Petroreconcavo S.A. ($RECV3)

Good morning. We're going to start our fourth quarter 2025 earnings call, and we're just going to wait a few minutes for the people to enter the room. Good morning, everyone. We're just waiting for everybody to join us, and we will start. Okay. Good morning, everyone. Thank you for waiting. I am Maria, Director of Investor Affairs of the company, and we're going to start our results presentation of the fourth quarter of 2025. Our Executive, Jose Firmo, CEO, [indiscernible] CFO; and [indiscernible], Vice President of the Development of the Portfolio. They will make the presentation. We will then have a Q&A session with the Executive Board. I would like to welcome[indiscernible] , who is now going to into the operational area, and we have a surgical procedure that one director have to accompany, so he is not going to be with us. And we're going to have everything available on the company's site. Please send your questions from the QR code with a name of the person who is asking the question, and we will have that after the presentation. All the declarations here in this video conference that have to do with the business perspectives of the company and the targets depend on only on the Board as well as information available of the company. And future considerations are not a guarantee for performance. So Firmo is now going to begin.

Thank you, [indiscernible]. Good morning. Welcome to our 2025 results presentation and our most recent booking report. We ended 2025 strengthening Petroreconcavo's operational maturity with relevant advances in the execution of our strategy and a permanent focus on creating long-term value. The period was marked by an environment of price and exchange rate volatility and closed with an average Brent 14% lower than that observed in the previous year. We still delivered solid results, reflecting the resilience of our operating model and the discipline in executing our strategy. From a financial point of view, the net revenues totaled BRL 3.2 billion in the year and down 3% compared to '24, impacted by the pressures observed in the price of Brent and partially offset by the relevant contribution in the sale of natural gas. Compared to the quarter, we had net revenues of BRL 704 million, 10% less than in the previous period. EBITDA was BRL 1.4 billion in 2025, a reduction of 12% in the year-on-year comparison, evidencing the resilience of the company's cash generation even in the face of a challenging macroeconomic scenario. In the fourth quarter, we had an EBITDA of BRL 295 million, 16% lower than in the previous quarter. The lifting costs increased year-on-year and ended the year at $14.42 per barrel with a relevant improvement in the fourth quarter, already reflecting operational efficiency initiatives and rigorous cost management. Net income was BRL 638 million in the year, an increase of 46% compared to 2024. In the quarter, we had a profit of BRL 51 million, a decrease of 58% compared to the previous quarter caused by the mark-to-market of the exchange variation of our liabilities in dollars. At the operational level, the average production was 26,500 barrels of oil equivalent per day and stable compared to 2024. We also maintained a sound capital structure, ending the year with leverage of 1.10 versus the net debt to EBITDA and the net debt of approximately $1.6 billion. We also continue with a disciplined capital allocation with BRL 263 million in dividends already distributed and another BRL 300 million declared, reinforce our commitment to generating value for shareholders. The fourth issuance of debentures carried out throughout 2025 contributed to the lengthening of the debt profile and the reduction of the average cost, strengthening the efficiency of the capital structure. Later, Rafael will detail in greater depth the company's financial performance. Finally, I highlight an important structural advance, the acquisition of 50% of EPGM [indiscernible] and the adoption of the proportional cost apportionment model that strengthened the resilience of our midstream and has already resulted in an annual reduction of approximately BRL 61 million, which includes reductions in processing and flow in addition to optimizations in transport contracts. Average production remained stable in a year marked by relevant technical decisions and the execution of more complex projects. Throughout the year, we drilled 15 wells, including producers and injectors in addition to 2 deep wells in Bahia and the first horizontal well in the company's history, significantly expanding our knowledge of the subsurface. In the evaluation of the 2 deep wells, we confirmed the presence of hydrocarbons and the identification of new zones with preserved pressures, expanding the knowledge of the assets and the long-term potential. Development plans for these reserves will now be built in the coming years by applying all our knowledge and technological capacity necessary to achieve the levels of economy required for these developments. In Rio Grande do Norte, the company's first horizontal drilling was completed, generating relevant technological learning that could pave the way for new value levers. Despite the production challenges of these wells, the company has evolved technically and continues to mature technological and cost reduction solutions with a focus on economic viability and future investment cycles. In summary, 2025 was a year of important strategic decisions in which we moved beyond the traditional model to prepare Petroreconcavo's future, combining operational stability in the short term with the construction of new value levers in the long term. The evolution of our operational resilience has been a concrete venture of value generation through logistics and commercial diversification, greater security in the flow and cost optimization especially in Rio Grande do [indiscernible]. On the front of alternative oil wraps, we signed a contract with [indiscernible], Ecuador for the construction and operations by the Port of Bin, creating a dedicated structure for storage and handling of the company's production. This initiative increases logistical flexibility and commercial efficiency and has the potential to generate more than $10 million additional in revenue annually for the company through the reduction of discounts and the opening of new marketing routes. In the midstream, the acquisition of 50% of the [indiscernible] assets represented a structural advance in the integration of the chain and in the strengthening of operational reliability. This new configuration has already translated into a reduction of approximately 41% in flow and processing costs a saving of BRL 12 million in the fourth quarter of 2025 at [indiscernible]. Looking ahead, we estimate recurring savings of around BRL 50 million per year, reinforcing value generation via efficiency and greater resilience in the flow of gas in [indiscernible]. We also made progress in the diversification of natural gas commercialization with the inauguration in partnership with GM Link, the first gas liquefaction compression unit in [indiscernible] with a capacity of up to 100,000 cubic meters per day. This initiative is strategic in expanding the customer portfolio, creating additional outflow alternatives and reducing operational risks. In an integrated way, these initiatives reinforce a more resilient, more integrated Petroreconcavo Group with greater control over its value chain, combining increased revenue, structural cost reduction and mitigation of operational risks, as you will see in the cost slides that will be presented by Rafael later on. On this slide, I want to highlight the resilience of our revenue in our adverse year for oil, underpinned by the oil and gas portfolio balance strategy. In 2025, we operate in an environment marked by a relevant drop in Brent, which fell about 14% year-on-year and higher discounts on oil trading as a result of contractual revisions. Even so, net revenue showed a reduction limited to 3%. This performance reinforces a structural differential of [indiscernible]. The oil gas balancing strategy, combined with an active role in trading was key to mitigating the impacts of the negative Brent cycle. While all revenue were treated pressured by the lower price of Brent and higher discounts after contractual adjustments, natural gas revenue grew 5%, reflecting a better use of the gas produced as an example of the construction of the [indiscernible] gas pipeline. We also had better pricing as a direct result of the trading strategy and contracts that work as a natural hedge and an improvement in the pricing of liquids extracted from the gas. In a challenging environment for oil, we were able to demonstrate the solidity of a robust, flexible business model prepared for different market scenarios. And now I give the floor to Rafael to continue the presentation.

Thank you, Firmo, and good morning to all. We demonstrate the evolution of our costs and expenses here, both in the quarterly and the annual view and show important advances in operational efficiency. Starting with quarterly costs, we observed a reduction of approximately BRL 14 million or 10% in the fourth quarter of 2025 compared to the third quarter of 2025. This reduction is even more pronounced when compared to the fourth quarter of 2024, representing a decrease of BRL 61 million or 14% year-on-year, consolidating a new level of costs for the company. This drop is mainly explained by 3 factors: reduction in the lifting cost, the midstream costs and royalties. Regarding the lifting cost, there was a reduction of BRL 28 million quarter-over-quarter due to lower costs with asset integrity and well repairs, taking the absolute cost to the lowest level recorded in 2025, approaching the average level observed in 2024. This reduction is also reflected in the cost per barrel, which fell from USD 15.52 in the third quarter of 2025 to USD 14.32 in the fourth quarter, representing a reduction of 8% compared to the previous quarter despite the lower production in the period, which impacts the dilution of fixed costs. Midstream costs decreased by 18%, reflecting the initial gains after the acquisition of 50% of [indiscernible] with lower processing outflow and transportation expenses in Rio Grand do Norte as foreseen in the business case of the acquisition and as already highlighted by Firmo. As for royalties, they also showed a decrease when compared to the previous quarter following the lower reference oil prices in a lower Brent environment. Finally, general and administrative expenses increased quarter-over-quarter, mainly reflected in legal, IT and reserves reporting services. In the year-on-year comparison, there was an increase in costs of 5%, totaling $1.6 billion in 2025, reflecting the higher expenses in the first half of the year. In summary, the performance of the fourth quarter reinforces a level of normalization of the cost structure, supported by the capture of operational efficiencies and the strengthening of the company's resilience. In the fourth quarter, we observed a relevant reduction in the breakeven cash cost, a direct result of the improvement in the company's cost structure previously presented. In the quarter-on-quarter comparison, the breakeven fell by USD 1.1 per barrel fell by USD 1.1 per barrel from USD 28.9 in the third quarter of 2025 to USD 27.8 in the fourth quarter of 2025, mainly driven by the drop in lifting costs and midstream resulting from the acquisition of [indiscernible]. This movement shows gains in operational efficiency and greater cost discipline for the company. On the right, we have the EBITDA bridge. Despite the reduction in the price of Brent by 14% year-on-year, EBITDA decreased by 12%, ending 2025 at $1.4 billion with a margin of 45.7%. The 2025 CapEx reflected the acceleration of operational execution throughout the year, while in the fourth quarter of 2025, it already incorporates a gradual change in the profile of investments. In the development of reserves, we observed a reduction in CapEx in the fourth quarter, reflecting the lower drilling activity and workovers in the period, adjusting the pace in a scenario of reduction in oil prices. In 2025 as a whole, we made relevant investments in deep and horizontal wells, a strategic decision with the potential to generate value in the long term, which are part of the plan that aims to determine the most efficient and best value way to develop new reservoirs in the coming years. At the same time, we have intensified our execution of workovers and facility projects with a focus on asset integrity, operational reliability and the beginning of a more accelerated expansion of water injection projects. We continue to strengthen our ability to execute. And although we have not yet reached to the ideal level, the advances are clear and create a sound foundation to capture sustainable results. In the midstream, the acquisition of assets in [indiscernible] was a structural move to integrate the value chain and 90% of the amount has already been disbursed in 2025. For 2026, the trend is for a more conservative CapEx in line with previous years with less intensity on the drilling front and a focus on financial discipline and return. This slide reinforces a central point of our commercial and financial strategy. The search for a balance that allows the company to safely navigate the cycles of volatility of Brent oil while capturing upside in favorable price scenarios. Starting with the oil hedge, the company maintains a very disciplined policy. For 2026, we have about 65% of the oil production, 1P oil production protected. For 2027, this number is reduced to about 37% and to 9% in 2028, which guarantees cash predictability but allows us to capture upside in positive Brent movements. On the natural gas side, our strategy is even more differentiated. With contracts structured with gas pricing as a percentage of Brent with floor and ceiling or fixed price plus a variable portion, gas brings an important protection in adverse scenarios and at the same time, has the flexibility to capture higher prices when Brent rises through the redetermination of Brent in the gas contracts. In practice, this works in the following way. For the downside, there are currently contracts with an average floor of contracts worth approximately USD 74 per barrel, which protects profitability in downside scenarios. In addition, products like LPG and fuel gas have fixed prices, which adds even more stability to cash flow. For the upside, part of the contract is pegged to uncapped Brent or higher caps, near USD 141 per barrel, allowing it to capture additional value in more favorable price environment. So looking at 2025 as a basis, our capacity to get the upside Brent in our natural gas revenue is approximately 42%. This framework allows us to combine the best of both worlds, predictability and margin protection in stress scenarios without giving up upside potential when the commodity cycle is positive. It is a strategy that reduces volatility, improves visibility of results and reinforces the quality of our cash flow over time. In this slide, we demonstrate the evolution of the company's cash position. So starting from the initial cash position of 2024. The main positive lever was the strong operating cash flow, which added around BRL 1.2 billion, reflecting the robustness of the assets and the operational efficiency of the portfolio. This cash was consumed by CapEx that totaled approximately BRL 1.45 billion, including nonrecurring events that we would like to highlight. The first one, about BRL 331 million were directed to the acquisition of 50% of the midstream assets in Rio Grande do Norte. And in the second place, another BRL 160 million were invested in deep and horizontal well projects. Another relevant movement was the issuance of the third and fourth debentures with funding of approximately BRL 1.2 billion, further strengthening our liquidity and which we will detail better in the next slide. Next, we observed the outflows related to [indiscernible] paid in the amount of BRL 263 million in addition to interest paid and other disbursements of BRL 232 million. As a result, we ended 2025 with a cash position of BRL 1.6 billion. All these movements reflect a more optimized capital structure with shareholder remuneration and active management of liabilities. Finally, when we look at free cash generation, we see that in 2024, we generated around BRL 1 billion. While in 2025, the number was BRL 196 million, mainly reflecting the drop in Brent and the higher volume of CapEx with the nonrecurring events already mentioned. This slide summarizes well our work in recent years in search of efficiency and optimization of our capital structure. As can be seen, in the last 2 years, we have achieved a significant reduction in the average cost of debt, which in 2023 was composed of bank loans with an average cost of almost 9% per year in dollars. While at the end of 2025, this debt was completely replaced by debentures raised in the period, which resulted in an average dollarized cost of 6.1% per year. In addition, we were able to lengthen the debt profile, and we got a better distribution of amortizations over the years, ending 2025 with a duration of 4.1 years and a leverage of 1.1x the net debt EBITDA of the last 12 months. Speaking specifically of debenture issuances, 4 operations were concluded between 2024 and 2025, all with excellent acceptance by the market and with successive reductions in the average cost, already considering the swaps made to dollarize the debt. The first issue came out at about 7.1% per year, while the fourth came out at 4.9% per year, a benchmark in the sector and demonstrating not only the good market moment for these fundings, but also the recognition of the company's differentiated credit quality. In summary, this fourth issue consolidates a very clear strategy, less cost, more time and greater predictability, creating a solid capital structure to sustain Petroreconcavo's growth in the coming years.

Back to you, thank you, Rafael. So the year of 2025 was also fundamental for us to continue moving forward with our contribution and positive social impact. Throughout the period, Petroreconcavo social project impacted directly and indirectly about 21,000 people in Bahia and New Grande do Norte, a growth of 21% compared to 2024, with initiatives present in 40 communities covering 75% of the areas where we operate. One of the main advances of the year was the implementation of [indiscernible] in partnership with the [indiscernible], an initiative aimed at strengthening municipal public education. In the first year, the program benefited more than 11,000 students in [indiscernible] with relevant advances in literacy indicators and the qualification of managers and teachers in the network. We also started the women in oil and gas project in partnership with [indiscernible], which offered a technical training course for 30 women focused on the oil and gas industry that is being completed now in the month of March. The initiative expands opportunities for professional inclusion and contribute to strengthening gender diversity in our sector. Finally, in 2025, we became part of the B3 Dividend Index as well as Great Place to Work Index portfolio, the IGPTW in addition to the GPTW certification, recognitions that reinforce our commitment to the best people management practices and consistent generation of value for shareholders. Before we move on to the Q&A section and taking advantage of the fact that we released our new reservation certificate yesterday, we now present the 2025 reserve certification with 182 million barrels of oil equivalent in 2P reserves which clearly illustrates how the continuous identification of new projects continues to be the main growth vector of the company's reserves in [indiscernible]. It's 26 years of experience in revitalizing mature fields with consistent results and a disciplined process of incorporating incremental workover drilling and secondary recovery projects all evaluated and certified by one of the most respected independent certifiers in the industry. A relevant point is the reserve replacement ratio achieved, which was 0.96, which demonstrates our ability to offset practically all production in the period with new certified reserves, preserving the longevity of the assets and the stability of the production profile over time. In addition, 79% of 2P reserves are classified as 1P, evidencing one of the lowest risk portfolios in the Brazilian onshore sector. Natural gas also stands out, representing 43% of total reserves, contributing towards diversification of the mix and greater strategic resilience. Taken together, these results reflect a company with a proven technical capacity to originate valuable projects, allocate capital in a disciplined manner and sustain reserve growth in a consistent cost-effective manner and in line with operating cash generation. And with that, I give the floor to [indiscernible], who will present the certification a little better.

Overall, our reserve report this year represents a very strong and consistent addition of projects in the conventional development of these mature fields. During the year, we were faced with an environment in the price of oil that was very challenging as we approach this reserve report. In spite of that, we were able to add additionally new projects in the area of workover in excess of 300 workover -- new workovers added to the report as well as around 20 new drilling locations. We also included in the report additional projects of water injection and secondary recovery, pilots that we had initiated in new reservoirs that hadn't been flooded under waterflood before, but were validated by our reserve auditor during the investigation process of the reserve report that allowed us to increase our reserves during the year under a 2P scenario of 9.3 million barrels. As Firmo said, that nearly replaced the production that we had and generated a reserve replacement ratio that's close to 1. Given the economic conditions and the lower prices of Brent that we saw during the year, that was a challenging achievement to secure. As we progress through the reserve report, we have increased our estimated recovery -- estimated ultimate recoveries in these reservoirs in our oil and our gas reservoirs. We still maintain a benchmark for our oil recoveries on the order of 30% to 35%, and we have multiple reservoirs that are at that level now. But you can see that we have additional room to grow this in the future through additional project identification as well as in the gas area, where we're approaching 74% estimated ultimate recoveries, but targets in the range of 85% to 90%. One of the strongest parts of this report for me is the reserve to production ratio. it's nearly 20 years. That reflects a very robust and extensive and diverse project list across the company that can be scaled over time. Obviously, with the environment of lower oil prices and looking to the future, thinking those might drop off even more while the report was being prepared. It was a challenge to schedule our capital allocation within the report and also maintain the discipline to execute the projects. As we move into the production forecasting that exists in the reserve report, during 2025, we had several challenges, principally in the [indiscernible] with the accentuated decline that we saw there that didn't allow us to achieve the levels of production that we had expected during 2025. anchoring this reserve report in the present production levels of December, you can see that our forecast now for 2026 is at about 26,500 barrels for the year. The gradual growth that you see in the P1 forecast is based upon a very disciplined capital execution report for the development of our proved reserves and the incremental 2P forecast that you see that rises to approximately 37,000 barrels in 2030 reflects the response of the waterfloods and the incremental wedges that we will see there with the future development of those floods over the coming years. The combination of the lower production estimates for the coming years and also combined with the addition of the other forecasts and the discipline on our capital execution generates a cash flow curve that is more modest going into the future for the next 5 years, but also extends the cash flows that we see into the future, as I had said, with the additional projects that we have. Overall, it was an environment where we were expecting to see a lower Brent prices within the next couple of years, but the report continues to have significant levels of projects that are -- that are very diverse and able to be executed. We had some increases in the lifting cost in the report, but those were balanced by the reductions that we saw in the midstream costs. So our overall operational cost structure in this report remained relatively flat. When we take a look into the future of the capital expenditures. You can see that under a disciplined environment and a reduced Brent environment, the reserve report forecasts a reduction in our capital expenditures for 2026 from the 2024 report that we had presented last year. That gradually comes up and achieves a higher level with some of the waterflood development projects that will be advancing through the next 2 to 3 years. But overall, what we saw with the profile of our development CapEx per barrel was effectively in a real sense, the same as we had projected last year. We had some adjustments that occurred due to the exchange rate variation that we saw at the end of the year, and that accounted for most of the increase in the dollar portion of this report. We continue to be very careful and disciplined in how we allocate capital. The additional projects that we added this year are strong and robust, and they're focused in the conventional development that we are executing in these mature fields. Last year, we went and drilled additional deeper wells and started into the program of drilling horizontal wells, learning a lot about those areas and the existence of those hydrocarbons that we had there. But for the future, those projects remain outside of this report as we continue to optimize our cost structure on those projects and gradually migrate them through our opportunity development plans for the future. I'll pass it on to Rafael to finish.

Thank you, Troy. In terms of value, the 2025 certification confirms a perspective of expressive and well-distributed future cash flow generation over the years, which reinforces the predictability of cash generation and the longevity of the portfolio. Even under more conservative assumptions in the annual comparison, especially the reduction in Brent, the 2P reserves continue to support a [indiscernible] USD 2.4 billion and a PV-15 of $1.9 billion in 2025, indicating a high intrinsic value for the company's assets. In summary, the 2025 reserve certification confirms a solid and resilient asset base with consistent production, disciplined CapEx and robust cash generation over time, evidencing the solidity of the economic value and the company's ability to adapt quickly to market changes. And looking at the future and reaping the fruits of the last 2 years of learning with this team, we are very aligned and very clear about what we must do. We are all guided by discipline in execution today and for long-term value creation. The first is the robustness in subsurface management, focusing on maximizing the recovery of reservoirs with primary and secondary and accelerating development of new technologies that extend the longevity of reserves. The second pillar is the reliability and resilience of production, integrating gas and midstream, ensuring efficiency and flow, asset integrity and operational gains throughout the chain. Finally, excellence in the execution of interventions and drilling and workover with rigorous planning, optimization of rigs and services and with efficient supply chain management. And finally, continuous development of people. And at the end of the year, we have the organizational structure to align the organizational design with the strategy. So as of January, [indiscernible] will assume the Vice Presidency of Operations with a focus on safe and efficient production management, while Troy became the Vice President of Portfolio Development dedicated exclusively to strategy and subsurface management. In addition, [indiscernible] expanded his scope as Finance and Investor Relations. also accumulating M&A and the capital planning and allocation. Finally, in January of 2026 with the departure of [indiscernible], Rafael assumed the position of Vice President of People and Operational Support, consolidating the new structure aligned with strategy and operational efficiency and long-term value creation. 2026 has started with a lot of turbulence, but also with a lot of opportunities, and we are absolutely ready to generate even more value this year. Thank you very much. Maria, do we have the questions?

Thank you, Rafael, Troy. I'm going to try and because of the time, I'm going to put some questions [indiscernible]. So the first one is -- and I'm going to get together with Jean Paul. What is the production expectation for 2026? And can we talk about the strategic plan the company has for the growth of production in the next cycles and especially with regard to cost optimization and operational gains?

Thank you for the question. I think the last 2 slides have the objective of giving this answer. The expectations for this year that we designed, this was a year of CapEx reduction. So it was much more conservative, removing from the CapEx, the more daring drilling, let's call it that. We have conventional drilling and also stabilization in workover. Of course, we didn't have any midstream acquisition in the plans this year. So the CapEx is lower with a production expectation that is flat. So that's our expectation that we trace in this year. The idea is to really structure and mature these projects. So last year, what we did for the company was develop alternatives for the development of reserves. And now we're in the traditional process of oil and gas and planning and development of fields for us to design preparation for the future. So this year, we have many projects in our reserve report, and we're going to develop them traditionally. So flat production and reduction of CapEx. Of course, when we made this plan in the -- everyone in the oil and gas area. They had a distinct view of what we have today. And I think this is one of the questions that should come up. The company has the flexibility to change depending on the environment and the price of oil. In the environment that we evaluated, we have this perspective. The CapEx would be much lower and a flat production for this year. The possibility of accelerating and changing this exists. Let me leave our view in very clear. What we see today is a change definitely in terms of the oil price, but there's still a large level of uncertainty. for the duration of this change. So we have to wait a little longer and understand what's going to happen over the next few weeks and months so that we can actually change the course of the company. Today, the company is implementing what was designed, which was 1 year of CapEx that was more restricted with a flat production. Okay. So you answered most of the questions that came in. All right. So I'm going to go to the hedge. There's another question from [indiscernible] and from JP, we have one from Rodrigo, BTG that I'm going to put together. There's a hedge disclosure of the company showing that at a certain Brent level, they were able to capture high prices. Can you explain what the mechanism is and what the commercial policy is like at this moment? And if we can comment on the beginning of the year, where we have more hedges and if we can actually provide an idea of how this was done and what the conditions are. So that was -- part of it was already in the presentation. But anyway, let me just introduce this. So the company hedging today is not a debt condition anymore. It's not another restriction that the company needs to have. It is fundamentally strategic -- and we observed the hedging. We observed the hedging very clearly here. And Rafael brought a slide that tries to provide visibility. Fundamentally, the oil and gas portfolio of [indiscernible] allows it to have a protection structure that is very asymmetrical and it's very interesting. I think it's a differential aspect for the company. So I think that all the hedging decisions many people have asked about hedging for the future. And this takes exactly the same premises that we had in the past, structuring the company in a way so that it can capture value in both circumstances. If there is a change going down, and this could happen at any moment and very quickly in the industry or even maximizing what it can do in the case of high prices for a long term. I think he tried to explain in more detail in the presentation that I made -- so in terms of oil, the instruments that we use, they are conventional. We have 0 cost collar structure. And normally, the floor is about $60 a barrel. In this specific case, the contracts that we have, the cap is about $70. These are the instruments that we have since last year. And more recently, we had the format of swaps. So fixing the price, mid-60s more or less. That's the oil price. Inside the scenario that there were 3 consecutive years of downfall of the oil prices and the understanding in the market was that there was a large probability for oil to go -- get close to $50. So we tried to protect ourselves. And then there's about 35% of oil that is not hedged. So it captures the upside completely. And then there was also the gas contracts because the gas contracts have a great protection in terms of downside. So we were able to have about $70 per barrel. But at the same time, they captured the upside as well, so about 40%, 42%, which is the account we made. And in the contracts that are directly connected to Brent as well as those that have a cap, but the caps are very high, about $140 a barrel. And there's a series of contracts, C3+, C4+, et cetera, and they are completely associated to the Brent. So in terms of gas, it's interesting and gas is about 40% of the company revenues. And on that side, they also capture the oil upside. Okay. The question from Gabriel in this scenario, I think most of it you've already answered, but there are some interesting points here. In this scenario of elevated oil prices, we can see the campaign accelerating with more workover and drilling campaigns to increase production. If that is the case, would the company be able to have additional investments with their own equipment? Or would they have to hire more? Yes, this is more detailing. So our capacity for workover since we are talking -- it's very interesting. So what we developed in the country -- company here is the capacity of doing workover at a very low price, low cost, right, and very controlled and also being able to accelerate and deaccelerate workover very easily. And that was one of the requirements. So there is an execution performance that is very high, and it can accelerate and deaccelerate very quickly. It can learn and unlearn very quickly. So we have an operation that very quickly in the same month or in the next month, we can understand the results and we can accelerate or decelerate. Our flexibility of 55 concessions with a list of more than 2,500 projects that are in certification. That's a great reserve and knowing how to modulate this activity or this workover activity is very important. But I think we established the premise that we are going to carry out about BRL 400 million in terms of workover and depending on how we decide to do it. So it's a lever that we're going to accelerate 30% to 40% more because of the oil price. No. That's not going to happen. I think the lever has to be in drilling, where we have equipment that is available to accelerate. And actually, it's the only sector that the company uses for the partners that have flexibility for drilling. And the flexibility and workover is all inside our own equipment, using our own equipment, and we can hire more, but only in very specific cases, special cases. And in drilling, we have a lot of flexibility to accelerate or not. And these levers are much more efficient to capture production if we actually see an increase in price that is sustainable in terms of oil for the next 18 to 24 months. So this is basically the lever we have to be able to make an evaluation of the production in the short term. So it's less workover and a lot more drilling. And Gabriel from citi. Considering the scenario of higher prices, the company should be able to delever more rapidly. So what is the focus of capital allocation in this scenario of lowering the leverage. So let's talk about some scenarios that I think are important. Scenario #1, which is being implemented today is a scenario of a more restrictive CapEx with flat production and material prices have to be maintained. So you're going to have a bigger cash flow bigger than expected because you're going to capture the -- as we said, we are able to capture part of the upside and then we have a bigger cash flow generation that allows us to talk about this. I've been explaining this to the market, how we do it. So quarter-to-quarter, we sit down with the Board. We evaluate the capital allocation that brings all the availabilities of investment plus drilling or workover if necessary or the possibility of an acquisition in the midstream or an M&A or the allocation of capital through dividends or rebuying of shares. So we revisit this every quarter based on the cash that we generated and the cash expectation that we're going to generate later on. So today, uncertainty, in my opinion, is still very high. But obviously, what has been demonstrated is the possibility of a bigger cash generation and consequently, flexibility for the allocation of capital. So the question about the dividends, I think we've already answered that. I think the whole market has already understood the strategy of [indiscernible], flexibility and being able to do this every quarter depending on the opportunities that come up. So as we've seen, and it's not news to any of us who are decades in the oil and gas area, that's unpredictable. So that's -- there was no doubt in our minds in October of last year that this would be a year of depressed prices in oil. And what we're seeing is a record every week. So this is an environment that's completely unpredictable where the allocation of dividends, the possibilities of M&A, the acceleration of the development of reserves, all of this has to be evaluated in a much more flexible manner compared to other industries. and I always said that and I believe in this, has an advantage, a huge advantage in its cash generation and what it does according to everything that we show in terms of resilience that the company has, it can allocate this in the best way possible. So if there is a possibility of increased dividends this year, yes. Last year, we reduced the dividends based on the investments we did. This flexibility, I think, is already well known in Petroreconcavo. And for me, this is a competitive advantage that we have. Okay. So there's a question from [indiscernible]. So do we see any possibilities, any opportunities, right, for participating in the next cycles of permanent offer areas and also areas that are marginal and this if this opens up a new cluster for the company. Does that make sense? Well, the first part is yes. We participate in the evaluations all the time in terms of availability of areas, and we participate actively in the sort of resource. When he talks about the idea of something marginal, so that's a division that is very interesting in our sector. The oil industry is more or less divided between the exploration of the reservoirs and also the mature fields and then there's the marginal field. And Petroreconcavo does not have the strategy or intention to participate in the marginal area. So marginal is definitely outside our scope. And last year, we actually made some portfolio movements, and we got a marginal field, and we gave it [indiscernible] that proposes to do this in the best way possible. So this is what we see, and this is what happens in the oil and gas industry around the world. You have specialized clusters. So our great our great capacity, our DNA is in what we do every year. So if we're able to, through our concessions, enhance the recovery of our reservoirs in a way that 100% of the production that we spent in the previous year, we substitute that with new reserves. So that's our DNA, and this is what we've done over the last 25 years and has generated a lot of value. We're going to continue to do that, always focused on this. Marginal fields is one point. It's an area that definitely has other experts working on this, and we're going to manage our portfolio with this. I don't know if that was the question, but -- and we still have some questions about prices, and then we'll go into certification. So over here, do we believe in the pricing of the gas contracts? How are they going to behave over the next few months? And talk a little bit about Bahia Gas that has a component that is not connected to Brent. So if we can explain the pricing expectations in the context of the higher Brent prices. Well, the only thing I think Rafael actually gave details about this. Just remembering that they go through a quarterly assessment. So there is a repricing system. There's an adjustment of prices every quarter. So they don't react in the same way as oil because oil is daily. That's the only visibility we have. But since you've changed the -- that's still part of your position, I'll allow you to give more details. Well, so the contract that we have is long, and we have the development of Mina. We're in the last year. And there is a great portion of it that is fixed in dollars that goes through this mechanism of quarterly adjustment. And there's an additional portion that is connected to Brent. So today, there's the upside, but most of it is a fixed price and there's the protection of the downside. But the variable portion is -- yes, well, we think we have to think about 2026 and wait and see the volume of these contracts compared to 2025 to say that it's the last year of the contract. Yes, that's right. We've already been through the peak in the contract in the second, third and fourth year. And now in the fifth year, it has already gone to a lower position. So today, it's a smaller part of our portfolio. But gas in Brazil -- and the crisis now is not only oil. We can see that over the last few days, there's something structural happening in the global gas industry. We have expectations. if they ask me about the price expectations for gas, it's for it to go up and follow not directly, but it will follow the same line as the oil price, at least in the short term. That's what we see, which is very uncertain. I still believe that nobody knows this clearly. We cannot model it. But this is the view of 18 to 24 months. So there's a lot of short-term issues happening, and we have to wait a little more to understand what kind of disturbance, especially in LNG that we are looking at. We see this current moment, and we're making very important changes and difficult to understand in the long term. We don't know what's going to happen in the LNG market. Okay. So I'm going to go into certification now. I have a question from Gabriel from Citi and a complementary one from. So the first part asking about details and the increase in CapEx for the development of reserves. And if you can actually bring a little more color to why this was increased? And do you expect any increase of complex drilling compared to the drilling in the previous certificate? I think that's important. The slides give us this view to explain this. So we saw a reserve certification last year that was done with dollar at BRL 6. And this year, the dollar is BRL 5.60. So it's a huge difference. And the Brent also is a huge difference in terms of the economics of the field. But one of the great topics, the main change in the cost that happened in the report came from the change in the exchange rate. So usually, you have an increase of 3% in the CapEx and the general cost that comes from the observations that you make every year and checking what is happening. We don't see an inflation of cost, a huge inflation of cost. Our short-term lifting costs, and we talked a lot about this in the market. We needed to increase the company's resilience. We invested quite a bit in a series of -- in an increased resilience. And what we did was in terms of aggregating assets, we increased that, but that's not perpetuated in the reserves report. The report shows an optimization curve that is quite high, but there is no increase in the inflation reserve, let's call it that. Of course, there is a small portion, but it's very little. There's nothing about deep wells or complex wells. These are in 3P or in the contingency resource. There's nothing in 2P that will absorb any kind of cost considering what we did last year because that's the 1P and 2P traditional, right, 90% of probability, up to 50% of probability in the 2P and 1P curves. So that's important to understand. And I think we provided -- well, the total OpEx of the reserves is is smaller because we have midstream integration that is bringing a lower cost for the future. That was the strategy. So in fact, if you look at the reserve report as a whole, you're going to see that the level of efficiency of Petroreconcavo has increased over time comparing last year with this year because of the total OpEx being lower. But you have these effects, and we try to provide visibility to them in the presentation. Great. So I think we heard -- we answered most of the questions. There are others that have already been answered. So I think we can close. Thank you, and see you next time. Thank you. Bye.