TechnipFMC plc (FTI) Earnings Call Transcript & Summary

Hello, and welcome to the Technip Energies Capital Markets Day. I'm Phillip Lindsay, and I will lead Investor Relations for Technip Energies and will coordinate today's event. We're broadcasting this event live from Paris, with the stage set up following strict COVID guidelines, and all of our speakers have tested negative for COVID in the last 24 hours. Technip Energies has assembled a highly capable and experienced leadership team with a demonstrated ability to deliver world-class project execution to drive innovation and to inspire a highly talented workforce. I'll now let the team introduce themselves. Arnaud?

Hello and welcome. Arnaud Pieton, I'm CEO-elect for Technip Energies. I have over 22 years in the energy industry. 17 of those years with Technip and TechnipFMC and now Technip Energies. 12 of those 17 years, I have spent abroad in the U.S., mainly, but also in the Far East and Asia Pacific, leading various parts of our business. And all this before joining the executive team of TechnipFMC on day 1 of the formation of the new company as the Head of the Human Resources function, which we are now calling People and Culture. I then led the Subsea business before being Technip Energies, supported by this highly energetic and very capable team, which I know very well.

Thank you, Arnaud. Bruno?

Thank you, Phillip. Good afternoon, everyone. So prior to joining Technip 7 years ago, I've been success -- I've been 15 years as public -- in public accounting and then as a consultant, but always with a constant focus on the energy sector. Since joining Technip 7 years ago, I've been successively in the U.S., then CFO for the Yamal LNG joint venture. And for the last 3-plus years, I've been the SVP Finance for the segment. So it's a real pleasure to be here today in this continuity, but also to open this new chapter as the CFO-elect.

Thank you, Bruno. Marco?

Hello to everyone. I'm Marco Villa, COO-elect, 30 years experience -- international experience in finance, business and operation, out of which 25 in Technip, where I held several role of increasing responsibility in such a domain. Since the merger with TechnipFMC, I have been the President of the region Europe, Middle East, India and Africa, the largest business segment for Onshore/Offshore.

Thank you, Marco. Stan?

Hi, everyone. Stan Knez. I look after the Process Technology business unit, which is responsible to manage an extensive portfolio of proprietary and alliance technologies. With more than 30 years in the industry in both upstream and downstream, previously held technology leadership positions with KBR and Shaw Energy and Chemicals. I joined Technip in 2012 with the acquisition of Stone & Webster. Look forward to spending a great day together.

Thank you, Stan. Magali?

Hello to everyone. I'm Magali Castano, SVP People and Culture. I've worked in the energy sector for the past 20 years, always in human resources. I started with Shell in HR operational role, focusing on change management and supporting the evolution of the downstream business in Europe. A bit more than 10 years ago, I heard about a project named Prelude, and this is one of the reason I applied and actually joined Technip at the time. Since I joined, I had various roles in HR. In particular, the HR Lead for the business unit Europe, Middle East, India and Africa; VP of People Development for TechnipFMC Group and since last year, Head of People and Culture for Technip Energies. And I'm very happy to be here today.

Thank you, Magali. Charles?

Thank you, Phil. Good morning, good afternoon. I'm Charles Cessot, SVP Strategy. I've got nearly 15 years experience in energies. First, in consulting, then I joined TechnipFMC 9 years ago, where I had the opportunity to evolve from investment to strategy in Houston and Paris. Previously to that, I was a Corporate Development Head for TechnipFMC. I'm of course delighted to join Technip Energies in my role. I'm delighted to report out today on growth opportunities.

Thank you, Charles. And last but not least, Alain.

I am Alain Poincheval. I joined the company 30 years ago as a young process engineer, and I went through all the segment of the company from Onshore/Offshore to Subsea. I held many position in project management, and I was the Executive Project Director for the Shell Prelude FLNG. Then I held the position of SVP for the Paris business unit. And now I'm the Fellow Executive Project Director for the LNG Arctic 2.

Thank you, Alain. Some of the comments made today may include forward-looking statements, which are based on our best estimates with the information we currently have. Obviously, these outcomes may change and are also subject to the risks detailed in the following slides. In terms of schedule, the formal presentation will last approximately 3 hours and will be delivered in 2 parts. In the first part, Arnaud will introduce Technip Energies and cover our investment case, our ESG approach and our significant market opportunity set. Then Alain Poincheval will discuss with you a pioneering approach in downstream and gas. Then Stan, who heads up process technology, will then explain our plans to accelerate the energy transition. And our strategy head, Charles will talk to you about our future expansion opportunities. We'll then move into our first Q&A before taking a 15-minute break. After the break, you'll hear about our execution capabilities from Marco. While Magali, Head of People and Culture, will talk to you about our key asset, our people. We'll then move to the financial section with Bruno Vibert, who will present our financial strength, stability and outlook. And then we'll return to Arnaud to close out the formal presentation before arriving at our second dedicated Q&A. In terms of the format for Q&A, participants have the opportunity to submit questions directly into the webcast and you can submit questions at any time during today's presentation. Now before moving to the main presentation, let me first recap on the rationale behind the decision to create 2 industry-leading, independent, publicly traded companies. The separation will allow each company to focus on their respective strategies and provide both improved flexibility and growth opportunities. The 2 companies will have distinct and expanding market opportunities and specific customer bases across the energy value chain, dedicated and enhanced focus of management, resources and capital, robust backlogs supporting future revenues and compelling and distinct investment profiles. We strongly believe that providing independence for these businesses would unlock further opportunities and value creation for all stakeholders. And in terms of transaction highlights, the intention is to distribute 50.1% of the outstanding shares in Technip Energies. TechnipFMC will initially retain the remaining 49.9%. However, Bpifrance plans to invest $200 million in Technip Energies through the acquisition of shares from TechnipFMC to become a long-term reference shareholder of Technip Energies. And over time, TechnipFMC plans to conduct an orderly sale of its stake in Technip Energies, the initial lockup being 60 days. Technip Energies will be listed on the Euronext Paris Exchange with ADRs for U.S. investors, and we are targeting deal completion in the first quarter of 2021, subject to customary conditions and regulatory approvals. So with that and before passing on to our first speaker, CEO-elect, Arnaud Pieton, we will now play a short video. Thank you. [Presentation]

In October 2019, we've announced the name of our new company, Technip Energies. And today, we are incredibly excited to share with you our new company vision and branding. The first part of our name, Technip, will be well-known to you and is a well admired and respected name across the industry. And for our people and for myself, the passion and sense of pride of being associated with this historic name was so strong that we felt compelled to keep it. The second part of the name, Energies, truly reflects where we are going as a company and our vision we are sharing with you today. We are Technip Energies, which will also be known as T.EN. Now before we start diving into our investment story, allow me a few words on the very important subject of safety. At Technip Energies, safety is and will remain at the heart of everything we do. At the beginning of every meeting, no matter where it is held in the world, we always start with safety or ESG moment. So it just seemed only right that I start with our commitment to safety in today's meeting as well. We have demonstrated solid improvement in all our key safety performance indicators over the last 3 years. And this is not about luck. We have developed a robust approach to quality, health, safety, environment and security, or QHSES. We have advanced programs that apply learnings from many decades of project delivery. We and our teams are proud of our approach to safety, but we will never take it for granted. We place safety at the heart of everything we do, and that means being people centered and remaining adaptable. This is what we intend to be recognized for. Turning now to our investment case. We believe we have a highly attractive value proposition. When you think about Technip Energies, think about the leading engineering and technology company for the energy transition. One with a 50-year history in LNG and one ideally positioned for the low-carbon LNG of the future. But we're far more than a pure LNG play or a conventional E&C business within the traditional energy industry. We have a leading position in markets such as ethylene, hydrogen, but also refining and petrochemicals. We have growing businesses in sustainable chemistry, including renewable fuels and CO2 management. We are in the sweet spot for the need to accelerate energy transition and this means that we are set up not just to navigate that transition but to thrive in the energy transition. Above all, our customers trust us. Our reputation has been built on our people. We thrive on creativity and progress and their ability to deliver outstanding projects time after time. Together with our strong order book and our commercial selectivity, all of these support our financial strength and the stability and are the backbone for sustainable shareholder returns. Now looking at Technip Energies at a glance. Technip Energies is a highly differentiated and leading engineering and technology campaign. With our broad offering of project capabilities, technologies, products and services, we are totally relevant for the energy transition. As expressed by Phil earlier, we will be headquartered in Paris with the legal domicile in Netherland, and the company will have its shares listed on the Euronext Paris Stock Exchange under the ticker TE, and we will also have ADRs for U.S. investors. With our 15,000 employees, we are truly global, operating in 34 countries, and we can point to over 61 years of successful operations. We are a EUR 6.1 billion revenue company supported by a significant and high-quality backlog of EUR 13.2 billion. And based on indications from rating agencies, we will begin life with a BBB investment-grade rating. Let me give you a greater insight now into our business by giving you an overview on how we intend to manage and report the business going forward. We are a diversified provider of projects, technologies, products and services. As shown on the left side of the slide, a large part of our business is the delivery of projects of various natures. We have a strong and iconic history, including so many welfares. Our engineering and technical expertise supports a renowned project management model and we master technology integration. And this is probably one of the greatest attributes of our company. We do not need to win all the technology bets to be successful. We have a diverse portfolio of projects and commercial models that differentiates our backlog position and provides balance to our enterprise risk profile. Now moving to the right side of the slide. In addition to our projects, we are also engaged in technologies, products and services, which we refer to as TPS in Bruno's section later on. We have a strong proprietary technology portfolio and licensing position, accretive to our bottom line. We provide a range of services through early engagement, including feasibility and concept studies and front-end engineering. And our history of successful project delivery makes us a credible and ideal project management consultancy or PMC player. Our digital expertise is accelerating, and is an enabler of growth in advisory lines. Turning now to ESG and sustainability at Technip Energies. We want to be recognized as a reference in this area, and we believe we can achieve this through stronger business alignment in the energy transition and in ESG principles more broadly. And integrating a sustainability strategy throughout our newly formed company in our processes and our business development. We have already developed our business code of conduct and have well-defined health and safety and diversity and inclusion policies. But in addition to this, we are performing a materiality assessment to define the ESG and sustainability issues that matter most to our business, but also to our stakeholders. We will use these insights to develop a sustainability road map and align our reporting process. Within the first year, we will come back to you and to the market with a sustainability strategy. And when we issue our first sustainability report, we will also publish a scorecard that we intend to publish annually thereafter to track our progress in ESG and sustainability. As a best practice, we intend to support the 10 principles of the United Nations Global Compact as well as the 17 UN Sustainable Development Goals. Ultimately, myself and the Board are accountable for ESG and sustainability at Technip Energies. Let me talk about this a bit more on the next slide. The TechnipFMC Board has structured management compensation to align us with shareholder goals. And we know this will remain the case post spin under the Technip Energies Board. Taking shorter and long-term compensation structure together, the majority of our executive management compensation is performance-based and is designed to reward actions that will create shareholder value over the long term. But in 2021, in addition to the customary financial objectives, we intend to align senior management remuneration packages with ESG as well. This tangibly signals how seriously we take ESG and sustainability at Technip Energies. Turning to our Board, it will comprise of 8 directors, including myself and a nonexecutive independent chairman, Joseph Rinaldi. Board continuity is ensured as 5 nonexecutive directors are joining from the TechnipFMC Board. And we will have 3 committees: audit, compensation as well as an ESG committee. Looking now at the macro backdrop for global energy demand. Post pandemic, the demand outlook for energy is perhaps less clear over the long term than previously. The IEA stated policy scenario on one hand suggests its long-term upward trend will continue driven by strong population and GDP growth, notably from developing economies. Whereas on the other hand, its sustainable development scenario depicts a scenario where global energy demand may not even grow. And this latter scenario would lead to the greatest change in energy mix. What is clear from both scenarios, however, is that renewables and bioenergy will gain significant share of the global energy mix and continue to attract significant growth in the capital investment due to increasing competitiveness against conventional sources of energy and growing policy support. Other sources of energies are expected to either remain flat to slightly up, as is the case with natural gas and nuclear or reduce as is the case for coal and to a lesser extent, oil. In fact, natural gas is the only fossil fuel that will at least maintain its share in primary energy demand in the next decades. With its lower carbon intensity, it is a critical transition fuel and replacement fuel for those more damaging to the environment like coal as demonstrated by China's government-led programs to displace coal with gas. Gas is a key fuel for connecting regional markets and delivering on the energy needs of fast-growing economies. And its role will be boosted by expanding traded LNG. LNG specifically will increase its penetration in the gas mix from 9% in 2018 to 13% in 2040, according to the latest assessment from the IEA. And in this context, we see a mismatch between LNG supply and demand. Therefore, investment should increase further in the coming decade. But as we will explain throughout today's presentation, we, as Technip Energies are largely agnostic to this mix. We believe we can thrive in whatever scenario plays out and that Technip Energies has a critical role to play on the journey to next year. Now thinking about our customers. This long road to a carbon-neutral energy system presents so many challenges and opportunities. Our customers are being faced with very complex products, how to decarbonize the global energy system while simultaneously satisfying the demand for energy. There's a growing social and political pressure on traditional industries to rise to this challenge to reduce emissions with pressures also intensifying from the capital markets and regulations. Traditional industries are responding by laying out longer-term ambitions to reduce emissions with many pledging to become net 0 carbon companies in the future. And this is driving more diversification. Oil companies reimagined as energy companies with moves into electricity, sustainable chemistry and electric mobility. The dilemma for our customers is how far and how fast to pivot towards building a new carbon-neutral businesses that can offer acceptable financial returns while balancing payouts for shareholders. One thing, one thing should become very clear to you today. Technip Energies is totally relevant and totally ready for this market. In fact, when you think about our core capabilities, they will be central to the energy landscape regardless of the definition of this landscape -- regardless of the definition of this landscape. When you think about Technip Energies, you should not think of a company that is particularly exposed to demand for oil. In fact, we are completely agnostic to feedstock. Our focus is really on the process of the molecule transformation, the integration of technologies. Whether it's gas or oil or biomass, we're indifferent. And while natural gas is our main conventional energy chain today, how base business, if you like, that picture is evolving. Over the long term, we would also expect oil to be gradually replaced by natural gas, hydrogen and biomass. And CO2 management will also be of critical importance. And we must not forget, we must consider also the energy chain of the future, namely the electrode. But again, regardless of this energy chain, and regardless of our involvement, the fact is that we have the required skills and the flexibility in our operating model to support our customers at every step of the transformation chain. In some projects, we may have an involvement in all of these categories, which you have on the screen from technology through services. In other scenarios, on the other hand, it may suit us to only be involved in a single aspect of the projects. Ultimately, our role is determined at what makes the most economic sense to our company and our customers. The key concept underpinning this is selectivity. A concept you will hear repeatedly throughout this presentation today. Turning to energy transition. We have defined 4 pillars through which we are addressing the energy transition: LNG and low-carbon LNG, sustainable chemistry, decarbonization and carbon-free energy solutions. We have outstanding energy molecule transformation skills and capabilities. Our strong engineering capability allows us to define the optimal architectural design from energy source to energy demand. And we are able to integrate complex technologies into these projects to best match the project needs and determine the best project economics. Often, these are proprietary technologies to Technip Energies. But equally, we can integrate the technology of our alliance partners, and we can even license technology from a third-party technology provider. This flexibility in our operating model clearly provide many avenues to be successful in the energy transition. And this core capability set is reinforced through world-class project management and execution capabilities. And as we navigate the energy transition, we are truly equipped with the skills and the relationships and the technologies to be able to address several growth markets, including hydrogen, biofuels and the circular economy. We'll show you today several real case studies, real case studies of many of these exciting new opportunities in today's presentation. And if there's 1 thing you take away from this presentation, it's that energy transition is not a risk to our business. Energy transition is our business. Moving now to our markets, where we have a significant and diversified opportunity set, present and future. Today, the drivers of our existing and future markets are different to that of the past. I spoke about it a bit earlier. Of course, broader macroeconomic trends and demographic factors remain key. But the global agenda to mitigate the impacts of climate change have taken center stage. And we intend to leverage our core capabilities to meet changing customer needs and have them succeed in the energy transition journey. Looking at our markets, we continue to see a solid base within our traditional markets with a large annual addressable market of over EUR 70 billion with growth GDP led. We have a solid base, and we have identified growth markets that fits squarely within the energy transition domain in addition to that base. This is true notably in the areas of hydrogen, sustainable chemistry and CO2 management. In these markets, we see an annual addressable market of over EUR 15 billion. And we anticipate much faster growth of up to 15% compounded. In addition, we have identified upside potential in adjacent markets to more than EUR 15 billion per annum. Here, in the upside, we are positioning in the carbon-free energy chain, notably in green hydrogen, but there are other exciting opportunities, which you'll hear more about from Stan Knez later on. We plan to grow our high-end services offering as well in advisory and consulting, and we will use the Genesis brand as a springboard. And we plan to expand selectivity into industries such as life sciences as well. Now in aggregate, we have a substantial annual market opportunity set of over EUR 100 billion with high-growth potential in identified growth and upside markets and supported by a significant base in traditional markets, which themselves are evolving towards lower carbon markets. Now with that as an introduction, today's presentation aim to provide you with greater insight on our market position and our strategic vision for the future of Technip Energies. There will be 5 segments to the presentation, which my colleagues and the leadership team with me today will take in turn to showcase. We will begin with our pioneering position in downstream and gas with our first speaker, Alain Poincheval, Fellow Executive Project Director. Alain will explain to you the strength we see in our base markets of LNG, Onshore and Offshore, our market positioning and competitive advantage and the role, the very important role that we can play in decarbonizing these markets. Alain, over to you.

Thanks, Arnaud. So let's look at our base markets. We believe we have a highly competitive offering to address the significant market opportunities in LNG, Offshore and downstream. Where in aggregate, we have an identified market opportunity of EUR 60 billion to EUR 70 billion. We see first an annual addressable market EUR 10 billion to EUR 15 billion in LNG and gas monetization. Addressable because we are a market leader in LNG and have proprietary technologies for gas processing and NGL recovery units. Second, we see also an annual market of EUR 10 billion, EUR 15 billion in Offshore. The majority of which is in the gas domain. And here, we have the industry's most comprehensive reference list for FLNG and a pioneering position in the market for gas FPSOs. And then we see an annual market for downstream of EUR 40 billion to EUR 45 billion. And again, here, we have a leading proprietary technologies and equipment in petrochemicals and a leading market position in ethanol. Over the long term, we expect gas to continue to displace coal, particularly as gas is around 40% -- 40% less CO2 intensive than coal and emits far fewer pollutants. While the magnitude of the displacement can be argued, we believe that gas is increasingly competitive with other forms of energy. And a decarbonized version of natural gas could indeed displace coal faster than many perceive. Following a record year in 2019 for new capacity project sanctions, 2020 was a period of low project final investment decision by our customers. However, Technip Energies was able to secure the Costa Azul project for Sempra Energy. The only LNG project sanctioned in 2020. This mirror 2017 when we captured the only project sanctioned in that year as well, LNG Coral FLNG. And this is not luck. We align and engage with the best quality project, with the best opportunities of success. Looking ahead, the LNG wave is not over for Technip Energies. It's far from it. Our market analysis, which is in line with forecast from independent consultants and many of our large customers show significant investment in new LNG infrastructure will be required to support the LNG demand in the mid-30s. And we estimate here a supply gap of above 140 million ton per annum. And this is equivalent to over 25% -- 25% of the current capacity. This is equivalent also to around 15 mega projects that require sanctioning. However, we do not anticipate that the supply gap will be made up exclusively of mega projects. There are several smaller projects, brownfield expansion, debottlenecking project that have a strong potential to move forward. We believe that modularization and mid-scale will have a significant role to play. And we believe that Technip Energies will have a significant role to play here. With that as an encouraging LNG market backdrop, now let's consider our positioning. We are, for sure, a top-tier player with our market position reinforced by recent reference and contract awards. Size matters in LNG. Customers look to us to solve LNG engineering process technology integration with rotating equipment and potential for modularization. In the future, bunkering will become increasingly important, and we can use our designs and mid-scale expertise to play a role. We have an extensive LNG reference list. Getting back to the world's first LNG project in the '60s that was about to go. We have executed the world's largest LNG development as well as mid-scale plants. We are a pioneer in FLNG with the industry-only references. We have expertise in applying modularization to large-scale project and we have project management solutions for megaprojects in remote location. I will show you, for example, in Yamal. In aggregate, we have developed 20% of the global installed capacity that is in operation today and delivered over 100 million ton per year of capacity to the market. And today, we have other 20 million ton per year under construction. Clearly, LNG is a core competency for Technip Energies. We have a broad offering, project delivery products, including loading arms as well as services capability. And we are present in all regions with large gas reserves. But we do not stand still in this market. Our pioneering approach to the LNG market continues. We are working on innovations to further differentiate in the area of low-to-0 carbon LNG, modularization, mid-scale and floating LNG. Moving to our first case study. Let's look at 2 major projects in the Arctic region: Yamal LNG and my project, Arctic LNG 2. Yamal LNG has been a tremendously successful project and one that has created significant value for our clients, our partners and for Technip Energies. I would like to touch on several other factors that contributed to its success. First, our mindset. I will use here the April 13 analogy here. Fear is not an option. This demonstrates the pioneer spirit we have as a company. We inspire a younger generation of engineer to rise to the challenge. And in this instance, we were fortunate that all the stars were aligned on goals and ambitions between the customer, ourself and the supply chain. Second, our multicenter execution. This aspect has been critical to the success of many projects, not just Yamal. But our ability to load different engineering centers afforded us significant flexibility and efficiency in the execution scheme. And then complex multiyard management, more than 10 yards to manage for this project. Module fabrication in Asia, 0.5 million ton, 0.5 million ton. And the logistics, very intensive between China and Russia. The result was the first 2 trains delivered in record time and the third train delivered 12 months ahead of the original schedule, an unprecedented fit in the LNG industry. Yamal LNG has taken the engineering practices well beyond traditional boundaries. The challenges of constructing and operating in such Arctic condition, very harsh, requires innovative methodologies, out-of-the-box thinking and designs and intense [indiscernible] to push the usual industry solutions to a new level of success. And more important, we are honored by the trust of our clients, Novatek and the opportunity to serve on the Arctic LNG 2. Arctic LNG 2 will bring onstream nearly 20 million ton per annum, new capacity comprising 3 LNG train. The development will utilize 42 modules significantly larger in size and complexity. And these modules will be based on a concrete gravity-based structure, what we call GBS, an innovative engineering solution we worked on extensively with our partners during the field. For Arctic LNG 2, we will leverage our recent success from Yamal LNG through the continuity of [ leadership ], execution model and [indiscernible]. And despite the challenges of COVID-19, we have made solid progress and Arctic 2 remains very much on track. The future of LNG, however, is changing. This critical fuel can also decarbonize. Within the LNG value chain, we estimate that as much as 75% of emission occurred during the pretreatment and the liquefaction. Given the breadth of our scope in this value chain, this puts Technip Energies at the heart of the solution to decarbonize LNG. We have here identified 3 key areas of emission. First one being the CO2 from the feedstock. And here, we can suppress the emission through compression and dehydration. The second area, typically, LNG plants are powered by gas turbines. Today, we can drive efficiency improvements in the process and power generation. But we can move further. We can further neutralize emission from turbines using what we call CCUS, carbon capture, utilization and sequestration unit or even replace the turbines with renewable power, electricity from solar or wind. And we are working with partners on new solutions, including hydrogen as a substitute for fuel gas. The third area, there is also a potential for CO2 and methane leaks from LNG facilities on plant. And here, we can reduce venting and flaring. And minimize fugitive emissions as well as the use of water and waste. In summary, to achieve a low-to-0 carbon LNG scenario, expertise will be required from multiple domains, including hydrogen, CCUS and renewables. All skills that we possess and therefore, Technip Energies is uniquely positioned to help the industry succeed in decarbonizing LNG. Let's now consider our offshore expertise, where we can leverage a 50-plus year track record to help bridge customer needs for decarbonized yet economical offshore solutions. We believe many of these skills and competency we have developed in offshore will also be relevant for the energy transition markets, such as floating wind, which Charles will come back to later in the presentation. We are a pioneer for floating LNG, what we call FLNG, and can boast the industry's only reference. First one, Prelude FLNG for Shell. The largest offshore facility ever constructed. I was the Executive Director for this consortium, 0.5 kilometer long. Imagine 0.5 kilometer long. PFLNG 1, Satu for Petronas. And today, we are executing Coral South FLNG in Mozambique, which I will cover in more details on the next slide. FLNG can be an attractive opportunity for when the gas needs to be extracted faster than it will take to build an onshore liquefaction. But sometimes, the main hurdle is cost. That's why we continue to innovate, to improve cost competitiveness and develop new solutions for a range of applications that improve flexibility and reduce environmental impact. We have a structural R&D program in place and at achieving better economics of scale for large capacity offshore gas reserves prospect. This leverage our experience in the FLNG market to date with new innovations, including mega modules, and new installation method and can lead to substantial CapEx and OpEx savings for large capacity FLNG. This is a highly promising development. We have also developed a high-value module approach. This is based on lean and standardized designs. We can utilize this to differentiate our commercial offers. But there is also a potential to develop alternative commercial model, including product sales. This modular approach enables flexibility on existing infrastructure and new projects including the ability to unlock stranded gas reserves. And it also offers our customers optimized performance in terms of economics as well as the environment. Our latest FLNG project takes us into the new frontier of Mozambique in Africa for the Coral South project for ENI. Coral South was the first project approved in Mozambique for area for development. The FLNG facility will have a capacity of 3.4 million ton per annum. The facility will use a double hull vessel of over 400 meters in length. This is longer than the Empire State building installed. Coral South will be the first FLNG deployed in water depths of 2,000 meters and the first FLNG in the African continent. Collaborating with trusted partners is something we do on many project to bring together complementary skills, technologies and experience and enabling new concept to become reality. For Coral, we are partnered with JGC and Samsung Heavy Industries, who we have worked extensively within the past to provide with a full development solution and robust execution plan for Coral. As ENI confirmed, in November, we are now over 75% complete. All topside modules have installed, including the [indiscernible] accommodation module as well as 12 gas treatment and LNG modules. And we are excited about the services opportunity that our EPCIC contracting model brings on this project. Finally, as part of our approach to the project and dedication to the region, we developed a sustainable local content plan in Mozambique to support the project in terms of human resources and infrastructure. Turning now to downstream, where we have a rich history, which includes over 40% market share for ethylene technology, over 30 grassroots refineries and over 200 modernization and revamp projects. We have a diverse offering with leading proprietary technologies and equipment that enables customers to achieve greater efficiencies in their plant. Through continuous innovation, we made incredible progress in plant efficiency in terms of reducing total installation cost per unit of production, reducing feedstock consumption per [ measure of production ] and reducing CO2 emissions. This focus R&D to drive process improvement has been part of technology for decades. And this is what drives our leadership position and our differentiation, and this is providing opportunities for smart revamp to provide flexibility around feedstock. We are also driving further optimization through digital monitoring to minimize downtime while optimizing production and helping our customers better integrate their refining and petrochemical operation to lower their costs and enhance their margin. A good example of our R&D strategy is driving market leadership is in the ethylene domain. We are seeing significant efficiency and environmental gain in our proprietary technologies. Here, we estimate that our innovation can drive more than 30% reduction, 30% reduction, in emissions per unit of production while materially reducing fuel consumption during the production process. Such innovations were instrumental in the recent award by Shell of a significant modernization contract to upgrade ethylene furnaces at their Moerdijk facility in the Netherlands. For this [ given ] project, we will provide proprietary equipment and related services for 8 ethylene furnaces, which will replace 16 units currently on site and that we found reducing capacity. Our low-emission cracking furnace design reduces CO2 emission by replacing [ it from few guys ] with green electricity. And importantly for Shell, our modular approach will enable a direct operation throughout the project. This award further demonstrates our leadership in ethylene technology and contributes to a material reduction in CO2 emissions at the Moerdijk facilities. In summary, we are a partner of choice globally with a 50-year track record and leading position in the attractive markets of LNG and ethylene. We see robust long-term demand both for gas and downstream with LNG playing a more prominent role in the energy mix and both LNG and downstream playing a critical role in the energy transition. And our innovations around decarbonization and efficiency are enabling sustainable solution for greenfield and revamp projects. Thank you for listening, and back to Arnaud.

Well, thank you, Alain. Thank you for so much passion and for representing the very important project management discipline with so much passion at the highest level of the organization within the Executive Committee. I cannot tell you how important it is to me to have this project management competency represented in our executive team. Now to complement our decarbonization strategy for our base market, in this next section, you will hear how Technip Energies has the process engineering capability, the agility, the appetite to accelerate the energy transition. Current initiatives combined with our flexible operating model will allow us to unlock the energy change of tomorrow and capture our share of high-growth markets. As our next speaker, Stan Knez, SVP, Process Technology, will explain, when you think about hydrogen, think Technip Energies. When you think about sustainable chemistry, think Technip Energies. Stan, over to you.

Thank you, Arnaud. Let's take a closer look at our growth markets: hydrogen, sustainable chemistry and CO2 management, all of which reside squarely in the energy transition space. In aggregate, as Arnaud just indicated, we have identified a double-digit market opportunity of upwards of EUR 15 billion per annum. We are a world leader in hydrogen, having delivered our proprietary steam reforming technology to over 270 plants globally, representing over 35% of the global installed base. And we are a recognized partner of choice with long-standing partnerships with the likes of Air Products, relevant for gray and blue hydrogen, while also forming new ones that improve our positioning for the green hydrogen market. In sustainable chemistry, which for us includes biofuels, biochemistry and the circular economy, we see an annual addressable market of EUR 5 billion to EUR 10 billion. We are positioned well with established business and multiple references, most notably in biofuels where we have a preferred alliance with market leader Neste. Turning to CO2 management, we see an annual addressable market of up to EUR 5 billion. We already have over 50 references for CO2 removal units, including a leading strategic alliance with Shell for the CANSOLV carbon capture technology. Taking a closer look at our position in the market for hydrogen and how we expect it to develop moving forward. Let's not underestimate the collective knowledge and experience we have gained from our 50-year track record in hydrogen, over 35% of the installed base. That's 270 plants. In addition, we have proprietary technology through our steam reformer, which has multiple applications. For example, today, we are utilizing it in renewable fuels plants. Hydrogen is the most widely used industrial gas in downstream today. We use it as feedstock in ammonia production for fertilizers, in petroleum refining for clean fuels and in methanol production. But looking to the future, hydrogen holds significant promise as a clean energy carrier. It could be used to decarbonize industrial processes like Alain talked about, decarbonization of LNG, used as fuel for mobility and even to provide heating in our homes and buildings. According to the Hydrogen Council, which we are a member of, by 2050, 25% of passenger vehicles, 30% of trucks and 25% of buses will be fueled with hydrogen, with investment dollars of several hundred billion likely required in order to reach the 2050 target on climate change. In the long term, hydrogen has the potential to be as important in the energy mix as natural gas is today. We see a very bright future for hydrogen, and we are confident we can leverage our leading market position to remain an important and relevant player in the hydrogen market of tomorrow. Assessing the growth opportunity in clean hydrogen, when we combine our gray hydrogen heritage with our leading carbon capture solutions, we have the in-house capabilities to fully engineer and construct blue hydrogen plants. We already have over 50 references for carbon capture solutions in hydrogen plants, many of which are retrofit into existing plant assets to become hydrogen with CO2 capture. And we are increasingly involved in studies and believe we are positioned well for a wave of blue hydrogen. As key industries, including downstream and steel, increasingly aim to demonstrate CO2 capture in their facilities, we see a positive business development pipeline consisting of up to 20 CO2 capture units to be retrofitted on existing hydrogen plants where Technip Energy has built the original facility, plus a number of grassroots blue hydrogen plant opportunities. And we are developing our technology approach. Our strategy utilizes proprietary technology through our SMR, or steam methane reformer, and licensed technology through an agreement for autothermal reforming. For CO2 capture technology, we currently have access to capture technology through our strategic alliance with Shell CANSOLV, and I will talk about this later. Access to these technologies combined with our gray hydrogen experience will be our platform to play in the green hydrogen market. Turning to green hydrogen. Our ambition is to act as a leading indicator and EPC services provider for green hydrogen projects. Green hydrogen technologies involves electrolysis and hydrogen storage, and we can bring our design execution, scale up competencies into play to make these projects economically viable. While historically, green hydrogen projects have stalled amid challenging economics, 2 aspects will be critical for this industry's development. Firstly, government policy. Importantly, the momentum here is strong, and we have seen many strong pledges for green hydrogen from governments all around the world, including major economies within the EU as well as the U.K., Japan and Australia. And let's not forget about the United States. Secondly, the cost of electrolytic hydrogen are expected to fall rapidly in the coming years, benefiting from innovation, improvements in the supply chain and economies of scale. And the MOU and technology collaboration we have recently signed with McPhy is exactly in line with that goal. In October 2020, we signed a strategic partnership and investment in the green hydrogen arena with McPhy, a leading manufacturer of equipment used in the production and distribution of green hydrogen. With McPhy, we will leverage our established brand, customer relationships and international footprint to develop large scale and competitive green hydrogen solutions from production all the way to liquefaction, storage and distribution. We will jointly address commercial opportunities, work on integrating our respective offerings and undertake R&D for hydrogen technology. We are also joined by Chart Industries, whose expertise in equipment development is complementary to our process technology and project capabilities. We firmly believe that both innovative technologies and partner collaboration will be needed for the world to achieve net zero carbon targets. And this collaboration between McPhy, Chart Industries and ourselves is a clear example of the important role that Technip Energies can play in the development of the green hydrogen industry. In summary, when you think about Technip Energies, think Technip Energies. When you think about hydrogen, think Technip Energies. Both ways. Our expertise in integrating process technologies, either proprietary or from third-party licensors, fosters early project engagement and can make significant impact on project economics. From conceptual design to piloting, engineering scale up and ultimately, commercialization, Technip Energies is a leading supplier of process technologies. We have built an extensive portfolio of process technologies with a consistent strategy focused on R&D, alliances and acquisitions. We have an active research and development program. Approximately half of our R&D expenditures is deployed to improve the efficiency of our existing portfolio of process technologies. Programs are often focused on reducing environmental impact, capital cost reduction as well as development of add-on technologies to enhance the offering. The balance of the investment is dedicated to the growth of the portfolio through development of new processes or products such as proprietary equipment and catalysts. This can be through open innovation with partners or through dedicated acquisitions. All of this serves to accelerate our strategy to strengthen and diversify our technology offering. Looking in more detail at sustainable chemistry. Sustainable chemistry focuses on the environmental impact of chemistry and aims to develop more resource efficient and inherently safer designs of molecules, materials, products and processes. Our leading R&D centers in Europe and in the United States are currently focusing our efforts on 3 key areas: biofuels, bio-based chemicals and the circular economy. In biofuels, our proprietary Hummingbird technology for the conversion of ethanol to ethylene was recently selected by LanzaTech for a first commercial-scale biorefinery to manufacture sustainable aviation fuel. We also have a preferred partnership for second-generation renewable fuels with market leader Neste, which I'll come back to on the next slide. In biochemicals, we have proprietary technology, for example, with Epicerol, which offers a cost-effective, bio-based process to produce epichlorohydrin and benefits from a reduced carbon footprint compared to traditional propylene-based processes. In fact, this is a completely green process. We also have a promising alliance for polylactic acid, or PLA, with our partners Sulzer and Futerro, and I'll come back to this on a subsequent slide. And in the circular economy, we have several promising partnerships that provide us with access to recycling technologies. This includes the Infinia technology with BP, which enables circularity for difficult-to-recycle plastic wastes as well as technology for turning plastics into bio oil via a process called pyrolysis. And we continue to look at other potential partnerships, particularly in the area of chemical recycling. Let me now turn to a series of examples to help put this into perspective. In our next case study, we illustrate our alliance with Neste. Last year, we announced a partnership with Neste for renewables fuels projects where Technip Energies will provide front-end-loading, FEL, services and participate in project execution. Neste's technology allows for the conversion of second-generation feedstocks, like vegetable oils or waste fat, into renewable diesel and other renewable fuel products. This technology is becoming increasingly important as it provides an efficient and sustainable solution in the fuel sector while addressing environmental concerns. This alliance is built on our long-term collaboration with Neste, illustrated by the successful delivery of 2 world-scale renewable fuels units in Rotterdam and in Singapore, and today, the ongoing expansion of Neste's renewable products facility in Singapore, which will increase production at that facility by over 60% to 1.3 million tons per annum. Ultimately, the partnership with Neste aims to achieve industry-leading capital productivity through the highest standards of HSE, improved operability, accelerated innovation and reduced project cycle times. We are proud to be Neste's partner of choice for future renewable fuels projects. Our next case study covers PLA, or polylactic acid, a sustainable bioplastic which also fits into the circular economy. The promotion of greener alternatives to traditional plastics needs to be backed by suitable technologies that enable the industry to produce high-quality bioplastics in an efficient manner. PLA is a plant-based and versatile polymer that offers a sustainable alternative to traditional hydrocarbon-based plastics. For instance, consumers can now choose a PLA-based plastic cup that is not only green, but it is also biodegradable and recyclable. The PLAnet alliance is able to offer a fully integrated package addressing the full PLA value chain to multiple industries, including chemical and agriculture, and we have been making good progress. In December 2019, we signed a contract for a feasibility study for Azerbaijan's first bioplastics plant. This could ultimately lead to a significant project within 2 years. Turning now to CO2 management. We believe we have an obligation to apply our skills to enable the decarbonization of global energy. We now proactively offer life cycle analysis and carbon impact assessment with all of our engineering studies. This gives our customers the knowledge to consider carbon-conscious choices during early phases of engineering where there is the biggest opportunity to minimize the carbon impact of developments. We have a carbon assessment tool. We call it Gen-CAT. This tool provides an assessment of direct and indirect emissions from procurement to asset construction through to operations. The beauty of this tool is its applicability. It can be used for greenfield or brownfield, upstream or downstream, across the energy transition. In essence, it can be applied to any asset. Through digital early engagement, innovation and collaboration, we can help our customers make a significant ecological difference and neutralize the carbon impact of their project asset on the environment. Driving energy efficiency also has a critical role to play in decarbonization. As Alain had mentioned earlier, we are no stranger to this. Our continuous R&D programs are driving significant environmental gains. And in carbon capture, utilization and storage, our track record continues to develop. To date, we have been involved in more than 30 CCUS studies globally with more than 15 clients. Our expertise extends across multiple disciplines, including CO2 transportation, CO2 for enhanced oil recovery as well as other approaches to carbon capture and storage, concepts and solutions. Our lean project execution expertise is accelerating the maturity of this project portfolio, and we will continue to learn, develop and evaluate this market opportunity. We are engaged in industry-wide collaboration, including close cooperation with regulatory authorities and cross-industry focus groups. We are developing a clear understanding of where the market gaps and the market opportunities could be for Technip Energies. And today, we benefit from a preferred technology alliance with Shell CANSOLV, which is one of the few carbon capture technologies commercialized at industrial scale. Turning now to a case study for carbon capture and storage. Through Genesis and our process technology teams, we are involved in the feasibility and front-end studies for the Acorn carbon capture and storage and hydrogen project in the U.K. The Acorn CCS project aims to capture CO2 from the central industrial belt in Scotland then reuse existing Atlantic pipeline infrastructure to export and reinject the CO2 into depleted reservoirs in the North Sea. The reuse of existing oil and gas infrastructure provides substantial capital investment advantages. The project plans to develop further to sequester CO2 collected precombustion by the reforming of natural gas to hydrogen. CCS is a viable and vital option for many countries today beyond the U.K. in order to meet climate change obligations. Not only does it enable swift and significant CO2 capture from industrial sources, but it can also enable the generation of hydrogen in bulk, which can be used for low-carbon heating and transport. Reinforcing our carbon capture credentials, our Genesis and process technology teams are involved in multiple studies for potential CCUS projects, including some notable recent awards. Economics is the challenge today with carbon capture solutions. In order to tackle this, we have developed a high-value carbon capture module to enable customers to decarbonize their assets. Our operating center in Norway has extensive expertise in carbon capture with references dating back more than a decade. And with a product mindset and through utilizing Shell CANSOLV technology, we have designed a fully modular system utilizing standard equipment that can be deployed to almost any industrial application. Not only is this significantly more competitive than existing solutions, but it also has a lead time of less than 1 year. In fact, we delivered a pilot project for Fortum's waste-to-energy plant in Oslo in only 21 weeks, and there is potential soon to move to a full-scale design to -- for the plant of up to 400,000 tons of CO2. The example here is onshore. Subsequently, Charles will illustrate how we are working on offshore applications as well as looking across the entire chain to CO2 treatment and liquefaction with highly promising indications. To summarize the section, the energy transition is perceived as a risk by many of our peers. But for Technip Energies, the market shift towards hydrogen, sustainable chemistry and CO2 management plays to our strengths. This structural change in the market is an opportunity for us. We'll leverage the pioneering mindset that we have ingrained in our culture. I'd even say this is business as usual for us. We are totally relevant for this market. We have the prerequisite skills to support our customers in their own energy transition. We see a rich opportunity set, and we will look to leverage our differentiation to further enhance our full cycle offering from technology to projects and beyond. Thank you. And with that, I hand it back to Arnaud.

Well, thank you very much, Stan, and thank you, again, for making the topic of the molecule and chemistry so approachable to many of us. So with our base and growth market potential now established, now let's consider the upside case. In this next section, you will hear about how we can bring our core capabilities to exploit new growth opportunities. We will discuss how we intend to grow our services and advisory business lines. We will discuss how we intend to further penetrate into energy transition markets, and we will discuss the opportunity set of our expansion into adjacent markets. Who better to present this section than Charles Cessot, our SVP, Strategy. Charles?

Thank you, Arnaud. As you've already seen with Alain and Stan, Technip Energies has a proven position in its traditional markets and is positioned for growth in major low-carbon energy chains. But there is also a significant market opportunity beyond this. By leveraging our core competencies, we intend to grow our service business lines, to expand our energy transition addressable market and to move into adjacent industries. In aggregate, we've identified market opportunities of up to EUR 15 billion globally, which is largely untapped at the moment. In services, we've already established 3 business lines in advisory and consulting, digital plant performance and project management consulting. These services represent an asset-light, high-margin and low-risk opportunity set for us, and we believe we can expand our offering and grow additional revenue lines with the market opportunities of up to EUR 10 billion. In energy transition, we plan to build on our established offshore expertise to develop a greater presence in full-scale, carbon-free marine projects. We will leverage our expertise to deliver new innovations to the emerging market of offshore hydrogen and offshore wind. We will develop innovative architecture to overcome the CO2 management challenge through our proprietary offshore CO2 hub concept. Combined, we aim to tap into an addressable market of up to EUR 5 billion. And finally, in adjacent industries, we selectively grow our life science, metal and nuclear and as well as agritech businesses. These prospects have the market opportunities of up to EUR 10 billion. Now let me go through these 3 key areas of opportunities in more details. Turning first to our high-value service businesses, which is offered at different phase: early engagement or ultra-early engagement with Genesis; or project phase with PMC, which could be seen as well as an alternative to project delivery. Genesis has a strong track record of transforming project economics. Its new and expanded scope include advisory in all of the Technip Energies market and particularly, the one aligned with energy transition. These services will be supported by well-established brand to ensure success in these new markets, which Marco will take you through in his presentation. In consultancy, our rich history of successful project delivery has made us an ideal project management consultancy player. We fully integrate with our customer teams to derisk execution from technology selection to final delivery. This work is typically delivered on a reimbursable basis, providing us with a high-value and low-risk stream. We have grown our PMC organically from a standing start 8 years ago. And we've now carried out around 11 million man-hours for customers, including large roll-on projects such as RAPID complex for Petronas in Malaysia. Recent activity level have been around 1.5 million man-hours a year, and we aim to double this over the medium term. Focus now on the upside in services. Here, the use of our state-of-the-art process capabilities in an intelligent digital tool helps deliver the most accurate diagnosis and recommendation pattern to our customers in the operation phase of a plant. Plant performance improvement, or PPI, is our proprietary process tool that leverages a common operation cloud platform to enable our process engineers to engage seamlessly with the plant site. Using physical-based model together with machine learning and real-time data, this cutting-edge tool enables intelligent and real-time modeling of plant performance and as well energy efficiency. With PPI, we provide software and advisory services for direct and collaborative decision taking on the plant. And the actual beauty of the tool is that it can be used on any plant, whether Technip Energies has been involved originally or not. Plant performance will serve as a bridge to grow our life-of-plant services, unlocking new businesses opportunities of allowing us from even a closer engagement with our customer for major improvements or revamps. Turning now to floating offshore wind. We are already experienced in this market with several references, from [ conceptually ] to project work and PMC. We were actually involved in several world firsts: the delivery of the first world-scale floating turbine for Equinor Hywind Demo in Norway in 2009; the assembly and the installation of the first floating wind park in Scotland for the same customer in 2014; and last but not least, the first highly innovative spar design for the Google-Makani energy kite pilot where Genesis led the design and EPC in 2019. Through the combination of in-house expertise and strategic partnerships, we can address the complex challenges of floating offshore wind, [ I mean ], challenging being, first of all, the project economics. And to address this issue, we leverage on 50-year track record of capabilities in offshore design including floating structure in harsh environments. To be clear, we have no immediate intention of owning wind installation assets. Our key differentiator is our ability to manage risk and multi-interfaces in the marine environment. We are expecting rapid growth over the next 10 years, and we will be well positioned to capitalize on these evolutions. As Stan has already highlighted, to manage energy transition on the global scale, we believe hydrogen will be required in enormous quantities. We believe as well that offshore will become the natural home for hydrogen. There is likely resistance for storage and often a proximity of a renewable source. We see as well multiple application for offshore hydrogen, such as energy carrier, stabilization source to deal with intermittency and lastly, fuel for vessel or industry in hubs. At present, we are actively looking to bridge the gap between the offshore wind and hydrogen transformation, and we believe we are the right partner to deliver compelling innovation to the industry. This is particularly the case given our process transformation capabilities, our expertise in offshore and [ top sides ] and our integration of architectural design capabilities. Thinking ahead, we could even support the development of any other molecule as an energy carrier with our process technologies capabilities. As we saw earlier in Stan's presentation, in our partnership with McPhy, industrialization and scalability will be important for this market to mature. But this energy chain represents a truly exciting development for the future. We will, of course, continue to position Technip Energies to play a central role. Let me repeat Stan's message once again. When you think about hydrogen, think Technip Energies. As you will hear from Magali later, our 15,000 employees are all deeply passionate about pushing technological and project boundaries to overcome the challenges over time. This includes developing an innovative concept to overcome the challenge of CO2 management. Our global CO2 management solution includes our offshore C-Hub concept. Thanks to this solution, CO2 is captured and liquefied onshore before being sent offshore by low carbon carriers to the injection host, the offshore C-Hub, where it's injected into reservoir and permanently sequestrated. The concept is the best way to address emission in various quantities from multiple emitting locations, such as industrial, cement or steel facilities onshore. Our preliminary study show that the total emission from this CO2 management solution would represent less than 2% of the emissions that we are sequestrating. Clearly, this is a highly favorable trade-off. Currently, the concept is being evaluated by key operator in the North Sea and is raising more and more interest from our customers as our recent MOU with Transborders Energy in Australia shows. What also makes this solution attractive is its versatility. As the reservoir reach full capacity, the unit is simply disconnected, relocated and connected to another reservoir. Therefore, capital investment requirements are one-off in nature. We have developed in-depth know-how on CO2 management solution-based on in-house expertise and can definitely adapt this concept to various applications. In addition, we generated intellectual property on specific elements of the concept, which is a clear indication of our creativity at the service of major problem in an economically viable way. Turning now to growth potential in adjacent industries. Today, we are focused on 3 core areas, which is life science, metal and nuclear and agritech, and we will selectively grow our services beyond energy with a low-risk reimbursable model. In life science, we've been a leading provider of designing, building and validating pharma and biotech facilities for over 25 years with over 300 references worldwide. Our knowledge and skill in this area are considered as industry benchmark, notably, in the high-end pharmaceutical processes of production such as plasma or more simple vaccines. In France, we have a leading engineering service provider position, and we may pursue international growth opportunities. In metal and mining, we offer the highest standard of excellence with high-value services and proprietary technologies on copper, gold and potassium. And we have substantial experience across the mineral value chain from mining to processing. Our foothold in this industry, together with our outstanding execution, could be critical for energy transition given its supply of rare raw materials. And finally, agritech is a fast-growing market, which is adapting to trends in decarbonization and circular economy. One project that we are very proud to support is with Ynsect, a world leader in insect breeding where we are delivering a vertical farming facility for aquaculture and pet nutrition, 2 nonenergy markets with a very interesting growth profile in the coming decade. Illustrated throughout this section of the presentation are many different innovative applications. And before I close, let's take a closer look at our global innovation and lab network throughout the world. Technip Energies is a market leader in process technology and process commercialization, a position we sustained through continuous process improvement and R&D. We have actually a proven track record in developing first-of-a-kind process technologies and innovative process commercialization. In fact, technology developed by our company can be found all over the world. But what set us really apart is the seamless relationship between our lab network and the engineering centers. This allow our licensed technology portfolio to stay ahead of the competition, and it also enable customers with IP to leverage our capabilities to turn their concept into reality. For example, our lab in Weymouth in the U.S. develops petrochemicals-based technologies. Our lab in Frankfurt, Germany is principally focused on polymer and sustainable chemistry. And in the southeast of France, in Cybernetix, we have advanced robotics expertise and as well our own incubator. But what Technip Energy excels at is the ability to help our clients commercializing their product. This is a key part of our approach to support the scale-up of potential breakthrough technologies often through collaboration with smaller technology companies or start-up. Last but not least, we also partner through extensive collaboration with the best R&D research institutes across the world through co-developed programs. To summarize, I hope you will agree with me when I say that we have a wealth of exciting growth and expansion opportunities ahead of us. We intend to grow our advisory and service revenues and expand into new markets where we can differentiate. We will utilize our project delivery skills and energy molecular transformation technologies to expand further into carbon-free markets. And we will leverage our core capabilities to expand our offering into selected markets, mostly with a service value proposition. All of this can be only achieved with a strong dose of innovation without compromising on project selectivity. Thank you very much. And with that, I will hand back to Phil.

Thank you, Charles. We'll now move to our first Q&A session, which will last about 30 minutes. As a reminder, you can submit your questions directly into the webcast. We'll now pause for just a few minutes while we position ourselves in the room and the Q&A [ roster ] gets assembled. Thank you.

Okay. Welcome to the first Q&A session. Many of you have submitted questions, which we thank you for. Our first question comes from Sasi at Morgan Stanley. So the question relates to carbon emission reductions related to LNG. So is this an opportunity for new greenfield projects? Or could it also be a brownfield opportunity as well? If yes, are you having any discussion with operators of projects that you have worked for where this could be applied?

Yes. Sasi, thank you very much for a very interesting question and actually a very pertinent one because I'm tempted to answer yes and yes. The decarbonization of LNG is a topic that we are discussing for both green and brownfield. And actually, it is unlocking a, I would say, a new set of opportunities in brownfield that were probably underestimated or we would have underestimated 2, 3 years ago. But today, those conversations are real. They are actually converting into real studies and feasibility studies and we know how to make that happen. We know how to make it happen, but -- and those studies, I'm sure, will convert into real brownfield opportunities going forward. And we may discuss that later again, but it's also very true for brownfield. So yes and yes and really opening a new set of opportunities for us in brown and greenfield.

Thank you, Arnaud. So the next question has come through from Michael at Citi. And his question relates to Charles' section. So can you explain what is required to target the upside markets that you've identified? Does the company have the competencies today? Or will it need to acquire or organically build these capabilities to target this market opportunity?

Thank you, Michael, for the question. Actually, I hoped that my presentation would have demonstrated a little bit of what is implied through R&D and the clear access of those upside markets. The R&D play a tremendous role within Technip Energy, and this R&D is multiple form. This can be small M&A, organically based, or external innovation-fronted. We will never stop, and we had not stopped building on R&D. This can lead to some acquisition. We're going to put some brick around the access of the upside markets. Now the -- just to be clear, the M&A is not at the service of changing market share. And the bolt-on opportunities and we developed active views and a very good understanding that we continue to cultivate and with -- together with Marco and Stan, we will test among the realization and the maturity of this upside market in the future.

Thank you, Charles. Okay. Next question is coming in from Bertrand at Kepler Cheuvreux. And I wondered when this one was going to come up. It's the Qatar LNG expansion question. So Bertrand's understanding is that we're bidding in consortium with Chiyoda. When can we expect Qatar petroleum to select the winning consortium for the main liquefaction package? There's a supplementary to that, which is, does the Qatar project include a low-carbon solution? And there's yet another supplementary to that, which is, are you currently working on LNG projects with green electricity solutions? He was thinking, in particular, about a small-scale bunkering project in Oman.

Bertrand, thank you. That's a lot of questions in one question, but I'm very happy to answer them. So you're right, your understanding is correct about Qatar LNG. We are in association with Chiyoda and may just -- may I take the time to remind you that together with Chiyoda we were -- we are the incumbent. So we built the first 3 trains or mega trains in Qatar, which are performing extremely well. Therefore, the opportunity -- and you will hear from Marco a bit later on today. That opportunity really fits squarely with our disciplined approach to megaprojects and mega LNG projects. So we know the infrastructure. We know the country. We know the partner. We know the client. We know the technology. So it's certainly, obviously, an opportunity that is of high interest to us. As for the -- when will we know kind of, you read that the latest offers are in. And for the rest, really, it's down to our customer. So we will follow the pace of our customers. We are engaging, maybe like others, and it is down to the customers and the customers' pace ultimately. So -- but obviously, we are following that very closely and with a huge amount of interest. And then to the section or part number two of your question, yes, I mean, Qatar LNG and this -- the Qatar NFE project, as it is named, does include quite a large CCUS module built into the concept of the plant. So it is actually opening the door to a much lower carbon LNG already. And it will capture multimillion tons of CO2 per annum. So a large amount of the CO2 that would normally be emitted by this plant would be captured, thanks to the CCUS module, that is actually now built into the concept and the architecture for the plant. So really, we're taking a step further. We're going a step further when you think about LNG in the traditional way versus, I would say, the new way. Lastly, I believe it was about LNG plant-based or fueled by green electricity. Here as well, I would say, yes, we are competing, and we are competing in more than one opportunity. And when I say more than one opportunity, it's more than one real tender. So that's what I can say about LNG powered by green electricity.

Great. Thank you, Arnaud. Okay. Next question coming in from Vlad at Bank of America. So previously, you described yourself as a leading engineering and construction player focused on downstream EPC project execution. You're now describing the company as a leading engineering and technology company for the energy transition. Could you please explain the change?

Vlad, thank you. Very good question. So -- and what's changed, and what's new? Well, we are creating Technip Energies to start with. Okay. So we're putting that business on the forefront. And we are putting not only the business, but also the high-value attributes of that business on the forefront. I've told you about projects on one side and PTS, and you will -- TPS, sorry. You will hear the same from Bruno a bit later on. It is important for us to put that high-value attributes or those high-value attributes on the forefront of Technip Energies. And in addition to that, we're not abandoning the construction side of things. I'm sure, Vlad, I mean, you've been following us for quite some time. You know us well. Technip Energies is an asset-light business model. You will hear about that a lot from Bruno later on. We are asset-light, which means that we don't own or we don't operate construction means. No, we don't have trucks or cranes. But our key competency is really with the people and the know-how and the expertise to drive large construction projects. So we've kind of always been an E&T company. Our strength is really in the engineering, the technology, which we have in-house or we can integrate it. We can integrate technologies of many kind, and that's what we are putting forward today for you.

Great. Thank you, Arnaud. Okay. The next one has come through from Marc Bianchi at Cowen. And Alain, this one, I think, is addressed to you. So 75% of emissions from LNG that was shown on a previous slide, does that include upstream gas production and downstream power generation?

Thank you. When we refer to the 75% production of CO2 into the liquefaction, we mean that CO2 is embedded into the pretreatment where you need to remove the CO2 from the feedstock. So I can consider it as the upstream CO2 capture. And unfortunately, the thermodynamics tells you that to liquefy, you need energy. And today, the energy of a liquefaction plant is coming through mainly gas turbines or power generation through gas turbines. So the game here is to try to capture the CO2 coming from the power generation also, and this is what you referred to. And this is where stand the majority of the CO2. And to do that, as we explained, we have the capability to provide either CCUS directly to capture the CO2 from the fuel emission or to displace the CO2 through the fuel gas with hydrogen. And this is the beauty of the solution that we are able to bring to our customer, multi-service company, able to bring the highest technology and the more valuable one.

Alain, thank you very much. Okay. The follow-on from Marc was around hydrogen. So Technip Energies' contribution to blue hydrogen is clear, but the question is, really, how you participate on green hydrogen is less clear to Marc. So what could be the company's content on, say, a 10-megawatt or 100-megawatt green hydrogen facility? Stan, I think this one's for you.

And I'll take it. Thanks, Phil. Really good question. So I talked about green hydrogen and I talked about the strategic investment we made with McPhy. So we seized on that opportunity. And of course, that gives us direct access into the life of the electrolyzer, which is a key building block of green hydrogen. Of course, when we look at Technip Energies, we are looking at the complete green hydrogen plant. Clients are coming to us and asking us develop, engineer, construct a green hydrogen plant for us. So the electrolyzer is one part, but we're looking at the renewable energy coming in, the dynamic response to the electrolyzer. Then we're looking at the infrastructure, the utilities, the compression, the storage, potentially liquefaction of hydrogen, transportation. So we're integrating everything, getting the value and then the project delivery. And so whether it's 10 megawatt, 100 megawatt today, of course, we're doing that today. We're looking at projects today. But we're also beginning to look at technology R&D, innovation with the intent to scale up, and that's really part of our DNA. We have a track record of scaling up technologies. So once we start looking at the gigawatt facilities, we're already beginning to think about the challenges in terms of what innovation, what value improvements, supply chain, economies of scale need to be brought into that equation. So hopefully, that gives you a bigger and clear perspective of the big picture we see around the green hydrogen opportunity.

Thanks, Stan. [Operator Instructions] Looks like we've got another related question. This one is from Amy Wong at UBS. In green hydrogen, given that it's a young industry, can you give us some insight into how customers decide on the solutions, maybe how they select the supplier? And what are some of the key factors that affect their decision to move a project forward? Again, Stan, I think it's for you.

No. I mean it's really the heart of the equation here. So when a customer comes to us saying, I need hydrogen, the first thing is that -- we're seeing is that they don't care about colors. They want to understand their optionality on hydrogen. So we can give them a view of what is the cost-effective approach to hydrogen based on their specific conditions. For instance, some will go to blue. Because they have carbon capture, they want to go to that solution. But many will go to green. So if we're looking at green hydrogen, of course, the availability of renewable energy is foremost. And then we look at the scale that they need, and of course, what are they going to do with that hydrogen. We're also looking at a lot of projects that are going all the way to green ammonia from green hydrogen. So within that, they're looking at what's it going to cost me? What are the supply constraints, for instance? How big can I build the facility? What's my operating cost? What's the maintenance? Everything. So similar to what we're doing today in our current business, the same questions are being asked. And that's where we, as Technip Energy, really earn our money. We can really give the customer the confidence that they're getting the best technology, that it will work, the best engineering and value improvements, the scale that is there to deliver the best project for them at the end. So a lot of factors go into that conversation, but you can come to us, and we will help you walk through and understand what factors are important to you to make your projects successful.

Great. Thank you, Stan. So the next question has come through from Mick Pickup at Barclays. So Mick's question is, many of your peers would suggest that they have very similar skills to yourself, and they all have varying overlap with your track record. So what differentiates Technip Energies? Arnaud?

Well, Mick, thank you. Well, I hope that after today's presentation, there's another part this -- I mean, a bit later on, of course. You'd be convinced that there's only one Technip Energies, and that's okay if we don't fit exactly within a group of peers. And I don't see any other company out there just like us. But okay, we've, I mean, on purpose, presented a -- it was in my part of the presentation, on one hand, the project side, and on the other side, the TPS. I think this -- what differentiates Technip Energies is really that, first of all, the extensive portfolio of technologies that we have within the company. So that's first and foremost. And then -- I'll come back to that, is this ability to integrate any type of technologies with the type of -- with the level of success with which we are doing it. And I think it is what truly differentiates Technip Energies from, I would say, maybe the rest of the field. And the fact that more than anyone else, thanks to our own technologies or our ability to integrate the technologies, we are so agnostic to the feedstock. And I think this is a clear differentiation for Technip Energies in addition to the very disciplined operations that we run and the strong delivery that we do day in, day out for our customers through the projects.

Thank you, Arnaud. That's great. Okay. Mick's follow-up is, you say that you are feedstock agnostic, but the scale of many renewable projects today are smaller than your traditional projects. So how confident are you that you can switch from one to the other and can be balanced. And does having many smaller projects versus less bigger projects pose any problems?

So I will start, and then I will hand over to Marco in order to develop a bit on the renewable and circular economy or renewable fuel projects. Yes, we are feedstock agnostic. And -- but I want to insist on the fact that we are not abandoning the base. I want to insist on that. We are not giving up on the base. The base is transforming. The base is decarbonizing, and we're not giving up on it. So we're not giving up on our revenue stream. Being feedstock agnostic allows to -- allows us to then turn to a different type of projects. And we execute very large-scale projects, but also smaller one. And I want to give Marco the opportunity to maybe tell you a bit more about what we are doing in renewable fuels, in particular, which maybe is not so obvious to you and the audience. Marco?

Thank you, Arnaud. So on renewable, we started more than 15 years ago working on it for Neste and with a completely different approach, that the traditional project is more on an alliance and integrated project team. And so we have been able to fulfill the -- successfully, both the Rotterdam and Singapore refineries. This is the reason for which now we are working on the expansion of the Singapore refinery. And this is something that we have even in other area, for example, the alliance we have for the PTA on BP, that is even on the scheme of the alliance. This is just to say that we have many operating centers in our company, and we are capable to provide all what the clients want from the megaproject to smaller ones. So we have an agile organization that can be adapted to the needs of the client, and we will mobilize in front of our client which of our operating center most suited to the client needs.

Thank you, both. Okay. Next question has come through from David Farrell at Crédit Suisse. So his question is, as you split from TechnipFMC and pursue your own paths, do you see any areas of dis-synergy that need to be addressed? And will there be any ongoing relationships between the 2 companies? Arnaud?

Yes. Thank you, David. I will start and hand over to Bruno, who you haven't heard about -- or from just yet and is being very patient, and you are being very patient. And as I know, you are anxiously waiting to hear from him on the finance section. Well, the relationship with Technip -- between TechnipFMC and Technip Energies going forward will be ad hoc. And we -- between 2 leading companies and if and when it is required, I think it's a good idea that these 2 companies would collaborate. But no, there is nothing cast in stone about must dos, don't dos, et cetera. I think the 2 companies will be allowed to live their lives, and so that they have taken up their independence and grow accordingly. And I think that's an important attribute of the 2 companies going forward. Bruno, would you like to add something on the recent transaction?

Yes. So in terms of dis-synergies, for sure, there will be some because you will have a Board, you will have an Audit Committee, you will have 2 listing entities. But really, I think by being independent, we will have 2 fit-for-purpose companies. So the target -- and I will highlight it in my part of the presentation, will be to have a structure. We will be a bit more efficient. That's enabled by the fit-for-purpose. And basically, this efficiency, this leaner organization, simpler organization will more than outweigh any dis-synergy that may be created by the spin. Thank you, Phil.

Thank you, Bruno. Okay. A question from Guillaume at SocGen. The question is about a future potential event. Obviously, we've talked about ESG today. Would we be planning an ESG Investor Day within the next 12 months?

Guillaume, thank you. As I expressed, I mean, ESG is a very important topic. And we want to be known as a reference company for ESG as well. And this is why we've taken the conscious decision to take our time to establish an ESG strategy and ESG road map and ESG scorecard that is reflective of who we are, Technip Energies, as a company. I think this will be -- this will be time well invested. And we have not just yet decided on the timing and, I would say, the conditions for communicating back to you. But we will do so probably within the year, coming back with our strategy and with a scorecard that will -- that are important to us and will be important and will define Technip Energies as a company.

Thank you. Thank you, Arnaud. Okay. The next question has come through from Sean Meakim at JPMorgan. There is investor skepticism regarding the need for blue hydrogen. Everyone is looking ahead to a green hydrogen economy. Can you talk about the importance of blue, not only in reducing emissions, particularly in the Eastern Hemisphere, but also as a stepping stone towards achieving the ambitious green targets laid out by many of the governments? Stan, I think this one is probably yours.

No. Really big question. And our clients are, obviously, like I said, looking at their optionality available today in terms of hydrogen. That graph is how much hydrogen I need, at what cost and certainty of delivery. And of course, depending on what that focus is, we see all 3 areas: the bluing of the existing gray hydrogen portfolio around the world, which we have a significant share and is currently in play. So we have a number of technologies that we can help the bluing of the gray, and we see those opportunities moving. They will do so in the context of wherever they are, our hydrogen plant, in a refinery, it will be in that context. We do see the need for blue hydrogen. The technology solution and the scale of that is available today, and it's the next level of cost competitiveness. So if you have CO2 capture, and you're looking to use hydrogen, particularly, say, for decarbonization of LNG or your assets, you could put those together. You can make a cost-effective solution relative to blue. And of course, we know that the world needs to go to green. And when we look at hydrogen, remember that we need a six-, seven-, eightfold increase in hydrogen to really satisfy the amount of hydrogen that we're going to need to displace the fuels and everything else we're using today. So we expect green will be the answer for that. And it'll start from a very small place. And today, we see a number of green hydrogen opportunities. The technology has been around for a while. We're beginning to innovate, add value to those technologies, but the cost is still higher. But with the support of governments, with technology innovation, with improvements in the supply chain, with scale up, which is really what Technip Energies does best, we believe we will break through that curve and get green hydrogen to where it needs to be to satisfy the world's needs.

Okay. Thank you, Stan. Okay. The next question has come through from Mark at Jefferies, and he's asking about FLNG. So as a leader in FLNG, how does the technology compare to land-based solutions in terms of CO2 emission intensity? And are there any companies looking at full CCS capture for FLNG projects currently? Alain or...

I mean on this one, we have the -- not the guru because I don't like the word. But I mean, the man who owns FLNG in the company because he's delivered Prelude, and he's actively engaged and knowledge -- and following the Coral FLNG as well. So I will pass it on to Alain, and we'll do a bit of team play on this one. Alain, over to you.

It's a question from a client to develop, so all the session will not be sufficient. FLNG purpose is to unlock gas reserve first, which are not accessible today easily through onshore liquefaction unit. So let's put the driver at the same pace. And then when you have been able to unlock this gas reserve with your FLNG concept arriving faster on the market, producing in a more secure way, then you will -- we will be encouraged to think about how I can reduce the CO2 footprint of my investment. And then we can go with solution, which are today developed for onshore. There is no way to think differently. And we have many technologies that's available to push fuel gas with hydrogen when we can generate hydrogen offshore. It's not an impossible target. So I think that this is an overall program for a customer to think like that. And I think that we are, yes, the company to help him to develop that. But this is the future of tomorrow, so I'm really enthusiastic with that, yes.

Thank you, Alain. That's great. Okay. His follow-on question is also around LNG. So in terms of LNG projects, TechnipFMC has targeted selected major greenfield projects. Now using the 15 major project equivalent supply gap that we discussed in our presentation today, how does that translate into the opportunity set in the coming years, granted we've already discussed Qatar? But what proportion of these opportunities could be brownfield or debottlenecking in nature?

Well, as you've heard from Alain, the LNG wave for Technip Energies is not over. It's not over. And in a difficult year like we've had in 2020, we have been awarded the only LNG project that has reached FID, and it's the Sempra project on -- in Mexico for Sempra Energy. So when we think about the opportunity set for LNG, so first of all, I need to tell you, it's not only about mega modules and megaprojects. You heard from Alain that the opportunity set is also shifting towards the LNG infrastructure, say, for refueling, for example. We are interested in that, and I think we have a competitive offering into that landscape as well. For the rest, well, you know us. You know our presence, where we are and where we're executing LNG projects and with which customers. So I think it is important for you to keep in mind that the customers we're engaged with, from Yamal, for example, to Arctic LNG 2, well, those conversations are not over, and we can imagine that subsequent phases will come after that. And again, I've used Russia, but I could have used other areas of the world. The important is those conversations are ongoing. Those FEED studies are ongoing. And therefore, we have, I would say, all the building blocks in order to build on the visibility for the future LNG projects going forward, but they would be of several types and several sizes.

Great. Thank you, Arnaud. Okay. Last question for this section from Waqar, Waqar Syed at ATB. What level of capital spending will be required in the intermediate term to position Technip Energies to capture these new market opportunities in services, energy transition and adjacent industries?

That would go to Charles, no? We should go to Charles.

Charles, I think this one's yours. I mean...

Yes, yes, for sure. Yes, thank you very much for the question. There is, obviously, a capital need, which is, I mean, translated. And again, if you can extract from Stan's part of the presentation and my part of the presentation, we are deeply rooted, and our DNA is focused on R&D. So therefore, R&D is organically built by the women and the men of Technip Energies or a little bit acquisitive or partnership, just like open innovation or our lab network is allowing us to do. The capital need that we benefit from over the last years will stay, I mean, roughly speaking, at the same level from an R&D standpoint since our differentiation and, notably, on offshore hydrogen nor offshore wind is coming from our ability to scale up from our engineering and not necessarily technology. Just like Arnaud was saying at the opening, we do not have to win all the technology bet. We have a nimble approach where our partnership is as well a big piece of the puzzle. I hope it's -- it's answering your question.

Thank you, Charles. But I just want to complement because you haven't heard from Bruno yet. I think you will hear from Bruno a bit later on in the presentation in his section today that Technip Energies is equipped with a capital structure to answer to our own ambitions. And that's an important point that Bruno will clarify for you later on.

Thank you, Arnaud and Charles. Okay. That concludes the first Q&A session. We'll now take a 15-minute break before the second half begins. So we'll reconvene at 4:25 CET. Thank you. [Break]

Welcome back. And moving to our next section. We have a reputation for outstanding project execution. This makes us a partner of choice, both for our customers and for our project partners on larger contracts. Selectivity is vital to our success. And in this section, Marco Villa, CEO-elect, will share with you how we assess and approach projects in order to maintain the quality of our backlog. And then we'll have Magali Castano, SVP People & Culture, share with you insight on what makes Technip Energies a truly world-class organization, our people. Marco, over to you.

Thank you, Arnaud. So let's have a look on our successful delivery. You can see over the past 60 years, we have played a key role in many of the industry's largest and most iconic projects. It wasn't easy to shortlist just 10 project because the list of successful project goes way beyond what we show here. As to the LNG on which Alain went through previously and the gas to liquid, our achievements are: the very first LNG plant from the Camel project built in Algeria in the year '60s; the world's first floating LNG project for Satu and Prelude where we successfully offshorized the technology, making Prelude the largest floating structure on the planet; and we have also developed the world's largest GTL plant for Oryx in Qatar. We had built as well more than 30 grassroot refinery since the late year '50s, including the world's deepest conversion refinery, such as Jubail project in Saudi Arabia, with the capacity for more than 400,000 barrels per day. For Neste, we do -- we have a partnership as presented by Stan. We have built the world's largest biodiesel plant in Singapore, and we are currently expanding this plant. These are critical references for Technip Energies in a market with significant long-term growth potential. We have as well historic references in the petrochemical space. We are a world leader in ethylene, delivering over 45 grassroot ethylene plant, including the Etileno XXI project in Mexico. This is Latin America's largest petrochemical project. Our reputation is strong as well in offshore where we have many successful references for conventional and floating platform. Despite not having any fabrication or installation assets, we can meet our customer needs as we have the necessary skill to manage full EPCI project. We have been also pioneers in domain beyond floating LNG, including self-installing platform, large FPSO and Spar, such as Aasta Hansteen, the world's largest Spar. Our frontrunner spirit is strong as we embark on this new chapter for Technip Energies. And we continue to act as a trusted and reliable project execution partner. Let me now give you some insight in our operating model and our recipe for outstanding delivery. Selecting our project is critical to our success, and we are focused on securing the right projects, those that have the right economies from our customer and for Technip Energies, the right terms and condition and have alignment to the right partners, both operator and project partners. There are no must-win project. We are prepared to walk away from prospect if necessarily, no matter how much work have gone into the tender phase. Most of our major projects started with early engagement where we believe we can influence technology choices, often utilizing our proprietary technologies or alliance partner technologies, as detailed by Stan earlier. We can also help defining specifications to reduce overall investment cost and the risk upfront to set us up for successful execution. Our mindset is one of a pioneer. We have many world first, and we can be considered the new frontier specialist, offering flexible contracting model and the ability to overcome many on the industry's most complex engineering challenges. This is all supported by strong technical expertise and project management capability with our operating model underpinned by robust risk management and control. Looking ahead, digital will play an increasing relevant role in the full life cycle of projects. We have several initiatives underway that will support our digital offering, and we believe digital will have an increasing role in our execution. We believe strongly in early engagement as a route to defining and optimizing a project scope. This way, we believe we can ensure economic viability, and ultimately derisk project execution. Through early engagement with our client, we can evaluate the best technology solution, the best specification, the best project development solution and the best execution strategy. Our customer are demanding the best project economies and the lowest carbon footprint, and we aim to deliver this through early engagement activities. It is really at the front end of a project where we can achieve the most influence on this item. We have several early engagement route: Genesis, one of the access to further grow our high-end services offering, as explained by Arnaud and Charles, is a leading engineering and advisory services company, agnostically helping energy companies to create, realize and enhance the value of their assets. In addition, we have a significant engineering capability within Technip Energies where we perform a significant volume of front-end engineering studies. And last but not least, our 60 years track record with thousands of references. This make us a natural partner for early discussion on brownfield or follow-on project where we already hold a position. Now turning to our process for risk management and control. These all begin with project selectivity. Selectivity is key for us, as outlined by Arnaud. Our risk management and control system begin at the pre-bidding stage with a dedicated risk assessment of the initiative, focused on risk identification, risk analysis, risk evaluation and risk mitigation. This is rolled out throughout all the project life, including proposal and execution phases via dedicated risk management meeting and risk assessment workshops. This is in accordance with our proposal gates and monthly project management review processes, both shared by the top management of the company. In addition, we carefully assess who the best partner could be. In addition to technology partner and licensor, we are partnering offer with peers and construction companies in order to bridge gaps in 3 keys areas: project sites and de-risking; access to different to enable us to deliver robust project execution scheme; and access to financing, which is increasingly important today. Choosing the right partners to work with is critical to our success, and this is why we focus on reputable and creditworthy partner we can rely on to deliver a successful project. Our ability to set up complex and multipartner scheme and flexible contracting model to fulfill our customer objectives is a real differentiating factor for us. And we continue to develop a stable partnership network. Also key is our understanding of local construction capability. Our presence and track record in-country ensure we understand the local capability. The project risk profile and our ability to manage that risk will determine our involvement in any given project and the type of our involvement. I cannot stress enough how important are our culture of transparency and attention to details on projects. It's rare for a major EPC project not to encounter challenges, but it is how we address these challenges that make the difference. Warning flags are raised early. Even the smallest of potential problems of cost overrun are escalated and discussed in our monthly project management review. Problem are dealt with when they are small so they don't become a big problem. This culture truly reinforce our robust risk management processes. Turning now to our major project portfolio. This slide illustrates how our sophisticated and disciplined commercial approach significantly mitigate the risk associated with our project. On this slide, we show our top project, and we show our key selectivity principle. We have talked about previous of the importance of early engagement. And as we illustrate here, all our major project started with early engagement, typically through front-end engineering. In addition, we have a technology position on the majority of our project, either through the integration of technology from our proprietary portfolio of process technologies or integration of technologies assessed through alliance partners. All these strengthen our commercial position. And then we are constantly working with known project partner, from international construction to local construction companies, who we have successful worked with previously. And we are working in familiar geographies in country and region where we have known and have a track record. Knowing who you are working with and understanding where you are working, I believe, are a critical component for a successful project. This isn't -- this is not an exhaustive list of selectivities criteria. But I believe that ticking the majority of these items of any given project will help mitigate risk. As a vision for the future, we also like to add a carbon-based metrics to our future selectivities criteria for Technip Energy. So we are mitigating risk to our company and also mitigating environmental impact. The last and often most critical piece is the contract. And for me, this is all about discipline. It is imperative that we enter into a contractual framework in accordance with our risk management policy. Then we look to mitigate risk through negotiating the right terms and condition within the right contractual structure. In other words, a framework that reward us for the risk we are prepared to take on while giving us protection from risk that are out of our control. As I said before, at Technip Energies, there is not such thing as a must-win project. Digital. Today, digital is an often-used term with different meanings, depending upon who is using it, from digitalization to digital transformation. Technip Energies is embracing digital capabilities as a core enabler of our business. Digital know-how will enable us to contribute to a sustainable and profitable operational performance with potential to drive growth in revenues, improve internal efficiency and enhance our ability to collaborate with customer and our supply chain. Today -- to date, we have developed in-house digital capabilities. to enable our operating model from early engagement through project management expertise such as SPYRO. SPYRO, this is a market-leading proprietary software for the prediction of ethylene cracking furnaces yields. Over 70% of the ethylene producer worldwide use SPYRO for optimal performance or design development. This software is also the basis of the new SPYRO assets management digital services to allow real-time plan prediction in a cloud-based application. Then EasyPlant. EasyPlant is our own trademarked construction IT tool, enabling the management of all the construction activities till client handover of the plant. It is a centralized data platform with multiple access configuration, enabling clients and subcontractors to monitor the planning, the progress and the execution of the construction activities. Our ambition in respect of digitalization is supported by the 4 pillars shown in the slide: Utilizing data analytics as foundations; innovative digital project execution; digital assets delivery; and digital service offering. Now let's look specifically at front-end. We are digitally engaging with our customer at the early planning phase. And our ultra-front-end suite within Genesis represent an open platform, a digital toolbox that enable a greater level of collaboration with our customers as they evaluate their investment opportunities. And by leveraging cloud computing to perform calculation and to process data at a greater speed, we can evaluate more option in less time. This allow our engineers to focus on identifying previously undiscovered scenarios to unlock the optimal value for our customers' development. Part of the ultra-front-end suite is our industry's leading carbon assessment tool, Gen-CAT that has been already introduced by Stan, which will provide an assessment of direct and indirect emission from procurement to assets construction through operation. One of the strength of Gen-CAT is its applicability. It can be used for any assets, be they greenfield or brownfield, upstream or downstream and now even renewable. Through early digital engagement, innovation and collaboration, we can help our customers make a significant environmental difference and neutralize the carbon impact on their project assets on the environment. And now let's take a closer look at the SPEED model. The data management need of our company, Technip Energies, are enormous. And we need to structure the data efficiently and effectively so we can learn from the data and leverage our extensive track record. Digital is helping us. And our speed-to-digital project tool is defining a new way of delivering assets, which leverage a standardized and optimized engineering system that maximize the reuse of past data and minimize data recreation in short. It promotes the single source of true concept for optimizing cost and delivery time. This is strengthening our technical and project management competencies to a consistent and transparent data-centric approach. This system brings huge benefit, including faster access to project information and seamless integration with customer system. This allows for a better collaboration with customer to optimize on requirements, cost and schedule and a faster decision-making. We estimate a time saving of up to 20% on dedicated task. Ultimately, this systematic approach to engineering is helping to derisk procurement and construction, which, as a result, strengthen our execution capability. And with that, I will hand over to Magali to discuss our workforce. Thank you.

Thanks, Marco. Technip Energies is a truly global organization with a highly skilled workforce located across 34 countries, and we are headquartered in Paris. Our main operating centers span multiple regions, including Europe with Paris and Rome as main location, the Americas, Middle East and Africa as well as Asia Pacific and India. And over half of our workforce is outside of Europe. While we have clear centers of excellence, for example, Paris for LNG and Rome for downstream, a key advantage of this structure is the flexibility we can bring to our execution models. In particular, as Alain [indiscernible] presented the Yamal and Arctic projects, we execute utilizing a multicenter model on many of our projects, depending on expertise, resource utilization, site location and client base. It also means that we are close to our customer, and we are close to our projects. We are a people business. We'd like to say internally a brain-intensive business. And we are really thankful for the phenomenal talents of our 15,000 employees worldwide from our engineers and project managers to our technical experts. It is our people, our processes and our operational discipline that drives our outstanding performance on projects. And this is why it's so important we can retain our key people and bringing fresh talent to the organization. We believe our strong alignment to the energy transition will support both talent attraction and retention, in particular towards younger people who are excited by energy transition and motivated to contribute to the change. We now have a video with testimonials from our employees about what Technip Energy means to them. [Presentation]

As stated in the video, we believe that experience and diversity matter greatly in a people organization like Technip Energies. Diversity brings many benefits, including increased creativity, innovation and even productivity. At Technip Energies, nearly 30% of our workforce are women with a slightly increasing trend. And our effort on gender diversity will continue and be strengthened. As an example, we set as a target that 50% of young graduates will be women from 2021 onwards. We have over 100 nationalities across our employee, and nearly half of our employees are millennials and Generation Z, which is up to the age of 40. And this is also balanced with the level of experience in our organization that is consistent with our strong execution and financial track record. We have a low staff turnover. And on average, our workforce has been with us for nearly 10 years. Our diverse and experienced workforce provide us with significant expertise and capabilities and gives our customer confidence in terms of our execution. And we are supported by a community of over 450 season project managers as well as over 300 technical experts with industry leadership. Our people are our most critical assets. And we thank all of them for their diligence, their dynamism and their commitment to Technip Energies. As shown on the prior slide, we have an experienced workforce with a high company seniority. So now let's look at how a typical career path could look like at Technip Energies. We have an extensive playground in terms of job diversity, but let's focus first on the career path in the project management field. This goes from graduate engineers to project managers and directors to people like Jean-Marc. He delivered the Yamal project and is one of the 3 fellow executive project directors, the most distinguished project for Technip Energies. The expertise and knowhow we have in executing projects has developed and evolved throughout our 60-year history. And this knowhow cascade in the organization through interaction, shared learnings and on the job learning as well as structured development programs to enable people to get to the next level. It becomes a learning loop and ensures we are constantly pushing to improve our people's abilities and our overall execution capabilities. When I talk about learning and sharing, it's also about learning agility. The competencies and the skills are transversal. Thanks to learning agility, our people are able to be effective on projects of different type or size. There is a true transversality of our workforce. By the way, the people you see in this slide are real employees. And all of them kindly gave us their permissions so that we could share with you real example of our talents. This illustrate as well diversity in the workforce in terms of gender and nationalities. It reflects our serious effort in this area, which will be sustained and accelerated. We are extremely proud of our project expertise within the company. And equally, we are proud of our expertise beyond projects, especially our technical experts. Similar to the previous slide, let's now consider a career path in the technical expertise field. In this example, we plot a path from young process engineers through to deep technology expertise. We actually have a structural development program for our technical experts, the technical expertise program. It is designed to recognize and reward our technical experts through a ladder of [ 4 ] levels up to the fellow technology expert level as Dominique on this slide. It also meant to [indiscernible] known in the company and encourage them to be contributors and leaders externally across the industry. Through this program, we also want to ensure we are the expert in the right discipline for the business of today and of tomorrow. These people are our trusted adviser, our R&D personnel and our technical and technology experts. They are critical to our organization and are the service of our projects and of our proprietary technology portfolio. Technical innovation is at the core of what we do. Our technical leadership expertise enhance our capabilities, strengthen our covering and inspire people, both within the company and across the industry. And our fantastic workforce will be led by a highly capable and experienced leadership team. Many of these individuals are presenting today. Not with us today are Christophe Virondaud, Head of Commercial; and Christophe Bélorgeot, Head of Communications. There is, on average, over 25 years of diverse international experience in our industry across this team and a demonstrated ability to drive world-class project execution and lead innovation. To conclude on this section, our value proposition is underpinned by our strong project execution that's leveraging off 60-year track record, a leading process technology portfolio and robust risk management processes. We are enhancing our project execution capabilities through integrating digital into our project processes. And we believe that the digital transformation of Technip Energies brings many other benefits including internal efficiencies and enhanced market and service opportunities. Sale activity will remain a key mantra for us, and we will not move away from our disciplined commercial approach. And our 15,000 human energies really make the difference. Thank you, and over back to Arnaud.

Thank you, Magali and Marco. I don't know about you, but when I hear the head of the human resources of people and culture function as we call it, within Technip Energies, talk about commercial discipline and our disciplined approach to our execution, I feel good. As we progress towards spinoff, we would like to provide you with the relevant information on Technip Energies that illustrates our financial strength and demonstrates to you a solid foundation for sustainable shareholder returns. Let me now introduce to you the long-awaited Bruno Vibert, CFO elect. Bruno, over to you.

Good afternoon, again. And maybe the best news of my presentation will be that yes, it is the last presentation. So from a financial standpoint, our business may sometimes be seen as complex, lumpy. But in fact, Technip Energy's specific operating model has truly many attractive features, which I will try to underline in my part of the presentation. First, being only a backlog-based business, we have excellent visibility in terms of top line and margins. Our ability to deliver guidance in April in what were exceptional circumstances, is, I believe, a strong testament of that. Second, our contracting discipline and operating model notably with customer advances, milestone payments, enables us to have an early cash conversion of earnings. Third, we are an asset-light business with limited CapEx. And as mentioned by Magali, our assets are really our people and processes. You will see that we will start as a new company with a strong balance sheet, giving us the means to our ambition in this new chapter. Finally, the combination of those 3 items convert to high returns on invested capital, and this supports a long-term dividend policy commitment. I will, of course, illustrate each of these attributes as I go through my presentation. Turning to the key financial attributes of our 2 businesses: Project Delivery and Technology, Products & Services or TPS in short. Projects delivery represents the majority of Technip Energies revenue and generated EUR 5 billion in the 12 months to June 2020. It's a well-diversified business, operating LNG, diversified downstream and finally, to a lesser extent, in the offshore and upstream sectors. This business is a long-cycle activity with revenue growth linked to the evolution of our backlog, which stood at just over EUR 12 billion at the end of H1 2020. For this business, as led out by Marco, the key is really this combination of selectivity and project execution. We will see that while we are expecting revenue growth given our backlog and the opportunity set, growth in itself is not a strategic objective. We are targeting work where we can differentiate. We are targeting profitable work with an acceptable risk profile and the right cash flow profile. Turning to TPS on the right. Revenues totaled EUR 1.1 billion in the 12 months to June 2020. Activities within TPS are typically shorter cycle versus project delivery. As such, TPS contribution to the total company backlog is, by design, lower than the contribution to the total company revenues. Backlog for TPS stood at just over EUR 1.1 billion at the end of first half 2020, which is basically 1 year of revenues and representative of a business, which is more of a [ call-off ] in nature. While TPS does not provide the solid medium-term visibility of project delivery, TPS does offer accretive margins, notably through our proprietary technologies, our products and higher-value service lines. We see clear potential to deliver steady revenue growth from this business in the coming years, and it will surely be one of the strategic focuses of Technip Energies. Before I turn to the figures, let me first explain how we intend to report financials. First, we intend to introduce, or reintroduce rather, the concept of an adjusted IFRS framework. And this is really related to the joint venture accounting. Under IFRS, a joint venture is either fully consolidated or equity accounted. In other words, we either account for 100% of the operations or 0%. None of the 2 really shows the true economic performance. And the most glaring example of this is with the Yamal project, where our economic interest is 50%. But under IFRS, we consolidate 100% of the backlog: revenues, margins, et cetera, associated to the project. The adjusted view with proportionate accounting will put us back at 50%. This economic view, we are convinced, will make it both simpler and both more relevant for investors. In addition to this adjusted framework, since we are asset-light, we feel that EBIT is more representative of our economic performance and our ability to generate cash. We have limited need for capital expenditure as shown in our 3-year financials. So EBIT and EBITDA margins are relatively similar, especially if you take out the IFRS 16 leasing standard impact. Turning now to the information on the slide. Our industry-leading financial performance is driven by 2 distinct characteristics: unwavering selectivity and proven excellence in project execution. This really translates in the EBIT margin expansion shown on this slide with an improvement from 5.8% in 2017 to 7.1% in 2019, benefiting notably from successful LNG projects in their completion phase. In this period, after a trough in 2018, revenues grew by around 25% year-over-year in 2019 as activity ramped up at the back of our backlog growth, notably for the project delivery business. For TPS, you can see less volatility. And on contrary, a stable mid-single-digit growth from 2017 to 2019. Our backlog has increased significantly over the last 3 years, as shown on the right. And at the end of 2019, backlog was almost 4x the position at the end of 2017. And this without lowering our selectivity criteria. This quality backlog gives us a great visibility for our future earnings. And also, it enables us to go through some more difficult periods. And as we focus on the 2020 performance next slide, this will be, of course, a great proof point of this feature. The benefits of backlog and robust project execution is, as I was saying, really demonstrated by the financial performance that we've been able to deliver in 2020 in really exceptional times. Despite the pandemic and the highly challenging operating conditions, we delivered more than 25% revenue growth year-over-year in the first half of 2020. We also see growth on a full year basis with high single-digit revenue growth year-on-year based on our estimated closing range shown on the left chart. In a year marked by such disruption, volatility, delivering growth and an ability to provide guidance as early as April is obviously quite remarkable. But it is also very indicative of the visibility that we can provide to investors. Profitability has also been resilient. With full year 2020 margins, anticipated to close in a 5.6% to 5.8% range, a step down from 2019, but step down largely anticipated and driven by lower contribution from Yamal LNG but not yet offset by other projects, which are still in their early phases. Turning to the backlog. We've had no backlog consolidation during 2020. We have remained fully committed to our selectivity in principle. And without major EPC award or FID in the first half of the year, we had a low book-to-bill explaining the decline in backlog. However, with 2 major awards booked in the second half, we could anticipate a full year book-to-bill in the region of 0.75, which should be considered as a strong performance against a very difficult backdrop. TPS has also shown a strong resilience. And as we focused towards more low-risk service contracts during the early phase of the pandemic, TPS actually ended the first half of the year with an increased backlog with a book-to-bill of 1.2, another sign of the growth potential of this business. Taking now a deeper look into the backlog. Clearly, we have excellent visibility for 2021 and very solid revenue visibility for later years. As of the first half of 2020, we had over EUR 10 billion to be executed from 2021 onwards, including nearly EUR 5 billion for 2022 and beyond. And remember, this is at the end of June, so this did not even include the work for Sempra Costa's LNG and the Assiut hydrocracking refinery in Egypt. These 2 recent announcements obviously only reinforce our position and confidence. One point which I want to reemphasize, while our backlog has extensively grown in the last 2 years, backlog growth is not a target per se. Management, our commercial teams are not incentivized to grow backlog. Marco was very precise. At Technip Energies, there is no such thing as a must-win project. We are focused on securing the right projects with the right economics, the right terms and conditions and with the right partners. In terms of project concentration, while there is always more spotlight on the mega projects, we have an extensive portfolio of projects beyond these. In fact, as shown in the middle pyramid, we have over 160 projects currently with a backlog value under EUR 100 million; 8 projects between EUR 100 million and EUR 500 million; 5 projects between EUR 500 million and EUR 1 billion; and one above EUR 1 billion. And remember, this does not include Costa Azul and Assiut at the higher part of the pyramid. Looking at the market on the right. We have around 60% of our current backlog within the energy transition space, including LNG. [ Energy ] is typically accretive to our projects delivery business, given our differentiated and market leader position. So we feel very, very good about this contribution. The 60% also includes the work we have in sustainable chemistry, including the biofuel project for Neste and a growing workload in CO2 management. The balance of 40% is diversified across more traditional markets such as downstream, petrochemicals. So not pure energy transition per se. But most of these traditional projects has some kind of novelty with improved efficiency, for example. There is not a project which is looked at today, which looks like a project that would have been designed 10 years ago. Our backlog gives us a lot of visibility for future earnings. But on top of that, we can grow even greater confidence by the breadth of our pipeline of opportunities. In aggregate, for the years 2021 and 2022, we currently see and work on an opportunity set of around EUR 90 million. Please note that this only includes project opportunities that we've chosen to be actively engaged in. In other words, this is our addressed market and not the addressable market, which is much larger and was presented earlier in the [ CMD ]. This pipeline clearly shows that we are not overly reliant on any single market or geography. Our 3 main markets are very balanced, 33% in gas, 37% in downstream and 30% in offshore, upstream and other industries. From a geographical standpoint, no single geography accounts for more than 30% of the pipeline, a very nice balance. We are often asked about our concentration risk, and the angle is often through the backlog, which is fair. But really, this can be distorted given some of the sizes of large projects, such as in LNG. Well, for me, this opportunity set is really the best way to look at it. The key is to have a well-diversified and extended opportunity portfolio, then through our selectivity process, try to secure the right contracts. Afterwards, Marco and the team just need to execute the projects. Easy. On the right, we show a very clear and specific trend in the pipeline with the exponential acceleration of prospects within the energy transition space beyond LNG. For 2021, we see opportunities in contract value over 8x the levels we were absorbing in 2018 and 2019. This is the outcome both of more opportunities and of an increase in the average project size. We see such growth throughout the 3 different areas of sustainable chemistry, decarbonization as well as in carbon-free energy prospects. This trend has really accelerated during the pandemic. And based on the conversations with our customers, we feel it's really only the beginning. So if I recap. A solid backlog; an extensive pipeline of opportunities; and on top of that, new markets, which are really soaring. A bit of a sweet spot to now move on to our outlook and financial objectives. Given our backlog and the market opportunities in front of us, we are confident that maintaining our selectivity mantra and pristine project execution can really deliver growth in periods to come. On an IFRS adjusted basis, I will start with an indication on how we expect to close 2020. We see revenues in a tight range from EUR 5.9 billion to EUR 6.1 billion, which indicates potential year-over-year growth of up to 10% driven by growth in project delivery. For EBIT, we estimate margins in the range of 5.6% to 5.8%, implying a step down versus 2019. 2020 is indeed a transition year to a more normalized level of margins as we are in the early phase of major new contracts such as Arctic LNG 2, [ MIDOR Refinery, BP Tortue Gas, FPSO ] and so on. Turning now to 2021 and our medium-term outlook. For 2021, we expect revenues to reach EUR 6.5 billion to EUR 7 billion, up from the EUR 6 billion expected from 2020. This growth is, of course, backlog driven with significant contribution from key projects such as Arctic LNG 2, BAPCO and MIDOR Refineries. And further supported, obviously, by the awards of Costa Azul LNG and Assiut. Included in this projection is also an expected contribution from Yamal of EUR 150 million to EUR 200 million on an adjusted proportionate basis. Beyond 2021, given our existing backlog and the opportunity set, we see a good potential for single-digit revenue growth for both project delivery and TPS. A specific word on those long-term top line projections. We will always be careful to provide our guidance, in particular, for the project delivery business because setting target and expectations for this specific business may lead to the wrong behavior. Selectivity must remain key. It doesn't mean that we do not see growth. As a matter of fact, we do. It is just that we need to be able to say no to any opportunities if the conditions are not there. Although we do not have the same long-term visibility, we also expect revenues from TPS to sustain a positive level of growth during this outer period. Moving to profitability. We see 2021 EBIT margins in a range of 5.5% to 6%, excluding one-off costs associated with the transaction. So a profitability in line with the 2020 performance percentage-wise, but of course, with a greater top line. This is factoring a growing contribution from the new generation of projects as they ramp up and less reliance on the former generation, which are rolling off. We also anticipate continued revenue growth in TPS, which is accretive to our margins. In the medium term, we see a clear upside potential to our margins targeting 100 basis points or more driven by cost reduction, project mix and project maturity. I'll discuss this in more detail on the next slide. A word on tax. We estimate the effective tax rate to be in the range of 30% to 35% for 2020 and 2021. Due to some of the complexities of the carve-out, the historical tax rate shown in the 3-year financials may not necessarily be a good guide for the future. But on a long-term basis, we do expect to be in the 30% to 35% range. Finally, even though we will report mainly on EBIT, I know that many will want to compute equivalent EBITDA figures. So in the footnote to this slide, we have added -- provided an EBITDA margin range based on expected adjusted depreciation and amortization. which mostly comes from the application of IFRS 16 relating to lease standards. However, our annual CapEx is expected to be well below this D&A in the region of EUR 30 million with some potential increase as we deliver our technological ambition but always remaining very disciplined. As I was just saying, we believe we can materially improve our margins in the medium term. We estimate that we can improve them due to 3 main drivers. First, improvement to our cost structure, creating a leaner and simpler organization, removing unnecessary overhead, centralizing support functions. In fact, we are targeting a 20% decrease in our indirect cost. And this will more than offset, as we discussed with David in the previous Q&A, the potential dyssynergies. This, we feel, can be achieved even with a likely increase in R&D spend, both in absolute terms and as a percentage of indirect cost. We are targeting some growth through technology development. So this incremental spend will be matching this ambition. Second driver, as I just mentioned, we see growth in margin accretive activities, namely those in technology, products and services. This strategic growth is likely to be mainly organic although we could make inorganic investment. This growth will be accretive and improve the bottom line. Third lever, strong project execution and risk mitigation on projects maturing into completion phases. Given our current portfolio, good project execution, should be able to lead to future upsides as we derisk projects just as we've experienced in 2018 and 2019. Through these 3 elements, we are confident that we can continue to deliver a best-in-class financial performance. So if I want to recap on the margin outlook, we see 2020 EBIT margins at or close to trough levels. We see potential for some margin improvement really starting from 2022. And from 2023 and beyond, we see potential for 100 basis points of margin accretion. To conclude on margins, we're often asked about normalized level of margins for our business. Well, hopefully, the information I've just presented will provide some clarity on how we see them going forward. Before I go through the overview of our balance sheet. In this slide, I want to focus on our guiding principle with respect to project cash flow. When we enter into new contracts, and this is part of all bid reviews, our objective is to retain a positive cash flow throughout the life of the project. We target to start positive on day 1 and then to have milestones of cash inflows largely offsetting the cash outflows. The chart on the slide depicts a typical project, whereby cash received remains above cash payment through the life of the project, thereby remaining constantly cash positive. What this means is that we operate with negative working capital. We receive advance or milestones payments ahead of us physically performing the work. This is why we say that we have an early cash conversion of earnings, which is a very specific characteristic of what we've been able to achieve and sustain over the years. This positive cash flow position is a bidding principle and part of the selectivity. But beyond that, we execute each project with a resolute cash focus. As part of the monthly project reviews, we have the visibility of the actual cash performance of each contract. And of course, all projects are different. Terms and conditions will vary. But our aim is always to enter into contract with positive net cash flow and then to deliver on this basis. So with these [ 4 words ] on project cash flows, I can now turn on to our capital structure and balance sheet, which will be strong, very differentiated and really giving us the ability to invest and grow our future -- business in the future. Some key features of this balance sheet that I would like to highlight. We expect to begin life with the shareholder equity of approximately EUR 1.2 billion, which is quite fit for purpose for a business which has very limited CapEx requirements and which operates at a negative working capital. In terms of working capital, as I just highlighted and as we see on this slide, we operate with a negative working capital. with most strikingly net contract liabilities, contract liabilities less contract assets of EUR 2.6 billion. This discipline in our contractual and promotional model puts cash on our balance sheet on a structural basis. As an opening balance sheet, we see an amount of growth cash of just under EUR 3 billion and net cash of 2.2 if you net out the financial debt on which I will focus in a couple of slides. This cash does include our joint venture share. But at the end of the day, it does not make a significant difference. For a fully owned subsidiary or a joint venture, having cash enables to pay out future operations, pay out for home office services and also includes some element of profits, which will stay on our balance sheet. So clearly, in this picture, cash and net contract liabilities, or NCL, are critical features of our differentiated balance sheet. As such, I'll spend a bit more time on the tax [ paid ] on the next slide. The NCL is, if I simplify, the difference between the cash received from the client, from inception of the project and the revenues recognized also from inception. In other words, the NCL corresponds to the cash that we've already received for future revenues, meaning future project costs and future profits. At the end of June 2020, we had EUR 2.7 billion of net contract liabilities, of which approximately 20% was attributable to the Yamal project on an adjusted basis. So 2 building blocks with somewhat different profiles. But although the stages of the projects may be different, Yamal and non-Yamal work in the same way. We have cash on our balance sheet today offset by NCL, and this NCL will be [ onward ] partly as cost, partly as profit depending on how we execute the project and gradually extinguish the risks. One short cut, which may be done by the investment community, is to treat the net contract liability as a quasi-debt in the bridge from enterprise value to equity value. I would argue this to be quite conservative given the embedded profit component in this NCL, as I just highlighted. And this is really exemplified by Yamal on the right. As we go through the warranty phase, the NCL of just below EUR 500 million at the end of H1 2020 will be extinguished in 1 of 2 ways: our cost incurred for potential reworks or as incremental profits for Technip Energies. Looking ahead to 2021, we expect to reduce this liability for Yamal by approximately EUR 150 million to EUR 200 million. So if the plant performance continues to be strong with no material reworks, then a significant portion of this amount could become incremental profit. And remember, this is under adjusted view. So with proportionate accounting, of course, there is no mandatory redeemable liability. And there is no cash outflows associated with this extra profit, other than to pay our tax bill, obviously. To complete the overview of our opening balance sheet, I'll focus now on our strong liquidity and very limited leverage of the opening capital structure, which will be reflected by the expected solid investment-grade rating from S&P. In terms of liquidity, we have -- first and foremost, we can rely on our level of cash that we have looked at in great details. But on top of this, we've secured a revolving credit facility of EUR 750 million, which will be fully available for general use as well as backstopping commercial papers. Given the amount of CP estimated to be outstanding as of day 1 of the spin, EUR 125 million, we would have a net extra liquidity provided by the SCF of EUR 625 million, bringing our total liquidity to a total amount of EUR 3.7 billion. This opening position really does give us a great confidence in our ability to deliver the project and lead the energy transition transformation without a constraint put on our ambition. Turning to leverage. Excluding liabilities associated to leases, our financial gross debt for the opening capital structure will amount to just around EUR 750 million, which, given our EUR 3 billion of cash, puts us in a very solid cash position. The bridge to bond will be drawn up upon completion of the spin and is today fully committed by a group of 4 underwriters. We intend to issue a bond within the coming quarters with a maturity between 3 to 5 years, depending on market conditions. This EUR 750 million of gross debt will represent a ratio to EBIT using the 2021 midrange guidance, which I just presented, of 1.9 turn. Given the specificity of our capital structure and asset-light business model, we would target, on a long-term basis, to trend toward a ratio of 1 turn, giving us, at any moment, to have the flexibility to increase our debt level as we would consider investment opportunities. On a net debt basis, being in a net cash position, our ratio is obviously negative. And our net cash will be more than 7x our midrange EBIT guidance for 2021. Turning to capital allocation. The consistency of our financial performance and our capital structure will enable us to design a balanced capital allocation with a lot of flexibility. This capital allocation will have 3 main pillars made of shareholder dividends, investment opportunities and balance sheet strengthening. Regarding shareholder returns, we believe that the consistent dividend policy can be sustained given the 3 key characteristics of Technip Energies: first, a business model that is of low capital intensity, which means an ability to generate high returns on invested capital based on the projections that we have given; second, strong free cash flow generation through the cycle with early cash conversion of earnings; and third, obviously, a very solid starting balance sheet. On a medium- to long-term basis and subject, of course, to the Board and shareholder meeting approvals, we intend to pay an annual dividend initially representing at least 30% of the net profits. This prudent capital allocation in terms of dividend will also enable us to make additional investments for organic growth and all selective acquisitions and as well, utilizing excess cash flow to strengthen our balance sheet and reserves. So to wrap up some of the key aspects that we've seen today. Our industry-leading financial performance is supported by commercial astuteness, robust product execution and a resolute cash focus. Our high-quality backlog with a breadth of commercial opportunities really give us good visibility for future earnings, and we see potential for margin expansion going forward, up from the 2020 levels. We are an asset-light business with a strong balance sheet that is differentiated amongst our peers and also aligned with sound capital allocation principle. All of this yield the potential for high returns on invested capital through the cycle. And as importantly, it does give us the means of our collective ambition in Technip Energies to make Technip Energies the reference investment platform for the energy transition. Thank you very much, and I will now pass it over to Arnaud.

Thank you, Bruno. Well, you've now heard from the Technip Energies team, and I know you will have many more questions for us. But in summary, I hope that through all of today's presentations, we've demonstrated to you what we believe is a compelling and sustainable investment case. When you think about Technip Energies, think about a leading engineering and technology company for the energy transition. We are far more than a conventional E&C business within a traditional energy industry. Actually, just before Christmas, I was talking with a customer about energy transition and decarbonization. His words were, "Arnaud, we have a dream of being part of this brave new world when it comes to CO2 management and decarbonization. But are you prepared to share that dream?" I reply, "I mean, of course, we are. We're not just a bunch of engineers with everything that people understand behind the world. We're just as creative as any start-up, except we've been around for a lot longer." We're progressive. We don't simply reuse the same recipe from one project to the next. And while we are supported by strong processes, which we need, you don't deliver a project like Yamal LNG one year early, one year early, by applying old recipes. The level of creativity, innovation within this organization is immense. And it's because of our front-runner spirit that you see our name associated with so many world-firsts. And because of our asset-light model expressed by Bruno, we'll be able to pivot in the right directions as new energy markets gather momentum. This means that Technip Energies is set up not just to navigate the energy transition. The transition remains a normal course of business for us. We will thrive in the energy transition. At Technip Energies, we believe in better tomorrows, and we believe we can make a better tomorrow. Thank you very much for listening. We will now turn to our closing Q&A session. Phil, over to you.

Thank you to all our speakers, and thank you for listening. We'll now begin the second Q&A session, which will last approximately 30 minutes. Same format as previously. Please submit your questions directly into the webcast. And thank you for your patience while we repopulate on the stage and the Q&A roster gets assembled.

Okay. Welcome to the second and closing Q&A session. Our first question comes from Øystein at Fearnley Securities. And his question is, can you please elaborate on how much of the backlog is related to LNG? And how much is related to other energy transition segments, such as sustainable chemistry, hydrogen, CCUS and so on?

Justin, thank you for the question. So through Bruno's presentation, you've heard that 60% of our backlog is energy transition-related today. And yes, it is today dominated by LNG. But I'd like to acknowledge that LNG is part of energy transition today, particularly as we're moving towards low carbon and low-carbon LNG is accelerating. So I'd like to insist on the fact that for us, that low-carbon LNG is part of this 60% mix. And energy transition is also growing, mainly in the TPS section of our business through services and studies. And you've heard from Marco about the Neste relationship and the partnerships and the fact that they are selecting Technip Energies for pretty much every of their ventures. But when I think about this 60% and how it's going to evolve in the future, there are a few things and a few indicators that we track within Technip Energies that are important in order to basically confirm our ambition and confirm the directions we are taking. And those indicators are actually the number of early engagement, front-end studies, concept studies that we are currently undertaking. Those seeds that are being planted, which we know a portion of them will convert into real projects and tangible backlog in the future. What is the time line of those? Some of them are more or less mature, but we are extremely encouraged by the growing number of studies that we are conducting around energy transition and around the energy transition theme. And that will convert in time into strong backlog project tangible numbers.

Thank you, Arnaud. There's a -- I guess a related follow-up here, it's from Bertrand at Kepler Cheuvreux. And he's interested in the potential medium- and long-term targets here for, I guess, energy transition work, excluding LNG. Are you prepared to put any targets on that in terms of what it could become as a proportion of revenues?

Well, we're not going to set a target. And a lot of the new energy or energy transition venture are still maturing. And this is why I think it would be probably undisciplined to set a target at this stage around energy -- pure energy and new energy ventures. But again, I'll come back to those seeds that we are planting that are being planted by our customers, engaging us into those early concept studies, et cetera. This is going to convert. We know that. A large portion of that is going to convert. So that's, for us, the true indicator that we are positioning ourselves, and we're taking off on that new energy road.

Thank you, Arnaud. And then an unrelated follow-up from Bertrand is to Bruno. Bruno, the adjusted IFRS EBIT margin guidance is after corporate costs, if he understands well. In order to compare with the previous segment reporting margins, could you give an indication of corporate costs that we could see in 2021?

So yes. Thanks, Phil. And as always, Bertrand, you understand perfectly well. So yes, our projections and our historicals are net of corporate costs allocated for the past and, of course, assessment for the future costs for the future. So it's difficult because, as I was saying earlier in my remark, we won't have exactly the same basis. We will have a simpler organization being a bit of a pure play. We won't have a dual listing of SEC, U.S. GAAP and IFRS with Euronext listing. So we will have a bit of a simpler structure. So this cost reduction of corporate as well as global overhead will be part in the reduction that we target and the 20% that I was mentioning.

Great. Thank you, Bruno. Next question from Amy Wong at UBS. So during Marco's presentation, he mentioned a 20% reduction in costs due to digitalization. How have these cost savings been allocated between yourself and the customer? And are these cost savings necessary to keep Technip Energies' solutions competitive in the medium term? Marco?

Thanks. Thanks, Amy. I apologize. Maybe I was not so clear in my presentation. The first step, it's 20% of time saving in certain task. Of course, for those tasks referring to engineering that -- those mainly related to data-centric approach, it will be a saving on the engineering services, but it's not -- this make the difference on the best economics for the project. It's the 20% of saving on timing. This saving of timing, that it came as well from the data-centric approach but as well as with the data required management with our vendors, firstly, enable us to have a much robust project execution and derisk it. And of course, it will be passed, a significant part of this, to our customer. But -- and you -- I cannot explain to you how it's important for evaluating the return of investment for a customer and early delivery of the plan comparing with the traditional one. But in general, what I want to say, we exist, thanks to our customer projects. And we need to do everything to making this project flying, increasing their project economics, and digital will help a lot of us on this journey.

Great. Thank you, Marco. Okay. The next question has come through from Jean-Luc at CMC -- sorry, CIC Securities. "How do we reconcile TechnipFMC guidance for Technip Energies, given in Q3 2020 TechnipFMC guided to, in dollars, sales of between $6.3 billion and $6.8 billion and an EBITDA margin of at least 10%? How does that compare with today's guidance in euros of EUR 5.9 billion to EUR 6.1 billion of sales and 5.6% to 5.8% of EBIT margin?" Bruno?

No. It's not -- Arnaud? So okay, let's get technical a bit. So Jean-Luc, a couple of items or multi-steps. Of course, moving from the old guidance made under U.S. GAAP. So first, you need to switch from U.S. GAAP to IFRS. Not a lot of differences, but a few and mostly related to FX and lease standards and accounting. Then, of course, you have the difference between, especially for the bottom line, segment reporting within TechnipFMC and then stand-alone company for Technip Energies, which is including all corporate costs allocated to Technip Energies. Then you have the third layer, which is adjusted. And so basically, you cut back using the proportionate method, which I described. You reduce your Yamal from 100% to 50%, but you also put revenues and costs of other joint ventures, such as BAPCO and Coral, as revenues. So basically, you have these 3 steps, which make you the bridge between the previous guidance and the current lending estimate. Of course, these are relatively comparable, fully [ trustable ]. And the current guidance for Technip Energies would be fully in line, let's say, with guidance provided after Q3 in October for Technip Energies as a segment of TechnipFMC.

Thank you, Bruno. Okay. Next question coming through from Guillaume at SocGen. And I think this is maybe a question that relates to the accounting differences between IFRS and adjusted IFRS. So his question is, what is the timing of the settlement of the remaining MRL?

Okay. Thank you, Guillaume. Well, hopefully I was clear. And now with the adjusted IFRS framework, to some extent, we don't care because we report cash on a net basis. So the partner share is not represented in our adjusted cash figures. Having said that, of course, as the project -- as the Yamal project continues to go through the warranty phase, we will continue -- if profits come, basically to distribute shareholder dividends, partly flowing back or staying within Technip Energies and partly being paid to our 2 partners, JGC and Chiyoda.

Great. Thank you, Bruno. Okay. Next question is from Sean Meakim at JPMorgan. So Sean says, "Energy transition is a critical component of Technip Energies' value proposition to investors. Can you compare the competitive environment -- sorry, the competitive dynamics in your key energy transition channels versus your traditional downstream and LNG markets? And how do those differences impact your expectations for margins and returns in the medium to long term?"

Sean, thank you. So very interesting question. Obviously, there are more than, I would say, a single shade of green in our ambition towards energy transition. So when you think about, for example, the low-carbon LNG opportunity, which was introduced by Alain a bit earlier on, well, I think we believe -- I mean we know that market fairly well. We know the landscape in which we compete. And I would say that the competitive landscape is very much in line with what we know for LNG and maybe other types of projects. Now there are other energy transition opportunities. And I said a bit earlier that for some of those ventures, the competitive landscape is still really maturing and is -- it will be probably unfair for me to give a strong opinion about where it's going to land in terms of that landscape and its competitiveness. Of course, it's competitive. And this is why I think -- I don't think. I know that for as long as at Technip Energies, we continue with our cost leadership; we continue to differentiate; we continue with our ability to integrate technologies; we accelerate what was presented to you by Marco around digitalization, in particular; and we industrialize a bit more our engineering, I think we will maintain that cost leadership that is necessary to compete in energy transition of whatever definition as well as in other markets. So maintaining the differentiation of that cost leadership is key, and I think we have that.

Super. Thank you, Arnaud. And Sean's follow-up is one for Bruno. "Can you please give some more details regarding the cash flow cycle for the different businesses?" So project delivery, TPS. And maybe how investors should think about the makeup of the existing backlog and the impact of -- on Technip Energies' free cash flow profile in the medium term.

Okay. Thanks, Phil. Interesting question, Sean. So as I said in my presentation, 2 different businesses within Technip Energies: project delivery and TPS. In TPS, as I said, it's shorter cycle. So there will be a much more linear approach to cash flows and less of the lumpiness aspect I mentioned, which can be partly or more associated to project delivery. So the way we look at it for project delivery, and again, going back to my part of some of the slides in my presentation, is positive cash flows for each project, which means early cash conversion. This means, at the end of the day, that when we recognize revenues, these revenues were cashed in, to some extent, prior to this recognition in this period or before. This means that, yes, we have revenues partly offset, let's say, by the unwound of the net contract liability. If everything was frozen, then we will have kind of a pure reduction. But of course, we have the continuous project with milestones, plus the new generation of projects as they ramp up. So that's why in this specific industry, setting a target for cash flow can be difficult because of the cutoff and milestones from when reworks come, will this before the end of the year, after the end of the year, what is a ramp-up, so we could have very quickly some differences. But over the long term, over the cycle, we have an early cash conversion and excellent. Because below EBIT, to some extent, we will have a limited leverage. So limited expenses below EBIT. So then it's just about the tax rate, which we guided at 30% to 35%. So that's the way we would look at it is, of course, positive free cash flows, given our ability to generate cash upfront, and then a good gas conversion over the cycle with sometimes milestones that could create some variations. But over the cycle, not an issue.

Super. Thank you, Bruno. Okay. Next question is from Vebs at Coker Palmer. So Vebs' question is, "What project conversion is baked into 2021 revenues? So does it include orders that have been booked in the fourth quarter, so Costa Azul and Assiut? And how is the Yamal contribution expected to change in 2021 versus 2020?" The final part of his question is, "Is Qatar also assumed within the guidance?" I think maybe we'll start with Arnaud and Bruno will complement.

Yes. We'll let Yamal complement -- sorry, I will let Bruno complement on the Yamal part in particular. But when you think about 2021, yes, part of the Costa Azul project that we've secured in the fourth quarter last year and the Assiut project as well, we are ramping up on this project. So naturally, you will see some revenues backed into our 2021 guidance. But as I said a bit earlier, when there was an earlier question on the Qatar project, we are not dictating the timing of the award of the Qatar project. So we -- and we are a disciplined company. I think we are insisting a lot today on that. We are a disciplined company. And collectively, we are giving you a guidance for 2021 today. I think what is important for you to retain is that guidance doesn't change whether Qatar is awarded or not awarded. And that's an important point that I want to convey. Bruno, maybe you can do Yamal?

Yes. So to complete on Yamal, so of course, as a continuation of what was provided for Yamal as part of TechnipFMC, we've continued to provide the amount, although it's under adjusted IFRS, of the Yamal net contract liability, plus some guidance. So basically, I just said that we will have an expected amount of unwound of the Yamal NCL between EUR 150 million and EUR 200 million in 2021. We are going, let's say, through the warranty phase of this project. So that's why from 2020-2021, you see this kind of amount decreasing. And as we progress, you should expect beyond 2022 to have something which becomes really insignificant versus the total company.

Thank you, Bruno. Okay. Next question is coming in from Sasi at Morgan Stanley, and it relates to the EUR 90 billion opportunity that we're pursuing over 2021 and 2022. More specifically, on the EUR 33 billion opportunity in downstream, can you provide more detail on the key projects or contracts there and maybe any color in terms of how these opportunities are spread between refining and pet chem? Stan?

I'll take it. So thanks for the question. So I think the numbers that Bruno presented, for sure, are looking at a balanced picture today between pet chem and refining. And when you look at some of the projects that we had indicated, Assiut on refining, Shell Moerdijk, those you already know about. We don't comment on specific opportunities going forward. But I can give you a little bit of perspective on how we see those markets developing forward. For sure, petrochemicals will grow. It will actually be more than 50 because we see refining as being flat. The petrochemical markets for us are worldwide. We see China still very active. We see opportunities in the Middle East. We see opportunities, if you can believe it, in Europe, and of course, in the U.S. Even though refining's flat, we will continue to see specific opportunities emerge as customers, for instance, like the Assiut one, they're upgrading their refinery to be more cost-competitive with advantaged feedstocks, et cetera. But we'll also see some integration between petrochemicals and refineries. So we see positive developments in those markets going forward in a lot of the geographies that Technip Energies has a strong footprint on.

Great. Thank you, Stan. And Sasi's follow-up is on the dividend policy. "So can you walk us through how you arrived at the 30% payout? And how is the payout eventually decided?" Perhaps you could touch on some of the key criteria behind this. Maybe, Bruno, you could take this one.

Yes. Thanks, Phil. So Sasi, of course, you know we are not even totally formally created, and so all these decisions will be discussed in due time with Technip Energies' Board of Directors, approved by the shareholders. What we set out and I presented is something balanced in terms of capital allocation between shareholder dividend, some possibility for investment and balance sheet strengthening. We feel that beyond the dividend, we feel like it's important to have this strengthening and to have this opportunity to invest as we look at the energy transition, the evolution to make investment. So that's why we felt that first pillar, representing basically 30%, was consistent to also pursue basically the other targets that we may have as a young company in the markets. It also gives an inclination for long-term shareholders to be able to benefit from this long-term dividend policy that will be sustained over the years. And we felt that 30% was a good starting point.

Great. Thank you, Bruno. So next question is coming through from David Farrell at Crédit Suisse. And the question is that -- well, David expressed his surprise to hear that the margin profile is expected to consistently improve given the roll-off of Yamal LNG, which we know is very accretive to the margins. So are there some -- are there some poorly performing or other poorly performing contracts in the portfolio that are also rolling off? Or what is accounting for this margin accretion that you see moving forward?

Okay. Thank you. So in terms of margin recognition, some of you will know us very well, having followed us for a long time. And our margin recognition profile is not linear. And it's the outcome of 60 years of experience of project kind of delivery. We know that at inception of the project, you have more uncertainty, you have more risks. That's why at the very beginning of the projects, to some extent, you can't have the same margin recognition that you would have more at the tail end when you've taken out the uncertainties, when you've derisked the project. So if you take the 3 years kind of back, '17, '18, '19, we had a young generation of project. Yamal was in the completion phase, but the other projects were in their very early phase. So in this kind of scenario and model, we would have a somewhat lower contribution of gross margins from this new generation of projects. As they progress, as we are able to execute, even with the pandemic and the way we've been able to deliver, this project execution will lead basically to project derisking, which means project margin. And we have -- we are very comfortable about the portfolio, the backlog that we have. It is the strict outcome of the application of a selective process that we've been able to apply consistently over the last years. So that's why we have the ability to execute. And this execution will drive sustainable level of margins beyond 2020.

Great. Thank you, Bruno. A question is coming fast and furious for you. The next one is from Simon Toyne at Redburn. You provided the generic shape of cash inflows and outflows during a single project, but could you perhaps clarify how that translates to the current working capital position, excluding Yamal? And what is the profile of working capital movements other than Yamal over the next couple of years?

So good question. Coming back to the cash flows, when you look at our position and when you see that Yamal is just 20%, you see that all the projects are really contributing to this position. And this is just another proof of, yes, we are disciplined in the way we approach, and we flag and we control this cash flow curve for each project. Of course, this position will flow over the years, depending on the project execution. And as some projects made to the tail end kind of reduced their working capital position, this would be offset by the ramp-up of other projects. So in the short term, as we see these good prospect opportunities as we see potential for growth, EUR 90 billion of project opportunities for 2021 and 2022, this gives us the ability to see the potential for future inbound, which would regenerate, basically, net contract liabilities to be able to sustain, let's say, a stable amount over the years to come.

Great. Thank you, Bruno. Next question is coming from Michael at Citi. Can you talk about the key metrics that senior management -- sorry, "Can you talk me through the key metrics for senior management remuneration at Technip Energies, both short-term incentives and long-term incentives?" Arnaud, I think that one is for you.

Yes. Thank you, Michael, and thank you for giving a little bit of breathing time to Bruno. It was extremely -- I mean the rest of the stage room was gone, but he's extremely popular this afternoon here or this evening. So back to your question. On -- I mean, first of all, I will say that this is still work in progress because this will be established by the Board and the Comp Committee. So these conversation are taking place as we speak, pretty much, so to speak. But I think it is safe to say that on the short-term incentive for the executive team, in particular, you will find financial indicators that are probably unsurprisingly to you around EBIT, cash flow from operations. And the ESG metrics, in particular, are yet to be defined and will be part of conversation with our Board and the Compensation Committee or the ESG Committee, as we call it. As for the long-term incentive, well, again, still work in progress because we need the stand from the Board on that matter. But expect that, unsurprisingly, it will be around TSR or total shareholder return.

Great. Thank you, Arnaud. Next question is coming in from Mark at Jefferies. And Mark would like to know about the contribution of Loading Systems and Cybernetix, which were previously part of TechnipFMC businesses. What revenues do these businesses contribute? And are they margin-accretive?

So I will start with the answer and then hand over to Marco if he wants to complement. So you're right -- I mean you're rightly pointing out that Cybernetix and the Loading System were part of different businesses and are now part of Technip Energies. Both actually fit very squarely within the offering that the new Technip Energies wants to put forward. There is a natural fit between loading arm and Technip Energies. You will find the loading arms on our jetties, on the plants that we deliver and we architect and then deliver, on the floating assets that we are currently working on and are delivering. So there's a very natural match and fit for loading arm and Loading System within Technip Energies. I would say to characterize loading arms, I think, for many, 2020 has been maybe a difficult year. And for loading arm, it's been a great year, 2020. And all the building blocks are there for that to continue through innovation and the rest, and again, cost leadership throughout 2021. And on Cybernetix, Cybernetix, at the moment, it brings a robotic content and future technologies content to Technip Energies. And Cybernetix, and Marco will be able to share that with you a bit more. But I mean, we're using Cybernetix as a hub for start-ups. And I think this is giving a twist -- a very interesting twist to Technip Energies. Marco, would you like to complement?

Yes. Thanks, Arnaud. Just 2 issues. Yes, they are new, but we pay a lot of attention on both. As Arnaud was saying, a Loading System have registered in 2020 the record of order intake and our plant, it's fully loaded so -- and with a good pipeline for 2021. As far as Cybernetix, we have as well worked to utilize Cybernetix to improve the performance and delivery on our plant. And together with Arnaud, we have utilized Cybernetix for the inspection of the important floating LNG Coral for ENI. So they are both very important for Technip Energies for the future. And we are dedicating a lot of efforts for a continuous growing contribution of both of them in our strategy.

Thank you, both. Okay. I think we've got time for 2 more questions. This next one is from Vlad at Bank of America. So his question is, "Contract liabilities were roughly equal to 25% of backlog at the first half point of last year. What do you think is a medium-term sustainable level of contract liabilities relative to backlog?" I guess that's a Bruno question.

Yes. Thank you, Phil. Thank you, Vlad. It's difficult to set a target. As I was saying, all terms and conditions vary from one contract to another. The portfolio may vary a bit. And we don't really work with setting up a target to say, this is the trend, and we want to have this minimum amount. We want -- we look at each contract almost separately, especially for the major ones, from the building stage when they are reviewed in the different gates, then from the monthly project reviews every month. And basically, we do not set a target where, okay, this is minimum 15% or this is minimum 20% or 25%. So I would say, not a target that we would use. We say that over the years, we've been able to maintain this discipline and consistency. I don't see any reason why we would deviate from this discipline. So this would put, on a long-term basis, net contract liabilities positioned on our balance sheet, offset with cash. And then the amount may fluctuate, depending on some of the contracts, but maintaining a very, let's say, good position.

Thank you, Bruno. Okay. Last question of the day has come from -- excuse me. It's a follow-up from Amy at UBS. "So looking at the tendering pipeline, what are the terms and conditions as it relates to prepayments? And how could it impact Technip Energies' ability to maintain that net positive cash profile?" Maybe, Marco, you want to make a start on this one?

Thanks for the question. We have focused on the presentation of our disciplined commercial approach. One of the golden rule that we have on our discipline, is that all the projects should have a positive cash flow. We are implementing the investment of the major oil company, but all should be with their own money to face all other expenses we have. So yes, there will be prepayment in all the tender that we are facing, and this will enable us to continue to maintain a net cash position.

Super. Thank you, Marco. So that brings the second Q&A to a close. There were quite a few more questions in the queue. So apologies for not getting to them all. But please contact myself or anybody on the team, and we'd be happy to follow up. The full slide pack will be available on our website very shortly. I'll now pass on to Arnaud for some closing comments. Arnaud?

Thank you, Phil. Again, thank you again for being -- for spending that time with us today. Before we close, and together with the team here, I would like to leave you with a few key thoughts. The energy transition needs smart energy engineers. You'd find them at T.EN. The energy transition needs the combination of leading technologies and technology integration capabilities, you'll find them at T.EN. The energy transition also needs partnership and trusted execution, you'll find them at T.EN. T.EN is the investment platform for the energy transition. Thank you.