Gas growth from Neptun Deep, the expansion of our integrated power business, and investments in the future of mobility create a more resilient, lower carbon, and more valuable OMV Petrom for our shareholders. Taken together, these strategic growth areas are expected to increase profitability by around 50% by the end of the decade. This increase is supported by projects with final investment decisions or high visibility. This is not an aspirational case. It is an execution case. At the same time, our financial framework is unchanged. The overall investment remains at EUR 11 billion for 2022 to 2030. Within this, we are allocating capital opportunities with clear strategic fit, proven technology, and attractive returns while reducing exposure to less mature options. This is how we balance growth with resilience.
We are investing in the future of OMV Petrom with a clear focus on returns, cash generation, and sustainable value creation for our shareholders. Since the launch of our Strategy 2030, we have been very consistent in how we reflect performance into shareholder value. Our dividend policy is translating business performance into competitive total shareholder returns. We have combined progressive base dividends with special dividends, resulting in competitive total distributions each year and an average dividend yield of around 13% over the past five years. At the same time, our payout ratio consistently outperforms the median of both the global majors and the regional peers while preserving a disciplined approach to cash distribution. Together with share price appreciation, this has translated into total shareholder return from 2022 to 2025 of around 160%, substantially higher than both global majors and regional peers.
With a strongly integrated portfolio and a clear path towards providing lower carbon energy, we are well-positioned for resilient growth. Neptun Deep, our low-carbon investments, and the discipline in our traditional business are expected to drive stronger cash flows and earnings, supporting our ambition of approximately 15% return on average capital employed by 2030. This financial strength is intended to translate directly into shareholder value. Our dividend policy remains a clear commitment. Progressive base dividends complemented by special dividends in a favorable market environment and provided that our investment plans are funded. Since 2021, the external environment has changed significantly. Europe has faced energy crisis, geopolitical tensions have intensified, and regulatory interventions have become more frequent. All of these have made the combination of energy security, affordability, and competitiveness even more forefront in the energy dialogue.
At the same time, the energy transition continues, but not in a straight line, not at the same pace across all markets and technologies, and not at the pace initially expected back in 2021. Renewable power and storage are gaining scale, electrification is progressing, and lower carbon solutions are becoming increasingly relevant. However, the transition is also facing headwinds, infrastructure limitations, permitting delays, volatile commodity prices, and regulatory pressure. Against this backdrop, our strategy has proven resilient. We remain committed to our strategic direction, our investment pillars, and our dividend policy while adapting our capital decisions to market realities and the evolving pace of the energy transition. Looking ahead, we continue to see good growth fundamentals in our region while experiencing macroeconomic and political uncertainties. GDP per capita in our core markets is still projected to grow faster than the EU average.
This reflects rising living standards, economic activity, and energy demand. At the same time, the demand mix is gradually changing, driven by electrification, mobility trends, decarbonization policies, and the need for secure and affordable energy. While the mobility mix is gradually evolving, lower motorization in our region means that there is still room for traditional fuels demand to remain robust by 2030 even as electrification gains traction. Gasoline is expected to exhibit double-digit growth for the remainder of this decade, supported mainly by the evolution of hybrid cars. Hard-to-decarbonize sectors are expected to keep diesel volumes structurally high with modest growth to 2030. Aviation fuels, including SAF, are expected to grow even faster, the latter based on mandates imposed by ReFuelEU Aviation regulation. In gas, we continue to see growth in our operating region towards 2030.
In Romania, this reflects both the recovery from the lower consumption levels seen after the price volatility of 2022 and the emergence of new demand, including from power generation and industrial consumers. Gas will remain essential for flexibility, security of supply, and the balancing of renewable power. The region's demand is also expected to be supported by gas growth in some sectors, most notably in power. In power, demand is expected to increase, supported by electrification across the economy and by the development of e-mobility. This reinforces the logic of building an integrated power portfolio, combining renewables, storage, flexible generation, and trading capabilities. For some of our products, especially with lower emissions, growth will continue to 2040. After 2030, we expect demand for gasoline and diesel to begin to drop following the same demand trends seen in developed countries.
At the same time, aviation demand is expected to continue growing toward 2040, which makes the decarbonization of air transport one of the key opportunities for our region. Post 2030, we expect domestic natural gas consumption to decline as lower operating rates for gas-fired power plants are forecasted, while the share of renewable sources in the electricity mix increases. However, we estimate natural gas to continue to play a key role in the regional energy system through 2040 as a balancing source for renewables and enabling emerging technologies. Energy demand is changing and transforming, and with that, so is our portfolio. Through regional gas, integrated power, sustainable fuels, and e-mobility, OMV Petrom is well-positioned to capture this changing demand while continuing to support energy security and lower carbon emissions. Let me now turn to the market assumptions that frame our strategy.
As we look towards 2030, we continue to expect volatility to remain a structural feature of the energy markets. Commodity prices will move with global supply and demand, geopolitical developments, regulatory decisions, and the pace of the energy transition. This is why we do not build our strategy around a single price scenario. We build it around resilience, flexibility, and value creation. In our base case, we have updated several price assumptions to reflect the latest market outlook while continuing to manage the business for value creation across the strategic cycle. The current situation in the Middle East reinforces the need to plan for volatility. At the same time, for 2027 to 2030, our assumptions are pointing towards a more balanced oil market than expected two years ago.
As a result, we are using slightly lower Brent assumptions for the rest of the decade, supporting investment discipline and resilience across market environments. For gas, we increased the upper end of the range compared to our previous Capital Markets Day. For power, we reduced our base load prices, and we now show also the indication of captured prices for wind and solar, as this better reflects the revenue profile of our renewables portfolio than base load prices. We now assume a lower CO2 price path, not because the direction of decarbonization has changed, but because recent market signals point to a more gradual progression. Recent years have demonstrated our ability to adapt and perform to changing circumstances. Adaption has always been part of OMV Petrom's DNA.
It is what has helped us navigate uncertainty in the past, and it's what gives us confidence that we can continue to create value and seize opportunities ahead. While our strategic direction remains unchanged, we maintain a flexible portfolio of opportunities adjusted to market demand, technology maturity, and value creation potential. Black Sea gas remains at the core of growth. We are reinforcing our position through Neptun Deep, a stronger exploration focus, and a broader regional gas platform that supports security of supply in the region. In power, we are building an increasingly integrated regional business. Renewables, power storage, trading, and commercial optimization will work together with our flexible gas to power generation to capture value across the power chain and support the decarbonization of the regional energy system. In mobility, we continue to combine a high-performing traditional fuels business with scalable low-carbon solutions, including biofuels and e-mobility.
This allows us to respond to changing customer demand while protecting our cash generation capabilities. Together, these activities support resilient cash flow and profit generation while enabling continued transformation, attractive shareholder returns, and GHG targets aligned with market realities. I will now hand over to Cristi, who will provide a deeper view on how we're advancing our regional gas growth agenda, exploration activity, and our broader E&P portfolio.
Thank you, Christina, and good afternoon, everyone. Let me continue with Exploration & Production and explain how our portfolio supports OMV Petrom growth agenda. As Christina mentioned, Black Sea gas is one of the three areas of our strategic growth. For E&P, this means three priorities: delivering the Neptun Deep project safely on time and on budget, expanding our exploration options across the Black Sea, and continuing to manage our mature asset base with strict capital and cost discipline. The Black Sea is the cornerstone of our growth strategy, and we strongly believe in its long-term potential to contribute to both regional energy security and economic development. While discoveries in the recent years confirmed the Black Sea potential, our regional portfolio covering activities from exploration to development and production gives us a strong platform for future activities.
We have been producing oil and gas in the Black Sea through Petromar for more than 40 years, providing more than 10% of our current production. The development of Neptun Deep will add approximately 70,000 BOE per day, turning Romanian Black Sea into a major contributor to our production. While Neptun Deep is progressing towards production, we are also looking beyond first gas. The Black Sea is an emerging basin, and we continue to explore its potential through four exploration blocks in Romania and Bulgaria. I will come back to this with more details later in my presentation. But first and foremost is the crown jewel of our portfolio. Neptun Deep is a game changer for OMV Petrom, for Romania, and the wider region. It will unlock one of the European Union's largest natural gas resource, strengthening energy security, reduce Romania's dependency on import, and support economic growth.
At the same time, it can provide the energy needed to support Romania's broader transition to a lower carbon energy system. Execution is progressing well, and the project has reached more than 85% of the total progress. As announced yesterday evening, we are targeting first gas in the first half of the next year and plateau production by the end of Q3 2027. From an economics perspective, this is highly attractive investment. With around EUR 4 billion of development CAPEX, the project is expected to deliver approximately 140,000 bbl of oil equivalent per day at plateau for nearly 10 years. The Neptun Deep project is not only about the scale, but it is also about the quality of the execution. As planned, the project moved faster than the industry average, with first gas targeted around two years earlier, comparable with offshore development similar of this scale.
The project has been designed for remote operation with a modern offshore concept and a lower emission intensity compared with the industry average. At full plateau production, Neptun Deep is expected to contribute around half a billion to our 2030 EBIT. So it is not only a major step for regional energy security, it is also a major step in the earning and cash generation profile of our E&P business from 2027 onward. Supported by highly competitive production cost, we expect the project to generate an IRR above 12% over the lifetime. The expected economic contribution for Romania is also substantial. According to an independent study, Neptun Deep is expected to generate around EUR 20 billion in budget revenues and to create or maintain approximately 9,000 jobs.
In addition, the project is expected to contribute around EUR 40 billion in economic added value through direct activity, supply chain effects, and broader economic impact. Neptun Deep is not only a major offshore development, it is a project that supports public revenue, employment, industrial activities, and long-term energy security, while also contributing to a transition towards a low emission carbon economy. With the broader impact in mind, let us show you a short video highlighting the progress we have made on this strategic project. Pretty impressive. Neptun Deep is the cornerstone of our offshore business and also the platform for future growth. Over the past years, we have built the capabilities required to operate safely and effectively offshore, from shallow water to deep water. Operation through the value chain to the execution and production.
These capabilities are now a strategic advantage, and they enable us to pursue additional offshore opportunities with discipline and focus. Our exploration program is built on a deeper understanding of our existing acreages, as well as a growing acreage position. By 2030, we plan to allocate around EUR 100 million to new offshore opportunities in Romania and Bulgaria. We focus on competitive portfolio options that leverage our existing knowledge, infrastructure, and regional position. In Romania, this includes potential exploration wells like Anaconda and Cormoran. In Bulgaria, we are assessing options in Han Asparuh and preparing a seismic campaign in Han Tervel, broadening our understanding of the regional basin. While Neptun Deep remains the main growth driver for the second half of the decade, our exploration activities may give us additional optionality beyond 2030.
It reinforces our offshore position, supports regional energy security, and keeps OMV Petrom well-placed to capture future offshore gas opportunities. The Neptun Deep gas complements our existing production assets. We continue to manage the traditional business portfolio with the same principle that guided our overall strategy, value over volume. This means concentrating capital on the most attractive bbl, maximizing economic recovery from existing assets, and focusing on near-field opportunities where we can leverage infrastructure, subsurface knowledge, and operation excellence. At the same time, we are reshaping our portfolio to make it simpler, more resilient, and more efficient. A streamlined footprint, strict cost discipline, and continued modernization allow us to protect cash generation even as the asset base matures. Traditional production is expected to remain broadly flat in 2030 compared to 2025, while portfolio optimization, strict cost management, and continued modernization support resilience performance through 2030.
With an operating cash flow breakeven at approximately $30 per bbl oil equivalent, the portfolio remains positioned to generate cash while meeting our operational efficiency objectives. Looking at the E&P portfolio as a whole, the impact of Neptun Deep becomes visible from 2027 onward, when E&P is expected to become materially more cash generative, driven by Neptun Deep. At the same time, production cost per BOE of our overall portfolio is expected to reach approximately $9 per bbl, supported by the scale and competitiveness of Neptun Deep. Taken together, our E&P portfolio combines near-term cash generation with disciplined exploration and long-term resource optionalities. This gives us a resilient E&P platform anchored in cash flow from our mature asset, enhanced by Neptun Deep, and complemented by selected exploration across the region.
I now hand over to Franck, who will show you our gas and power business, how our gas and power business convert this strong supply position into market access, commerciality, flexibility, and integrated value creation.
Into money.
Into money.
Thank you. Good afternoon. I am very pleased to be with you tonight. Today, not tonight. Maybe later, but today. You may hear a very slight French accent, so sorry. I will try to speak slowly to make sure you understand me. Thank you, Cristi, for the introduction, and let us start. I think you see here the map of the region, and I think it is very important to focus on the region for Neptun gas and the contribution to the regional security of supply. As Cristi explained, Neptun Deep will materially strengthen Romanian gas position from 2027 onwards. For gas and power, the key question is how we convert the stronger supply position into value. The answer is market access, flexibility, and integration. Romania is expected to move from an import dependence toward an export potential, and this materially change the role we play in this region.
With existing infrastructure connecting Romania to its neighboring market, we built on our ability to serve demand both domestically and across the region, especially in countries that are expected to remain structurally dependent on import. Romania is a very attractive market, given its proximity and lower transportation costs, market access. Looking at the contract signed until now, most of them are delivering in Romania, and the end user cover a broad range of industry, from manufacturing to logistic, tourism, and other services. In term of volume, approximately one third of the quantity contracted are with Romanian customer at the moment. Our market access, our trading capabilities allow us to optimize sales across the market and across the countries you can see on the map.
Over the past two years, we have already expanded our B2B activity in Bulgaria and Hungary, and we see further opportunities to broaden our regional presence, both in gas and in power. Both gas and power is enforcing its important role as value bridge, connecting the gas growth delivered by Cristi and his team with local and regional customers, power market, and integrated opportunity across the value chain. Based on our gas marketing strategy, we target to reach a total gas sales of more than 70 TWh by 2030, including Neptun Deep volume. We are looking to optimize a mix between the quantity sold on forward contract and spot market at European hub and local market link price. Let me move now to the power business, where our objective is to increase the value by strengthening our regional footprint with a lower carbon, integrated, and flexible portfolio of assets.
Here you can see on the drawing what we are looking at. The logic is straightforward. Its renewable generation give us the opportunity to meet growing low-carbon power demand with a flexible gas fire generation at Brazi Power Plant, complemented by battery storage, to help and manage the renewable intermittency and support optimization across portfolio and deliver green product to our customer. Together, these elements allow us to capture value from generation and also from integration, balancing, and trading, using AI to optimize our position. On top of a 0.9 GW of gas fire power plant in Brazi, we have already secured more than 1.3 GW of renewable power project net to OMV Petrom, as we have joint venture with partners, most of the case. To this, we are adding a net target of more than 0.3 GW of battery storage by 2030.
This give us both scales and flexibility as the regional power market evolves. At the same time, we are expanding market access on cross-border trading capabilities. This is important because value and power will increasingly come being able to optimize across technology, market, and time frames, from renewable, from storage and flexible generation, to commercial solutions for customers. By 2030, we continue to target more than 6 TWh of annual net electrical output, while green power will represent more than 30% of our power sales. So our power strategy is about adding capacity and about building an enlarged integrated platform that support decarbonization, improve flexibility, and creates value across the energy chain. Let me now go on a level deeper into our renewable portfolio. Our objective is not simply to add MW, it is to build a capital-efficient portfolio with a mix from wind and solar and battery.
This is why we are combining scales with discipline using a diversified funding model and working with partner where this improve capital efficiency, project financing, and execution capability. We are investing approximately EUR 1 billion in renewables with an attractive expected return profile. Our portfolio is already moving from development into delivery, and 0.8 GW is under development and more than 50 MW is already operational. These figures are net of OMV Petrom. by end of this year, we expect to reach 300 MW growth in term of operating assets, which is a very good progression. By 2030, this give us a clear path to growth, a net renewable capacity of more than 1.3 GW and an annual production of more than 2.4 TWh. By the end of this decade, we are expecting to account for 55% of our total renewable production, with PV contributing the remaining 45%.
This asset will not stand alone. This will be integrated with battery storage, our existing flexible gas power generation, and our trading capabilities. This allow us to optimize production, manage intermittency, and capture higher value across the power chain. Importantly, we are scaling this portfolio with capital efficiency in mind, using a mix of own equity, EU grants, bank financing to support faster execution while protecting returns. In this way, in a growing and fast-developing market environment, we are becoming one of the few integrating renewable power storage and gas-fired power generation player in this region, transforming low-carbon energy into predictable outputs. Digital transformation is also a major focus for us, enabling the development of an integrated power system that connect renewable, conventional, and battery assets through real-time data, advanced forecasting, automatic position management, and algorithmic trading.
It's a completely new IT platform which is under construction, which will contribute to creating a virtual asset capable of optimizing dispatch and capturing value across multiple energy markets. Our model is clear; renewable provides the growth platform, integration provides the value uplift, and discipline funding project return. We are now moving from portfolio build-up to visible execution, and here you can see on the map where are our main projects. More than 60% of our renewable projects have reached final investment decision, demonstrating tangible progress from portfolio development toward execution. Our model combines, as I mentioned, partnership with fully owned projects. This allows us to scale faster, share execution capabilities where it makes sense, and remain disciplined in how much capital we want to deploy.
It also gives us access to a balanced technology mix, with solar representing around two-thirds of the portfolio and wind around 1/3 of the 2030 target capacity. Our objective is not simply, as I mentioned, to add capacity, but to build a portfolio that creates earnings, support decarbonization, and strength our integrated power business. Taken together, this project is expected to contribute around EUR 100 million to EBIT in 2030. This comes on top of our traditional gas and power activity that are estimated to contribute by approximately EUR 150 million. Gas and power, around EUR 250 million for the group EBIT by 2030, EUR 100 million the renewable, and EUR 150 for the non-renewable traditional business. Before handing over to Radu, let's watch together a short video highlighting how our renewable power portfolio is moving from plans into execution. Thank you. Now let me hand over to Radu.
Thank you, Franck. Sorry for missing the French accent. Good afternoon, ladies and gentlemen. We will be exploring a bit the value of the Refining & Marketing and the contribution that we are building and bringing to the strategy execution for 2030. Of course, it is not only about our company, but it is as well about the transition of Romania and what is going to be our contribution in Romania and in our region.
I will start with a snapshot of our refining activity, a major source of value creation, and the cornerstone for our development plans. Our continued investments in Petrobrazi of over EUR 2 billion over the past 20 years have contributed to building a compliant, reliable, and flexible refinery with top operational availability in the region and in the EU. Our license to operate is built on meeting the highest environmental standards and complying with all regulatory obligations.
We have consistently delivered on these commitments, supported by investments of more than EUR 200 million in the last five years. Gradually increasing the turnaround cycle from two to five years, accompanied by various refinery debottlenecking initiatives, contributed to consistently increasing reliability and above-average utilization rates. The next turnaround is scheduled for 2027, when we expect a utilization rate of around 85%, while our target remains to maintain high utilization rates of over 95% on average for the rest of the years to 2030. Another focus, especially in recent years, was to increase flexibility to process a wider range of crude types. To that end, we expanded our logistics infrastructure, the installation of the second crude oil tank in Petrobrazi, and additional storage capacity in Constanța port, alongside improving technical sulfur acid gas treatment capabilities.
We see crude basket flexibility as a major advantage, especially during volatile supply markets and the key support for maintaining a high refinery utilization long term. In recent years, we also finalized investments aiming at switching production to higher value products, such as the new aromatic complex, increasing our toluene output to 100,000 tons per year, and in projects boosting the performance of our reforming and diesel hydrotreater units to increase volumes of high-quality gasoline and diesel. Additionally, we focused on accelerating Petrobrazi's digital transformation through targeted solutions across the key operational areas. Asset performance with predictive monitoring to optimize cleaning schedules. Energy efficiency to detect losses and validate performance. Emissions monitoring via CO2 dashboard. Process safety through expanded CCTV coverage and remote monitoring. Field operations by digitalizing, for example, wagon inspections.
All these steps are part of the journey to turn our vision of long-term competitiveness from our refinery into practice, focusing on two main pillars. First of all, optimizing traditional fuels production through capturing benefits from the value chain integration with our E&P production and sales channels, high utilization rates in order to respond to a resilient traditional fuels demand, and continuous focus on efficiency. Secondly, gradually becoming an integrated platform for supplying future mobility solutions with the addition of biofuels and the inclusion of green hydrogen in the production processes. Our next slide shows the strong progress we are making on our journey to become the first major producer of renewable fuels in Southeastern Europe.
Our EUR 750 million project to build a SAF HVO plant and two green hydrogen facilities is progressing as planned, and we will have a bit more details of the project execution in a minute. The project allows us to respond to increasing biofuels demand in our region, already visible especially when you talk about SAF, sustainable aviation fuel, and expected to further increase with EU blending mandates, rising from 2% in 2026 to 6% in 2030. We have a strong aviation footprint in Romania, and we are already a major SAF supplier for the main Romanian airports. The green hydrogen component ensured compliance with EU regulation while benefiting from the EU funding with EUR 50 million non-reimbursable grant received from the National Recovery and Resilience Plan yesterday cashed in. With the SAF HVO project, the majority of our 2030 targets will be delivered.
For the remainder of 50,000 tons per year of biofuels and 7,000 tons per year of green hydrogen, we are currently exploring new projects in the areas of biomethane and co-processing and additional green hydrogen. The achievement of these targets is expected to generate a contribution of around EUR 130 million to 2030 Group's total Clean CCS EBIT. Our SAF HVO project has reached more than 65% total progress and is now in advancing stages as the construction works and integration of the operations are progressing. Main civil works for the SAF HVO plant, as well as the heavy lifting activities, are finalized. Construction advances according to plan across all work fronts, including underground works, secondary steel structure erection, equipment installation, and fabrication. The green hydrogen facilities are also almost complete, with all electrolyzer modules delivered and installed, and mechanical completion achieved.
In the next months, we will handle utilities hookup, testing, and commissioning. The gradually start operations soon after should follow. In addition to these two main project components, we are also undertaking some essential infrastructure upgrades. A new electrical power system and a new flare system, which will serve both biofuels and green hydrogen production and other processes in the refinery. We have a comprehensive strategy on the biofuels project. We have already secured more than 80% of the feedstock for the first years of production, while also planning for a new storage tank for finished products in order to support logistics. Marketing has also started with around 25% of the first five years production already contracted. Finally, I would like to emphasize the high safety standards so far among our priorities in everything we do.
We have prepared a short video to showcase some of the highlights during project execution. Progress is happening every day. Tomorrow, for the ones that are going to visit the refinery, we might see some more progress as well even. Moving to retail business. Our dual brand strategy and initiatives in recent years have allowed us to capture market opportunities and come very close to reaching our 2030 targets well in advance. Major initiatives are focused on three main directions. First, our partnership with Auchan to deploy convenience shops in all Petrom branded filling stations is the first large-scale partnership between a fuel network and a grocery retailer in Romania. Second, continuous innovation in the gastro portfolio and expansion of our shop offering with a wider selection of beverages and healthy snacks, including our own label products under the VIVA brand, present in the OMV filling stations.
Third, leveraging loyalty apps for both Petrom and OMV branded locations with a cumulative number of users of around two million, contributed to increased customer retention and higher frequency of visits. By 2030, we plan to continue increasing our presence in high traffic areas as Romania highways infrastructure develops, to strengthen our successful convenience partnership strategy, and further pursue product innovation with the objective to remain our customers' first choice. Digital tools are essentials to help us evolve to customers' proposition and strengthen our network economics. We are using digital solutions to improve efficiency by automating convenience products inventory management, optimizing food production based on sales prediction, and reducing manual effort to electronic shelf labels. Moreover, self-payment terminals for fuels and services generate additional efficiencies while also leading to an improved customer experience. Part of our solution for the future of mobility is building the largest infrastructure of charging points.
Our ambition is to reach around 5,000 units by 2030 in our operating region. Although demand for electric vehicles has been fluctuating in recent years, we believe that the future of transport will be a mix of options with electronic mobility gaining traction. Positioning as an early mover has allowed us to secure access to grid, leverage the best high traffic locations, and benefit from EU funding opportunities. The first years of development focused on rapid scaling through M&A and building mostly fast and ultra-fast chargers in our best locations. As of June 2026, our EV charging network comprises approximately 1,550 charging points across filling stations and destinations locations such as shopping malls and hypermarkets. Charging services are currently available at around one third of our filling stations locations, diversifying our customer proposition and supporting our non-fuel business performance.
Next, we plan to continue implementation in our filling stations while also expanding in third party locations and B2B segment, adapting the pace market development with the aim to achieve around 2,500 operational charging points in 2028. We see this business as complementing our integrated mobility offer and consolidating our leading position in the mobility segment in the region, while also generating additional synergies with our renewable power portfolio. In short, we believe our diverse product portfolio in refining and marketing is ready to capture future opportunities coming from changing mobility preferences and act as a competitive differentiator in the long run. Building on integration, high quality customer experience and digitalization as major growth enablers. With this, we have shown you how our business divisions are progressing from strategy into execution. Let me now invite Alina to explain our financial framework. Thank you very much.
Good afternoon, ladies and gentlemen. I am really happy to see you today in Petrom City, and also thank you to those watching us online. Let me now present to you the financial framework that underpins our Strategy 2030. As we are in the most intensive execution phase of our strategy, capital and performance discipline continue to remain at the core of our financial frame. This means allocating capital to the right projects, preserving the strengths of our balance sheet, and turning stronger business performance into value for investors. We are maintaining our overall investments of approximately EUR 11 billion from 2022 to 2030, of which EUR 5.4 billion has been spent by end of June 2026. This framework is designed to deliver stronger earnings, returns, and cash generation by the end of the decade.
By 2030, our Clean CCS EBIT of above EUR 1.5 billion and Clean CCS ROACE of around 15%, supported by contribution of Neptun Deep, Renewable Power, SAF HVO, and the continued resilience of our traditional business. At the same time, shareholder return remain a core element of our proposition. We continue to target between 5% and 10% annual growth in base dividend, complemented by special dividends in case of market conditions and investment needs allow. Overall, our policy remains to distribute between 40% and 70% of annual operating cash flow, averaging around 50% over the strategy period. We are investing for growth with a clear focus on cash generation and competitive shareholder returns. Now I will go in each of the three pillars of our financial frame in more detail. Our first pillar is about rigorous capital discipline, and our approach remains unchanged. Value over volume.
We allocate capital to projects that enable our resilient growth by delivering strong returns, enhancing integration, and advancing our transition to low and zero carbon at an adjusted pace. We are maintaining the EUR 11 billion investment amount for 2022 to 2030, while adapting the allocation to reflect market conditions and the maturity of the opportunities available to us. As already communicated this February, we reduced the share of capital allocated to low and zero carbon projects from 35% to 25% until 2030, while pacing beyond 2030 our spend on lower carbon technologies such as carbon capture and storage, not yet economically proven for investments. The period 2024 to 2026 is the highest investment period in our history, reflecting the peak execution phase of our major strategic projects, including Neptun Deep, Renewable Power investments, and the SAF HVO plant.
After this phase, annual organic investments are expected to normalize towards approximately EUR 1 billion on average per year until the end of the decade. We continue to apply strict return thresholds across the portfolio. Above 12% IRR for regional gas projects and traditional business, and above 10% IRR for low and zero carbon projects. This ensures that we grow only where we create value. Let me now present the second dimension of our financial frame, strong financial performance. Our traditional business continues to provide a strong and resilient earnings foundation. It remains our main cash engine, supporting both the transformation of the portfolio and attractive shareholder returns. At the same time, the major projects currently under execution are expected to become increasingly visible in our earnings profile from 2027 onward.
Neptun Deep will be the largest contributor, complemented by Renewable Power and SAF HVO projects, as these investments move from construction and ramp-up into operational contribution. This is why we expect Clean CCS EBIT to step up from around EUR 1 billion on average in 2024 to 2026, to around EUR 1.4 billion on average in 2027 to 2030, despite a lower price environment expected for this period. In other words, the investments we are making today are expected to translate into stronger profitability in the future. This earnings growth is also expected to consolidate our returns. By 2030, we expect Clean CCS ROACE to be around 15%, supported by higher contribution from strategic projects and continued focus on performance. Let me now continue with another important lever of value creation, cost competitiveness. In a market that remains volatile and highly inflationary, efficiency is not a one-off exercise.
It is a structural part of how we protect margins, strengthen cash generation, and fund our transformation. We have therefore set a clear ambition to deliver more than EUR 150 million in cost savings by 2027, compared to 2024 baseline, with the full benefit reflected in EBIT. This is already well underway. By end of June 2026, we have delivered around 70% of this ambition, showing that the program is moving from plans to tangible results. Going forward, we are embedding efficiency deeper into the way we operate. This means further simplifying processes, increasing automation across operations and overheads functions, and using digital tools, AI, and data more systematically to improve productivity and decision-making. These initiatives are not only about reducing costs, they are about making OMV Petrom more resilient and more agile.
By unlocking synergies across all our business segments, we strengthen our competitiveness, our operating model, and support our financial targets. Now, let's have a look at how all above translates into attractive shareholder returns, the third pillar of our financial framework. Our first priority remains a progressive base dividend. We continue to target annual growth of 5%-10%, providing a visible and reliable return to shareholders through the strategy period. In addition, where market conditions allow and after funding our investment program, we will complement the base dividend with special dividends. Overall, our commitment remains to distribute an average payout of 50% from 2022 to 2030, while planning to distribute dividends at a minimum 40% of previous year operating cash flow in any single year until 2030. By 2030, our operating cash flow is expected to exceed EUR 2 billion.
This will translate, according to our guidance, into more than EUR 0.8 billion in total dividend distribution. Testing our Strategy 2030 under a downside price environment, our financial position remains resilient. We will still be able to support our progressive base dividends, maintain largely unchanged our 2030 investment plans, and keep gearing below 20%. In this context, please also refer to sensitivities of our operating profit to changes in relevant market price quotations provided in our backup slides. Let me also address our decarbonization pathway, as this remains an important part of how we deliver Strategy 2030. As shown throughout today's presentation, our approach is pragmatic and value-driven. We are reducing the emissions of our own operations while investing selectively in low-carbon businesses where we see resilient demand, mature technology, and clear route to returns.
Our scope one and two emissions, we have already made solid progress with a reduction of 19% at the end of 2025, and we remain committed to our 2030 target of a 30% reduction, both versus 2019. This is supported by continued energy-efficient measures, methane reductions, operational improvements, and the increasing role of lower carbon energy in our portfolio. For the broader energy supply, however, we also need to reflect market realities. The transition is progressing, but not at the same pace across all sectors and geographies. Security of supply, affordability, and competitiveness remain essential. This is why we adjusted our carbon intensity ambition to better reflect demand development and the actual pace of the transition. In this context, we are assessing CCS and geothermal opportunities selectively. These are areas where we can build on our existing strengths, especially our subsurface capabilities, project execution experience, and regional position.
But we will only move forward where the full value chain supports commercial viability, including technology readiness, infrastructure, regulation, and customer demand. Our principle remains the same as for the rest of the portfolio. We invest where we can create value, reduce emissions in a credible way, and ensure financial resilience. With this, I will hand back to Christina.
Ladies and gentlemen, as you have seen today, OMV Petrom is moving decisively from strategic ambition into execution. Neptun Deep, our broader Black Sea growth opportunities, renewable power, and the SAF HVO plant and e-mobility projects are no longer just ambitions. They are projects underway with clear milestones and disciplined schedule and cost management. Together, they are expected to deliver around 50% higher profitability by 2030. These projects are growing our integrated energy portfolio of assets, reinforcing our role in Southeast Europe's energy resilience, and positioning us to capture value from the transition towards a lower carbon future. Our transformation is underpinned by a rigorous financial framework. We are allocating capital to projects with attractive returns while preserving the resilience of our traditional business and the strength of our balance sheet.
As these investments progressively come on stream, we expect them to translate into stronger earnings, higher cash flows, and competitive shareholder returns through 2030. This is the essence of our Strategy 2030: disciplined execution, resilient growth, and sustainable value creation for our shareholders. With this, we conclude our presentation. We will take a few short pause to arrange the speaker setup, and after that, my colleagues and I are available to take your questions. Thank you.
Thank you for your patience. A little bit of reordering there. We thought it was nicer to take questions directly in front of you. Alina, shall I hand to you?
Absolutely. Good afternoon, everyone. Let me start by introducing myself. I'm Alina Petrescu, Head of Comms and Sustainability at OMV Petrom. We will start our Q&A session today, but just a few administrative issues before. We will be taking questions from the room, of course, but also from online. Kind request, in order to be able to accommodate as many persons as possible, limit your questions to two and address them all at once or both at once, actually. Our kind request is also that we stay focused on our topic today, so Strategy 2030. All other questions will be redirected towards our Q3 webcast, which is coming up in around a month or so.
With this, I will actually go to online for inclusiveness to start us off, and maybe two combined questions with a bit of a recap on what we've heard so far. What has changed in OMV Petrom's Strategy 2030 compared to the original strategy, and what are the main factors behind these changes? Also, if you can focus a bit on the company's energy transition ambitions and its 2030 targets.
Okay, thank you. That will take us back to December 2021, and we've had a Capital Markets Day in there, so allow me to summarize the two, if that's okay. I want to start with what hasn't changed. Ultimately, what hasn't changed is capital allocation in terms of EUR 11 billion going into the business and the dividend policy. We did, in the last Capital Markets Day, an update and clarify some of the dividend policy, but ultimately, the dividend policy and the capital is unchanged overall. What also is unchanged, Neptun Deep. Neptun Deep delivers on track according to the original schedule, actually back in 2021, which was even before we had FID the project. So some big pillars there.
Ultimately, I would say there's two, maybe three areas where adjustments have happened, and that has been ultimately where we have seen new technologies moving faster with more robust business cases in energy transition than we have gone larger, and that ultimately is in the renewable side. We originally had a target of 1 GW with partners. It is now 2.5 GW with partners. In addition, originally, we started with solar, then we added wind, now we add storage. This is the sort of what's happened on that. That is part of the capital allocation, but also because of how we do capital, because we use financing, because we use EU funding, it's a bit of a different capital mechanism that we use there.
In addition, we have actually taken some capital away from technologies that are not as advanced as we thought or the business case was not robust enough. That has also been on carbon capture and storage, which we still see as very important. It's just a pacing issue and what's the right time that we will see the business case for that. With some of that capital, we have been able to allocate it to our E&P business, both actually our existing traditional business as well as you've seen the exploration opportunities that we've had to be able to do that. Actually, if you recall, maybe back in 2021, our target was 160,000 BOE a day by 2030, and now it's 170. That's excluding any portfolio activity that we might do.
I hope what I would want to leave you with is that we are following a strategic direction. The energy transition is moving at different paces, and we will adjust accordingly how we do investments to make sure we get the best returns that we can for the company. Those are just some of the examples of where we have made adjustments. We have also made adjustments in our GHG targets, so we have stuck to our net zero by operations by 2050 as an ambition. We have our Scope 1 and Scope 2 target reduction of 30% that Alina talked to, and we have also said 10% in total in our overall lower carbon footprint of our overall portfolio, including sales. That is some of the adjustments that we have made overall to that.
Ultimately, I say stay the course with some adjustments that we think are pragmatic in the energy transition. If I had a moment that I feel really proud of is that actually what was really good is that we had the options of where to put the capital. When we wanted to move it away from others, we could find options for that. I believe that is a differentiator in our sector. Thank you for the question.
Thank you. We will now move to the room. Show of hands. My colleague here in the back will help us with the microphone. We have someone here right in the front row. Paul. Thank you.
Hello. Alejandro Vigil from Santander. Thank you for organizing this event. My two questions are, the first one is about all across Europe, we are having this wave of potential windfall taxes and price caps. If you can elaborate how your company is managing in the different businesses, in gas and power, in refined products, this regulatory pressure across the portfolio. The second question is about you had this good news on the execution of Neptun Deep, but 2026 has been disappointing in terms of exploration, with these two dry holes. What did you learn from this experience, and why are you so convinced about the exploration program going forward? Thank you.
Thank you. Alina, do you want to try and cover all the different divisions when it comes to windfall taxes and regulations overall? I think you are exactly right. We do not necessarily think across of Europe, you are necessarily going to see a lot of change because there is so much volatility going on. Alina will talk to the specifics and I think how robust we have. You bet, even after two not commercial dry holes, we still have a lot of belief in Black Sea, but I will leave Cristi to talk more a bit about that.
Thank you for the question. I will try to stay brief because if I talk about regulatory intervention, it could be very long. There are many. All in all, what is important is we are all the time in advocacy and discussion with authorities. Many times what we see in Romania is that we start from here, and we become shorter when it comes to smaller, when it comes to interventions. Going into concrete, what we have seen, and I will start with Refining & Marketing, was an intervention for Q2, which was temporary, covering only quarter 2. It had several levers, capping the refining margins and retail margins at the level of last year. It had some intervention around excise as well, and also it had a solidarity tax, which was depending on the crude price. This was the Q2.
Then we had moving forward into Q3, we had July, no intervention. Then in August, we had another set of interventions which are lasting until October, slightly adjusted versus Q2, where capping is around retail and commercial margins. No cap on refining margins anymore, but the solidarity tax that is dependent not only on crude price, but also on diesel price, which basically captures the refining margin via the solidarity tax is a part of it. All in all, we remain part with part of the upside. That is important in our numbers, and we will continue to have a dialogue and discussions via the professional associations with authorities all the time in explaining the impact of a regulatory intervention in our investments, because that is all about it in the end. Stability for a company investing, and we are at the most intensive investment period in our history.
This matters a lot. Our investments are always long-term investments, and these long-term investments require stability of the fiscal and regulatory regime. It is part of our everyday work and challenge to have this dialogue, and coming to the results, yes, there are intervention. Very important is that these interventions are temporary, are targeted, and we remain in the end with part of the upside. Moving into Gas & Power, we have seen also there, we still have until end of Q1 next year capping for households and district heating producers. That is valued. The rest which is around wholesalers, but also power business is not regulated anymore. It is less regulation from this perspective into the Gas & Power.
On E&P, we do have the normal, in addition to royalties, we have supplementary taxation, more on gas, both onshore and offshore as well. Stability and predictability remain a core essential for us going forward, and we assure you that we have this dialogue all the time with the Romanian authorities.
Talking about Bulgaria, which we are referring, basically, we need to not forget that we are in exploration. In an exploration, there are goods and there is less goods. Basically, it is important to keep this in mind. We found gas there. It was not commercial, so the geologists proved. What each well is bringing to us, successful or unsuccessful, is bringing data which is helping us understanding the basin. Let us not forget that we are in the Neptun Deep, Neptun Shallow. We are in Han Asparuh, Han Tervel .
So we are best positioned to understand the geology. We are as well seeing the potential on the neighboring country, what is happening in Turkey. So, I think the data are valuable, and we are analyzing and seeing and understanding the basin. What I want also to say is that, as announced, we are following two more exploration wells in the offshore.
One is Anaconda, which is a commitment well in deep water, and as well Cormoran. I think understanding the basin is the value which those wells brings to us. And one another point which I want to make, I want to remember that on the wells in Bulgaria, our partner paid EUR 100 million for the two wells, plus after that, an equal share of the wells. So commercially, it was mitigated from the beginning. Thank you.
Thank you. Another question from the room.
Hi. Guy Levy from Morgan Stanley. My first question, of course, you are anchoring your base case scenario on $75 Brent. But I think there is a plausible case here that we continue to see Strait reopening and reclosing for some time, and that is sustaining higher oil prices for longer. How should we think about your capital allocation under that scenario? Should we think about more upside in terms of shareholder remuneration? Are there any sort of additional investments that could potentially even take your target in terms of production higher than 170 by 2030?
My second one, I was curious about your E&P cost over the coming years. If my math is correct, even with stripping out the effect of Neptun Deep, we also have a big reduction in terms of E&P costs in the legacy portfolio. I was keen to just hear more about the initiatives that can take us there. Thanks.
You want to start with the cost one, and then we will come back with the capital one.
Okay. Indeed, on the cost side, if you take the average nine that we have announced today, and you take out a $9 per bbl that we have mentioned today, and you look at what Neptun operating cost expectation is, you end up with a cost which is lower than is today. What we are doing, we have very significant cost and efficient programs ongoing. Programs which cover from simplification of footprint, simplification of processes, automation, everything that we could imagine in dealing with our cost, because this, in the end, will define our competitiveness going forward.
Yes, we are seeing today high oil and gas prices, but we believe this will not be forever, and we have to be competitive at lower prices. That is why we do huge effort on cost management. Also tackling all the new technologies, the data, AI and all that. We have very ambition plans in going down with the cost by 2030, quite a lot.
The capital allocation is almost the other side of that equation, right? How do you keep your costs down for when prices come down and to keep yourself competitive, and then what happens when prices pop up? Really, are the fundamentals changing or not, and for how long? Because in the end, obviously, we have a rate of return that we're looking to make sure that we achieve, and it needs to pay back in a certain amount of time, and can you guarantee that? With regards to does it change dividend, obviously, if the operating cash flow goes up, so does the payout. With regards to would we change the dividend policy, not at this point in time. I think the main thing for us is does our geology and does our option set allow more things to become more economical, competitive?
Part of the challenge with a high price also is high inflation. High inflation turns into high salaries, and then you get the cost inflation on the other side. So we just need to watch that we don't run away with ourselves too much on the high price. Having been in the industry for over 30 years, we are notorious for chasing the highest price and then wondering why we have high costs as well. So it's just a learning after many years that you need to be careful of the spikes in price. Generally, it tends to be more of better dividends, but let's watch out for capital.
Thank you. Quite a few hands on that side, I saw.
Hi. Adrian Stanciu, EVERGENT Investments. Just a couple of questions from me. Once Neptun Deep reaches plateau production, how should we think about the price realized on OMV Petrom's share of gas relative to European hubs? I have seen it in some of your reports, you also provided an approximate annual after-tax cash flow sensitivity for different prices of oil and gas. Could you also provide one for the change in gas prices?
Yeah. Thank you. I will go with the Neptun price. We put a set of pricing scenarios, and you will have access to the full presentation. For gas price, we see it somewhere between EUR 25-EUR 35, or maybe I should say it the other way around, from EUR 35 going towards EUR 25 towards 2030. That is how we see the gas price, with EUR 35 being just a rather shorter period and then moving down towards EUR 25. We do have a set of sensitivities that we also published in our presentation, oil price, but also gas price, and our sensitivity for EUR 1 per MW when Neptun will be. We put sensitivities for the years 2028 to 2030. This means full year of Neptun and everything else. It is EUR 50 million impact in EBIT. Thank you.
Good afternoon, and thank you for your presentation. Thank you and congratulations for the very nice execution of your strategy. Irina Răilean from Mosaiq8. My first question is regarding Neptun Deep, and given this increasing number of incidents, geopolitical, who and how is protecting Neptun Deep? The first one. The second one is regarding your commercial strategy of Neptun Deep. We saw a very nice map of the regional gas demand, but the competition is also increasing from American and other sources of LNG. Some big Romanian players have also secured quite large volumes coming from these LNG channels. How and why is Neptun Deep more competitive, and why our neighbors would buy gas from Neptun Deep but not from other sources?
Great questions. Maybe we start, I think, on the security. We are very much expecting that question, spent a lot of time on it. Then why do we think Neptun Deep gas is better than U.S. LNG? Franck will have a field day telling you that.
Yeah, thank you for the question. What I want to say is that we're collaborating with all the authorities in order to secure the progress of the project. For us, it's paramount the security of our people which are working offshore. I want to remember that it's also Petromar and also Neptun Deep in this part. There are clear split according with the legislation and with the practice between what each party needs to contribute at. Our real contribution is in term of monitoring, detection, and supporting the response. Our responsibilities are related to the operational safety field and operating in a safe manner the infrastructure. I want to remember as well that the infrastructure is in the exclusive economic zone area of Romania. Romania is part of the NATO.
As well, the infrastructure is high piece of technology operated remotely. We are having a field support vessel, which is in the field. Thank you.
Yeah. I continue. Thank you for the question. First, oops. First of all, there is place for gas because next year there is the ban of the Russian gas. In this region, I think you have to be aware it's about 16, 17 BCM of Russian gas that needs to be replaced. Neptun is 8 BCM, so you see there is space for Neptun. I think it's important first to make sure there's a market in the region. Why it's competitive, first of all, it's cleaner than the U.S. LNG, so it starts with a CO2 footprint. There is a huge difference between whatever you import. I think that with the methane emission rules and the European legislation, we don't think too much about that, but that could be also a differentiator for Neptun gas.
On term of competitiveness, the transport of gas from LNG to the market, and here we're talking about if we want to replace this Russian gas, it's quite expensive in term of transport. There is also for us, we are closer to the market than any LNG from Greece or Poland or Germany. I think that's something where we see our competitiveness.
If I could just build on it. Obviously, we are continuing to explore to look for more gas. We fundamentally believe that there is competitiveness in being able to bring gas into the European market. Overall, when we look at all the different energy transitions, paces of energy transition, the EU remains a net importer of natural gas. As you bring the energy security conversation in, you bring the economic impact conversation in, then actually indigenous gas out of the European Union is a very attractive proposition. We actually see the market being able to compete well, and we see buyers wanting more and more diversification of who is supplying their gas as well. That is why we believe not only about the Neptun Deep, but also what other gas can we bring into the market. That is why we keep looking for some more.
Thank you. We continue with questions from the room.
Thanks for the presentation, and thanks for the invite. I have one upstream and one gas trading question. On the upstream, the two wells that you are going to drill in the Black Sea, assuming that they were successful, do they simply connect into the existing Neptun infrastructure, or is there something else required there? On the gas trading, I have been told there has been conversation about the Romanian government having the first right of refusal to buy gas from Neptun. What is the story behind that? Is that an issue? Thank you.
Cristi, you want to go first and then Franck on the second one.
I would, that exploration, we are not talking too much about what will be the result. I would propose, let's wait, let's see how the results are coming, and after that, we will disclose what are our thoughts in order to go into the development phase. Still exploration, there is some work to do after that into developing a potential discovery. Yeah. That is true. Thank you.
Yes, you are right. In the Offshore Law, in fact, there is a possibility for the state agency responsible for strategic storage, so ANRE CPEC, to have the right of last refusal for offers. But so far, we are exercising this correspondence. We have seven days to exercise their right. We submit, as I mentioned during the presentation, we sign already more than 30 contracts. It is ongoing, and we have not seen any activity at the moment. Yeah.
Thank you.
Oleg Galbur from ODDO BHF. Thank you for the presentation. Let me start with a short follow-up on a previous question regarding security of Neptun Deep assets. The follow-up is whether your current insurance cover any risks of asset damages caused by a drone attack, for example. My two questions are, you were clarifying what are the difference and similarities between the previous strategy update or initial strategy and the current update. I would like to follow on the 2030 EBIT target or guidance of more than EUR 1.5 billion. It is difficult to assess whether this target is essentially unchanged from the previous one or whether you are more optimistic or vice versa, pessimistic. If you could add some color to this target, that would be very helpful. Secondly, on the HVO SAF plant.
First, what is the demand outlook for sustainable fuels, taking into account the somehow reduced focus on decarbonization, especially among aviation sector, and the evolution of conventional fuel prices? Second, what are your expectations regarding margins development for SAF and HVO? In other words, how should we think about the future earnings contribution of this business? Thank you.
Thanks. Alina, you take insurance, and is 1.5 good or bad? Greater than 1.5, actually, I think we would also remind. But let's go into that, and then with that, Radu into HVO SAF question. Yeah.
On the insurance question, unfortunately, I have some confidentiality limitations, so I can't share with you anything on that. We are very strict around confidentiality there. But I'll go to the second question, Oleg, around 2030. I hope you will be happy with this one. We have in 2030, slightly lower price environment that we have seen when we launched our strategy. If you look at our assumptions. Under this slightly lower price assumptions, we see still the result above the 1.5. I'll comment a little bit around it. Maybe it helps in understanding. What we say is that 45% of it is E&P, and we give this in the financial framework. You will see the slides. Roughly 45% of 1.5 means 675, more than 675 E&P, where Neptun is 500.
Then 40% of this number, of the more than 1.5 is going to R&M. This is more than EUR 600 million. Then we also give some granularity there, and we say retail is approximately 60% of it, and we also give a number for how much is SAF HVO figure. The rest, 15%, is basically gas and power, and this is RES, approximately EUR 100 million, and the rest is traditional gas and power. Overall, the strategy remains strong, even if a slightly lower price environment. If the price environment will be better, you have all the sensitivities. Of course, we will create more value for shareholders. Thank you.
If I could add a piece, because obviously there was some capital allocation done, so there is some financial performance coming that wasn't forecast before, but was coming from something else that was less certain. In addition, I think to the greater than 1.5 is there is more certainty underneath that. I think that will naturally, obviously, enter the question, at least for the HVO/SAF. In the end, we took out some spend on technologies that we didn't think were advanced enough, and we put in technologies that we thought either were very established, like E&P, or into the renewable and therefore more, I would say, certainty behind the delivery of it.
Thank you very much for the question. I would start by saying something important about the installation of the plant. So production plant is supposed to have 250,000 tons per year. It's a batch production plant, which means that we have full flexibility on producing the most economical HVO or SAF. Whatever is most economical, we can produce more out of these products. When you talk about SAF, which is demand driven mainly about the regulatory environment, we have so far a very clear regulation in place ReFuelEU , which assumes 20% this year and then an increase to 6% in 2030. Looking to the markets, our markets in the region, only in the markets in the region, we assessed that the demand should be around 75,000 tons per year. It's 80,000 tons per year region.
If you are addressing as well Central European markets or more west, it's then sky's the limit. We think that from 2030 onwards, actually, SAF is going to be short in Europe. HVO related, only our own demand for 2030 to comply with the regulation that needs to be achieved when you talk about GHG reduction in Romania. Only our own demand is 300,000 tons. That means that actually from today's perspective, we would be needing more HVO than what we are going to produce in 2030. We believe we see for the SAF 2030 onwards short position, while for HVO, we see full need of the production already from 2030 for own products. Because that HVO is going to be blended in our fuels produced in Petrobrazi. Thank you very much.
Thank you.
Yeah. I have mentioned that before, that indeed we have already contracted 25% of our production and of the SAF, which is going to make even easier the reaching the target in 2030. Thank you.
Maybe we go now for another question from online, and then we come back to the room. A question on our renewables portfolio. How do you view the synergy between the solar and wind farms and the Brazi Power Plant in terms of energy offering for your customers? What are the next steps towards the 2.5 GW target?
Yeah. Thank you for the I suppose it is for me, the question. Yeah. Maybe I start with the second part of the question, which is what is left, what is the next step. Well, we still have around 1 GW of FID to pass. We have a lot coming this year. That is something which is a good progress. So far, we have a good track record, so we continue to reach also double-digit return on this FID. We also target an additional 300 MW of battery to pass FID. We did already with our partner pass 300 MW and another 20 MW and another 80 MW plan. So it is progressing well on the FID. Of course, the execution, I mentioned we are 800 MW in execution at the moment. So I think the FID is a very important part.
As part of FID is also the project financing, because one of our flagship in our portfolio is the wind farm of 650 MW, which will be the largest onshore wind farm, at least maybe in Europe. This will, in term of project financing, you can imagine it is quite a nice project for the people in charge of it. But challenging on this market, I have to say. But it is progressing well as well with a European bank be a partner. So I think that is really the main big steps. The additional 1 GW, the construction, of course, and the project financing. On the integration of what I tried to explain during the presentation of solar, wind, and the battery and the gas power plant. What we are doing, we are sending back, of course, this power to our customers.
When you look at corporate PPA, you can sell just a pay-as-produce PV profile, but you compete with everybody, with all the developers. What we are bringing on the market is this combined product, which is quite unique on the market and help us to convince customer to sign midterm power contracts. So we are heavily now marketing this combined, which enables to have a profile which is much better than just a pay-as-produce PV profile for customers. So that's where we are really seeing the integration from a customer point of view, yeah.
Thank you. Any other questions in the room? Please.
Thanks, Adnan on the RBC. Thanks for the presentation. Two questions from me, please. Just the first one on your outlook for refining margins over the next 6-12 months. Do you see that sustaining at the current levels that we're seeing? If that does happen, do you foresee any issues that could restrict you from fully realizing that, the strong margins apart from windfall taxes? Then the second, just on Neptun Deep, obviously you haven't said what the exact startup would be in the first half of 2027. Just curious if there's any scope for accelerating that to the early days of the year, just given Europe needs the gas and the pricing there is. Thank you.
Can you just say the Neptun Deep question? Sorry.
Just there is scope for accelerating the startup to the first part of the year.
They want it faster. On the refining margins one, we can go into a little bit of detail, but obviously it's not a big strategic question for us. Maybe we would cover that more in our 3Q results, if that's okay. Because, I think that's a sort of anomaly in our strategy, I think. Our ability, I think, to respond to those, I think we have demonstrated and articulated before. Alina sort of answered that one overall. Neptun Deep, let's just say we're happy with the dates that we put out for now. So, thank you.
We had everybody asking us to narrow the window, so we were feeling really good about narrowing the window down. So, we will, at the right time, if it's appropriate, we will of course narrow the window again. But for now, first half of the year.
Any hands in the room? Then I will first go to our last two questions, Neptun Deep related and online, and then come back to the first row here. Neptun Deep appears to be progressing according to schedule. Could you outline the key remaining milestones leading up to first gas, and then what is the expected EBIT contribution from Neptun in 2027? The first and second half of the year.
Yes. Allow me first to start with what we realized so far. So basically, we will lay down the main gas pipeline, 160 km. We made the connection with the onshore. So we crossed, made a micro tunnel, and we made the connection with the pipeline to the national gas metering station. We're progressing the work over there in NGMS. We installed the jacket. We put on top the platform, the Neptun Alpha, as you saw. We're now installing the production equipment. We're drilling in the full swing and full execution of the drilling. We drilled seven wells so far. So we're continuing till up to the 10. We are in the installation of the deep water pipeline and making the connections as well with the platform. We're continuing to make the platform ready for receiving gas. We installed the fiber optic cable. So, quite a lot achieved.
We need to put all the things together right now to make connections, to test the system, to make all the systems ready for receiving gas, continuing drilling, testing the wells. Quite busy. The last 20% of the project is not about huge progress in terms of infrastructure, but putting things together in the right order in order to be able to produce it. Thank you.
Let me go to the Neptun question. Basically, what we have announced yesterday is a first gas window, not a first gas date, which means that we keep some flexibility around that. Therefore, I will not be able to say a number exactly. We said that the first gas would be in the first half, so by the end of June, and then full plateau by the end of Q3. We will reach the 70,000 bbl per day. Obviously, less than EUR 500 million, that is the EBIT that we will have on a full year Neptun, but we do not give a precise number right now. Thank you.
Thank you. What looks like our last question for today.
Yeah. Thank you for the last opportunity. It's a question about the efficiency of your balance sheet. You have a very strong balance sheet, net cash position, basically, so it's something that I would like you to discuss, if it makes sense or not to have this position. Also, the second question related to that is the M&A opportunities in the region. You think that this balance sheet could be allocated more efficiently in some M&A opportunities? Thank you.
Alina, you want to do the first bit, and I'll talk a little bit about the second bit.
Sure. Yes, indeed. If we look in the last years, but also end of last year, we were on a net cash position. This was also driven by significant delays in Neptun. We were waiting for this moment of Neptun becoming reality for a long time. Now, what we see is with the highest investment period in our history, our net cash position is going significantly down. We have announced with our Q2 results, we said clearly free cash flow before dividends will be negative, and then we have the dividends. Our net cash position will go really down. We are going towards a net debt territory. Our financial framework basically requires us to test all the time ourself under the downside price scenario, and we have a limit of the gearing at the 20%.
The answer is yes, the plan is not to remain on a net cash. We go down, but we try to limit ourself in a downside scenario not to be above more than 20% gearing, just to remain robust, from a financial point of view.
Maybe if I can build on that. Part of the, I think, success of the company so far has been that it is absolutely resilient. Resilient to the downside is also important to us because we will protect the capital, and we will protect the dividend in the downside situation. With regards to, you are absolutely right, by the time we end, exit the decade, we are a different size company. We are absolutely a different size company. We talked about the 50% EBIT to that. We have our exploration opportunities that we will look at, and we are hopeful that one of them will come through, if not two. We have a lot of excitement about how we see the Black Sea, but other opportunities that we are looking at in the power side as well as in the Refining & Marketing side.
Logically, that would be an opportunity to consider inorganic. But right now, our focus is to deliver that cash. That is our focus. That is our imperative commitment to you all as shareholders of the firm to deliver that. Then, of course, we will be starting to think about what does next look like. Last question. With that, I take the opportunity to say thank you so much for being with us here in Petrom City. We are so used to seeing many of you online all the time, so it is great to actually have you here in the building with us. Many thanks to everybody who is online. I think we have about 70-75 people online actually as well joining us. So thank you for your interest in the company.
Thank you for your confidence in the company. Be assured we are growing this company in a very resilient and very thoughtful way about how we use the capital, how we invest it, how we grow the company, and how we give the shareholders the returns that they are looking for. So thank you very much. Look forward to the conversation afterwards. Thank you.