Good afternoon, welcome to PRIO's second quarter conference call. I am Jose Gustavo, Investor Relations and Treasury Manager, and I will be hosting this event.
Simultaneous translation through the sound channel icon on the bottom of your Zoom screen. A translated presentation is available on our investor relations website.
The presentation and comments about the results will be made by our CEO, Roberto Monteiro, our CFO, Milton Rangel, and our COO, Francisco Francilmar. After the presentation, they will be available for a Q&A session. At this time, all participants will be in listen-only mode. To ask questions, you can ask questions in writing using the Q&A feature or use the hand, the Raise Hand button to ask questions live. This event is being recorded and will be posted on our IR website. This presentation contains information based on future estimates and projections based on assumptions by the company. These may change, and therefore, should not be taken as fact or used as a basis for financial forecasts beyond the plans that the company discloses. I would now like to hand over to our CEO, Roberto Monteiro.
Good afternoon, one and all, and welcome to our earnings call to discuss second quarter 2023. It is a great pleasure to be here presenting these results to our investors, to several [Petro] employees as well, and to our stakeholders in general. Well, to talk a little bit in a succinct way about the quarter, I believe that we had two big stars, right? The first of them, I don't know which was the first, which was the second, but one of the stars was our production. We reached a record production of 91,000 barrels per day in the quarter, and we also reached a daily production volume of 100,000 barrels per day. The average for the quarter was 91, and production today is around 100,000 barrels daily.
This is all thanks to the great operational operating efficiency, the resumption of Albacora, the continuous improvement of Albacora field, and obviously, to the drilling campaign, the revitalization campaign of Frade field, which has been bearing excellent fruit. The second big highlight of this quarter was our lifting cost. Yes, our lifting cost that was as low as $7.4 per barrel. We had been on a downward trend throughout the whole last year. With the addition of Albacora, the lifting cost increased a bit to $9.5. Now, obviously, with all this production, we managed to deliver a very strong lifting cost of $7.4 per barrel. All this leads to a sales volume of 7.1 million barrels of oil sold in the quarter, which generates a net revenue of $530 million.
We are going to talk a little bit about discounts ahead, but we also see discounts being reduced. We had a discount of $9 a barrel, give or take, in Q1, but already falling to levels below $7 in Q2, already pointing to a further improvement in the next quarter. This generates a net revenue of $532 million, an EBITDA of $333 million, in spite of our export tax, that in the quarter alone amounted to $47 million, a net income of $185 million. Moving on to the next slide, we see here the graphical representation of this lifting cost. This $7.4 per barrel is the lowest in the history of the company. Average production of 91,000 is also an all-time high in the history of the company.
We reached the mark of 100,000 barrels per day. Today, we are producing a little bit more than 100,000 barrels daily. This leads to another consequence, which is the company's cash that was affected in Q1 with the closing of Albacora, with the closing of Dommo. We had an inventory issue as well, when we had some postponements. Anyway, we ended Q1 with a cash position of $104 million. In Q2, we are already at $240 million, and we have accounts receivable. Of course, this is not part of the cash, but it can be considered as quasi-cash in the order of $282 million. The company is very healthy. During the quarter, we also had a program or executed a large part of the share buyback program.
If I'm not mistaken, we bought, and we'll talk a little bit later about this, Milton will touch on it, but it was $60 million, almost $70 million in terms of shares purchased, and always maintaining a level of buyback so that we continue to have a very sound cash position and a very healthy leverage ratio. We see on the slide that we reached a 1.1x net debt/EBITDA ratio. In short, the company is super prepared for growth, for investing with an extremely sound balance sheet structure. Well, I'll turn the floor to Francilmar , and then I'll come back. After Francilmar , Milton will present, and I'll come back to talk a little about sustainability and the next steps. Thank you.
Hello, folks. Thank you very much, Roberto. I'm going to continue on slide five with the performance of the assets. This quarter was one in which we made an exceptional delivery, and I'd like to thank the team's effort because this is the result of the work of many people who have been working hard for a long time at the company. It is another important step. We delivered the strongest quarter in terms of production and with very, very good cost control. This is not a sporadic event. It is something that we have been building brick by brick here at the company. We delivered, in all fields, a significant increase in production that helped reduce the price of barrel produced or the lifting cost, which also had a great help from cost reduction.
This led us to deliver this significant increase in production and a significant reduction in the lifting cost, which makes us proud and certain that we are on the right track to build an increasingly resilient company. I'll run through the details now, starting with slide six, talking specifically about the lifting cost. In this quarter, we had a reduction of more than 20% in the price of barrel produced, very much due to the increase in production in all assets and the cost reduction. Basically, also in all assets, despite some obstacles along the way. This was very good. We will continue at this pace, with this trend, despite having challenges here and there, mainly due to tightening of the supply chain and some prices that tend to put some pressure.
We continue to work to find alternatives and cope with this environment, because we strongly believe that the only protection we really have is to have an efficient operation with a lifting cost as low as possible. We believe we have this, and it is our mission to strive to reach an even better number. On slide seven, let's talk a bit about Frade. We had a very strong quarter also in this asset, where we made important deliveries. We delivered two producing wells. There was a significant increase in production. We had a scheduled maintenance stoppage that was planned in March. Actually, it was in May. We stopped for three days to resolve important issues, to continue having an asset with good operating efficiency as it is, right? The Frade FPSO is very efficient, providing very important stability and reliability.
We need it to stay that way, the whole team is working very hard to make it happen. The only thing that impacted here, despite the efficiency being below 90%, was the scheduled stoppage and the lack of production of producing well MUP3, which is still under maintenance. After we delivered the new wells, we have to rig now, performing the job of restoring this well, which should come into production over the next three to four weeks. That's what we expect. This is Frade, an asset with a very good performance. Here we detail a little bit more the revitalization campaign.
We concluded the first and second phases, and this well of the third phase, which we drilled ahead of schedule, was an opportunity that we identified thanks to the performance of the first well that we put into production last year, ODP4. We saw that the reservoir had a much larger volume of oil in place, and that it could fit a well and eventually a second well, a third one, maybe. It's all being evaluated. We managed to find, and the team is really to be congratulated for managing to make the construction of this well in good time and linked to a very good realization cost. We managed to put this well into production now already at the beginning of the third quarter, which really shows the great potential of Frade. All this is part of the reservoir that we already knew.
In this quarter, we did some research of this. Looking at this map here on the left side, there is the prospect of Maracanã in green, and we did some research and confirmed that there is oil. In the future, we will make an assessment of the extent of this discovery to confirm if it is commercial, how many wells fit, how we can put together a strategy to have production. Potentially, we'll do some more research. I hope that maybe it will happen in this second half of the year, a little further on. Frade shows us that there is still a lot of potential in the future. We need to do a lot of homework to digest all the information and set up this third phase for Frade field. Moving on to slide nine, let's drill down a little bit on Polvo and TBMT.
Here we had a quarter of deliveries and ensuring plant stability and reliability. We delivered two wells that were stopped. Workovers and repairs were completed, so production increased considerably. The FPSO worked very well in terms of stability, and there was a very important gain, i.e., we managed to take another step forward in improving power generation, consuming less diesel and using more gas at the field. This ended up giving us a substantial reduction in the overall cost and the OpEx of the unit. That's it. The name of the quarter for Polvo and TBMT is stability and efficiency, and it's going very well. The challenge here in the future is to design a new campaign and to have an increase in production, to continue moving forward and working to have a good cost-benefit ratio in the assets.
Moving on to slide 10, we are going to go into more detail about what the quarter was like in Albacora Leste. It was a quarter of progress. We had a first quarter that was complicated because we were beginning to understand the asset more, and we found issues much more challenging than we thought. It was very hard work to reestablish, a lot of maintenance to establish reliability in these systems that were degraded. This has been done, and we see it evolving step by step. We can see... In the operating efficiency graph on the right, in June, we already reached the 74, almost the 75% efficiency. In July, we've already moved up a notch. We've already managed to repair and deliver a lot, and a lot is being done.
It's a very big task force effort. We believe that in the coming months, this will improve step by step. We are working very hard so that by year-end, we can reach the operating efficiency we are aiming for above 85%. This is our big goal. The challenge is great. Everyone is very focused. A lot of people with a lot of determination working to deliver this. Production has been responding. It will continue to follow our efficiency improvement. As we increase the efficiency of the plant, improving reliability and stability, production will follow. We expect this to happen to improve over the coming months of the year. Now we move on to the next slide, slide 11, to talk about Wahoo. Well, Wahoo is the asset that we are working to develop. It's a big project of the company.
It is in full development, you know, we are in different battle fronts. Execution of equipment, construction, equipment delivery is already happening. Works on the FPSO to receive the oil, so we can be in a better position to control. The work in the subsea area is also all happening as scheduled. Everything is going well. The rig that is being designed to work there is our Hunter Queen rig, that is in the final stages of mobilization and repair. The only point of attention we have, in which we are working very hard and very closely, is obtaining the drilling license, the environmental license to drill at Wahoo. It is in the final stage at IBAMA. We have been following the process up close, and we hope to obtain it in the coming months. Everything is moving forward.
We have a plan A, B, and C, and so we will move forward over the next few months. With that, the first oil, well, you see in this whole process, we do have some options, but for first oil, we keep to the schedule. In the second quarter of next year, we should be starting Wahoo production. That's it, and I'll turn the floor now to my friend, Milton. Thank you.
Thank you, Francilmar . Good afternoon, everyone. Continuing our presentation on slide 12, we will talk about PRIO's financial performance in the quarter, okay? Well, the second quarter of 2023 is marked by quantity of barrels sold of 7,156,000 barrels. The Brent fell a little compared to the first quarter of 2023. The average Brent of our contracts was around $77, and, you know, on top of that, we have discounts, we have selling costs. With that, we reached this revenue of $532 million. A very important and relevant point of our quarter concerns the export tax, which is basically what is in this line of internal sales and export taxes in the order of $47 million in this quarter alone. This was a big offender for our results.
Apart from that, there are commercialization expenses. That includes freight, insurance, and other related expenses related to the offtake in the order of $34 million. It is natural that it grows over the quarters due to increasing quantity sold and the company's current scale. With this, we reached a total FOB revenue of $450 million. Very positive highlight of the quarter, as already mentioned, refers to the lifting cost, which relates to the cost of goods sold, COGS, of $7.5 million per barrel. Other than that, we had an increase in, in GNA, and this is largely explained by the appreciation of the BRL. Remembering that most part of our GNA is basically in BRL, and when you have a stronger BRL, this number in U.S. dollars increases.
This explains, by a large extent, the increase in GNA in the quarter. With that, the EBITDA is $231 million, and adjusted EBITDA is $233 million, and still a very strong result. This shows the strength of the company despite the export tax. We continue to deliver a very solid result. Depreciation and amortization were higher due to Albacora Leste, in essence, and the entry of the asset impacts the result as depreciation is higher. With this, our profit for the period amounted to $184 million, which is quite a strong result for our quarter. We are now moving on to slide 13 on funding, and also looking at the chart more in the center, the amortization schedule.
We've noticed that there is already a payment of bilateral debt in 2023 of $70 million. 2024, a higher amount, $386 million of bilateral debts. 2025, a little bit as well. 2026 is our international bond. 2027, we have our debenture in BRL swapped to U.S. dollars. I think it's important to mention here that we are absolutely fully funded with no need for additional debt or any rollover to honor these commitments. The company has been generating a lot of cash, and we are very comfortable from a liquidity point of view. Obviously, if there is any opportunity or any interesting situation for us to do any kind of liability management, we can certainly take advantage of that, but it's definitely not a necessity. It could be just an opportunity.
Regarding the duration and the average cost of debt, today, we are at 2.5 years of duration, and it makes sense for this number to fall because we have not been taking on new debt. The debts are finally approaching their maturity, and the average cost is around 6%, which is a very competitive cost for this duration and for the company of our size. Anyway, the capital structure and funding situation are well balanced for the company. Moving on to slide number 14, we talk a little bit about cash variation. Starting from a net debt position in Q1 of $1.643 billion, we had a very positive EBITDA generation of $333 million, a positive variation of working capital.
In essence, in the first quarter of 2023, we had a very high volume of receivables, which materialized and turned into cash throughout the second quarter. Among all of the effects of working capital, a very positive effect of $130 million prevailed, basically justified by the receipt of these receivables that consisted of sales we made in March and the cash that came in between April and May. M&A expenses, basically, we are referring to fees from the closing of Albacora Leste and related things. Share buyback of almost $70 million, an investment that was certainly very profitable. A capital allocation that, in our view, made a lot of sense. CapEx of $188 million, and here we are talking about Wahoo development.
There is the Frade campaign that is moving in full swing, and still something related to the integrity of Albacora Leste, and a little bit of maintenance also in Brava. The financial result of $32 million in taxes amounting to $22 million. With that, a net debt of $1.5 billion at the close of 2Q 2023. Moving to slide 15 and talking a bit about leverage and capital structure again, we see that the leverage of the company was at 1.1 net debt/EBITDA, which is what we have in covenant, and it's something that we watch very closely. This amount remained the same in 2Q 2023.
In part, I mean, the trend would, would have been for this to have falling. It was maintained because we chose to intensify our share buyback program. This ends up using cash and influence, and influencing the indicator. We also intensified CapEx at Wahoo and Albacora Leste fields. With absolutely no concern here, we also see a trend pointing to a reduction of this indicator for the coming quarters. Basically, we see no big fuss here. Moving on, I'm going to hand the floor over to Roberto, who will talk about the environment, society, and the company's next steps. Thank you all. Have a very good afternoon.
Well, thank you, Milton. Now, let's talk a little bit about sustainability first. Then we will talk about the company's next steps. To talk about sustainability, the environment, and society, I would like to start with the issue of emissions, and also, we refer to our environmental responsibility. We recently released our sustainability report, where I would say one of the main indicators was the carbon footprint or kilograms of CO2 equivalent per barrel of oil produced. In the second quarter of 2023, we reported now in the second quarter, 21 kg of carbon per barrel, which is an improvement when compared to December, which had been 22 kg per barrel. If I'm not mistaken, I think last year was something around 27 or something around that range. This is in our sustainability report. We showed an improvement when compared to the fourth quarter, and we showed an improvement over last year.
If we were to do some fully comparable things, we would have to exclude Albacora, because just like the lifting cost, Albacora started with a slightly worse number when compared to the company's figures. Therefore, if we were to exclude Albacora in the second quarter of 2023, we would have shown 17 kg of carbon per barrel, which is already starting to be a carbon footprint that is very much in line with our operations and quite in line with our type of operation. From a safety standpoint, at PRIO, we held a sustainability and safety week with several lectures and activities addressing the subject. ANP itself participating in the event with some presentations, in order to raise awareness and to engage our employees more and more on the subject.
Regarding the pillar of health and well-being, we continue to carry out a mental and body health program, taking care of our own body through marathon, races, volleyball championships, hiking and canoeing. In short, it's always a super diverse thing that we have here in the company, and that has a huge involvement of our employees. I think this is one of the great programs that we have in the company. We also focus a lot on cultural sponsorships. This quarter, we were able to sponsor several events, some theater plays, like Fronteiras do Pensamento. We also maintained our sponsorship to the Paralympic team. Therefore, it was a quarter filled with achievements.
On this side as well, as we said in our release, the company cannot be measured only by its financial data, because there is an intangible aspect that is also important, and it is our responsibility, and this is the work we have been doing. If we move to the next slide, on the next steps, I'm going to list here a couple of things. As you all already know, the 1st and the last items are, are constant. They always appear here. The focus on the safety and health of our employees and third-party employees, our responsibility to society and to the environment. The last item is also a next step that always appears, which is to keep our focus on new M&A opportunities. Today, our major focus is on these intermediate topics.
Today, we are concluding the workover of the MUP3A well at the Frade field, which is a well that started producing last year and had a sand production problem. We closed the well, it has been closed for a few months. We finally did the workover, we should put it into production before the end of August. Even Frade Revitalization campaign itself, which is approaching the end of this phase, we now have some exploratory wells, some demarcation work of the Maracanã prospect, which Francilmar mentioned. With that, we go to other things. Frade goes back to the stage of, I mean, let's call it engineering, reservoir, subsea engineering and everything, to implement a new phase in the future, now that we are collecting all the data.
We now move on to the next front, which is Wahoo, where today we are working on the environmental licensing, both for drilling and the pipelaying for Wahoo. We intend to reach the first oil by the second quarter of next year, which means in less than 12 months. Anyway, here we have two things, two big major focus in our area, mainly in terms of the engineering areas, subsea, reservoir engineering, and so on. There is another super important point that concerns the operating efficiency of Albacora Leste. We had a very difficult month in February. March was slightly better, April was difficult again, so there were a lot of ups and downs. The month of June was already a much better month in terms of operating efficiency.
The month of July, this one now, I mean, the one that just ended now, was even better. I would say that in Albacora, we are beginning to see the results of our management. We have the field much more under control. We are beginning to reach efficiency rates, which make a little bit more sense in view of all the work we are doing in the field. Our goal of reaching the end of the year, close to 90, with 80 something of operating efficiency, remains largely intact. The beginning was a little bit more difficult, but we have been able to make consistent progress to get to that result. The last point here, which is worth noting, is that we are drilling again at the Polvo field in the Eocene Reservoir. The last time we drilled at Polvo was in 2020, early 2020.
It was even during the pre-COVID days. Since then, we have focused a lot on the operating stability of Polvo. Polvo and TBMT have reached excellent production stability and efficiency that at once reached 99% efficiency rate. Today, it is operating at an average around 95%-97%, so it's very good. Now we are finally going to resume our drilling program, or at least we will do this drilling there in the Eocene Reservoir at Polvo, which should be delivered now in the third quarter of the year. Well, that's all. I would like to thank everyone very much for joining us today. I would like to thank the determination and drive of our employees, because as always, this is what makes the difference.
I often say here at PRIO, that we can have great technicians, and we do have great technicians, but what really stands out is our culture, our willingness to go a little further. Thank you all very much. Thank you to the investors and society that always supports us. With that, I would like to open up for questions. Thank you.
Good afternoon, everyone. Thank you for joining us. We'll start the question and answer session now. Our first question comes from Pedro Suarez with BTG. Pedro, go ahead.
Good afternoon, folks. Good afternoon to all the team. I just have two questions starting with the lifting cost. In the past call, you spoke a little about reaching a lifting cost of $7 per barrel when you had Wahoo added. How would you rephrase this expectation now with data of the second quarter and with the July data? Francilmar also mentioned some threats or challenges that could happen. He mentioned that in the initial comments. Perhaps you could put that into context. My second question has to do a little bit about the remuneration policy, potential distribution or payout.
We know that you have a share buyback program that extends until March of 2024, if I'm not mistaken. Is there any discussion? I know people always ask about that, but are you thinking about perhaps paying more dividends, still trying to put into context the inorganic growth opportunities that you might see? I think that these are my two questions. Thank you very much.
Thank you, Pedro. I'll answer both questions. Regarding the first, the lifting cost, and Francilmar is kicking my leg here under the table. Regarding the lifting cost, we reached $7.4 per barrel. Today, average production in the quarter was 91,000 barrels daily. Now we are at 100,000, or slightly over 100,000 barrels daily.
The trend is that the lifting cost until the end of the year, until we add Wahoo, is that it will be around that. I think it will be around $7, perhaps a little more or a little less, but I think we'll start with $7 until we have Wahoo. With Wahoo, that should come down and get close to perhaps $6, even close to $5. It will depend on Wahoo, it will depend on Albacora Leste and how it develops next year, and so on and so forth. In the short term, in the next six months, I think that this lifting cost will remain at around $7, between $7 and $8 per barrel, but starting at $7 a barrel. Of course, the big star of the lifting cost was our production. We were very successful with Frade wells.
They started producing a lot more, thus diluting our lifting cost. That's why I believe that we will remain at around that, just like we will remain at around 100,000 barrels daily for some time, perhaps until the end of the year. We are not expecting any great decline. We have a new P3-A well that will start producing at Frade. We'll add another well at Polvo. With these new wells, we don't expect great productions from these wells. We won't have any wells adding 8,000 or 10,000 barrels, but it will offset and recover any potential declines, so we should maintain this level of production.
Regarding the share buyback program, Pedro, what we have approved by the board is the buyback of shares up to 10% of the capital, the company's capital, and this is what we are working for. There are two things that we consider regarding this program. We still have a lot of room. It doesn't make any sense to speak about dividends or such things. We are not going to have a dividend policy because we have this program in place. The point is M&A opportunities that we think might arise. Today, we are not actively looking at any deal specifically, so I don't want you to have this false expectation at this point. We, we are always considering possibilities. We are always considering business opportunities. If these business opportunities start maturing, it is only natural that we'll buy back a little less.
We'll hold on to a little more cash so that we can take advantage of these opportunities should they arise. That's one side of the equation that we'll look. The other side of the equation is our net debt over EBITDA ratio. We don't want to go beyond 1 time or 1.1 time net debt over EBITDA ratio. If the Brent, if the Brent price increases, if you're thinking about a Brent at $80-$85, that's what we've been seeing in the last few days, perhaps our net debt will, over EBITDA will be slightly below 1.1. Then the Brent price will drop, and we need to have room to absorb this, to, to make the company agile and prepared to act on any and all fronts.
I don't know whether I answered your question about capital distribution, but this is what we have approved. For now, this might happen faster or slower, depending on the price of the shares, and the speed might vary depending on M&A opportunities.
Yes, I got the message. Thank you very much.
Thank you, Pedro. Our next question comes from Regis with Credit Suisse. Regis , go ahead.
Hello. Can you hear me well?
Yes.
Good. Two points I'd like to know more. Congratulations on the results. Super strong results, so congratulations. What was slightly different than our expectation was the discount on your oil. It was similar to the upside that we had in the price reduction. I think that this is a result quality that is better. It is what you can control. You cannot control prices, but could you elaborate on the realization price dynamics, please?
Another topic that I would like to address, it's something we always talk about, is regarding the schedule of activities for Albacora Leste. It seems that it's all about improving the platform, operating efficiency, and so on and so forth. I'd like to understand, what else do you need to do at the level of the platform, and when will you have new wells starting to produce on the next steps?
Thank you, Regis, for the questions. I will speak about the discount, commercial discount, and Francilmar, I will speak about Albacora. Commercial discount, the way you have to look at the commercial discount is, in this quarter, if you look at FOB revenue of the company, vis-à-vis the average Brent price, and have to use the same weighted average for the Brent that we use for the sales.
Not all sales were priced in the same month. We get to a discount of close to $7 per barrel. In Q1, it was slightly higher, around $9 per barrel. The $7 per barrel are explained in the following way: There is about $1 referring to the sales of the previous quarter, and the reason why it is allocated in this month is that sometimes we sell and we price it, just like happened in the past quarter, but happening in April. We delivered in March, the sale happened in March, but the pricing was done with the average Brent price of April. Since we closed the result in the end of April, in around April 20th, we have to use a certain Brent for the month.
We adopt a Brent, and if you look, the oil curve only dropped since then. That drop impacted revenue, but it cannot change the result of the previous quarter, so we recognize this in Q2, and this effect was slightly higher last quarter, $1 per barrel, because it was a big drop in the price of Brent. We have about $7, minus $1, we have $6. There are things there that are not allocated to any sale, about $0.20 or $0.15, maybe even less than that. That is Caribbean. We still maintain some inventory, not oil inventory, but we maintain facility to store oil in the Caribbean, in the contract. In the past, one part was six months, another part was 12 months, so we are still in these 12 months. This has an impact on the second quarter.
What is the price that we're really selling at? Today in Q2, we sold between $5-$6 discount per barrel, and that matches the number that I mentioned. In sales that have been happening in Q3, it's between $4-$5 discount, so it's dropping. The normal situation would be this discount to be close to $ 3- $ 4. Our average would be $3 per barrel for the average of the company. It is dropping. In December of last year, that was the reason why we leased storage in the Caribbean. We didn't sell at this price, but we received bids at $17. We thought it was absurd, it didn't make any sense. $17 became $9 in Q1, and this number has been settling.
Another part of that happened because of the Russia embargoes that led to a big reaccommodation of shipping and freight internationally. Things are falling into place, and we do see an improvement. Perhaps I was not 100% clear in prior calls, but this was our expectation of having Q1 with a stronger discount, and that this would gradually decrease along the year so that we would get to a $3-$4 discount per barrel, which would be the normal for the company.
Let me answer the part about Albacora Leste. The plan is in the second half, we are still going to focus. Well, there's a lot of oil to be unlocked just by improving efficiency of the plant. Let's translate that. There is a limitation, either due to gas compression limitations.
I need gas to produce in some wells. There is a reasonable inefficiency of three systems. There's only one operating well. We have to recover that capacity. There's a capacity linked to water injection that limits a lot this production, not to mention power generation, that also limits the work. There's a big work front that we will address along the second half of the year. Gradually we will recover and improve production. Parallel to that, there are some workovers we'll do the subsea system. These are subsea interventions. We have to repair a Christmas tree. There's also an umbilical line to be repaired. There are some alternatives that we are working with. We will do it in the second half. New wells are scheduled only for next year.
Thank you, Roberto, Francilmar. If I may ask a follow-up question. For next year wells, could you break down the time expectations? Are they sequential, only after Wahoo? Another question, very quick one, if I may, do you have any expected production for MUP3A and for TBMT?
Well, let me take a step back. Well, we're going to have one rig operating, Regis. It's called the Hunter Queen. It is ready. There will be an inspection coming very soon, and very soon it will be ready to operate. It will be the rig drilling at Wahoo, and then it will be relocated to Albacora. We believe that it will be Wahoo first and then Albacora. Some things will be done at Albacora that will not require a rig. In our fleet, we have subsea construction vessels and so on and so forth.
In the first quarter of 2014, well, the numbers can vary a lot of bit, but the expectation is in Q1 2024, we'll be drilling at Wahoo, and then we'll try to allocate some subsea constructional vessels as much as possible to start doing some work at Albacora. Works that do not require a rig. When we are done at Wahoo, that should happen around Q2, we'll move that to Albacora. We'll start with simple wells. In some wells, we just need to do completion and put them into production. We'll start with the simplest and move to the most complicated ones. Idea to start drilling those wells, they need to be drilled, new wells, in the second half of 2024. This is it, right? Yes. What is the expectation for summer?
Well, we have this well that we have to resume production, MUP3. It produced last year, producing at around 2,500 barrels in the past. It should resume the same kind of production. The new well we are drilling is a smaller well, so well expected to produce 1,000-1,500 barrels maximum. If we are successful, please remember, MUP3A is certain because it is a well that has produced already. We'll just resume production there. Polvo, that's an exploratory well. It's a region in a reservoir where we have a good expectation, but it is nothing certain. For Polvo, there's still a question mark. You have to remember, Polvo is always at 2,000, 3,000, when it does really well, it's 3,000. It's that order of magnitude. Okay, Regis?
Perfect. Thank you very much.
Thank you, Regis.
Thank you. Our next question comes from Bruno Amorim, from Morgan Stanley. Bruno, you may proceed.
Hi, good afternoon. This is Bruno Amorim from Goldman Sachs. I have two questions. My first question is about operating efficiency of Albacora Leste. I would like to learn from you whether you understand that operating efficiency could also converge to the level of other assets, or whether there is any structural reason for that not to happen. My second question is about Wahoo. If you could recall the capacity of Frade FPSO, because Frade's production is growing, and I want to know... I know that you're going to do the tieback at Frade at some point, but I just want to understand how you will address that in the future. Thank you.
Bruno, well, first of all, Frade, the capacity of the ship is a, is a 100,000 barrels of oil. There are some other limitations, like gas processing capacity, and there is another thing, which is water, but water is not a problem. In total, will be 140. Yes, that may be a limiting factor. I look at the gas capacity as well as the oil capacity. If we get to the order of 60,000 barrels at, at Frade, it could be a little bit above that, but then we will do what we can just to ensure that the vessel is equipped to receive Wahoo's production, and then we will go up to the, the limit of the vessel. We are also looking at the possibility of an upgrade, and this involves an engineering work, which is already in progress.
Yes, this has been taken into account.
A potential issue, but it will be really good, you know, for us if we can boost that asset. In terms of Albacora Leste, the limitation, I mean, we do not have any structural issues, but the objective is to reach 95. We'd like to work, you know, as close as possible to 100%. We talk about operating efficiency of the company, we're not referring to the availability of the vessel, but the total capacity of the wells and what is realized, and that includes the wells, subsea things, and the vessel as well. I mean, when we're talking about a vessel, it's just like getting into a house that is totally deteriorated, and it needs repairs. We are making a lot of repairs, doing a lot of maintenance work, exchanging parts.
Once that repair phase is over, the maintenance is over, of the vessel, certainly performance improves because you can be more efficient, things will not break as often. Today, efficiency is lower than what we expected, because at some moments it stops working because maybe a turbine, you know, ceases to operate, or a water pump stops working, and that's why we have to, to interrupt production. We are working diligently to improve the performance of all of the equipment. I was saying at the beginning, we expect that by the year end, we will get close to 95%, so next year we can give another step. This refers to many different ways of maintenance, but as of next year, we will be a lot better off. Thank you.
Thank you, Bruno. I'm sorry for that confusion. Our next question comes from Bruno Montanari from Morgan Stanley. Bruno, you can go ahead.
Thank you for taking my question. I have a follow-up and two questions. Going back to the inorganic activities topic, I just want to know whether the company is only focused on offshore Brazil, or maybe eventually you would go abroad. In terms of your sales strategy, you are selling... I mean, is this due to export tax or because of the current environment? Or you would think that this could be a winning element in terms of pursuing that discount of $3-$4 per barrel? The third question refers to the tax rate of income tax. If you could give me an update on the use of more robust tax credits going forward. Thank you.
Well, thank you, Bruno. I will start-- Well, sorry, I think you... What was your first question again? Oh, M&A. M&A here and abroad.
The second question was trading. Okay, M&A and trading. Sorry. Okay. M&A, we focus on offshore Brazil, and if possibly, the Campos Basin. We still see opportunities. Internally, we see some interesting things in Brazil, in the Campos Basin. That's a familiar place to us. That's a place where we already have the infrastructure in place. If we were to think about going abroad, you would have to be going to a better jurisdiction with, you know, a good amount of volume, just as good as what we have. But today, our main focus is Brazil offshore. This is what we are pursuing, so nothing has changed in this regard. Our organic portfolio growth, perspective is very strong, and our growth continues to be high, and this allow us to be much more selective in terms of opportunities. This is what is happening right now.
We are being very selective in terms of picking the opportunities and potentially looking at potential opportunities. The opportunities are there. There are opportunities surrounding us. It's just a matter of time, it's just a matter of choosing the right moment, the right environment. Now, in terms of trading, what you said is true. There was an increase when it comes to customer delivery, but this is part of a strategy that we put together at the end of last year. The reason why we put this strategy in place last year, is that if you are selling at FPSO strong sale, then you would have three or four buyers for your oil. That's it. You would have the trading companies, and that's all. There will be Shell, there will be maybe BP, or...
I mean, in summary, you have the tradings negotiating with you, these tradings would do the delivery. I mean, this is okay when you have a delivery for every two months or every month. Now, when you have 3 million barrels a month, which is our case, this is no longer very good, because then you will have to constantly negotiate with these guys. Then, at the end, it's more difficult to reach maximum optimization of costs. We thought about delivering to customers. We established a trading company in-house. There is a person, Gustavo, in charge of the trading department. From here, we conduct the entire negotiation. We continue to sell FOB whenever it's more convenient, but most of the time, we deliver directly to customers.
When you sell to end consumers, to the refineries, and then you have, like, 30 or 40 of them. You have a much bigger bargaining power overall. You can show your oil to a lot more people, but these refineries, oftentimes, they are not just looking for oil in Brazil, so you have to deliver. That's why we introduced this new trading area, which is bearing great fruits. All of us, we are very pleased with what is happening in this front. I would say that today, we already sold half of our production volume to China, and we never we weren't selling anything, anything to China since 2020, since the COVID days, and we are, you know, sending the products to them.
This is just the second natural step, and you keep gaining scale, and at that point, it makes more sense for you to verticalize in that direction. With that, you can control this side of your logistics, and by the same token, we are closer to the end client. This is part of the reason why we are being so successful. Well, certainly, this involves a certain speed, you know, in terms of, you know, how many barrels we will reach, 3,000-4,000 barrels, but this is part of the strategy that is leading us in that direction. Now, I'll ask Milton to talk about income tax and the tax rate.
Okay, I'll try to simplify. Well, bear in mind that we start with a tax rate of 30%, which is the standard in Brazil.
It's also good to remember that we work in the industry of oil, in the oil industry. If you look back, you know, past legacy, there were some losses when we acquired Frade from Chevron. We also acquired a company that was operating at a loss. This is something very natural in this industry. By law, you could use a discount of 30%, 30% of your tax base for every year, so that 34 minus 30% becomes 23.8, you know, for the purposes of income tax. On top of the 23.8, in a very conservative way, naturally, we have to look at what we could do in terms of tax enhancements or, or tax use. You know, we, we do use credits from PIS and COFINS, and this is a natural benefit that our industry has.
Apart from that, as our company has a series of innovations as part of our productive process, we can benefit from the law of the good, Lei do Bem, we can use innovation. Innovation can apply to products or processes and so on. Whenever we do the math, we can still have an additional discount on top of that, the 30.8. You asked about numbers. In Q1, the tax rate was close to 22%-21%. There was a reduction now because we've been, you know, making several innovations, you know, and legal procedures, both in Wahoo and Frade, and we arrived at something close to 15%-16% in Q2. Obviously, I mean, you cannot guarantee this kind of tax rate. It, it depends on the current situation of the company. This is what we've been doing.
That's very clear. Thank you very much.
Next question from Gabriel Barra with Citi.
Hello, Gabriel.
I think you can hear me now?
Yes.
I have two questions, a quick follow-up question. One has to do with the leverage. We spoke a lot about the maximum level of leverage, but what is the minimum level of leverage that you will be comfortable to expedite the buyback or even think about a potential dividend payout? What, what would be the minimum level of leverage? I'd like to understand that important point. My two questions. First, regarding Wahoo. We have been speaking a lot about obtaining the licenses, but there are also some issues regarding equipment, particularly when we talk about PLSV. Perhaps that's the most sensitive point. In our discussions, there is a possibility that you can do just like with Hunter Queen, capitalizing the asset rather than leasing, leasing the piece of equipment.
If you could speak a little about the strategy and how the market looks like, opportunities and possible solutions, and the timeline of all that, given that Wahoo will soon come into play. Second point has to do with Maracanã, another great upside for Frade. We didn't talk a lot about that. Francilmar just touched on it, but if you could speak about the timeline and the possibility of achieving the second target for Maracanã. If you could speak about when that will happen, if it is happening, and if it's, if it's the North and the Hunter Queen, and if this will help us think about news for Frade. My three points. Sorry about that. Thank you very much.
Okay, let me speak about the leverage. Francilmar will try to answer all of your other questions. Oh, Gabriel, our bond covenant is 2.5. We're not even talking about covenants here. What we feel comfortable with in terms of leverage?
S omething that would be ideal for the company, because it would make the company prepared for new opportunities, would be something between 0.8 and 1.1. Something between 0.8 and 1.1. I think that with a, a cheaper oil price at around $70 per barrel, $75 per barrel, we could expect a leverage around 1.1. If we think about oil costing $85 per barrel, all average should be around 0.8, around that. This is it. These are the limits of the ranges, and no one wants to operate a totally deleveraged company. That's not the idea. I think that it's about returning to shareholders, too. This is very important.
That's why we are executing our share buyback program, and we have to have the serenity to always maintain a sound balance sheet, and we need to be always prepared, because these opportunities, sometimes they arise, and they don't arise twice. I, I like to say that M&A deals are opportunistic, and you have to be prepared. When opportunity arises, you cannot stop and think about it, consider. No, you have to act. With that, I think that we'll always be ready to enjoy any opportunities that should arise.
Okay, let's talk about Wahoo. Regarding the equipment, it's all very well mapped, all on delivery schedule and manufacturing schedule. Regarding POSV, indeed, the market is overheated, but again, our mission is to find alternatives. The operation that we had at Frade, well, we were able to adapt a vessel.
We had an LCV, a line construction vessel, and it laid all the pipes that we set out to produce at Frade and the injectors as well. We'll probably follow that same path. We have consulted the market. There are some alternatives, some POSVs that are very expensive, but at PRIO, we always work to deliver the best value. We're not going to do what the market is asking. Most likely, we'll find alternatives. We are already negotiating some alternatives to have a vessel adapted to lay all the pipes for Wahoo. It's all very well mapped, all under control, and it will work out. There was a question about Maracanã. Maracanã, we had a first drilling to investigate the reservoir. We found two reservoirs with oil.
What we are planning now is, well, we need to do another drilling to test the extent of the discovery and its quality. We should be doing that in the next few months, perhaps in the next weeks. We'll send the Norbe VI rig . It's finishing a work over in a well, and it will do the drilling to investigate the extent of the reservoir, the extent of the discovery. Having the data in our hands, we'll understand what we have, and then we'll plan a development. How many wells, the position of the wells, the strategy we'll use, if it will be a drill center, if we'll have a manifold integrating all three wells and take that to Frade, you know, all that takes some time to do. It's not something that we'll drill and start producing now.
Ideally, we'll collect the information, and next year, we'll have to buy the material, commission everything, then we'll put together a program to put the reservoirs into production. This is the overall plan.
Super clear. One point regarding Maracanã, and regarding the capacity of the FPSO, I believe you're considering that, too, right? Regarding the capacity of the FPSO, what would change in your plan to develop the field?
Okay, let's split this. One thing is a limited physical capacity, the vessel, the size of the vessel. The nominal capacity is 100,000 barrels, but because this is a mature asset and given some downgrades made by the previous company, the vessel does not reach 100,000. It reaches 90,000. We are working to bring her back to 100,000.
After that, we're studying whether we can increase the capacity by 10%, 15%, that's not an easy task. Physical limitation is one thing. We are making an effort to have the best possible scenario. The other thing is production potential. We might have to make choices. It's just like the pre-salt development. You drill X number of wells, seven, 10 wells in a field, you top the vessel with four, then you just have to stabilize production as much as possible. This might happen in our case. If it happens, it's going to be great. Our homework will be to manage the portfolio. What is the best oil, the fastest and the cheapest to produce manage the CapEx, working to maintain a maximum of stable production for as long as possible.
Super clear. Thank you very much.
Thank you, Gabriel.
Our next question from André Vidal with XP.
Good afternoon, one and all. My first question is, I'd like to understand bottlenecks in the development of Wahoo, particularly regarding the environmental license. You mentioned that a key point would be the license to drill. I don't know if there is any other license that could be a bottleneck. Do you have any deadlines that, like, if you don't get the license, it will be a problem for the development? Knock on wood, assuming that some of these licenses are not obtained, what would be the plan B of the company in terms of use of proceeds and development of oil fields? My second question, well, like to know if there was any update on the arbitration of Wahoo, what was being negotiated regarding the purchase of the stake belonging to the Indians. Any updates since the last call?
Thank you. Regarding Wahoo and the stakes and your arbitration with IBV, no, there was no update. We have been trying to engage in some kind of negotiation, but we haven't had a lot of support, so the arbitration is following its natural course. The last hearing of the arbitration should take place in October. Normally, you get the hearing, you get a decision within up to six months after the hearing, right? Yes. We believe that our case is very solid. We just wanted to propose a commercial deal. We are trying to buy their stake, so as not to continue with the full work of the arbitration, but we do see arbitration with good eyes. It's not the end of the world, so no updates out there. Despite our attempts, things did not evolve. As regards the Wahoo licenses, there are two important licenses.
The first is the license to drill, and the second is the pipeline license. For pipeline, it's simpler. It's a simpler license, but the drilling license normally takes a little longer. We expect the drilling license for the third quarter of this year, most likely around September. Around September. You know, IBAMA has their own times and deadlines. There are no problems, there are no issues. The field has been drilled years and years ago, so it's all well known. There's nothing new there. We think it's a matter of time. There's no bottleneck there. It's just IBAMA's timing to do things. The licenses we got always arrived at the last minute, and it will continue. That's how the game is played. We have no concerns regarding that.
For the pipeline license, the idea is that in the future, towards Q1 of next year, that's when we will lay the pipes. It's an easier license to obtain. It's a simpler thing to get. It is a critical path, indeed. Without it, nothing happens. Today, I think it's all addressed. It's all within the expected deadlines. If we have a plan B? Yes, we do have some plans B. That's a fact. For Frade, for example, we can think about the possibility of a third well in the ODP4, ODP5 reservoir. We'll start injecting water soon there, so we'll have the reservoir with more energy. We can try a third well there. Our reservoir engineering team is already considering that. We have Maracanã.
Of course, it's not something that we can do the next day, as Francilmar explained, but more towards year-end, beginning of next year. The Albacora workovers that we can do. There are a number of things of Albacora. We're not doing a lot there because the top side will not handle it. The top side still has a lower efficiency. It doesn't make sense to feed the FPSO with more oil, but by year-end, we'll start having an increase in production at the FPSO, and this increased production will give us more safety to do all the work. Plan C, if we can call that, is we have two prospects to be drilled at Frade. It's not just Maracanã. Maracanã will be demarcated, and then we have two prospects to be drilled, Guará and Anauá . The idea is to drill them before moving to Wahoo.
These are the activities that we will be performing, depending on when the license will be obtained and so on and so forth. The drilling license, if we don't get it in September, if we get it in October or in November, it won't hurt us a lot, because first oil is scheduled for second quarter. What matters for first oil is not, well, drilling itself, believe it or not. Of course, there's a limit. You, you'll need to drill eventually, but it's more related to pipelining and, and the rigid pipeline, where it have a vessel contracted for that between January and March of next year. It takes 45 days. Really depends on the weather, but it takes around 45 days. This will happen between January and March.
After March, when everything is in place and ready, we'll start producing. We can start producing with one, two, three, or even four wells. The number of wells will depend on when we get the drilling license. Of course, it is important. It is a critical path. Nothing is out of control. Everything is well thought of, and the plan is well designed and very well oiled. We are very confident regarding that.
Super clear. Thank you.
Our next question comes from Luiz Carvalho from UBS. You may proceed, Luiz.
Hi. Hi, folks. Thanks for taking my questions. I would like to revisit a few points. First, you talked a lot about acquisitions. Again, the company focused in a few assets in the past few years, but I assume that the limitation in terms of your funding capacity was a critical aspect of the process, and it remains as such. With its new cash generation and this new production level that you achieved, I know that you can escalate to a different level of assets. I know you already said that you were focusing on offshore Brazil and Campos Basin, but do you think it would make sense to think not in terms of oil fields, but in terms of companies? How do you see this process of, you know, expanding your portfolio?
My second question is that you were very successful in the past when you pursued some hedging strategies. I know that it was probably during a different moment of the company, but I would just like to understand how you are looking at it now and whether it would make sense, I mean, because you have to consider a very tight, you know, oil market or maybe some noises related to global activities. How do you intend to protect your cash flow or whether at this level, it would make sense? My last question is about regulation. The company, or at least out of the listed companies, this is the industry that was mostly impacted by the export tax imposed by the government. The government is now discussing a tax reform, and there are some discussions about, you know, the oil industry.
My question is, you know, how can you protect yourselves? Thank you.
Well, Luiz, let me answer each question separately. Well, first of all, let me talk about companies. I think there will be a consolidation of the industry. This is something that we've been hearing for some time. We are totally agnostic in terms of acquiring a field or companies. The important thing is that things have to make sense. They have to have synergies, the price has to be right, and it's important that whatever we do, we, we can add something to a company, but we are pretty agnostic in this regard. Again, well, if things make sense in terms of their synergies, sometimes we like the Campos Basin, we know how to operate it. That's why I don't see, you know, shooting in every direction.
There is onshore, too. I don't think onshore has anything to do with us. The second question, you said that you talked about... No, capital? No. The second question was about hedge, hedging, and the third question referred to regulation. About hedge, we are still operating with hedging. I mean, just now, I think this past week, we did a little bit of hedging. We look at this maybe in a more opportunistic way when compared to the past. Now, in August, we have almost 4 million barrels being priced in August itself, and it will be a large volume within the quarter. I mean, in the third quarter, this will bring about a high sales volume, but that will be mostly concentrated in August. We bought a few of put because we do not want to be so exposed to a possible fluctuation within the month.
Our strategy remains the same. Any time the volatility index of oil goes down, we start looking at it, and when things make sense in terms of pricing, we buy it. We do not have a policy where I'll say, "Okay, I will, you know, locked in a certain month or not." In the past, you know, we couldn't afford to, to be more extravagant. Now, when we see opportunities, again, hedging is something that we have to look very carefully. We do have a hedging policy at PRIO. I mean, in the past, I mean, we only buy put and at the money. Maybe this time we are being slightly more selective, you know, waiting to, to reach some price levels. Today, hedge is low. I think it was close to $30. At one point, it hit $29 or $27.
Even then, we see that the premium of puts is still very high. That's why we didn't do a lot. We only operated in the short term. This, the strategy, again, remains the same. Of course, today, with that cash generation, things become relative. In terms of the export tax, well, it is clear, and Emiliano is here, and he is the person that is leading us through this new area. The company has a certain size that, I mean, our presence becomes necessary. When I am referring to the regulating agencies, I'm referring to them in a in the broad sense. The company is increasingly present in debates, in events, in Brasília, and so on. This export tax caught us all by surprise, caught the entire industry by surprise.
We continued to invest, we kept moving, you know, with our operation, but at the end of the day, this tax can really hurt the health of several companies. This is another debate. Does it make sense for you to have an export tax, given the fact that this tax is so harmful when it comes to generating new businesses and new small businesses? If this export tax had occurred, like, five years ago, it would have been very dramatic. Today, with our lifting costs and everything else, things became a bit easier. Does it make sense for that to exist? I mean, and then that's why it's important that we participate in these discussions. The tax reform, that's another area where we, we have to participate.
Emiliano is a member of the Exporters Association, in addition to other associations. Contributions are being made in terms of the tax reform. I mean, export tax, well, the debate is over. There's nothing else to be said about it. Repetro is what we are trying to advocate. We want to maintain that regime. It's not very explicit. There is still a provision for that regime. We don't know what's coming from the Senate. We are excited because the entire market is in on it. We hope that the regime is maintained. I mean, PRIO today is an important voice. Maybe five years ago, that wasn't the case. Today, PRIO is an important voice. If we look in terms of production, PRIO is probably the second-largest producer in Brazil, or maybe the second or third producer in the country.
Well, certainly, Petrobras is, you know, out of the curve. Today we are a good voice, we understand the importance of participating in these debates. Emiliano goes to Brasília every week. He goes to Espírito Santo, here and there. He is constantly looking at this government and institutional agenda.
Very clear. Thank you. Thank you very much.
Thank you.
Thank you, Luiz. Our next, I think last question, comes from Leonardo Marcondes from Bank of America. Leo, the floor is yours.
Good afternoon. Thank you for taking my questions. Most of my questions have been answered. I just have a few follow-ups. The first one is about Wahoo. You talked about the licensees. I just want to get a better understanding about the timing.
I just want to understand that if the licenses were to be approved today or tomorrow, how many wells do you think you could... In how many wells you could have their first oil in, like, 2024? The second question is also a follow-up on Albacora Leste. I would like to understand whether you could give me a little bit more light in terms of production. What is the production level you intend to reach by the end of the year, and how many wells you would need to do the tieback to reach that objective? In addition to the wells that you intend to tieback to reach your, your objective, whether there are still other wells that will be part of that tieback in the short and mid-range? Thank you.
Okay. If the license were to be issued today, we would start drilling in September. This is our, you know, target date, because there are other tasks that have to be conducted before that. We would start drilling, I think, in September. Yeah, considering the schedule of the rig, we would finish Frade, and then we would go there. Well, next month, September. With that, we would initiate production with all three or four wells. I would see more likely four. In the case of any setback, maybe three . The limiting factor for Wahoo's production is, yeah, the pipeline. Production is not going to occur before the second quarter. The idea is that in a given moment, in the second quarter, the third quarter, it would occur. There is a critical path, and that starts with the pipeline that will occur between January and March. We don't know for sure yet, because we have to move forward a bit more.
Today, that window is still large, so we have to schedule that window with the vessel. The first oil only happens after that pipeline and all of the other things, like the manifold, the pumps, et cetera, valves, riser, and there are 200 things that have to be installed. Well, if the license is delayed, if we get the license to do the pipeline laying, and then everything follows suit. It is also important that we sit down again and re-discuss things with the vessel, because we do have that window between January and March. If we have to get out of that window, we have to start another conversation with the company that will do the pipeline.
In terms of drilling, if we start in September, then we would start with the four wells, and it's not gonna start before the second quarter, by no means, because of the pipeline. If the license is issued in December, maybe we will start with one or two wells. That's pretty much it. Albacora's production, we believe that by the end of the year, there will be two events. First, we will gain operating efficiency, and with operating efficiency, we will naturally be able to, to increase our production to close to 28,000 to 30,000 barrels a day. Okay? Doing the match with PRIO. Then there will be a second effect that refers to some wells that were shut down with hydrate, and there are some other injection wells as well, and they will be able to resume production.
The reason why we are not resuming production is because we do not have the top side to hold it. With that top side, we can resume the wells. The purpose is to reach production close to 35,000 barrels a day, net PRIO, by the end of the year, which is a reasonable challenge, but I think it's feasible, and I think that that's what we have to aim for. That's it.
Yeah, perfect. That's very clear. Thank you for the answers.
Well, with this last question, we end this call's Q&A session. I'll turn the floor now to Roberto for his final remarks.
I'd like to thank all of you once again for joining us. I'd like to thank the whole PRIO team, that always works with a lot of drive and determination to deliver results. I'll see you in three months. Thank you very much.