Hi. Good morning, everyone. Welcome to Petrobras Day 2021 at the New York Stock Exchange. Thank you for being here with us today. We'd like to take this opportunity to watch the presentations and take part in the discussions of our strategic plan from 2022 to 2026. After introduction and presentation, we'll start a Q&A session. We'd like to inform you that this event is always being broadcast. For those following the transmission on the Internet, you can send us questions at petrobrasinvest@petrobras.com.br. This event was organized and is being held respecting all health and safety protocols. All executives are fully vaccinated and have tested negative for COVID-19.
Today, we have here with us Joaquim Silva e Luna, Petrobras CEO, Cláudio Rogério Linassi Mastella, Chief Trading and Logistics Officer, Fernando Assumpção Borges, Chief Exploration and Production Officer, Rodrigo Araujo, Chief Financial and Investor Relations Officer, Rodrigo Costa Lima e Silva , Chief Refining and Natural Gas Officer, Salvador Dahan, Chief Governance and Compliance Officer, and Rafael Chaves, Head of Strategy. Now we'll watch a short video.
It looks like fiction. If we tell, maybe no one will believe us. It is already hard enough to imagine how is it possible to extract oil from the deepest reaches in the middle of a vast ocean. It seems impossible, but it is what Petrobras does. It is our daily life. All this because we have a very powerful source of energy, knowledge. Driven by this force, we discovered pre-salt. We are continuously breaking record after record, generating maximum value and focusing in the business we do best. No wonder we are world leaders in ultra-deep waters. This inventive energy is not only in our new technology. It is in new ways of creating projects, making choices, reaching results, acting responsibly. The choices we make today guarantee our future. The challenges are many, but we are not intimidated.
We are driven by transformation, and we are launching new strategic programs which will guide our operation until 2030. They are innovative solutions which will turn projects into results, the unreachable into achievements, and the impossible into amazing. Come with us to know more and to make history. We are energy for transformation.
Now, I'll pass the floor to Petrobras CEO, Mr. Joaquim Silva e Luna. Please.
[Foreign language].
That the company will keep focusing on what it does best, which is exploration of assets of oil and gas in deep and ultra-deep waters, especially the assets or the pre-salt assets, where Petrobras has competitive edges and is able to generate more value. With our debt under control in or towards a healthy situation, the company was able to increase 24% in its investments with a total of $68 billion in the period 2022-2026. In this period, we are forecasting 15 new platforms will be launched in 6 fields. In the areas of refineries, trading and logistics, we are investing in order to increase our efficiency and have a more resilient and sustainable operation in order to be present in a more and more competitive market.
The segment of gas and energy, we strive to maximize the thermoelectric park focused on high consumption and efforts in trading in proprietary gas, besides the commitment with the opening of market, of the market. To maintain our competitiveness is still very important to us, and to that effect, we keep digitally transforming the company and developing the competencies for a high-performance culture and integrity and competitive costs. We'll always be seeking innovative solutions for new challenges. Innovation is present in Petrobras' DNA. In this strategic plan, we reinforce the importance of the social responsibility as well as environmental, having positive impact for society and environment, strengthening our reputation.
As you know, in September, we published our mission to reach neutrality in greenhouse gas emissions of our operations, so operations under our control in a term that is compatible with what the Paris Agreement established. In order to reach that goal, we are investing more in that area $2.8 billion in reduction and mitigation of emissions. We will keep improving our governance, and we adopted a model that allows us to balance efficiency and control, focused in the competitive environment, strengthening of the decision-making process, safety and speed. The strategic plan mirrors the importance of a strong Petrobras that is healthy and generates resources.
The plan horizon, we are forecasting payment of taxes of around $70 billion of tributes, which added to our dividends that will go to the federal government and all the other shareholders, represent over 86% of our revenue, operational revenue generation. We want to have more dialogue with several stakeholders through active communications that are transparent. Lastly, we will keep investing with responsibility, trying to be the best energy company in generation of value focused in oil and gas, sustainability, safety, respect to people and the environment. Petróleo Brasileiro S.A. Petrobras, you can trust us.
Thank you. As you are probably aware, this presentation may contain forward-looking statements about future events that are not based on historical facts and are not assurance of future results. Such forward-looking statements merely reflect the company's current view and estimates of future economic circumstance, industry conditions, company performance, and financial results. These statements are only projections, estimates, or targets and may differ materially from actual future results or events. Please refer to the documents the company files with the SEC, especially our recent annual report on Form 20-F, which identify important risk factors that could cause our actual results to differ from those contained in the forward-looking statements. Now I'll pass the floor to Petrobras CFO, Rodrigo Araújo. Please, Rodrigo.
Morning, everyone. Thank you for being with us today. It's a pleasure to be here with you to announce our strategic plan, 2022-2026. We're very happy with the company's current moment and everything we've achieved over the last more than five years. It's a business plan that means a turnaround for the company's history in a completely different moment. We're very happy with the perspectives of the new plan. When we consider the initial message of the plan, first of all, we have achieved our gross debt target of $60 billion.
We think that's an efficient level of debt for an efficient capital structure, so we don't expect to reduce much of that debt. Especially considering that when we look at our financial debt, it's basically between $35 billion-$40 billion of the overall debt. We expect to maintain that level. At the same time, we do expect that, having achieved that in more than a year in advance, brings opportunity to create more value and to especially distribute more value, and that's the core message of this business plan. The company is highly focused on investing responsibly. What we mean by investing responsibly is always focusing on assets that are both resilient in terms of environmental impact, carbon footprint, and also lower oil price levels.
We expect to maintain our resilience scenario for decision-making in terms of CapEx, so our projects are resilient to a $35 Brent price. As you probably have seen, based on what happened in 2020, where we had an average price of $42 per barrel, the company was quite resilient to that scenario, and we do expect that our portfolio will be resilient to challenging scenarios in the future. We're continuing to be focused on those resilient assets. At the same time, we're also focused on decarbonizing our operations. We have announced last September our net zero ambition in the Paris Agreement timeframe alongside with the OGCI. We have also established a new governance to study for the future potential for profitable diversification.
Of course, Petrobras has a very strong portfolio and very resilient portfolio, so this is something that we're going to look into very carefully for the future. We want to make sure that whatever diversification we choose to do in the future will be as resilient as our current portfolio. Of course, we do have some capabilities that enable us to focus on certain kind of assets, especially those that involve advanced engineering, advanced technology, large scale projects. This is the kind of scenario where we're best at. For the current plan, we don't have any CapEx separated for the diversification, but we did put in place a new governance to study those potential opportunities in the future.
We're also highly focused on modernizing our refining plans, especially quality, so that we reduce the carbon footprint of our products, especially diesel. That is in a transition in Brazil to 10 PPM diesel and also biojet fuel and renewable diesel in Brazil is also a potential future agenda of products that have lower carbon footprint. We're also focused on continuing the market opening agenda. We're focused on the commitments that we signed with the Brazilian antitrust authorities, both regarding the natural gas market and the refining market as well. As you guys are aware, we do have some of the refineries have already been sold, and we still have some of them to be sold alongside the timeframe of the plan.
We continue to be focused on complying with the agreement we have with the antitrust authorities in Brazil. Finally, we do have the Equatorial Margin as a potential new frontier. We see positive exploratory prospects, especially when we consider the similarities with the Guyana region, where we have seen other peers have positive results. We do expect positive results in that area as well. That will be a potential new frontier for the company over the timeframe of the plan. In terms of the targets for 2022, as I mentioned before, of course, value creation is the main target, and we continue with our greenhouse gas emission targets. We have lowered them compared to the previous business plan.
We do have an expectation to create $2 billion in economic value added for the year 2022. You probably have seen that we removed the gross debt as one of the targets of the plan, but to continue with the capital discipline and to ensure that we maintain the efficient debt level, we have included the gross debt level of $65 billion as a trigger for the EVA metrics. We don't expect to do that. If our gross debt goes above $65 billion, the result for the scorecard will be negative. The first three metrics are part of the company's scorecards, and we also have an alert limit for total recordable injuries as well.
As you guys know, safety is a main value and priority for us. We do have a zero fatality and a zero oil spill ambition, but we do have targets for both of them, both for injuries and for oil spills as well, part of the executive group targets for 2022. This is a general picture of the plan, and I'll pass the floor to Salvador, our Chief Governance and Compliance Officer. We will discuss about our ESG agenda. Thank you.
Good morning, everyone. It's my great pleasure to present our ESG chapter from our strategic plan. The 2022-2026 strategic plan defines a very robust commitment to accelerate our ESG agenda, setting a tangible roadmap towards a net zero ambition within a timeframe compatible with the Paris Agreement, aligned with our recent declaration together with other OGCI members. At the same time, we are developing several initiatives aiming at the energy transition. We also want to maximize Petrobras contribution to the society by investing with responsibility and transforming the natural resources into value, welfare, and dividends. There is one basic assumption to address climate change discussions and net zero society, which is to be ready to have a sustainable operation, producing oil and gas compatible with accelerated decarbonization expectation in a scenario where only the most resilient and cost-effective products will be accepted.
This is how Petrobras is positioned. This is our dual resilience, as mentioned by Rodrigo, on cost and quality. By executing a strong operation and financial discipline under a $35 Brent scenario, and by offering a low emission product already positioned in the first quartile in terms of carbon intensity. Despite increasing 40% our oil and gas production in the last decade, we have reduced our emissions in almost 50% in the same period. When comparing to our major pre-salt fields, the CO2 emission reduction is even more substantial. We have set a $2.8 billion CapEx related to decarbonization and energy transition. $1.8 billion to be invested in our operations, with emphasis on CO2 separation, methane detection, and projects such as HISEP, all-electric platform, closed flare, and others.
Investing $600 million in bioproducts such as renewable diesel, biobunker, and biojet fuel, $130 million in R&D, digital transformation, and business diversification. We are putting together a new and strong governance with senior executives and experts from different areas. They have been tasked to assess new lines of businesses and products that can be incorporated to boost our long-term strategy, transition strategy. We are openly studying a variety of options to diversify Petrobras portfolio into different energy segments, and potentially reduce our exposure and dependence on fossil sources and at the same time, be profitable, ensuring the company's long-term sustainability. Furthermore, we understand there are some fundamental conditions such as large scale, complex engineering, and advanced technology that better integrate with our leading business capability and recognized know-how.
We are also creating a $250 million decarbonization fund to incentivize and accelerate new solutions. Projects with lower cost and higher impact on emission reduction will be selected and implemented, bringing greater competitiveness to company to achieve emissions neutrality, not only on scopes one and two, but eventually opportunities related to scope two, sorry, to scope three, will also be supported. In addition, our commitments to sustainability are reconfirmed in the 2022-2026 plan. They are organized in five components, climate change, water resources, biodiversity, waste management, and lastly, a more robust social responsibility program. Focusing on human rights, community relationship, and social environmental investments will generate positive impact, not only in the locations surrounding our operations, but the society in general.
Petrobras is committed to promote an open and competitive market, and to enhance our corporate governance by balancing efficiency with control, and promoting an environment of ethics, integrity, transparency, also influencing our partners and supply chain network. We continue to strengthen our governance by establishing a three lines of defense framework with independent control bodies and a robust decision-making process, with defined roles and responsibilities between the board of directors and the executive board by setting formal validation from statutory committees as well as legal and compliance independent opinion before any decision. In other words, no single person can make any important decision by him or herself. In addition, Petrobras faces strong supervision by several control bodies and regulators, not only in Brazil, but also abroad. From an investor protection perspective, as a state-controlled company or from an antitrust regulation, Petrobras is under continuous scrutiny and must respond accordingly.
Not only due to many laws and regulations applicable to Petrobras, but also under our company bylaw. There are several important gatekeepers and statutory protections against management override, political interference, and compliance violation, such as appointment and nomination policy with clear rules, minimum requirement, background checks, barriers of eligibility. Mandatory opinion from the audit committee and the minority shareholders committee on relevant subjects. Board of Directors minimum compositions of 40% independent member, which currently they are 70% of independent members. The Chief Governance and Compliance Officer autonomy, authority, veto power, and non-retaliation protection. Lastly, the compensation clause in case of any unbalanced obligation to serve the public interest set by the controlling shareholder. As a result, Petrobras has been recognized for all the recent years' efforts. We have returned to the Dow Jones Sustainability Index and the Corporate Sustainability Index from the Brazilian Stock Exchange.
Lastly, and the most important milestone of our turnaround journey, was the conclusion of the agreement with the U.S. Department of Justice. After three years, we have completed all obligations with a strong and recognized governance and compliance mechanism, closing an important chapter of Petrobras history and now ready to move forward to a brighter, solid, and long-term sustainable result. Thank you. Now I pass back to Rodrigo.
Giving you an overall perspective in terms of our financial strategy and the financial aspects of our business plan, we have four main pillars that will be the focus of the 2022-2026 period. Of course, the first of them is maintaining our efficient capital structure. If you consider that over the last five to six years, we were highly focused on reducing the company's debt and bringing it to a more compatible level when we compare to our peers. We were always focused on having a capital structure that is compatible with an investment-grade rated company, and that's the kind of focus that we still have. Maintaining that efficient capital structure that we have achieved is an important pillar of this plan.
All the CapEx, the distributions, and the portfolio management agenda that is behind the plan always considers maintaining this efficient capital structure. Our focus in the plan is, of course, on maximizing value creation, both with the projects that we have already in place and, with the 15 units that we have, during the strategic plan timeframe, coming online from 2022 to 2026. The focus will always be on maximizing value creation. We're also focused on mitigating risks through liability management. Of course, when we look at the liabilities of the company, we always look at them in a broader perspective. We're not only focused on the finance debt, but also contingent liabilities as well, finding opportunities to reach agreements and to solve contingent liabilities. Pension liabilities as well.
If you look at the 2021 cash flows, we have prepaid certain pension obligations, especially because they were more expensive than the financial debt of the company. We look at the company's debt in a very broad perspective, and we're always trying to find opportunities to maximize value through reducing debts or managing risks. We're also committed to the best capital allocation, both in terms of CapEx and finding resilient projects, and also of distributing the returns that we generate from those assets. I'll mention later on, we made improvements to our dividend policy to reinforce our commitment to the best capital allocation and having dividends as an important capital discipline tool as well.
When we look at the strategic plan assumptions, of course, the current scenario of more favorable prices when we compare to 2020, we have updated our projections in terms of future prices. But as I mentioned in the beginning, and as you guys have seen over the last couple of days, we need to be ready for challenging scenarios. We're always focused on approving projects that can face any kind of price scenario in the future. Our current perspectives are of a long-term price of $55 per barrel. We have improved a little bit compared to 2021-2025, but we had a $50 per barrel future price in the base case scenario of the plan.
When we look at the resilience scenario, we have maintained $35 as a resilient price for the future. When we consider the projections of the International Energy Agency, we do think that $35 is a price that can make us competitive, even in a scenario where we see demand going to 50 million barrels per day in the projections of the International Energy Agency. In terms of foreign exchange, we have seen a devaluation of the Brazilian real over the last year. Our projections for the business plan timeframe is a flatter projection, but a devaluation when we compare to the 21-25 timeframe. This picture summarizes our view in terms of the business plan, both in terms of cash flow generation and of a very balanced distribution of the cash flow that we generate.
If you look at the right side of the slide, you can see that we're highly balanced between CapEx investments, dividend payments, and debt amortization. We don't expect to reduce the company's gross debt, but we do have a debt schedule over the timeframe of the plan. As our CEO has mentioned in the beginning, we do see very solid contribution from Petrobras to the Brazilian society as well, both through taxes and through dividend payments to the controlling shareholder, aligning the interests of the controlling shareholders with the minority shareholders as well. On the timeframe of the plan, we do see a potential $85 billion-$95 billion contribution in terms of taxes and dividends.
When we look at the portfolio management part of the plan, we have anticipated some of the transactions that we expected to occur in the future, meaning BR Distribuidora, the follow on of the remaining shares that we had. Also the potential for closing RLAM in 2021. Those cash flows were anticipated and some projects were removed from the projections of divestments, especially Marlim, and we're going to talk a little bit about this later on. And the natural gas pipelines of the pre-salt fields. Those projects were removed from the portfolio management agenda. The remaining part of the portfolio management strategy continues pretty much the same, focusing on assets that are very resilient, close to the pre-salt production, both in terms of refining and of oil production.
Of course, exploration and production assets that are resilient to very low prices. In terms of dividends, of course, there's been an important improvement, and I'll talk about this later on, when we look at the improvements that we made to the dividend policy. First of all, when we look at the CapEx projections for the 2022-2026 business plan, we have improved our CapEx by 24%, but it's still mainly focused on the upstream operations. 84% of the plan is focused on upstream and close to 70% on pre-salt area where we have highly productive fields, highly resilient assets. That's still the company's focus.
We do have an important improvement in downstream as well, mainly focused on reducing the carbon footprint of our existing refineries and of the refineries that will continue with us after we continue the divestment processes. Opening up opportunities for hydrotreatment units and units that reduce the sulfur level of the products that we make in those refineries. One additional information that we included in the 2022-2026 business plan is the level of committed CapEx. We think that is an important transparency metrics so that you can follow on for the future and see the level of flexibility that we have, especially in the case of future challenging scenarios in the upcoming years. You can see that we start in year 1 and 2 of the plan with a substantially committed level.
When we look at the end part of the timeframe, you can see that the level of commitment is much lower. Of course, we have much more flexibility to respond to challenging scenarios if that's the case. In terms of improvements to our dividend policy, they were mainly focused on three pillars, reinforcing our commitment, simplifying the dividend policy, and creating more frequency and transparency so that we have more predictability in terms of dividend payments. If you look at the previous document, it was a five-page document, so reduced that to a two-page document that is much more straightforward. Some of the metrics, we did align them with the financial statements as well so that it becomes more transparent and easier to follow.
We have basically the CapEx is pretty much well aligned with the financial statements. We included the signing bonuses as part of the 60% free cash flow formula, and the operating cash flow is also aligned with the financial statement, so it's easier to follow on. Considering that we achieved the $60 billion debt level almost 18 months in advance to what we expected in the last business plan, we have made some adjustments that were not very clear in the prior version of the policy, especially with respect to timing. We do expect to distribute quarterly dividends after we close the quarters. We expect to announce the quarterly dividends right after we have the quarterly results approved by the company's board of directors.
We have included a minimum annual distribution that we'll talk about later on. Of course, we did change the policy to have a certain degree of flexibility with respect to gross debt. The way we drafted the prior policy, we were focused on reducing debt, so we had the target of the $60 billion debt level as a kind of a fixed target. When we think about the upcoming future, we do need some flexibility, especially when we have FPSOs getting online, for example, which will increase debt momentarily, so it doesn't make sense to stop paying dividends because debt has gone from $60 billion to $61 billion, $62 billion.
We did include a flexibility to go up to $65 billion, but it doesn't change our optimal level of $60 billion and our commitment to maintain the level of debt on $60 billion or a little bit lower. We do have some flexibility so that we don't stop distributing dividends just because one of the FPSOs has come online and has improved that in the short term. As I mentioned before, we're committed to the best capital allocation, so we have strongly reinforced the commitment of the 60% of free cash flow formula being a strong commitment and something that we will comply on starting as of 2022. Of course, we do expect to have a reputation of a company that distribute its earnings.
In terms of minimum dividends, I've already mentioned, but it's a $4 billion minimum payment, when we have scenarios of, Brent prices above $40 per barrel. We have maintained the possibility of, extraordinary payments depending on the scenario and potentially capturing price upsides when we do have them. Of course, all the parameters of our dividend policy consider that, the distribution cannot jeopardize the company's financial sustainability, in the future. We consider that given the level of debt that we have now, we have a very solid condition to distribute dividends and not jeopardize the company's, investments and future condition. In terms of capital structure, I've already mentioned, but we do expect to maintain that level around $60 billion, especially considering that it's kind of 60% of...
Between 40% and 60% of that is finance leases that are part of the company's operations. We do expect to continue actively assessing the markets to improve the maturity and reduce cost of the remaining portion of the finance debt as well. We expect to continue to be active in debt capital markets to improve the portfolio of the finance debt that continues with us in the future. In terms of portfolio management, as I mentioned before, we continue to be focused on the pre-salt assets and the refining assets that are close to our oil production and that have integrated logistics in the southeast part of Brazil.
The portfolio management strategy is continuing to be focused on divesting onshore and shallow water assets, international assets as well, complying with the agreements that we have with the antitrust authorities in Brazil, both with respect to natural gas and to refining assets. We do expect an impact in terms of oil and gas production of 250,000 barrels per day coming from the potential divestments. When we look at the business plan timeframe, we expect to have a portfolio that, even though has a little bit of less volume, is more value added to that portfolio, especially considering the improvements in the pre-salt production.
In terms of risk management, of course, we do run several sensitivities so that we are comfortable that our financial stability is sustainable within $35 Brent price, and we're comfortable with the current capital allocation strategy. We look at both liquidity and the potential to generate value even in challenging scenarios. Of course, we continue to be focused on cost reductions. The commodity is highly volatile, so we're gonna always be focused on reducing costs and making sure that our cash flow supports low price levels. We of course have a zero tolerance for misconduct. We have a code of ethical conduct, and we're focused on completely complying with all the regulations as well.
We do have a significant part of the business plan analysis that is focused on operational risks and making sure that we have a high level of safety and integrity in our operations. Finally, in terms of the procurement strategy, this is something that we are quite focused on as well. You have seen that we have 15 large size units coming online over the business plan timeframe. Most of them have already been contracted, but we're focused on early engaging with the market and making sure that we have incentives aligned with the supply chain so that we can deliver on the ambitious CapEx of the plan and not have relevant delays as we did have in the past.
We do expect to be able to deliver the CapEx within the timeframe of the plan so that we extract most of the value of the new projects. We're also focused on having more predictability and standardization of the projects. You probably have seen that, we're continually standardizing the units and trying to make sure that we can deliver them as standardized as possible, so that we make sure that we can always have them on time within the business plan. Another important agenda of the procurement area is that, of course, we're focused on decarbonizing our operations. It is very important for us that we do engage the supply chain in reducing their carbon footprint as well.
More and more we are engaging in programs to make sure that not only the supply chain follows our codes of conduct and all the governance part, but they also follow our ambitions in terms of reducing emissions in our operations. Next I'll pass the floor to. Oh, just the last one, Mayra talked about this. We have cash flows that are resilient to much lower prices than the ones that we see now, especially when we consider the year 2022. If you look at the $40 price alongside with the current exchange rate of 5.50, we would have substantial positive free cash flow even in that scenario. As I mentioned before, we're committed to delivering the business plan and to being very resilient to low prices.
I'll pass the floor to Fernando Borges, Chief Upstream Officer, that will talk about the perspectives in terms of the upstream business. Thank you.
Good morning, everyone. Now we are gonna zoom in on the upstream area. As already said by Rodrigo, we have a growth strategy based on our deep and ultra-deep water assets in Brazil, and exiting from offshore and shallow water assets. They are based on double resiliency in economic and environmental. In economic resilience, our assets has a sustainability of $35 per barrel in the Brent below in the long run. As already said, as we have high productivity as our assets, they are very low emissions in their production phase. We have others for like improving operational efficiencies and lowering the energy consumption in our operations. We have a very significant amount of investments in the next five years.
$57 billion are dedicated to the upstream area, mainly in the pre-salt. 67% is dedicated to pre-salt assets, 62% in development production in Búzios, Tupi, Sépia, Atapu, and others important fields in Brazil. We have 26% of the investment dedicated to Campos Basin, which holds important assets like Marlim Leste, Marlim Sul, and Roncador. We have a new frontier in ultra-deep waters in Sergipe, in northeast of Brazil. We have 10% of investment dedicated to exploration. Now we're gonna. Let's see how they are. Another aspect is with the portfolio management, we are increasing the numbers of assets that are resilient to the $35 per barrel in terms of carbon emission too.
When we take a look at the variation of the amount of investment in the upstream, we are jumping, we are increasing 23%. Part of it was balanced by a foreign exchange rate, the selling of 5% of the production share part of Búzios field. We are increasing the participation of owned FPSO in our portfolio, mainly in Búzios field. We have some reprioritization of projects like Sergipe ultra-deepwater. The Marlim revitalization is one that we are holding 100% of that asset. We had some impact of COVID postponing some investment from this year to the next year, like Mero 1 project. It amounts to $57 billion for the next five years in the E&P area. Looking at exploration, it amounts to $5.5 billion. This is the...
It's direct to 79 exploration blocks in Brazil, which we forecast to drill up to 70 wells in exploratory and appraisal. 58% of this is dedicated to our Southeast Basin, like pre-salt areas mainly. You have the equatorial margin dedicated, 38%, almost $2 billion in our 16 blocks in the equatorial margin. That's a very important new frontier with high potential, since the very successful exploration and production in Guyana and in Suriname. We expect to start drilling second quarter of next year. We have up to 14 wells to drill in the next five years in this region, all of them dedicated to deep waters. Looking to the future, we are trying to take more of our fields.
We have the strategic program called S20 that envisages in the next year to incorporate 20 billion barrels in our operated fields, in a 100% work interest view. Just to size this amount of oil in our 68 years of existence of Petrobras, we produced it 23 billion barrels. How to assess this now? They are leveraged by a very strong high-resolution seismic acquisition, which we're gonna dedicate BRL 2.5 billion, granting a very defining view of our reservoirs. With our advanced technology and using tools like artificial lift, we are committed to develop the best reservoir models of the industry, and that grant us a very important way to leverage recovery factors. We are being capable to see the waterfront in the water injection areas.
We can see the gas displacement with this technology. We are committed to have the best reservoir models in order to improve recovery effect in all the very good assets in pre-salt. This is our production profile for the next five years. We are increasing our production from a total of 2.7 million barrels per day next year, up to 3.2 million barrels per day of oil equivalent. Even considering the divestment we have planned too. The participation of pre-salt in this production growth is relevant. Today, it represents 70%, going up to 79%. We have 15 projects to come on stream to sustain this growth. You're gonna see next.
These are the 15 new FPSOs that are scheduled to come on stream on six fields. We are a leader in the world in number of FPSO projects. Twelve out of them is already contracted and under construction. Three of them, those in 2026 are under contracting strategy, in contracting process. Six of them are going to Búzios field, which is one of the main motors of our production growth. We here can highlight next year, Mero 1 coming on stream in the first half of the year. All the sectors of these FPSOs are being sited very closely by our team.
Here we can see the first FPSO for Sergipe ultra-deepwater that the contract process is already on the market. Taking a look at our Petrobras history, production history, we can see all the phases, and we take a look at the last 10 years. The blue zone are consistent with the pre-salt production, taking each time more space in our investment. In the last three years, we can see the Búzios participation in our production.
With those six new units that are under construction, and two of them contracting, we are gonna reach in 2026 33% of our production coming from Búzios, and the most part of them, all of them in the pre-salt, showing the relevance of Búzios. We reached the production of 600,000 barrels per day in two years. When you look back to the last, it was Tupi reaching this milestone, it took us six years in Tupi to reach this 600,000 barrels per day of oil-equivalent production. Going back in Marlim, it took us 11 years. We can see here an acceleration in developing this project, based on our knowledge, our deep knowledge in pre-salt and in the lessons learned in all this process.
Just an example of the beauty of Búzios, one of the wells reached 70,000 barrels per day of oil-equivalent production last year. Eight out of the ten most productive wells in the pre-salt are in Búzios. Búzios is the main investment in this plan. We have allocated BRL 23 billion to development of Búzios. Up to now, we have approved 10 projects. The first four are already in production, and we have six more to come. We have increased the production capacity of these FPSOs. The next generation is 180,000 barrels per day. The last three, we are gonna reach 225,000 barrels per day of oil production capacity.
We are aggregating new technologies like eight-inch production and injection lines, which could deliver higher productivity and injectivity. New riser systems to improve and lower the amount of investment related to subsea system. We are decreasing the cost of the wells, doing them more productively. We are applying water alternating gas as a recovery system for the full field in Búzios. If you consider the production capacity in the field, nowadays we have 6,000 barrels per day. We're going to reach 1.7 million barrels per day of production capacity in our production units. Mero 1, it's another star in our portfolio. We have all the four platforms under construction. Mero 1 is about to leave the sail away from Dubai to Brazil.
We expect to start producing Mero in the definitive system in the first half of the next year. It's a 180,000 barrels per day oil capacity FPSO and full reinjection. It is in place now where we are going to, I'll say, introduce a new technology that's HISEP separation. It's a technology that we are gonna separate highly concentrated CO2 gas in the seabed direct to a gas injector well. That's gonna be a breakthrough in terms of the bottleneck, the production units. For sure, it's the technology that could open other opportunities in some finds of oil in Brazil that has around 70% of CO2 in the gas.
That's gonna be an enabler for some of the discoveries we have already done, and we are gonna test in Mero 3 project. We are going to the market with this system at the end of this year, and we forecast implementing it in 2024 in the Mero 3 project. Tupi is our largest field nowadays. We have already produced 2.6 billion barrels. Today, only the Petrobras share is 800,000 barrels per day. The total production is 1.2 million barrels per day. It has a large potential to implement and to recover volumes. We are strengthening our strategy to take care of the integrity of the system already implemented, stressing efficiency in these systems.
We have an estimate of BRL 4.7 billion, only the Petrobras part, in terms of to extend water alternating gas throughout the systems already implemented. That's gonna for sure keep it very resilient in terms of low oil price. Campos Basin remains as a strategic area for our investment. It's an area that we have huge knowledge. We are revitalizing fields like Marlim. We have two units already in construction scheduled to come on stream in 2023. We have plans to drill more than 100 wells in the deepwater fields in Campos Basin.
We are committed to invest $16 billion, and for the production forecast in our plan, we estimate 600,000 barrels per day of production coming from these new projects. The third system is scheduled to Jubarte, that's another very good field we have. That's an important part and then a strategic area for us at Campos Basin, not only Santos Basin with pre-salt. We have some pre-salt in Campos Basin too. Looking to the new frontier for production development system, we have Sergipe Ultra-Deepwater. The first system that we call SEAP One, stands for Sergipe Deepwater One, is scheduled to come on production in the end of these five years. 2026. It's a field with very good quality of oil and gas, sweet gas with sweet oil.
The first FPSO is already. The contracting process is already in the market in a BOT model. We are studying a second phase for SEAP 2 in the coming years. Our lessons learned in pre-salt have a very high value generation. We have FPSOs much more complex in order to handle higher productions like 180,000 barrels per day or 225,000 barrels per day. The complexity of this system has increased. It could be possible to maintain the whole investment in a production system between $4 billion-$6 billion, considering our owned FPSO.
Because on the other hand, we have saved a lot of investments in the subsea systems, investment and efficiency, and the wells investment demanded on these systems. Just an example here, comparing our previous plan to this plan, we are having a 5% reduction in wells cost, construction, and 9% cost reduction in the subsea systems, because of the lessons learned we are having, and capable to have more complex systems in the same budget. Another aspect of our portfolio that is that we are very competitive in terms of lifting costs. In the previous five years, we had $8 per barrel of lift cost, and now we are forecasting $4.8 of lifting cost.
That is for sure leveraged by the efficiency of the pre-salt area that is gonna deliver just $3.5 per barrel of lifting costs. On the other hand, if you look to the total cost of oil produced, in this new plan, we are forecasting $29 per barrel, composed by these $5 of lifting, $12 of CapEx, and another $12 of DD&A. If we take a prospective view of our portfolio, we have a break-even of $20 per barrel, considering just as a forward position. The last, considering the integrity management program of our flexible pipelines, which was a concern two-three years ago, we have developed it a lot.
The results are being very good in terms of engineering models in order to extend the lifetime of our flexible pipelines. We have developed new technology in terms of inspections, and we are investing in developing new products and new flexible lines that could be resilient to or resistant to SCC CO2, which is the stress corrosion crack that affects those flexible lines. All the new projects are using rigid lines that does not have more of this worry that we faced some years ago. Thank you.
Good morning, everyone. Now we are talking about refinery and natural gas area. Our strategy here is based upon the transformation of our portfolio, focus on the assets that we have, synergy and integration with our upstream segment. In this plan, we endorse this direction, incorporated a strategic program that we call RefTOP. This program aims to position Petrobras among the best refineries in the world in energy and operational efficiency, giving even more resilience to our assets. In this direction, we are increasing our capital investments in the target refining portfolio, seeking to adapt our assets to produce high-quality products with lower carbon emissions following the evolution of our market.
In the natural gas area, we are advancing in the commercial models, seeking to adapt to the evolution of our market, and we are trying to capture opportunities in the integration of the gas and power segment. In the next slides, we can share our view of this transformation that our team is fully committed to deliver in the coming years. In the next slide, we can see this transformation of our portfolio. We are taking our portfolio towards our optimal configuration. Our goal is to be integrated to oil and gas production and close to the large consumer markets in Brazil and to maximize the processing of pre-salt field. We will proceed with our optimization of the refining portfolio by our divestment process. Talking about this, some units we are not able to reach a sales agreement.
Now we will carry out a new process in terms and conditions to be formally defined and agreed with Brazilian antitrust authority. Related to the natural gas assets, the startup of Itaboraí gas facilities will provide us with a higher increase in our processing capacity. It's almost 20 million cubic meters per day, two trains by 10.5 million cubic meters per day each train. Also, the regasification assets provide flexibility to our commercial strategy. While in power generation, our focus, clear focus is on natural gas integration with high-efficiency plants. Moving to the next slide. Here we can see the program that I mentioned that's called RefTOP. This program, which has the goal to position us among the best refineries in the world in terms of energy efficiency and operational performance.
In our benchmarking, we aim to be at the first quartile of the U.S. market comparisons on base. In this program, we have planned $300 million in investments, totaling about 148 projects. Of this amount, around 67 projects are of energy efficiency. This is one of the main pillar of this program. We forecast a 21% reduction in the energy consumption by 2025 due to natural gas, steam, and power optimization in our process. As consequence, our greenhouse gas emissions will be reduced. 16% reduced until 2025, and 30% until 2030. Our goal is to surpass around 97% of operational availability by focus on failure prediction and increase productivity in scheduled maintenance, having digital transformation as one of the main tools of this program. Moving to the next slide.
Here we can see in this plan, we gain more maturity in investments for our refining units' equation. In this plan, we will invest around $2.6 billion offering products specially designed to market demands and align with energy transition. We will be prepared to produce 100% of low sulfur diesel in the southeast refining portfolio. For that, we are investing in new hydrotreatment unit at REPLAN and upgrade hydrotreatment units at REDUC in Rio de Janeiro and revamp its other refinery in the São Paulo states. In this way, we will have 132,000 barrels per day of additional low sulfur diesel production capacity with an investment around $500 million in this business plan timeframe. Polo GasLub will be integrated with REDUC, that's our refinery in Rio de Janeiro.
In this site, we will have the first advanced base oil lubricants in Brazil, a product that we see a high growth in this timeframe of our plan. Additionally, this project will increase the performance of the conversion of REDUC, and we will increase the capacity of low sulfur diesel and jet fuel in around 93,000 barrels per day. At RNEST, that's our refinery in Pernambuco, we are planned to proceed with the revamp of train one and the conclusion of train two, expanding the processing capacity of 145,000 barrels per day. Our understanding here with this action is that continuing this project will increase maturity and reduce risk and add value to the divestment process with these units. In the next slide, we can see our strategy for biorefining.
In this business plan, we intend to invest around $600 million. We are trying to reach a potential capacity of 40,000 barrels per day in renewable fuels. By co-processing soy oil in hydrotreatment units and by using our already existing technology and hardware, we have projects able to produce diesel with a renewable content between 5%-7%. In the first phase, we successfully conclude industrial tests at our refinery in Paraná with potential production of 2,300 barrels per day. Now our challenge is to put these products in our commercial portfolio. We include in our future plans the upgrade of units at REPLAN and Cubatão refineries for co-processing renewable feedstocks with a total capacity of 10,000 barrels per day. In these units, we have a spare capacity of hydrogen that we can take advantage of.
Besides co-processing, we have a dedicated facility project for production of renewable diesel that can also produce sustainable aviation fuel with a capacity around 17,000 barrels per day. The implementation of those projects depends on the regulatory improvements and the introduction of renewable diesel in the mandatory biodiesel blend in Brazil. Moving to the next slide. Here we can see our action plan to the gas market. We maintain our commitment with the opening of the market as we agree with the Brazil antitrust authorities. We are anticipating full compliance with our exit from the natural gas transportation system and distribution business. New natural gas traders will be part of the internal market due to excess of our processing capacity. This we can see now at the beginning of 2022 with new producers offering their volumes to the market.
We are prepared to compete in a market with new dynamics. Our focus lies on the commercialization of our own gas and offer new products with different indexations and new time horizon from medium and long-term contracts, and new forms of relation with our clients. In summary, our business plan for refining and natural gas, we will invest around $7.1 billion until 2026, and we will be ready to capture opportunities in energy transitions and to deliver products with lower carbon footprint according to market specification. In refining, the ongoing projects will add a processing capacity of 145,000 barrels per day to our refining, and increase 320,000 barrels per day of low sulfur diesel and jet fuel production capacity.
We will have developments in biorefining, driven by regulatory evolution with a co-processing project followed by a dedicated facility that help us get ready to meet the decarbonization goals in aviation. Investments with RefTOP and operational availability and efficiency will lead us to be at first quartile according to U.S. refineries benchmark. We also have a 20 million cubic meters per day increase in our pre-salt gas processing capacity, and we are preparing for the competitive market. Now, I invite Cláudio Mastella, our Director of Commercial and Logistics Area, to complement the downstream strategy.
Good morning. The trading logistics area was created recently, joining downstream and upstream logistics with the trading area, domestic and global. Our role extends from the beginning of the supply chain, supporting exploration and production of oil, bringing materials, equipment, and people to our production units until the selling and delivery of our oil or products in Brazil and worldwide. Connecting, synchronizing, optimizing upstream and downstream movements with focus on company's results. That is optimizing costs and revenues. In the marketing and logistics area, we operate seeking maximum competitiveness with safety and efficiency, establishing partnerships with suppliers and customers, targeting increased efficiency in the supply chain. We constantly monitor domestic and global markets. Searching for the best alternatives, especially for our crudes or crude oils, ensuring maximum value capture.
We diversify transport models to better reach markets. We develop new markets and customers for our crude oil and products. We focus on the needs of our customers, either internal, talking about upstream and refining, and external, which are, by the way, the essential actors as they are source of revenue. We are applying digital transformation in our processes, and thereby gaining more agility and better service levels. We optimize the use of logistics resources by making the best choice between owned and hired assets. We focus on reducing emissions, both through operations and the use of more efficient assets, as well as through the development of new products with lower associated emissions.
Our downstream asset portfolio, as Rodrigo already showed, is focused on the southeast of Brazil, seeking resilient operations close to oil production and the largest Brazilian markets, with an integrated and efficient logistics based on terminals and refineries connected by pipelines to key markets. The concentration of assets does not limit us in our performance. Maritime terminals and the modern fleet of ships, as well as transshipment facilities, allow us access to various markets, including the most recent ones in Brazil and worldwide. With this, we are competitive in Brazil and globally, offering the best options in prices, quality, and service level to our customers. Our overseas offices access the main oil and product markets. This global reach, together with an efficient maritime logistics, allow us to always choose the best value alternatives for our products, for export or import.
We have transshipment facilities in Brazil, both owned and operated by third parties. We use our fleet of ships hired, with our own subsidiary, Transpetro, as well as hired with other ship owners, always seeking flexibility, efficiency, and competitive prices. Talking about the upstream logistics. We continue to improve our performance in maritime, land, and warehouse segments. Recently, we updated a benchmarking survey with a group of big upstream companies, the results shown in this slide, and the result was a very good one. In the maritime service to upstream, we climbed from third to second quartile. We have reached the first quartile in the air transport of offshore passengers in Brazil, where we are a reference in oil and gas industry. We moved this year around 52,000 passengers per month to and from oil platforms.
We stay in the first quartile in the inland logistics for material and equipment. This all, thanks to the continued optimization of our process and the use of modern and safe equipment. Our search for reducing emissions in the transportation segment is being implemented with the optimization of routes and speeds of the vessels, increasingly efficient vessels, and soon with the use of hybrid vessels in partnership with our suppliers. In the area of planning and inventory management of materials and equipment, we are implementing new processes of material management, as well as in partnership with the teams of upstream and procurement, stimulating the improvement of demand planning and acquisition of materials and equipment, focusing on inventory optimization. Going back to downstream, we are continuously removing logistical bottlenecks in search of increasingly efficient operations, of course, with the premise of safety as a value.
To this end, we invest in increase of operational capacity and flexibility of our terminals and pipelines. We are also adding dolphins to some of our terminals, gaining even more agility in logistics, especially important in all exports, which is expected to grow in the coming years. Finally, at the right part of the slide, we are continually acting against illegal taps on our pipelines, and our actions have proven effective. Although, of course, it remains a permanent point of attention. Finally, our investments in this plan amount to about $0.8 billion, shared between maintenance and diversification of models.
To greater agility and efficiency, of course, allowing our company to reach markets with greater competitiveness. Additionally, part of the investments are allocated to operational safety, mainly with replacement of some pipelines and expansion of transshipment facilities, as I have already commented. That's what I have for you today. Thank you a lot.
Thank you, Mastella. Now we'll begin our Q&A session. We have two microphones in the room. Please raise your hands to ask a question and state your name.
Good morning. Thanks for hosting the event, and thank you for the questions. This is Bruno Montanari with Morgan Stanley. I have a couple questions. The first one on governance. I think you have done a tremendous job in protecting the company from outside influence. Just wondering if there is anything else you can include in the bylaws or internal policies that would further insulate the company from intervention in the future? I know this is not the case today, but always good to add some layer of protection. Second question on cash management. I think you have been moving your view on minimum cash, increasing from $5.5 billion to $8 billion, despite counting on robust amount of RCFs.
Any specific reason for the increase in minimum cash position?
Salvador, can you take the first question, please?
Hello. Yes, thank you for the question. I think this is a natural process improvement that we have to continuously find out alternatives and solution to protect the company in better ways. The examples I mentioned are some of them. For another, Rodrigo mentioned by robustifying our dividend policy is another one. Of course, we will continue to find out using not only our internal knowledge, but external auditors and external regulators to make sure we are putting the best in place to protect our governance.
Rodrigo, the second question, please.
Yes.
Thank you. Thank you, Bruno, for the question. In terms of cash management, we still see somewhere around $5 billion-$6 billion as a minimum cash level, but we do consider the $8 billion to be the optimal for managing the daily operations of the company. We have recently updated both the cash management perspective and the target level of our debt. We see the optimal level of the gross debt to be between $55 billion-$65 billion, and the optimal cash level to be around $8 billion. It's something that we're continually monitoring, and depending on the scenario, we may update. This is what we view now as optimal, especially considering the units that are coming online and the upcoming scenario for the next years.
Thank you for your question.
If I can make a third one, perhaps to Fernando. We have seen some perhaps initial declines at Tupi. I know you mentioned some initiatives you are implementing at the field. Is the idea now to control this initial decline, or can we potentially see production increasing again, and maximizing production out of the area?
Bruno. All the producing fields face the decline since they have put the maximum production capacity on the field. What we are doing, if you took Tupi as a base, we have production maintaining tools that can be implemented like second wave of wells in some systems to face the decline. We have to extend the water alternating gas injection that was not considering the first systems. We have high definition seismic acquisitions in terms to seek for the oil was not swept from the reservoir. We have lots of reservoir management initiatives to face the natural decline.
If we do nothing, in one of these reservoirs like Tupi, we could face a range of 5%-10% per year of decline. As it's in an initial phase, we have room for several reservoir management initiatives to tackle and to hold this decline.
Okay. Thank you.
Christian Audi with Santander. I had a few quick questions. Presidente Joaquim Silva e Luna, as we enter 2022, which is going to be a presidential election year in Brazil, how comfortable are you with the company's ability to defend and protect this very solid and ambitious plan you just announced?
The second question, Rodrigo Araújo. Can you talk about particularly now that we are experiencing a downturn in oil prices, how safe is your dividend policy in an environment that can become potentially more difficult? The third question was for Rodrigo Costa. I just wanted to clarify when you talked about refineries, that now it is your plan to do the second train for RNEST in order to potentially improve the chances of selling it. It is a decision that you've made that you will spend that money on that project. Then the last question for Cláudio Mastella. Again, we're seeing a change in the oil price dynamic. You've made several price adjustments upwards recently.
Now that we're seeing downward pressure on oil, should we expect downward price adjustments as quickly, or will you wait to see if this oil price movement is merely noise and therefore not worth adjusting prices so quickly? Thank you.
Thank you for the question. Regarding the issue of build up this plan to ensure that the strategic planning between 2022-2026 will be implemented. The company has full control over its destinations in what regards the company and the government. Our company is very solid, has been built up a long time. I had the opportunity here to present really quick, but I'd like to say this. Petrobras is a state-owned company with an indirect management. In other words, all the officials are elected. It starts with the shareholders, then goes to the board, then they make their choices. Lastly, it's a mixed economy society, where today we have 63% of its capital or financial capital in the hands of private investors.
We have control organs and constant monitoring that understand the dynamics within the company, and we have total comfort and liberty to run this planning. Of course, election year has repercussions anywhere in the world. The moment as well, and the economy still reflects, you know, the COVID pandemic is also part of it, but we don't see any risk of not delivering. On the contrary, we are offering a lot of security from the moment that we've reached a level of debt that we wanted one year before the deadline. We assume a commitment with our investors. This is something that we have conditions to deliver. Thank you very much.
The questions. With respect to the second question about dividend policy, we show one of the slides that I showed was considering the sensitivity analysis for lower prices. When we consider what the company did in 2020 and the positioning of our portfolio for the upcoming years, we're quite comfortable that we can comply with the dividend policy, even in more challenging scenarios. As I mentioned during the presentation, we're focused on implementing projects that are resilient to even lower prices than the ones that we saw last year. This is an important part of our commitment.
If you consider what we delivered in terms of free cash flow in 2020, we were positioned probably either the best or one of the best cash flow generators even in a very challenging year. We're comfortable that we can comply with the dividend policy, even in a more challenging scenario. This is how we see now. At least for the short term, we don't expect we may see lower prices, but we don't expect something as dramatic as we saw in 2020. We would still be ready to deliver on the policy even in a more challenging scenario. Thank you. Thank you for your questions. I'll let Rodrigo and Cláudio Mastella answer the other ones.
Regarding RNEST. We keep our commitment to fully comply with our obligations with CADE. CADE is the Brazilian antitrust authority. We keep our focus on selling RNEST, but we receive feedback in the process that we run, that the potential buyers see some risks to completion of this project. We understand that we can make a difference in a new bid round for RNEST. We try to complete this project, but run in parallel with the divestment process. We must consider that the second train and the revamp of the train one has very good completion. The distillation unit is almost 9% complete. The coke units are around 80%, and the other facilities are around 70%.
We think that run these in parallel with the new process of divestment, we can add value and fully compliant with the divestment obligation that we have with Brazilian Antitrust Authority. This is our strategy in this business plan. I think that you asking if we will put money tomorrow? No. We run the governance. We have a very strong governance to approve any kind of project. We can demonstrate that this project must be resilient in the three scenarios that the company has. Now we're running this process and agree with CADE a new schedule to sell RNEST.
Okay. Talking about price, well, we've been experiencing a very volatile scenario. As we have been doing in the last year or so, we are very cautious about putting the prices up or down on the first signs of change. Well, looking at the scenario today, probably my crystal ball is as clouded as yours. I think we are observing a little bit more and moving as we moved in the past, cautiously, but keeping us competitive to the market. Okay.
Hi. Thank you for hosting us. Regis Cardoso with Credit Suisse. I have a couple of questions. First one is for Joaquim Silva e Luna. I'll switch to Portuguese. I think that should be fine.
Thank you for the opportunity. It's been a great lesson how Petrobras has been able to transmit a clearer message about its role in society and how to give back the value that it generates. A very quick math here. If you add the income tax and profits before taxes and participation of the government, that's almost 85% of the profits of the company. It doesn't need direct interferences in the price so that society can see the value that's generated by the company. This year alone, over BRL 23 billion in dividends were distributed, and even more than that in taxes.
All this introduction, actually, my question is this, how do you imagine this difficult mission of, let's say, passing on to society the message that the best way to give back value is not necessarily interfering with the markets in undue manner, in a way that eliminates other participants. At the same time, the market is so big, it's an incentive of BRL 0.30 in the fuel. The program costs the same as an income transfer program like the ones that exist or the ones that are planned to increase. This is my first question, and then I have a few others for all the other officials. Thank you very much. Thank you for your question. But this has been our challenge throughout the year.
Try to show society, especially the decision-makers, that the company has a social responsibility, but it does not create public policy. That has been our challenge, and we do this through giving back to the investor, which is the government in this case and shareholders in general. When we give it back to the government, that's when the government can make these public policies. Petrobras, until 1997, it was a state, fully state-owned company. That phase ended with the so-called monopoly, so it started to compete with the market. In the exploration and production area, that happened immediately since we have over 80 companies already in Brazil, but in the area of refineries, it was smaller. There's a big quantity of importers already, so there was. There's still people who have this perception.
Society still looks at the end of the line, the price of the gas, that Petrobras should still, as a state-owned company, manipulate these prices. Our difficulty is to try to supplant in terms of our national Congress, our executive branch and also society. We have been doing almost like a campaign of social communication so that people can realize that the best way for society to use Petrobras is allowing Petrobras to have its own governance as it has been managed and be a strong company with a consolidated portfolio. Such as our plan states, and we were already going in that direction, flying in that direction before, and characterized actually as shareholder, directly or indirectly. All Brazilian citizens are Petrobras shareholders.
Either they are shareholders because they receive dividends or because they're indirect, because they receive the benefits that the company affords or allows. We see that this vision has been possible, and we have seen at the government level, congress level, measures or steps have been taken to mitigate the effects of high prices of oil. Now we start to see, as Mastella said, we need to reflect this instability in our prices. These are structural features, not conjuncture. In the case of our fuels, they have a great amount of ethanol, like our biodiesel. The price should show that the participation of other agents.
I would say that little by little, this mission, which is not easy to transmit to society, that a company that is responsible for 4% of the Brazilian GDP needs to be managed very carefully. It needs this freedom to manage its own planning. Thank you. That was very clear.
Directors. Rodrigo, on the dividend policy, specifically, some more, you know, specific questions. Will the new dividend policy, the 60% formula, apply already for the fourth quarter 2021 results? Or do they start to apply to fiscal year 2022? Still on the dividends, what about the divestments? I think they are not explicit in the formula. If you have the additional cash from the divestments, I mean, I would assume you either distribute the cash or you will, you know, reduce your leverage to a suboptimal leverage structures. Should we assume that proceeds from divestments will be distributed as well? Maybe a second question now to Fernando Borges.
One of the aspects of the CapEx increase or the main driver in the increase in CapEx in this plan versus the previous one seems to be more upfront CapEx by Petrobras in the FPSO constructions. In the past, the owned FPSOs have delayed. How do you mitigate risks of delays? Just maybe a last one also for Fernando. The HISEP technology, which specific fields do you think would be enabled by that technology? Is it Jupiter? Can you do more of Mero with that particular technology? Thank you.
Thank you for the question. I'll answer the first one, and then I'll let Fernando answer the other ones. With respect to the dividend policy, we expect to start applying the 60% formula as of January 2022. We expect to apply that for fiscal year 2022, starting quarterly. Of course, we still have the year-end results, and we have made some dividend anticipations. Depending on the scenario and the cash flows, we could see some additional distribution for year 2021, depending on the year-end results. In terms of the formula and the divestments, we have not included the divestments in the formula on purpose. We do want to have our organic cash flow supporting both the CapEx and the distributions.
We don't wanna bring the debt to a suboptimal level. Whenever we have opportunities to make additional distributions, we will do that or to use the cash flow from divestments to support the maintenance of the policy, for example, in a year where we have higher prices in the beginning and then lower. That could be used as a buffer for the policy itself. We want to make sure that we're comfortable with the organic cash flows and being able to support both the CapEx and distributions with the organic cash flows. Thanks.
Borges.
Yes.
Regis, concerning to the FPSOs strategy, we have a very, very important learning curve on this process. In Búzios, we have privilege, in the last units, more owned one, we have completely changed the contracting strategy. The former ones that had big delays, there were several contracts that we had to manage for just one FPSO. once a kind of supplier had a fail impact more than one project. now we are contract under just one integrator for the whole, for the production facilities. we have incorporated all the operational aspects and design aspect that.
It improves not only cargo efficiency, but production efficiency. They have become more complex. We have approached the market with a much more mature design, not leaving room for project change and things that were not well-defined. We approach the market with a completed 3D model defined up to four-inch lines. Now our strategy today, we define if it's a leased one or owned one, project by project. That's, for example, we are approaching the market today for Sergipe Ultra-deepwater with a BOT model, and we have just signed the FPSO for Jubarte in a leased mode, and we are approaching Búzios, the complex ones, the last ones, as an owned design.
Our policy is a mixture of them in terms of to balance the few suppliers who have this capacity to deliver an integrated vessel. As I said, it's very different from the past and the main driver is project definition and the integrated capability to deliver it. Considering your HISEP question, for sure, it's a system used subsea to separate the gas with high contamination of CO2 directly at sea. You are implementing testing it in Mero but with many other applications in mind. Like as I said, the high CO2 content in some of discoveries you had in the past.
You mentioned one very good example, like Jupiter, with wonderful volumes, but with this factor of high CO2 content in the gas and HISEP would be a solution. In fact, we have already tested HISEP for the fluid of Jupiter and with very good results. Another aspect could be Libra Central, which we have discovered, but we have 72% of CO2 in the gas and could be a solution to handle with that. We are developing this technology, envisaging some aspect that we face in pre-salt in Brazil. That is one of the region of this pre-salt has this characteristic of high CO2 contaminating the gas, not the oil. We are very confident that's gonna deliver good results in the future.
Here, Luiz. Luiz Carvalho from UBS. I'm gonna switch to Portuguese and back to English again.
President, this discussion about the fuels maybe is not an only thing for Brazil. We're in the United States. President Biden made some comments within that line, that fuel prices, in a way, bother a little bit the American population. I like the phrase that you just used, saying that Petrobras has a responsibility. A social, a very big social responsibility, but she will not do public policies. When we look at Brazil, the fleet of last year, the fuel of last year, about 60 million vehicles. If we divide that, it's about 27% of the population has access. If we consider that every person has access to one vehicle, which is not rational.
How do you see that on the social side, in your position, that you have a military career, when we see, in a way, some kind of a noise, obviously on top of your prices, which is reasonable, but we don't see that in other commodities. Nobody's complaining about the price of sugar, meat. As a Brazilian, maybe that should be more relevant, but when it has to do with energy transition, that would make a contribution to that fossil fuel. Maybe you could contribute to that with your background, and then I'll ask two other questions. You do follow that very closely in Brazil, really? It is a commodity. It cannot behave any different than that. It regulates prices.
It's the demand and supply laws, as everybody knows in the entire world, commodities were increased in price. Now there's a shortage in demand with the lower supply, and that demand and supply law explains that when you have a greater demand, prices go up. You have to control the law of gravity. You have to leave things to flow regularly. In the case of other commodities, particularly I would say the foodstuffs like soy, coffee, sugar, et cetera, sometimes we don't perceive it because since it's 100% private. Petrobras has a state part that is owned by the state. That is a form of putting some pressure on politics and politicians saying that the government there should act with the company in order to change its behavior that it cannot change.
That's the way I see it. It's a way of doing politics with something that has nothing to do with politics. This is a law, market law, and it cannot behave any other way. The response to that, it complements itself with a question asked, "How can you convey that to society that the pricing in fuels, those have the participation of Petrobras?" The idea of publicity, not propaganda, but publicity, how can you compose the price in the case of gas? You put BRL 6, BRL 7. It was very clear that there are other components that interact. Petroleum oil and fossil fuels, taxes are very high on the prices. You end up having an elevated price. We have tried to get over that, overcome that. This is the way that we're looking at it.
That's the way Brazil is trying to solve it, to find a way to that part of society that is mostly impacted to receive some kind of subsidy. Like gas, it was already approved, and in the case of gasoline and diesel. Today, Brazil has a fleet of vehicles that is very big. More than 80% are dependent on they have to use gas or diesel and ethanol. In the composition of the gas, you have 27% of ethanol. I have said that I have a flex car, and it's been a year I don't put ethanol in it, which is very high. It's a little bit of that, but the answer would be to avail yourself of a topic that is known, you know, to take political advantage of it. Fernando Borges?
Salvador, this morning, one of the candidates that's gonna run for president next year mentioned some comments that he's gonna change Petrobras policy if he wins, right? I think it's important to try to give visibility how the internal bylaws of the company works and how the internal committees, you have the divestment committee, you have the investment committee, you have the people committee, you have the price committee. Just trying to get a bit more sense from you guys how this process work and how, I would say, protected the company is in terms of, I mean, a next president will need to actually to call a general assembly in order to change the bylaws of the company.
If you can give a bit more details, what will be the process, and how protected the company is, from external interference? Maybe the last question, I think it's to Rodrigo Costa. Petrobras was founded 68 years ago, and there was a big responsibility over the years to supply the country, right? I mean, to fulfill with diesel, gasoline, and natural gas. And I think that the company, over the past maybe couple years, slightly changed the way to see as, I would call a burden to be the only supplier, and it's now basically trying to not open room for other players like the trading companies and also few distribution companies. I would like to hear from you how you're seeing this movement, that Petrobras nowadays is not able to fulfill the country entirely as was in the past.
There is, I would say, the relationship between the company and other players in the, I would say, downstream market. Thank you.
Maybe Salvador will begin and then Rodrigo, and then Mastella, I think.
Luiz, thanks for your question. I think the answer, of course, is it's not easy, but at the same time, what private companies may consider bureaucracy, for us it's important gatekeepers, right? By having those minority committees, audit committee, people committee, risk management committees, this is an important way to protect the decision-making process of Petrobras. Of course, we can know it's not easy to say it's impossible or it's 100% protected because there's no 100% protection. However, we do make sure a very accountable and liable decision for each of us here, but also from the board of director members.
According to the Brazilian law, we are liable for the decisions we make. Ultimately, we run stress tests all the time to make sure our internal control environment allow us to early detect in case of any wrongdoings or any potential violations to our code of conducts. We have an external whistleblower channel that help us to identify and receive any allegation internally or externally. We also have, as I mentioned, the nomination policy, which is when you compare Petrobras' nomination policy to the, let's say, the standard policy applicable in the private sector or even on the state-controlled companies in Brazil, our requirements are higher. To avoid political indication, to avoid people related to political parties, to avoid people with no the minimum technical knowledge to take over those positions.
There are many, many elements that help us to deter or at least to anticipate potential risks. I think the last and not less important topic is the transparency. Petrobras is now guided to the market in terms of sharing all the information, balancing the information, of course, what is disclosed to everybody, and the transparency give those situations in case they happen. As I mentioned before, one of the triggers I mentioned, in case there is any imbalance situation, the controller indicates Petrobras to work on any public policy, Petrobras must be compensated, and this must be disclosed to the market. Okay? There is a number of protection. I tried to explain some of them here, but of course, this is a continuous improvement process.
Yeah. Luiz, if I just can add to that. From the financial side, of course, all the improvements that we've been doing over the couple of years, both in terms of dividend policy, both in terms of transparency of disclosures, we've been more and more transparent both in financial statements, earnings release, we keep adding more and more information and trying to be more transparent. I mentioned during the presentation, for example, the degree of commitment of CapEx is something that we added for the business plan this year as well. The strong commitment that we made, when we changed the dividend policy recently.
I think that in terms of capital allocation and making sure that capital discipline is continually within the company, that's also important. We publicly stated the company optimal debt level. This is also something that we were concerned about. We wanted to make sure that we give transparency to that. I think that overall, the financial side also adds to governance in terms of protecting the company for the future. Thanks.
And so.
Well, it's interesting, your question about the responsibility of supplying the market. That's something that we've been dealing with for many years already, effectively taking actions to create a competitive market in Brazil. Especially in diesel and gasoline in Brazil in the last years, we've been moving actively to attract other players to Brazil. Of course, the basis for this work is natural pricing of the products so that it's an attractive market. The idea here is to keep going on this. With the new refiners in Brazil, this is going to be more and more natural so as to create a demand in Brazil, market in Brazil with many actors, be they importers, traders, refiners, distributors, which are already important.
If you go back some years, you see that for the last at least two-three years, at no time Petrobras has been the sole supplier of the Brazilian market. All the time, there's been other actors importing diesel and gasoline to Brazil. This burden, as you said, I think it's away at this moment. I think it's time to see the Brazilian demand more as an opportunity than as a burden. Okay?
All right. Can you hear me?
I can hear.
Hi, Ronnie Hawkins from Global Infrastructure Partners. I have a sort of three questions. One, which is I think it would be answered by Cláudio and Salvador, which is around ship-to-ship export of crude from the FPSOs. I did see investment in transshipment there. What's your view on when you think about spillage, that's probably one of the big areas of concern, open ocean, ship-to-ship transfers. Is it a goal to eliminate that as a form of crude export over the life of this period? Or just a quick question on how you are looking to address that.
Thank you. To answer that, we are very careful with our operations. The transfer, the offloading. I think you're talking about offloading at sea of the FPSOs. We do transshipment on the coast also, to export transferring from dynamically positioned vessels to common vessels, and then to export to China, U.S., et cetera. The first transfer from the FPSO to one million-barrel vessels, for example, is done by a floating pipeline. We haven't seen accidents with that, but the system is pretty safe. We are really testing some new developments, just changing from these two-step approaches, meaning FPSO to dynamic positioning, to another transshipment to export vessel, to another kind of transfer with an intermediate vessel, some CTV.
TotalEnergies is trying this alternative these days. We are going to test this, which allow the exporter to use a common vessel without a dynamic position vessel. Of course, safety is an issue. Leakage is a concern all the time, but we are very careful on that.
Okay. A question for Rodrigo. One on gas and one related to refining. Maybe also to Fernando Borges. Which is, I didn't see, maybe I missed it, sort of the percentage of gas produced that's going to be reinjected versus, you know, produced for commercial purposes. Do you have a vision of that over the next five years?
Well, the reinjection of gas is an economic decision, yeah? We manage our reservoirs. Fernando can give you more details about this. We will always calculate the economic returns against oil versus gas, and manage the reservoirs doing this on a daily basis, managing. When we see these five years in the business plan, we can see a balance that we will evolve to export parity in Brazil. Even if we think about 2030, probably in this horizon, we will keep importing LNG to close the Brazilian balance. I think that this is your question, yeah?
Okay. Then finally on refining. The remaining REFAP and REPAR, is there a sense of timing in terms of those divestitures? Are you thinking about them? I know it's probably still conversations with CADE and the government and others. Would you anticipate that being before, sort of launch before elections or afterwards? Do you have any sense of that?
We don't agree any kind of schedule yet with CADE. We think that next year we will launch this process. Probably not asking a buying offer before the elections. We will launch again the REFAP and REPAR process. This is more complicated because now we'll go into our papers, analyze how we can manage the two schedules, agree with CADE, and after launch the process.
REFAP, one last question on the RNEST, the CapEx that you're doing there. Is that also the sulfur treatment unit? Has that been done already? Or is that part of the CapEx?
No, that's part, it's included. We are at the final bidding process for the EPC. In this business plan, we start with this, we launch this unit at 2023.
Thank you.
Just complementing the answer about the decision of exporting gas or reinjecting it into the reservoir. The first thing to highlight is that in Brazil, we have much more oil prone basins than gas prone basins. For sure, it's an economical decision for each specific field. We have to account for the CO2 content, separate it and reinject it to the reservoir. Although it's a contaminant, it's a very efficient recovery, oil recovery method to take more oil from our reservoirs. Another aspect that the technology bring to us is the results of the water alternating gas injection in terms to leverage recovery factors, so we can bring much more oil from the reservoir. That's the conditions.
For example, the pre-salt, when you have CO2, you have much more gas injection alternate with water. But if you go to Sergipe Ultra-deepwater development, as we have sweet gas, sweet oil, we're gonna have much more gas production than reinjection. It's a decision taking all the technical and economic aspects of each field. Always trying to maximize value for the company and for its shareholders.
Anybody else? We have some questions from the others as well, and we receive questions from Frank McGann with Bank of America Merrill Lynch. The first two were already answered, but there's a third one for Rodrigo Araújo. What are current expectations for additional asset sales in 2022, especially regarding additional refinery sales? Are these now more likely to be completed in 2023 and beyond?
Thank you for the question, Frank. In terms of the overall processes, I'll give a broad perspective in terms of asset sales for year 2022. We have relevant processes that are ongoing, especially shallow water and onshore assets in the upstream business that we expect to close in 2022, to sign and potentially close in 2022. We still have the 5% additional exercise in Búzios from CNOOC that was exercised now in the end part of the year, and we do expect to have that concluded by 2022 as well. Looking at the refineries transactions, we have already three signings, RLAM, SIX and REMAN.
We're very close to closing RLAM and we see potential to close at least one of the other two in 2022, and maybe the two of them in 2022. As Rodrigo Araújo mentioned before, with respect to the processes that were unsuccessful then that we will relaunch, we're currently discussing with the antitrust authorities so that we have the binding stage of the process closer to the end of the electoral cycle so that we have more clarity and more transparency to investors. We think that will be accretive in terms of value for the process. Another thing that we're concerned about is improving competitiveness in the bidding processes as well. This is one...
This is another part of the discussion we're having with the antitrust authorities so that we can maybe have some gap in between the processes with respect to timing, so that we have more competitiveness for each individual refinery. But this is something that is still being discussed with CADE. Thank you.
Thank you.
Take advantage and ask a couple more questions. [Foreign language ].
First to the CEO. Talking about Petrobras and his administration, how often is the contact with the government, and what kind of information do they ask for? How is that discussion with government on a daily basis?
You still have, I believe, a number of mothballed FPSOs that have been shut down basically since the beginning of COVID. What is the plan for those platforms going forward? Is the idea to shut them down indefinitely? Can they be sold? Can they be repurposed? And if you could mention what would be the liability, quote-unquote, to abandon those group of FPSOs that have been shut down. Thank you very much.
[Foreign language].
Petrobras is linked as a government company to the Ministry of Mines and Energy, so the contacts are few, but they usually happen on technical levels. Hardly ever they're forwarded to CEO of the company. There's always an informal contact. That is the link that we have with the government. We don't give any privileged information to anybody. We don't give away any information that has been treated only within the governance of the company.
The COVID crisis we had last year and the system that we shut down, those ones that could be economically feasible to bring back, we have already done that. Some of the shallow water platforms in Sergipe, Alagoas, and Rio Grande do Norte, they are still closed and in a divestment process. If we took in consideration Sergipe
Alagoas, shallow waters, we are in process of to return them to ANP and do the demobilization and abandonment. All the FPSOs that were shut down, we are in the process of terminating the contracts. As I said, the first concerning Campos Basin, the first alternative is to divest, which are in process with some of the fields. If we do not have success in this process, we are gonna engage in a process to return the concessions to ANP. Our portfolio, for sure is gonna be made with resilient assets only.
Thank you. We have another question from the audience. It's from Vicente Falanga with Bradesco BBI. The first question is regarding diversification away from fossil fuels. This is not included in the company's current CapEx. What level of investments is the company imagining for the next five years? What seems to be the interest to the company, wind, solar or hydrogen or all of that? Rodrigo, can you begin?
Yeah, I'll begin and I'll pass to Rafael. Well, in terms of CapEx, as we mentioned before, we don't have any CapEx spare for that in the business plan timeframe. Of course, we created a new governance that Rafael can give more details. We don't have a level that we expect in terms of investments for the upcoming years, but we do have certain capabilities that we think that we're best at that could favor certain kinds of businesses, especially large projects, complex engineering, complex technology. This is what we're being continually acknowledged for, and this is where we think that we're best at.
Any future solution will probably touch on those areas as the areas of expertise that Petrobras works on. I'll let Rafael continue.
Okay. I think that's very clear that the core of value creation proposed for Petrobras is focus on oil and gas in the longer term. These questions may be interpreted as, are we going to have a second core of value creation in the medium term? I think that the probable answer is yes. Another answer we know, which is no. We don't know yet. The work in the strategic department is about to list and list and list the possibilities, and we're full of possibilities. Hydrogen, nuclear, deep sea mining, aeolic, solar. Right now we are providing a study and researching about which of these operations could be the best one. Thank you.
Regis?
Hi. Thank you. Regis Cardoso with Credit Suisse again. Thank you. Thanks for taking a second one. Wanted to touch a little bit on the gas markets, a topic we haven't discussed too much today. Two topics on my side, and I think it's going to be for Rodrigo Costa and Cláudio Mastella probably. What led you to, you know, change the strategy regarding the offshore gathering pipelines? Two, how core those assets are? Is it related to the way it operates, or is it more of a, you know, market interest in the specific kind of asset? And still on the natural gas markets, that is also one that we are seeing, you know, a lot of discussion around pricing mechanisms.
Petrobras has, you know, modernized its pricing possibilities with different price references. I guess globally as well, natural gas markets have more diverse types of longer term contracts, fixed price contracts, floating and so on. How do you see this in Brazil? I mean, how do you balance Petrobras' role with imports of LNG, with the fixed demand from the distribution companies, which are now many of them in privatization mode, I would say. Do you think there will be sort of yearly auctions or be a longer term? Does Petrobras, you know, want to set fixed price for longer term? It's a very broad question, but I wanted to understand how do you see that opening of the natural gas markets in Brazil?
Okay, Regis. In the first one, we decide to review these divestment project because we saw a tax inefficiency in this model. This is one of the main aspects that are making us move a step back in this project. The second, the integration with the upstream. This is critical for our operations. We see probably that we not find a common value view in this process. With these two main aspects, we decide step back with this divestment. The second question, that's a very good question, because now the market is open in a current way. We offer for the market different perspective of indexation. I think that they are not so confident about gas-on-gas indexation, especially because the volatility of this indexation.
In my point of view, I was so frustrated because I think that the response this year will be better with this kind of instruments, but probably in the next or in the coming years, they will be more confident to close this kind of instruments. I think that they have a challenge to build a new portfolio of contracts, not only with Petrobras. I think that Petrobras can be as a kind of a supplier that provide reliability to the clients. We are a more stable supplier, and they can match with other different kind of providers, especially LNG, because we saw a lot of projects in the coast that can provide this kind of service to them. With all our other partners in pre-salt field that can add their portfolio.
They combine different products with different flexibilities, with take or pay and ship or pay, modeling different conditions in these instruments. I think that this is the future that the market will be facing, especially in the next two and three years. Our strategy is closing medium and long-term contracts to combine with our future of our production in pre-salt, because we have production with oil, so we need a more stable horizon to combine with our profile. I think that this is the main aspect of the market. Thank you.
If I may, an additional two questions to maybe just start with Fernando. Fernando, over the past couple of years, the company performed kind of a revision in terms of the asset portfolio. You put on sale, I would say a large amount of E&P assets onshore and even offshore fields, right? Looking forward, when we see the CapEx split and also the production outlook, we're probably gonna have, I would say, 85% or even a bit more than that of the production of the company coming from pre-salt. Pre-salt is really competitive against other basins, right? I mean, you mentioned about the lifting costs potentially going to $4.
Just trying to understand what are the other opportunities within the pre-salt in terms of potentially cost reduction, and other basins, like for example, you mentioned Sergipe-Alagoas, how excited are you in terms of the new opportunities? Tagging that to maybe to Rodrigo. Rodrigo, that resilience of the pre-salt fields basically gives you to the CEO and the CFO the ability to have a good outlook in terms of cash generation, right? I think the company might be free cash flow break even according to our calculations, close to $30-$35 Brent. Looking to that front, how do you see the EVA metrics that you just put on the plan versus the resilience of the asset portfolio of the company even in lower Brent scenarios?
Thank you.
Luiz, for sure, pre-salt is the key element of our portfolio. As I mentioned, we have 79 exploratory blocks, 16 of them in equatorial margin. We have six in Campos Basin, Santos Basin, and we have out of the $5.5 billion to explore. Dedicated to exploration, $2 billion is to the equatorial margin. We have $3.5 billion to these blocks in the Southeast Basin. Not only to complete the development of the fields we are already operating, but the exploratory efforts of the company has been the way to open new opportunities for the company. These exploratory blocks are focused in deep waters because of the size of the place we have already studied.
As I had mentioned, Sergipe Deep Waters is another opportunity, not so big, but we have room for two production systems.
We can see a very high potential Equatorial Margin. Once we test it in deep water, yeah? When you look to the petroleum system, the source rocks, the kind of reservoir they have found in the neighboring countries, we can map them happening in our blocks. We need to test for sure. The next five years, we have 15 systems, 12 of them allocated to pre-salt. If you add more years, for sure, we are gonna have other systems in pre-salt, right? We have the bidding process coming, and we have new opportunities in the pre-salt. We have exploratory drilling in progress nowadays. We are drilling two important prospects in Aram block. We have announced a discovery.
We found around 100 meters of pay zone with very good quality of oil. That's the business of exploration production. We need to invest a mild part in good exploratory opportunities in order to make room for the future.
Thank you. Luiz, with respect to the second question, I'll break it down into different parts. Well, the first part is, as I mentioned, we consider the $35 long-term price as the threshold for approving new projects. When you look at our resilience scenario, that of course makes sure that we have positive NPV projects, even in the lower end price level. Of course, we look at other metrics such as NPV over investment as well to make the overall portfolio decisions. We think that the $35 resilience scenario brings us quite strong projects that are definitely going to be value accretive for the company in the long term.
When we think about the EVA metric, of course, the year one cash flow is quite important. The way we implement the EVA in Petrobras, and it's probably a little bit different from other industries, we need to consider the future of the reservoirs, right? That way we don't jeopardize the value of the reservoir over the long run to bringing short-term production, destroying value of the reservoir over time. We do take that into account. What we do is we try to be price neutral for the future years. We consider the cash flow in year one, but we don't add our expectations of price levels to the upcoming years so that we properly manage the reservoir and not incorporate into the estimates our expectations in terms of prices.
Making sure that the project is resilient and not just having positive indicators because of our future price expectations. Thanks.
Thank you, Rodrigo. We have questions from Gabriel Barra with Citi, and we have three questions for you, Rodrigo. The first one is, how much of the projected CapEx increase was due to higher costs as a result of inflation, and how much represents the actual increase? Any increase or reduction from FX impact compared to last year plan? How much CapEx will be executed in dollars and how much is in BRL? The second question: What level of return does Petrobras expect as a result of the 2022-2026 strategic plan? And his last one is, given Petrobras' strategic plan and refinement on dividend policy, in the event of a higher than expected cash generation, could we expect dividends above 60% of the difference between operating cash flow and CapEx?
Can extraordinary dividend payments be made throughout the year or just at the end of a fiscal year?
Well, thank you. Thank you, Gabriel, for the questions. Well, regarding the first one, if you look at slide number 30, we do have a breakdown of the FX impact. In the upstream portfolio, it's $3.4 billion, and it's 60% of the overall CapEx dollar index. We don't give guidance with respect to individual cost inflation processes, but what I can say about that is we have a lot of mechanisms in place so that we do deal with some potential cost inflation in the industry. I think the first one is the fact that we do work with longer term contracts for critical resources.
The critical resources are usually contracted in mid to long-term contracts so that we can deal more effectively with potential cost increases in the industry, and we can smooth the price cycles as well. Of course, we're focused on early engaging the contracting process, so we have a very strong early engagement process so that we start the contracting way before the project starts, so that as Fernando mentioned before, we can standardize the projects and access the market in advance so that we can deal with potential cost increase.
Also one thing that we've been more and more focused on, especially when we consider the 15 units that are coming, we're working more and more on a portfolio view so that we can make sure that we have either more integrated processes or capture synergies between different projects so that we can streamline the procurement process and add value to the company. I'll let Fernando talk a little bit about the improvements that we made over the last couple of years with respect to well construction and improving the processes.
The first one I could say is that that out of the 15 units, 12 is already contracted.
Correct.
With the price closed.
Mm-hmm.
Another aspect is the learning curve in terms of efficiency in the subsea systems and in the well construction. It's been a wonderful reduction during the years. I just presented here the variation. In one year, the last plan to this one with those decreases of 9% and 5%. If you look in a perspective longer than this, the learning is being wonderful. The efficiency is being, how to say, in some way surprising. When you pack all these aspects of the main driver for our cost is the production you want it's already defined, yeah?
The combination of efficiency, high productivity, wells, lowering the numbers of total wells to come on the stream in a first wave, all of them sets us good numbers for this projection.
Thanks, Fernando. With respect to the second question, I think I touched on that for Luis' last question. We don't have, we don't give guidance on target returns, but we do have the EVA metric for the 2022 year. Of course, we're focused on the 35 resilience projects, so we can make sure that all those projects are highly value accretive. The last one about the dividend policy, the way we expect to operate that is distributing the 60% of our free cash flow during the quarters, and then potentially at year-end, having either extraordinary dividend distribution depending on the scenario or reaching the minimum level if we do have an unfavorable price scenario. Thanks.
Thank you. We now finish our Q&A session. You can send us questions to our investor relations team, and I'll pass the floor to Petrobras CEO, Mr. Joaquim Silva e Luna, for his final remarks. [Foreign language ]
Well, we are now closing this journey, which is very important to Petrobras. I would like to thank participation of all of you, your participation, your presence, your questions, they are stimulating. They help us first identify whether we are answering through our planning to the expectation regarding our Petrobras, especially the one that's being raised. Second, incorporate all the questions, information, and have a debriefing later with our staff to verify where do we need to improve. We are always learning, and Petrobras has that as part of the culture of the company. In these 68 years, what we have been doing is learning. Most of the changes that we've been implemented and the deep knowledge we have today as a reference in the area of deep water exploration comes from our learning zeal.
I would like again to thank you for your participation, and we're available to keep discussing. I forgot to say during my short speech that within the culture of the company, we need to be more visible, we need to make more contacts and converse or talk more. We have verified that even inside Brazil, Petrobras is a great unknown. There is no real perception of the company in Brazil. We need to inform what really exists and the potential that we have to keep contributing. Again, thank you for your participation. Thank you very much.