Earnings Call: Q4 2020

Feb 22, 2021

Good morning, ladies and gentlemen. Welcome to the Galp Full Year 2020 Results and 2021 Outlook Call. At this time, all participants are in a listen only mode. There will be a presentation followed by a question and answer session. Call. I need to advise you that we can only allow 2 questions per person. I will now pass the floor to Mr. Otello Ruivo, Head of Investor Relations. Good morning or good afternoon to you all and welcome to GOV's 4th quarter and full year 2020 results presentation. I would like to thank you for joining us today and wish that you are all in good health. We will start with a brief introduction from our recently appointed CEO, Andy Braun followed by Felipe, which will take us to the quarterly and full year results and provide you with the outlook for this year where Tore will participate as well. We will then be happy to take our questions. Please follow the operator's instructions at the end of the presentation if you want to participate in the Q and A session, which will be audio only. Before we begin, I would like to remind you that we'll be making forward looking statements that refer to our estimates and actual Full results may differ to factors included in the cautionary statement available in the beginning of the presentation, which we advise you to read. You can find the presentation and all remaining results materials at our website. So without further ado, I will hand over to Andy. Thank you very much, Italo, and good day to all of you. I'm thrilled to be here on my first results announcement for Galp. As you all know, I was in the Executive Committee of Shell for 7 years. And since I left in the middle of 2019, I've been in various advisory and Board positions. I've had a career that is not afraid of taking on business transformations and Adapting to new trends, but also with a sharp focus on efficient execution. As the Acting Director of Shell, I was responsible to integrate the BG assets into the company and that obviously meant integrating the deepwater assets in presalt in Brazil. In Shell also, I was involved in many gas and LNG projects bringing cleaner fuels into the company. I'm not a stranger to the Galp's upstream portfolio, but also in Shell, but in my portfolio work since I've worked on introducing low carbon technologies into the energy system. And so I'm really enthusiastic about the opportunity that provides to Galp going forward. I've only been enrolled for 2 weeks, but I've really got a good impression of the company. And as I thought, it has an enviable position in the upstream and integrated gas. The deepwater assets in Brazil and the Mozambique Integrated Gas assets are truly world class. But I've also found that this company has a great brand. It has a solid refining position and a commercial value chain in gas, fuels, electricity that goes from end to end in Iberia. But Galp is also of a size that can be agile and can move quicker compared to some of its larger competitors. Well, a demonstration of this is what Galp has already done in Iberia. It is now the leading solar player in Iberia in just over a year and as a platform for further growth and diversification. What I've also found is really talented people, professional people, focused people. But my job will be to focus them further to accelerate our delivery, to make sure that we keep financial discipline to create a profitable, efficient, clean, integrated energy company. But I also find a company that is doing very well in ESG, and is being ranked in Europe in its sector at the top. So in short, I'm just really excited with what I found, and all credit to the team on the ground, but also to Carlos for leading the company to this point and all its predecessors. Going forward, we do need to clarify our strategic direction. We need to create a strong and sustainable business. We have a strong portfolio. We know our strengths, but we should not be afraid of making difficult decisions. We need to create a company that is dynamic and able to seize opportunities. I look forward to demonstrate the progress we're making periodically, starting with the Capital Markets Day 2021. But I want to leave you in no doubt, we will be value driven. Will be driven to sustain our growth. We want to not only be able to thrive through the energy transition, but to be a great investment opportunity for our shareholders. However, despite this great excitement for the future, The short term does look challenging. The pandemic is not fully under control, and we need to show prudence in our investments. So going forwards, we will still be focused on a disciplined capital investment and prioritize where we will spend money. However, I believe The Batalhau project, we should proceed in the first half of this year to FID it. It is a truly exceptional project call. So it makes a lot of sense to go forward. But also it makes sense to go forward with the renewables portfolio that we have built and to grow and deliver that funnel. But we maintain our investment guidance. Over 2020 2021, we'll stay in the bound of €500,000,000 to €700,000,000 net CapEx, net of divestment that is, but that does include the Batalou project. Because we're going to be prudent in CapEx, we believe also we should be prudent in shareholder remuneration. So related to the 2020 Dividends. We're proposing the Board has proposed €0.35 per share. That will be submitted to the AGM for approval. This is a 50% cut from our pre COVID dividends of €0.70 per share, but reflects the economic downturn that we've experienced and it reflects some prudence going forward to maintain our balance sheet. For 2021, we expect to increase this dividend towards €0.50 per share. Despite the recovery in 2021 from 2020 20, it looks like a tough year, particularly in the midstream and downstream, we see no real signs of recovery yet. And although the oil price has gone up to $60 and above, we don't take this as a basis for planning. We're planning more prudently at 50 dollars per barrel. Going forward, we are a company that has distinctive growth. We're a company that doesn't want to be valued by dividend distribution alone. We want to combine growth and shareholder returns. I do respect that we need to create some clarity around this. And therefore, we're going to be having a Capital Markets Day in May. When I can describe what I've been doing in my 1st 100 days. We can deep dive into the various business sectors. We can talk about our operational performance, about our growth, about our medium- to long term strategy and capital allocation. I'm very excited about leading Galp. I'm very excited about coming with you on a journey that can demonstrate what we can achieve. Now I'm going to hand over to Filipe, who is going to explain the Q4 and full year results to you. Thank you very much. Hey, guys. I will start with the P and L on Slide 8, a brief review of the Q4 and the full year. In the quarter group EBITDA was only EUR410,000,000 given the environment our All our businesses were operating in. The upstream EBITDA was SEK 390,000,000 That's down 36% year on year, mostly reflecting low oil prices, Lower production, but also the depreciation of the dollar versus the euro. Quarter on quarter, the increase in EBITDA comes mostly from a positive impact from adjustments in overcharges booked in previous periods. The full year EBITDA for Upstream was SEK1.1 billion and that's down also 37%. Commercial EBITDA was €71,000,000 in the quarter and €325,000,000 for the full year, also highly affected by the effects of the Iberian lockdowns and the travel restrictions on the sales of oil products and natural gas. You know this is a very touristic part of the world and the economic effects have been particularly harsh in our core countries of Spain and Portugal. Refining and midstream, the EBITDA was €17,000,000 in the quarter, Actually with a quite a negative number in refining, given how challenging the refining environment was. But this was partially offset by a very resilient midstream contribution, including trading. The full year refining and midstream EBITDA was SEK113 million, here also with a negative contribution from refining. Renewables and new businesses is deconsolidated. So we have no contribution to EBITDA from our Spanish solar portfolio. So the net income of that business will follow under the associates line. Financial results were only €19,000,000 negative. So we have positive contributions from FX and mark to market valuations in some of our risk hedges. So after taxes, net income was €3,000,000 IFRS net income was minus €35,000,000 in the quarter and this mainly reflecting the post tax effects from the Metozingos refinery shutdown decision, partially offset by the capital gains we had from the sale of ggnd. For the full year, we have over SEK 500,000,000 in IFRS losses with a very large Inventory effect here on those numbers. Here on the cash flow table in slide 9, we have CFFO of SEK231,000,000 in the quarter, reflecting the weak downstream contribution as well as the working capital build. For the full year, CFFO of SEK1 1,000,000,000 was almost half of what we had in 2019, of course, highly impacted by the macro environments and the operational constraints brought about by COVID. Now this is especially true for our downstream activities with refining highly impacted by inventory effects given the sharp decline in the commodity prices during the first half. Commercial was way more resilient Despite the hefty reduction in oil and gas demand in Iberia, both in B2B and B2C. Upstream was very resilient with free cash flow actually up year on year, given the magnitude of the CapEx reductions and the higher production. Bottom line here is That free cash flow was €42,000,000 in this most difficult year and this already including the 3 Now this is the result mostly from the Matos Ingres in Spain. Now this is the result mostly from the Matuszinger's impairments, equalizations and also the U. S. Dollar depreciation Against the euro, this affects the euro accounting value of all of our upstream assets. On TG and D, the transaction that we announced back in October should be completed very soon. The relevant regulatory conditions have been met and the sale has been booked except for the cash proceeds. So we have a receivable of €368,000,000 booked under the caption of other assets and liabilities. Net debt was stable at €2,100,000,000 in the quarter, again, not considering the proceeds from GGND. And the liquidity position also remained very stable at about €3,000,000,000 This last Slides on 2020 sums up pretty well actuals versus our guidance back in February, which seems like ages ago. Back then, we expected cash flow from operations of SEK 2,200,000,000 and ended up with less than half of that. Having said this, we had substantial cash preservation decisions whilst also completing the very strategic solar acquisition in Spain. And if you were to consider the sale of Gg and D, net CapEx would have been SEK0.5 billion, so at the very bottom of the revised guidance we have provided you with back in April. Now Thor will now cover the next slide on Upstream as we move into the 2021 outlook section. Thank you. Thank you, Filip. Let us start this short term update by briefly covering upstream. As you all are aware, we disappointed on the production growth year on year with 7% versus what we initially target, namely between 13% 17%. In our analysis, 65% of the shortfall was due to COVID, directly or indirectly. 1st, we had a direct shutdown of 2 FPSOs due to COVID outbreak on the installations. And secondly, we had significant slower hookup of new wells due to the reduced People on board, POB on the installations and in the logistics chain, which we needed in order to perform the work. The reduced POB was a preventive measure to reduce the number of exposed individuals as much as possible, And that reduced capacity in the logistics chain was also linked then to COVID outbreaks on several of the vessels and the drilling platforms, where we also had the policy of minimum PoB. This gave us less capacity to conduct the planned program. But as you all know, COVID-nineteen directly or indirectly impacted offshore businesses across the industry. And looking at our closest peers, no one else reported any production growth. And Gulf still then delivered a 7% growth, all of which from very profitable low breakeven products, and this remains unparalleled in the integrated universe of companies. As a matter of fact, Gulf upstream actually delivered a higher free cash flow in 2020 than in 2019 due to the forceful response to the price shortfall with a 55% reduction in CapEx versus the original plan as well as a 25% reduction in staffing due to the lowered activity level. More importantly, Galp's highly competitive portfolio remains intact with a top tier delivery in terms of sustainability, both economically with a production cost of around $3 per barrel and environmentally with one of the lowest carbon intensity levels in the whole industry. Regarding our reserves and resources, results shows that our 2P reserves and 2C resources of 2,400,000,000 BOEs for 2020. That's in line with 2019, with 2020 production offset by added resources. We have included some details on this preliminary evaluation in the appendix. And now some guidance for 2021. Considering our recent experience, the uncertainty period we are facing and the persistent difficulties on all offshore activities related to COVID-nineteen, we have decided to add a new layer of prudency to our forecast. We therefore see production in 2020 to be in the range of 125,000 to 135,000 barrels per day, I. E, in line with 2020. We will, of course, continue to work with our partners to implement and reinforce all mitigation measures whenever possible. However, the pandemic effects introduces a risk, which we have tried to cater for with this production guidance. In 2021, we will conclude the ramp up of the unit in Werbigao and Sururu, an important contributor to our production, and we will start up the production in the Sepia project. As mentioned by Andy, we are moving fast to clear all relevant milestones to sanction Phase 1 of Bacalot. This is another world class product with the consortium successfully capturing the opportunities available in the market to further optimize what was already a very competitive project. All in all, the FID is planned for first half twenty twenty one and first oil in 2024. We have started early stages of FPSO construction works, while we are still working on optimizing development concept. We will continue with our partners in PMS 11 to optimize the development of 2Pierrasimo and continuously assess value added opportunities for further development in the field. An updated plan for development for the field is to be submitted to A and P later this year. And finally, we aim to spud JAKTE in Santo Mein principle towards the end of 2021. This is a low cost exploration activity, which if successful will add very valuable resources to our portfolio in the Frontier Basin. We will be sure to provide you a more in-depth view on our products at the Capital Markets Day. But in conclusion, And despite the short term challenges, I am confident that GOV's upstream portfolio continues to be differentiated, both in terms of competitiveness and sustainable growth opportunities. I will now hand back to Filip. Thank you. Thank you, Thor. So on the other fronts, we still have the lockdown measures in place and the Economic environment is still quite uncertain for Iberian Oil and Gas, at least during the first half of this year. So keeping our Prudent stands. We have 2021 commercial EBITDA in line with 2020. Hopefully, the second half will prove us very wrong and the environment will pick up quickly. The refining macro conditions remain challenging, although the forward curves look Supportive compared to the 2020 levels. So we see the Galp refining margins at $2 to $3 per barrel for the full year. Now concentrating all refining activities in Sinesh will lead to overall better competitiveness given the Synag, FCC and the hydrocracker. The OpEx and CapEx savings should become fully visible next year as we decommission the Matos Inos processing units this year. And whilst difficult, the decision to close the industrial activities of Matosynos became inevitable given the market and regulatory circumstances. Midstream 2021 EBITDA is estimated at €50,000,000 to €100,000,000 This is compared with our previous guidance of EUR 150,000,000 before impacted by the weak gas environment, which may limit our trading potential as well as by one off costs related with Particularly high tariffs for access to the Portuguese regasification terminal this year in 2021. In renewables, We continue to build up the competitive Spanish portfolio. We expect to have about 1.2 gigas installed by year end with the additional 300 megas online by the Q4 of this year. And in the Q4 of Last year of 2020, we had upsets in 2 transformers. This is covered by insurance. And this affected 3 75 megas of solar capacity. So this should be sorted out by next month, So well ahead of the summer peak production period. And we continue to look for attractive renewable projects, And our portfolio now stands at 3.7 gigas. This is with land and access to the grid. We will keep our discipline, value over volume, unlikely to win anything through auction mechanisms, which have recently had outcomes in this region, which we really struggle to understand. So we're not on that camp. Putting it all together on Slide 15. Now considering the restricted downstream environment in Iberia And Brent at €50,000,000 group EBITDA in 'twenty two turns should be in the range of €1,600,000,000 to €1,800,000,000 Well, CFFO at SEK1.3 billion to SEK1.5 billion. We keep the CapEx guidance we have Given your last year, so €500,000,000 to €700,000,000 then this considers the Baka Liao FID and the proceeds of the sale of TGMD. Now regarding the dividends of SEK0.35 related to 2020, This should be distributed out after the AGM in April. So this should be distributed out in May. And the Board has also indicated that under the foreseen scenario, say Brent around €50,000,000 Galp should target a dividend of about EUR0.50 related to the 2021 fiscal year with an interim payment To be considered sometime in the Q3 of this year. So I will stop here, and we will now take your questions. Thank you. So we will open the Q and A now. We have the team remotely connected from all over Europe to take your questions. So operator, could you open the session, please? Thank you. Ladies and gentlemen, we will now begin the question and answer session. Call. The first question comes from the line from Birajuwakattaria from Royal Bank of Canada. Your line is open. Hi, thanks for taking my question. And Andy, best of luck for the coming months and into the Capital Markets Day. I have two questions, please. The first one is on CapEx. On your gross CapEx for 2021, what do you Assume for the renewable spend, you also mentioned that you're expecting that a lot of the bulk of the Bacalar spend to be in that number. But could you also say whether you factored in a FID in Mozambique? Or is that not assumed till 2022? And then the second question on the production guidance. I mean, you normally come out with very conservative production guidance at the start of the year. You said you've taken this to kind of another level. I wanted to get your thoughts on whether the changes at Petrobras have played a part in that conservative guidance and your early thoughts Great. Thanks, Biraj. It's good to be talking to you again. So Yes. Thank you for your question. So yes, in terms of our gross CapEx this year, yes, Batalhau is the largest element In the investment plan. And yes, we really hope that we can go forward with that soon. Look, on Renewables, we're talking about CHF 200,000,000 So a substantial amount of money actually is going into renewables. But We aren't putting any money in for Rovuma at this stage. Still we're evaluating the way forward with our partners there, Do remember we are spending money on coral, the floating LNG scheme. So some coral, some renewables And bacalhau being a large element in that CapEx plan. Yes, in terms of Our production guidance, I think, Tore, he made sure, coming firstly, whereas coming into this job, I know the 7% increase was a disappointment, but I think it just shows how amazing that portfolio is. That even in this really, really dreadful year that we could grow by 7%. What we saw last year, We still see this year. We see issues with availability. We see wells not being hooked up as in the times we expected. So this is an ongoing difficult production environment, but in no way is this related to Changes of leadership in Petrobras. They are as you know, I know them very well from being partners with them before. They are an impressive executor of projects. And I don't think that change is impacting those production numbers. I might ask Thore if he wants to say any more about the 2021 production numbers because I can understand they are a little bit disappointing from what previously was announced. Tori? Thank you, Andy. Well, you know the Upstream business better than most, so I think I covered it actually really, really well. But what we have done is exactly what we based on our experience from 2020, we have Seeing that it takes longer to hook up new wells to have the necessary capacity in the logistic chains. And therefore, we have added actually, what we have done is we have actually done it in 2 ways. We have done both the probabilistic And a deterministic sort of simulation of what is the expected outcome of production, and that's why we are guiding in the way we're doing right now between 125 and 135. That is our best view as of today. Thank you. And anything on the changes at Petrobras? Any comments you can share? On my side, absolutely, I completely concur with Andy. Petrobras It's really executing very well. They have a very professional team, and I think that team will continue to So at this stage, we have no reason to have any worry on that. Okay. No, Jade. Thank you. Thank you. Thank you. The next question comes from the line from Oswald Clint from Bernstein. Your line is open. Good afternoon. Thank you very much, everyone. Andy, obviously, great to have you on the call. Thank you. I mean, I want to ask a bigger question. Obviously, Galp have great assets, and you know them very well. But I guess one of the issues you're going to find is in investors, Do you think of Galp as more of a, let's say, passive participant in some of these assets, whether it's Brazil or Mozambican? Having to wait for decisions further up the chain, which I guess was you in your old Shell position. So I wanted to firstly get you to talk about What you can do or say to dispel some of those views? And I know it's early, but any views on how you might be able now to get the market to better Really better appreciate the underlying asset quality in this portfolio because I think it has struggled over time to be fully valued. And then secondly, I wanted to ask about you talked about solar and Philippe mentioned the recent auction. So You want to grow that funnel. Prices in January, euros 24 a megawatt hour. You're collecting closer to €40 at the moment on the current portfolio. Does this mean you have to step outside of the Iberian Peninsula to really grow the renewables pipeline? Thank you. Thank you, Oswald. It's great to be talking to you again. It's interesting. Clearly, I understood The GALF portfolio really well when I was in Shell. And what I can see with this portfolio, not only is it Probably the best in our industry. We always one of the rationales for Shelter by BG was always to get into the Brazilian pre sold. And I think Galp has a great and enviable position there. And yes, it wouldn't surprise you that Chellewic looked at call. Mozambique quite positively. And I think that is one of the best and clearly one of the most prolific Gas resources available to the IOCs. Now am I concerned about the fact that we're a non operator? I think Alp has been a really, really strong non operator. I think it has been able to bring really relevant technical information to the table, which actually sometimes the operator has been influenced by. And again, from my experience, Being a non operator is not an issue if you have really, really good operators. And I think Petrobras And Equinor in Brazil, ExxonMobil in Mozambique, ENI with the Floti LNG, I think these are companies that I always enjoyed working with. And I think In this Galp role, not only have they got great resources, I think they've also got great partners as operators. And we will continue to play our role. And hopefully, I can add a little bit there because my experience as a non operator to influence them. As it goes on renewables, Oswald. Yes, indeed. So Majority of what the investments we've made so far, the 900 megawatts, there is a price floor on that, Regulatory flies fall. Going forward, we're going to have to look at how we balance the risk to the markets we're in. And we are going to be looking at what other markets we may move into. Now I can't give you any more details on that today, but I think That will be one of the things that we will address when it comes to the Capital Markets Day in May about how we would like to grow that renewables portfolio To increase its resilience, but also to increase the cash flows over a period of time. Okay. Thank you. Thank you, Andy. Thank you, Asil. Thank you. The next question comes from the line from Mehdi Enabati from Bank of America. Your line is open. Hi. So good afternoon all and thanks for taking my questions. So two questions, please, if I may. First one on the dividend. So you provided, let's say, your dividend for full year 2021 at €0.50 per share. So what Oil price could would make you revise down or up, let's say, that $0.50 Per share level. So let's say that the oil price goes back to $50 will you still keep your €0.50 Per share dividend target or no? And if I may, just regarding the decision on the interim dividend, You said that this will be taken in the Q1. Just for us to try to anticipate it, what will make you choose to pay an interim dividend or is it related to the oil price only? And another question regarding your CapEx guidance. I mean, last year, you said that the CapEx The net CapEx will be between €500,000,000 €700,000,000 on average for 20202021. Given that in 2020, you, let's say, had net CapEx above €800,000,000 I'd say that the market would have expected you to have, let's say, lower guidance this year Or lower CapEx this year than last year. So can you tell us why your guidance is Relatively high in 2021. Is it you being overly cautious? Or is it because, In fact, you and Equinor decided to accelerate on the development of Bacalhau or maybe on the development of your renewable pipeline? Thank you. Thank you, Mehdi. So firstly, on the dividends and oil price up, down, our results are a basket of Prices and demand levels in the refinery, in oil price, in the commercial business. So I don't think this is a we're not we haven't prescribed a formula here. And I don't think that is What we're doing at the moment. We're saying, if we have a reasonable year, it's a $0.50 dividend. And that's I don't think we're going to be looking at small tweaks up and down as we track oil prices. We are going to come back in May with a dividend policy, So we can be clearer and give the shareholders more certainty about their remuneration. But this sense, unless there are any disasters either way, It is a €0.50 dividend that we're going to be recommending clearly subject to all the approvals that we need to have. The interim dividend, I think we'll perhaps ask Philippe to talk about it in a minute. I think we will have to see how the market develops. We're in a full lockdown in Portugal at the moment, which is one of our key markets. So we have to see how COVID plays out this year. And we have to see As we get into the giving that interim dividend, how much confidence we have over the overall market. And I hope we can declare one. But I'll perhaps ask in a second for Philippe to talk in a bit more detail about the dividend policy. As the CapEx guidance, unlike the company I worked in before, big investments either way can be quite lumpy in this company. The ggnd was recognized on the books for last year, but the cash is this year. So You could imagine that if gGND had hit the books last year, then we clearly would be well within the range. And This year, we are going to invest in Bacalhau, but we're going to take benefit from the ggnd sale in a cash basis. I think you need to look across these 2 years and combine them and say, okay, what is the average across the 2 years of the €500,000,000 to 0.7 €1,000,000,000 But no, indeed, I think our message is for this year that we are not stopping on CapEx. We are continuing with a few Selected investments and I think particularly in the renewables portfolio and specifically in Bacalhau if we can get all approvals and we can go forward. I think it's probably worth Philippe, but just to talk a bit about the dividend and what will determine how much we On an interim basis. So, Fili? Hi, Mehdi. Medi clearly versus the previous guidance as we have provided before. We now have more prudent production levels. Obviously, we have lower Brent price assumptions at about $50 Refining $2 to $3 I mean, all this could surprise on the upside. We'll see. Lockdowns may cease further. But At this stage, we will want also to deleverage a bit this company. We're going to take The FID for Baek Elias. Baek Elias is about 30% of our production. So It's a massive project for us, highly profitable. And we look at shareholder value creation at large. If you look at the screen today, We are $0.50 We are at 6.5 percent yield for a company that has a very high Annual value. So I think our peers are at about 6% on average. So the investment proposition of Galp, We think it's different. We do not aim to be the highest dividend payer. So some discrimination is warranted in our view. Our cost of capital should be different given the In say, as we approach CMD and end of fall and if things go really well, yes, so there might be a call. Component of the $0.50 that could be distributed out within 2021. And that is the expectation Within the micro framework we're looking at. Just maybe a word on CapEx. So before the divestment in Gg and D and for 2021, Very wrong numbers, about €850,000,000 this year and say about €500,000,000 or so for Upstream. So that would be about 60% of our CapEx. That includes Baquela or Coral, and it also includes the last tranche of the payment For the Bacalar North acquisition sorry, Bacalar South acquisition, which is due with the unitization that Come shortly. The $200,000,000 alluded by Andy on renewables, This is the equity component. So the total gross CapEx, if we had 100% and if it was all financing, our call. Would be much more than that. And then you have about $100,000,000 in commercial or so and a bit in refining. So I hope this answers your questions, Mehdi. Yes, absolutely. Perfect. Thank you very much, Batafio. Thank you. The next question comes from the line from Thomas Adol from Credit Suisse. Your line is open. Good afternoon and welcome, Mandy. I stick to the upstream, if I may. And it's just a question generally About Brazil, so not just for Galp. Are all the FPSOs in Brazil facing the same problem you are facing, I. E, it makes sense to be risking the production potential call? Across Brazil by, say, 10%. And then secondly, you did have a high impact well you were drilling. I think And I think you hit target steps just before COVID, and that's the OIBRA approval well. And I was wondering if there's an update on that. Thank you. Thank you, Thomas. Good to hear you again as well. So look, call? I really wouldn't want to give any guidance on FPSOs in Brazil. Interestingly, as you may know, I was Vice Chairman of SBM call. I could see how challenging it was to operate these FPSOs during the COVID time, just in terms of getting people call. Everything else that goes on. And I think we see those even tightening today. So this is a difficult environment And clearly not one where you can get access to the resources as readily as you normally can. It's not predictable how that affects your production, But clearly, it does and it affects the pace in which you can continue to hook up things. So I think There is a macro impact of this in particularly on these offshore units in Brazil, which obviously been impacted hard by COVID, but I wouldn't give you guidance on that. I think Tore will may add to that, but the other thing is Tore Puru to give an update on that because obviously that was predates me. So sorry. Thank you, Andy. When it comes to ODiAPOIO, We have finished the evaluation of the Araporia S well, which were the one that we drilled. And the evaluation is actually not conclusive at this stage. For a prudent basis, we have actually impaired the amounts that we have spent on that well. As we viewed at this stage, it doesn't justify A standalone development. However, there is more prospectivity in that license. And what we are doing right now is that we, together with the partnership, are evaluating what is now the next That including then possible reprocessing of the seismic data in order to see what are the further potential. We see further prospectivity in ODiAPOIOS. So The last word is not said regarding this opportunity in Brazil for us. Thank you. What exactly I mean, what went wrong, I guess? I mean, you thought this would be a Carcara look alike, and And obviously, it turned out to be noncommercial. Was it at least discovery where you encountered oil? And what was exactly the issue there? Thank you. Yes. So I can confirm there's discovery assets also was notified into the press and via ANP. So how the carbons is definitely located, and that is why we see that the petroleum Things are confirmed. But as you know, there are always several factors that need to fit together in order for this to be 100% commercial. And At this stage, I would not like Thomas to go into further detail. As you know, this is something that there are a lot of Sensitivity with, and we would like not to keep that information internally in the partnership as we are evaluating further opportunities. But Petroleum Systems has been confirmed, hydrocarbons has been found, and there is still very interesting prospects To be tested and evaluated in audio for you. Thank you. Perfect. Thank you. Thank you. Your next question comes from the line from Jon Rigby from UBS. Your line is open. Thank you and hi Andy. I Just asking, when we first met, I think you were running Qatar in Shell, and that was 2 giant development projects going on. So you Presumably, can see how a successful upstream business runs both non op and op Because obviously there are skill sets that you can add value to. And as you noted, Galp has no real op. I mean, Do you think, so in advance of the Capital Markets Day, one of the things you'll get your head around is whether some sort of rebalancing call. For the company to be successful makes some sense. Just because of the way Your experience in that, that would be my first question. Okay, John. Yes, thanks for the question. And I think we'll probably again update in May. Yes, Shell clearly brought to the table masses of Tenable capability experience across the world. I think certainly for Galp, it's a much leaner organization that is set up on a non operated basis at the moment. So I think if we went into an operator position, we'd need to think very clearly about what that meant for us. Yes, the Gato operation, as you know, was Enormous, enormous. I mean the Pearl project itself. What was interesting about that was I think we're bringing together A number of things around technology and access to resources and things. So I think some of those fundamentals, I can still bring to the call. We can bring to the table, understanding the basis of the energy system, understanding where Galp can invest for benefit And leveraging partnerships in that process. So I have a big network in upstream. I have some experience in operatorship. I'm not sure if that translates to let's be an operator in Galp, but I'm sure I think I can bring a Real added benefit, particularly in the integrated gas world. And we can see those projects are clearly the operators are already call? And they're really good ones, as I said. Let's see as we go forward, as we explore more how we develop that upstream portfolio. But I to be honest, I have to say, Torrey and team are top world class upstream Players, I have been really impressed with the people I've met and the depth of insight they've had in the places they are, They have a position as non operated. And just on just to pick up on one of the comments you made in your introductory remarks, you talked about Taking hard decisions, right? I think you sort of ill sentimented about dynamism and so on. I guess The non op, a lot of that is then around about how you manage portfolio. So do you envisage The company being somewhat more dynamic in the way that it manages its portfolio going forward with an eye on value. I think this John, you've touched on the key point as I come into this company. What's really important Is that we set out our strategic direction. We have a rich portfolio in the up Streams, specifically, obviously projects like Bacalhau and a good exploration portfolio as well. We have this massive opportunity in Mozambique with integrated gas. We need to look very clearly at Sinesh We do with the refinery there and how we make that fit for the future. We have big ambitions in the commercial arena. We have big ambitions to grow our renewables. When I say we have things like battery values, value chains, hydrogen value chains to look at. When I say we have to be take tough choices, I think we have to be really clear on which things and which of these horses we're backing, Because I don't think we can afford to do everything. And so that clarity of purpose is what I'm really keen to bring into the plans for Galp. Got it. Thank you. Look forward to May. Yes. Thank you. Your next question comes from the line from Joshua Stone from Barclays. Your line is open. Yes, thanks and congratulations on the new role, Andy. I've got two questions, please. Firstly, on just coming back to the upstream production guidance for this year. Are you able to say how much contingency you're actually including in these numbers? I'm just trying to think if availability does come back in 2020 and we're in a sort of COVID free world, Touch wood for vaccine world, how much production could come back in 2022? And then my second question, slightly more high level. You mentioned sort of Galp being the right size for an agile transition. I just wondered if you could talk at a high level what you think the right pace of change is for Galp from the upstream to renewables and maybe talk about at a high level your intentions there? Thank you. Yes. Thank you. So Joshua, In terms of the production numbers, yes, I mean, I think many may think I've come in and clearly wanted Kitchen sink it or something like that. No, this is not the case. I perhaps facilitated a discussion about Where we thought we were and what was the likely outcome and that's what we've done. Clearly, we'd love to be able To offer more and I will be putting a lot of pressure on Florian team to see what they can do to achieve that. But this is think a fair representation of how we see the market today. So we're not going to speculate. So then the second question is around apologies, Joshua. Sorry, so on the speed of Transition, so how quickly you're prepared to move from upstream to renewables? Yes. So I think this is again, this is something for me. As I said in my remarks that a year ago there was really no renewables to speak about and now Large Siberian solar player. So clearly, this is a company that can make moves and make a difference very quickly. Clearly, if you look at upstream position, it's been impressive. It's been growing fast, but it's 130,000 barrels a day. I do think this is a company that has the agility to look at certainly through this decade at making substantial changes. We have to decide what's prudent for the shareholder. We have to decide what is in line with the energy transition and how fast we feel we need to go. That's something that we will be studying quite carefully in the next 3 months and come back to you with some guidance of how we See that. Galp has already guided at 10 gigawatts by 2,030. And if you do the sums versus our upstream size, that's massive. So that's the ratio, that's call. Faster transition than any of our competitors. So this is a company that can move fast. This is a company that can build a substantial portfolio in the new NG space and execute it. As Felipe said, we have 3.7 gigawatts of in the funnel of opportunities with grid connection already in place. So let's see how fast that goes, but it's underpinned by a really solid upstream in assets as we know that have very low decline rates. So this is a great platform for a company to launch into a transition and to do it I think effectively and persuasively and ahead of the rest of the market. Very clear. Thank you. Thank you. The next question comes from the line from Sasikanth Chilukuru from Morgan Stanley. Your line is open. Hi, good afternoon everyone and thanks for taking my questions. I had 2 left please. The first one was related to the upstream production. I was just wondering if it was possible to provide the production profile or the expected production profile on a quarterly basis in 2021, whether just wanted to check whether there was any major turnaround activity in or 1st half of twenty twenty one or if there's any spread difference in production levels in the first half and the second half. Any comments on the production level so far this year would also be useful. And if you were to look into 2022, other than Sepia, are there any FPSO units that will be ramping up in 2022? And based on the current assumptions, Would 2022 production be higher or lower than that of 2021? My second question was related to the CapEx And the comment of the CapEx level being around $850,000,000 in 2021 euros in 2021. Would that be a starting point for 2022 organic CapEx given potentially higher spend in Bekelhau next year? Would you see 2022 CapEx organic CapEx levels being higher than €1,000,000,000 potentially in 2022? Thank you, Sassy. Thank you for your question. Look, I think on the first point, And I'll probably pass to Tore to talk about it. I'm not sure we give quarter by quarter guidance, but Tore will be able to elucidate on that. On CapEx numbers, I'm certainly on production for subsequent years, really you're going to have to wait, I think, To the Capital Markets Day for us to reveal how we think that production goes in subsequent years. On a CapEx level also, this is again Something for us to explain in a bit more detail with the rationale in our Capital Markets Day. So Again, I'm not able to give any guidance on that. So I'm going to hand to Tore to talk about where what kind of production anticipation We've got over the year. Toreen? Thank you, Andy. Firstly, we do not have Sort of, Manoa. What should I say? We do not have Practice of guiding on a quarterly basis, Tasi. So that would not be correct of me to give you a guidance on that. I think the best thing we can do for now is to remind you on the 125,000,000 to 130,000,000. That is the range. And then as we come to the Capital Markets in May, we will also then start to speak about What is going to happen beyond 2021. But at this stage, it would not also be correct of me to mention what our thinking is beyond 2022, Except for the fact that, as you correctly mentioned, SEP will ramp up. And also remember that towards the end of 2022, we also expect to have the contribution from Carl. But guidance on the volumes, I think we will leave until the Capital Markets Day in May. Thank you. Thank you. Thank you. The next question comes from the line from Michael Thirred from Citigroup. I've got a couple, if I could. Firstly, On the Midstream, the EBITDA guidance is typically much higher than what you've guided to for 2021. So I was just Hopefully, you could perhaps elaborate on your assumptions that you're assuming for 2021 and what were the one off costs that Philippe mentioned in his prepared comments. And then secondly, I just thought it was interesting, you're one of the very few companies that provide prospective resources in the upstream. And I just thought it was interesting given the Europro well, but actually prospective resources actually increased by over 10% in 2021. And just more broadly, I just wondered if you could maybe talk a little bit about how, given the energy transition, how you plan to try and monetize this or potential resource base going forward? Thanks. Thank you, Michael. Thank you for your question. Look, I'm going to leave the detailed guidance on the midstream EBITDA to Felipe. I think he did mention the high cost call. Liquefaction that we have in 2021 and obviously some depressed demand through the year, but you may be able to elucidate more on that. And I will ask actually, sorry to also talk about the increase in prospective resources. I have to say that we do give and I think we give 2P and 2C numbers and Some of you will remember how I often talked about the ratio of 2P and 2C to production and how many years we would like to have in the bank there. Galp is in a really, really good position with respect to that metric. And that, I think, again, is a real strength of this company going forward. And Therefore, it doesn't necessarily have to look to the exploration success to see a funnel of good projects coming through over time. So it's in a strong position in the resource base. And of course, again, in Capital Markets Day, we will talk about How we're going to turn that into production, so over a period of time. So can I just then Ask to Filip if he's any more to add on the midstream EBITDA guidance? Filip? Hi, Michael. So in late last year, there was the auction for access to the liquefaction plant in Sinnes, That's the only one we have in Portugal. And a number of players were very long gas. We take or pay commitments, Trying to unload their molecules. So the auction led to a very high one off costs for access to the 2021 capacity. This is most likely going to be reversed next year. You will have seen there was a peak Pricing, both in Asia and in Europe for gas, not as much in Europe. So inventories are down. So there's less we see a lot less pressure for unloading gas molecules in Portugal going forward. So the guidance of $100 ish of EBITDA midstream and refining is actually all midstream, so trading effectively of gas And oil, as the $2 to $3 per barrel assumption for the refinery leaves almost no EBITDA. So our cash costs at about $2,500,000 $2,700,000 There will be very little on our assumptions, Very little EBITDA left in 2021. Thank you. And then if I should just Comment on your second question regarding the prospective resources. Michael, that's The 2 key contributors of the increase there has been Santome and Principe and also there is some contribution from also Namibia, but there is also from Udiapuri as you very correctly have pointed out and as I said in my comment. We have made a discovery there. That has led us to be able to include that in the resources. But as we said, as For now, we do not see that they are on the stand alone basis our commercial, but there is more opportunities set In that block, and we will continue to look forward to derisk that. Thank you. Okay. Thanks all. Thank you. The next question comes from Alessandro Pozzi from Mediobanca. Your line is open. Hi there. Good afternoon and thank you for taking my questions. For R and D, please. If you had to meet an investor today and if their question was what are your top two priorities For Galp, I mean, I was interested what will be your answer. And the second question is, what do you think about refining? Do you think that refinery like Sines can remain competitive over the next 2 years. It's really we may see some Going back on the margins on the back of pent up demand. But going forward, the demand in Europe was sluggish. I was wondering if you think that SINAX could remain competitive in over the next few years. Thank you. Thank you, Alessandro. So yes, I've been obviously thinking very hard about what the top priorities are for me coming into the company. And I think the number one priority is to step the strategic direction of the company. And we have embarked upon A detailed strategy refresh exercise looking at the opportunities we have and the choices we may need to make going forward. And clearly, I will not be able to reveal everything, but hopefully, I'll give some further guidance in May, I think, Capital Markets Day on that. The second, I think it's really just about bringing into Galp a sense of Teamwork of delegation accountability, performance management and agility that will make this a really dynamic company. And I Clearly, I have some experience outside the company and coming in, I think I can sense How I can take what is already a super team and take it to the next level of performance. So something about direction and something about unlocking the Latent performance of the company. I think the future of Sines is one of those big strategic questions. Clearly, It's a refinery now. Clearly, it's a lot more profitable refinery than we had in Machinas. But still, the world is changing fast. So what will we need to invest in that refinery in order to make it fit for the future? And how long is that future going to be? Really important considerations for us as we get into planning our way forward. So we hopefully will see a bounce back of some of these margins. But we also have to recognize that Iberian liquids demand will diminish over time. So how does Sinesh fit and how do we make it one of the top Iberian refineries in that world? Really important decisions for us to take. So thank you very much for your comments or questions. Thank you. Thank you. The next question comes from the line from Jason Kani from Santander. Your line is open. Hey, thanks. Good to hear your voice again. Andy, sorry, my voice is cracking. Really good that your That is a very dynamic company. I've got a couple of questions on well, firstly, the usual tax rate question, if you could. I think I ask it every quarter. Any guidance for the early part of 2021 in the next 12 months at your base case assumptions? Secondly, on I'm still a bit confused about the deconsolidation of renewables, because obviously you created a new renewables division and then deconsolidated everything. So do you think it will still be a deconsolidated business for the foreseeable future? Or once you get past 3.7 gigawatts and start rolling out towards 10 gigawatts, you consolidate that business back in. And maybe just staying on renewables, just The proportion of PPA versus merchant exposure of those 3.7 gigawatts, please. Thanks. Jason, can I just hand those questions to Felipe? I think they're very much in his call. Jason, same questions, same answers every quarter. Longer term on a normal world, we should be At about 40% on a cash basis, 50% on a P and L basis. Now we're not living in a normal world. And not only have we unfortunately created substantial tax losses this year. If you look at the P and L in 2021, most of what you see on the P and L is actually SPT taxes in Brazil. So 85% or 90% is SPT because unfortunately, the non upstream division was not generating any net income. So we need to wait for more normal times to get to where our guidance has been. On deconsolidation of renewables, this is a big point for debate and there will be Some discussion ahead of CMD. But at this stage, we are an oil and gas company. Oil and gas companies have a very, very low leverage, have a much higher cost of capital than renewables. So it kind of makes sense to arbitrage and lever up the renewables division Because there's a different pool of lenders that are very keen to do that. So whether we consolidate and you See that on the balance sheet. It's a bit optical, frankly. And we will give you guidance on If we were to have 100% of this business and fully funded by Galp, what would be the EBITDA? So you'll get that. But accounting wise, this cannot as an oil and gas company, this cannot still be seen as a on balance sheet proposition given the ambitions and the size of the portfolio we want to develop? Thank you. Thanks. Thank you. The next question comes from the line from Anish Kapadia from Palisys. Your line is open. Hi. I had a couple of questions. Just wanted to get Some guidance on a few of the financial items to start with. If you could give some detail on your call. Expectations for the associate dividends that you'd get this year, the Sinopec dividends that are going out and your cash Financial expenses. And then just a second question in terms of just going back to Brazil at the moment, Just where you are in terms of 2P in your existing FPSOs, what's your expectation in terms of Decline rates on those FPSOs now. Now that you've reached plateau production, should we be expecting Those to be moving into decline without any further projects on those. Thank you. Thank you, Anish. Let me ask Felipe to give us some guidance on the first one, and I'll ask Tori to give some guidance on the decline rates and also plans for the plan of development for the CP field in general. So thank you. Hi, Eilish. The dividends to Sinopec fall at the very bottom of the P and L under minority payments. So that's outside of the associates line. We know it was a high number in 2020. That was based on the 2019 performance of Alterygine Brazil. So we're not expecting that sort of number in 2021. The other associates or the associates have been predominantly the pipelines that we have coming from Northern Africa into Iberia. Ggnd, both of these are expected to disappear shortly. So we are selling ggnd, and our access or the use of the pipelines from Northern Africa is under negotiation with Sonatrac and the Moroccan authorities. So I would not bank on continuity of these two lines. We also had the Dutch entity held by Shell, ourselves and Petrobras that was the owner of a lot of the upstream equipment in Brazil. And that's been all sold into the JV in Brazil. So you will be seeing that disappearing as well going forward. So the associates learn structurally will be heavily weighted by the solar portfolio? Thank you. And Anish, when it comes to 2P at SEM and the way forward, right now, what is the key Challenge for us is actually to have and making available the capacity that we actually have For the different unit, I. E, we need to be able to hook up the wells and connect the wells and commission the wells faster so that we can get additional production capacity. We still have wells that needs to be drilled and wells that needs to be We connected. So that is the short term focus and then the little bit longer focus, and as I mentioned in my introduction and remarks and which we are really excited about really is the fact that in the partnership now, there is very, very good discussions about How should updated development plan for 2P at the semi looks like? And what we are in alignment in the partnership is now that we intend to go to A and P towards the It is now that we intend to go to A and P towards the end of this year and to deliver a new plan For development and production. As you know, we in GULP are quite see quite a bit of Additional potential for 2Perezema. There is, as you know, we think there are around 20,000,000,000 barrels of oil in place In that reservoir, and only 1 percentage point improvement in recovery is 200,000,000 barrels. So We think that there is a significant opportunity to get significantly more resources out of To be at the same time, and that is our key focus right now. Thank you. Thank you. Thank you. The next question comes from the line from Matt Lofting from JPMorgan. Your line is open. Hi, gents. Thanks for taking the questions. And Andy, welcome to Galp and congrats on the appointment. Two questions, if I could, please. First, On energy transition, Andy, I wanted to come back to the reference you made during your introductory remarks on Galp being right sized to be agile for the transition. You pointed to pretty active renewables investment this year relatively. When you look beyond pure size, could you share some initial thoughts on where the company can positively differentiate industrially call. Through the transition and how that perhaps feeds into capital allocation thinking into May, particularly given apparent competition and recent low carbon auctions in the region. And then secondly, returning to the cash return frame, clearly 2020 was an exceptional year in A number of different ways. But when you look forward and we sort of take the €0.50 indication for 2021, strikes me that conceptually with the industry's macro cycles combined with Galp's growth and potential transition objectives Prove challenging in recent history for the company to calibrate and sustain an absolute dividend policy. So Could you just talk a bit more specifically about the nature of the dividend mechanism that you're trying to communicate with the $0.50 here? Can it be part of the through cycle absolute distribution grown commensurate with earnings and cash? Or while GAAP remains in growth mode, Does it ultimately need to be configured more around the payout based logic? Thanks. Yes. Thanks for the question. Yes. So look, the differentiators, as I say, I came into this company Kind of aware that they've made this big solar investment and which is clearly a lot of megawatts in Iberia. But when I actually came into the company, I found that it was really dynamic. And then there were a lot of other avenues that have been explored, Whether it's through hydrogen, through Fenish and connections and or it's Through the battery value chain or it's through creating a business that puts solar panel roofs. What I find is a company that with the right focus and the right focus on innovation Can move fast and correct these different value chains. So I think that's a key strength. And why is that? Because it's an engineering company, because it's a company that has access to markets and understands, particularly in the Iberian market, It's customers well. It straddles these businesses and therefore can look at the integration opportunities, But also can invest as we've seen also in, through its relationships across Iberia. And arguably over time, I think in more international spaces with the relationship it has to build an upstream renewable generation portfolio. So it is a mixture of things coupled with this innovation that I think that will and the size where a senior team like I will lead will be able to understand the returns that we get from those various investments. That clearly is priority to put that together and to be able to articulate that in a really compelling way when we come back in May. As for how we look at shareholder distributions, I think this is a company and I said in our remarks, I don't want this company to be valued just because it has some kind of terminal value and we will distribute dividends until we run out of path. That's Not the intention. The intention is for a company that does give a very competitive return to the shareholder, but at the same time is growing not only in to offer good distributions, but also to demonstrate that it is growing, growing cash flows and then obviously over time will hopefully allow also those distributions to grow. So I think this is a company that For those two reasons, I think, should be able to come back with a really compelling proposition To you starting in May and then building away from there. Super. Thanks very much. Thank you. The next question comes from the line from Jorge Guimaraes from JB Capital. Your line is open. Hi, good afternoon. Thank you for taking my question. My first question would be related to your guidance on refining margin. Is it possible to provide us with an update on the long term guidance just with the Sines refinery? I assume it's more efficient. So we'd like to have your view on that. And the second one, it's about the guidance for commercial in 2021. You are guiding for a higher volume of oil product sales and yet you maintain EBITA flat year on year. So I would like to understand better what could be happening in 2021. Is it a reduction in margin? Or what could be going on? Thank you very much. Thanks, Jorge. Look, I will start and I'm going to hand Philippe also to I'll add something on this. With respect to refinery margins, we enjoyed $4 to $5 before. We're talking about $2 to call. $3 this year. So clearly, we believe there's an upside potential to the margin without having doing anything. Now clearly, In terms of Galp, having focused only on Sinesh and obviously closing down Maschinos is going to improve the average margin that we enjoy as a company. And we'll really enjoy that in 2022 once we've gone through the decommissioning and decontamination exercises. Now clearly, the big decision is how many more investments we're going to make in Finnish to actually improve that margin further and look at the various ways that we can do that. And there are multiple different avenues that we could consider investing in the refinery going forward. I think in terms of commercial, It was a strong year in 2020 with given the demand. And demand recovers, but doesn't get back to the 2019 level this year. And this is all around an assumption of the different products and what kind of margin we're going to get on those products through the year. So I think we're expecting another strong year like last year, I think is our conclusion from the commercial business. Do you want to add anything to that, Filippo? Yes. Just on the refining. Without Matos Ingors and given its hydro skimming nature, the theoretical margin Increase of Synes alone would be about $1 over the what we had before for the 2 refineries on a normalized year. So this year, Clearly, we will not have CapEx going to Matos Ingos, but we still have a lot of the OpEx as we decommission, etcetera. On commercial, just a reminder that we had a pretty good 2 months last year over summer And also January February were quite good. So 2020 was bad, but we had pretty solid spirit that we're Where we stand today, we're pretty far from where we were last summer. Hence, still some caution. Thank you. Thank you. Thank you. And our final question comes from the line from Rafael Dubois from Societe Generale. Your line is open. Thank you very much for taking my questions and welcome on board, Andy. One question on Upstream. Can you just explain the decline rates that you're observing at the various Brazilian zones where you are? If some of those zones have experienced finally a pickup in decline in 2020? That will be my first question. And then On Matosinhos, you were trying to sell some parts from this refinery. Can you also give us an update on this call? Yes. Thank you, Rafael. So Look, I don't know to what detail we would want to go into in terms of individual FPSOs and decline rates. It's a typical combination of availability level, Water injection performance, all sorts of other aspects that go into the overall production of these individual FPSOs. As Tori kind of explained that there is a lot of oil and a lot of further opportunity for infill drilling and call? To compensate for decline rate. So to kind of have an image this thing is up to peak and now we'll just Slowly decline away, I think isn't giving the true nature of that the potential of that resource. I will give Troy the floor just in case there's any more to add to that. As to Matt Sinos, and I have to first say that I think coming into this company, My heart goes out to the people that worked so hard for so long on that refinery. And I know that clearly the decision made by the Board in December to close it is a very heavy one on the people involved. And clearly, it's going to remain as a logistics call? And we will look for other ways to use that facility and we're studying that carefully. Clearly, some of the equipment there is equipment that we can use potentially in other projects in SeaNestion, but there are no clear Plans for exactly what we might do there. But our priority at the moment is clearly to make sure that we have a good plan for the people, have a good plan for how we're going to very responsibly decommission and decontaminate the site and then plan on what we will do and what we can do with the call. So Tore, any more to add on this? I guess you will agree this isn't a simple now it's all about decline. It's all about Coming out with a plan that makes sure that we don't get too much decline at all. So sorry, how do you want to address that? No. So first of all, it would not be correct of us to go in on this on an individual FPSO basis to discuss this. The key focus Last year, and it will remain the key focus this year, is to make sure that we get available the resources, I. E, the wells, Injectors that we have in place, make sure that we do the planned well workovers. Due to the capacity constraints, that has not been to the level that we really wanted to do in 2020. That is also why we are Courses for 2021 that we do not necessarily have access to the resources in this respect as needed. And then it is, as Andy said, it is a combination of the water injection capacity, the gas export capacity available and then at the same time, prudent reservoir management, where we do see that there is the need to make sure that we have the proper reservoir pressure in order to make sure that we can, in the best possible way, optimize the production. But as I said in my previous intervention as well. Key focus here guys is that there's still a lot of oil to be taken out of To Pietersema. And our focus now is really now to come up with a very good plan for how can we further maximize recovery in this field to second phase of development. And the partnership, as I said, is working really well in this aspect to maximize recovery of the pit. Thank you. Very clear. Thank you. So I think we'll come to the end of this session. Thank you all. The IR team will be happy to take any further questions that you might have as always. So I hope to see you all soon. Bye bye. That does conclude the conference for today. Thank you all for participating. You may now disconnect.