TotalEnergies SE (TTE) Earnings Call Transcript & Summary

Good morning, everybody. Welcome to TotalEnergies' Strategy and Outlook. We are delighted to get you today after 2 years in virtual. We have prepared a very exciting program. I mean, first of all, we have an app that you need to download and invite you to download on your mobile phone, where you will get all the information needed for the day, the program, the presentations, the table where you will be seated for lunch and dinner. So please download it. We have prepared an agenda for today, which we hope will be very exciting. So we'll start with our traditional, I would say, strategy and outlook presentation by Patrick Pouyanné and Helle Kristoffersen, then we will get [indiscernible], which will be focused on the our activities in the United States and developing our multi-energy model in the United States. Then we'll get the lunch. We'll go back 1:40 for a deep dive, second one on LNG, our portfolio integrated. And then we'll have a break and we have a new format for you, which are run tables that we have organized. So we have 2 executive committee members will animate those front tables. We hope it will be very interactive for you. That's the program for the day. Without further, I invite Nicolas Terraz, President, Exploration and Production for a safety moment.

Good morning. Safety is a value for TotalEnergies for the management of the company, one way to demonstrate our commitment to safety is to go on our site, on our production site, on our project sites. And there, we can interact with the front line team. We can discuss their activities, the risk associated with our activities, and we can carry the safety message. And by going to sites, we also, by taking time to go to site, we also show to our team that safety is important and safety is a value. So this morning, I just want to share with you an illustration of this. This was in April 2022 for the World Day for Safety, where all the company's senior management went to sites in various locations in the U.K., in Denmark, in Congo, et cetera. And we didn't go there alone. We went there with the management of our contractors. One aspect of our safety culture is that we work jointly with our contractors, our contractor staff are particularly exposed. So by going together with the management of our contractors, we carry a common message to our teams. So what did we do on August 29, Well, we launched the deployment of our new Golden Rules, which are a set of very basic rules to prevent injuries at work. We've been -- these rules were introduced initially in 2010. And this year, we reviewed all our injuries over the past years to improve those rules, and we decided, in fact, to introduce 2 new roles, one on line of fire and however in being exposed on being in the line of fire and the second one on hot wax. So to conclude, I just want to say that, of course, we need to remain humble. We still have injuries in the workplace. Safety is a daily concern on the daily commitment of the company. Thank you for your attention.

So good morning, everyone. I'm a -- real pleasure to be back here at the New York Stock Exchange after 3 years of absence because of the COVID. And to meet all of you again in person for this day of presentation and the roundtables with all my colleagues of the Executive Committee, which are here with me today. So I know that some of you come as far as well as the West Coast or even Europe. So thank you for all coming. But again, it's important that point of the, I would say, history of the company that we have the opportunity to meet together. Yesterday, we had our Annual Macro Energy Outlook, which was presented to you by Helle. She will contribute also today to this strategy and outlook presentation with me. Coming back, I would say, on more the short term and medium term in the next 5 years, I would say, of evolution of the market, which, of course, have an influence of on strategy and outlook. Yesterday, it was our vision down to 2050. It's quite timely. In fact, that we are presenting this strategy and outlook now because our company, TotalEnergies is entering, I would say, an exciting new era, which is marked, of course, by increased returns, but fundamentally also, but a new element, which means that our financial situation will have never been so strong. We are -- we will reach and that we -- it's now within our reach to achieve zero gearing company of zero net debt to zero, which makes us obviously stronger, more resilience, which gives us a lot of flexibility to implement our transition strategy to invest, to execute, to deliver it, and we will come back on it. But also, of course, to, I would say, to be to have more flexibility to think our future. I know that you have some expectations from this presentation and our objective is to answer to these expectations. The first expectation, of course, is what about Russia? What is the future of TotalEnergies without Russia? So I told you at the general assembly for shareholders, the annual one in May. Less Russia, more U.S. less Russia, and let's be clear, there is no more any plans, no investments to invest in that country, we declared it. And so the choice that we have taken -- the deliberate shows for this presentation is to present you the outlook of TotalEnergies without Russia. So all the figures are only without Russia because fundamentally, we don't think our future's with Russia, but without pressure. So that's the first answer, clear answer. And my motto was less Russia, more U.S. This is maybe one of the reasons why we are here. Also, by the way, to recognize that in the last year, in fact, we've seen quite an increase of institutional shareholding coming from North America from 35% to 42% by the end of the summer. So maybe here, investors understand better our multi-energy transition. And for sure, oil and gas. So we'll -- and there is also a reason about when I say more U.S., not only investors, it's also because the U.S. are for us a playing field, quite a good playing field of putting in action of strategy. And Jean-Pierre, by the way, our CFO, after my presentation, will make you assume about our strategy in action in the U.S. with the 2 pillars, which are the LNG on one side and renewables in the other side. we have taken the last year. And again, this year, some bold steps here in order to develop our strategy because, really, we think that the U.S. land we're fitting very well with both pillars of the strategy, LNG and renewables. So Russia, the question is there is no future with Russia in this presentation. The second question that you are asking expectation is what about the LNG business of TotalEnergies without Russia. And that's the second key question. We'll address it. Obviously, you have seen some news coming quite timely there again. And so I could add that it's less Russia, more U.S., more Qatar. So you have the question, the answer is there. More Qatar. We have been for many years, it's not only this year. It took us 5 years to reach that point. And in fact, many years, we have many of the executive committee members who spend their part of the life, by the way, in Qatar, myself Nicolas, Stephane. So Qatar is really well known, probably one of the reason why everything with strong relationship in this country. We have been successful out of the giant 48 million-tonne development, which Qatar is planning through North field East and North field South. Our stake will be the equivalent of 3.5 million tonnes of larger stake among the majors, and we'll come back on it. So less Russia, but more Qatar. And the third question that now the least important for all of you, third expectation from all of you is what do I do with the pile of cash -- what is the return? What do we allocate their cash, cash allocation? Of course, it's a very important question, which we bought, which we'll approach in a very different mode when we have a company which is going down to net zero debt, I would say. Of course, it's gives more flexibility to think about it. So I will present you the new framework of cash allocation. But we have established a Board of Directors has spent 2 meetings in the last 10 days, but in fact, we began to think about it since middle of the year when we realized what was the new framework in which TotalEnergies is moving. And so we'll deliver to you 2 clear messages. The first is the guidance of written through the cycles of 35%, 40% of cash payout. And the second one is that we implement that from 2022 and using a new instrument, and I will explain you why we decided that beyond the ordinary dividend, beyond the buyback, we introduced a special dividend before that will be paid to our shareholders before in December '22 of $1 -- EUR 1, sorry, EUR 1 per share. So that's for my introduction, and then I will embark you in this presentation. Again, I'm not alone here today. I told you. And by the way, you will have the opportunity to discuss and meet all my colleagues because we have organized the day this morning with a presentation, but then Jean-Pierre will speak about the U.S., and we'll take the Q&A after these 2 presentations. And then this afternoon, we'll have some Zoom on LNG by Stephane, but some round tables on mobility, on our projects and for one tech organization and around as well electricity business model around with my colleagues of the Executive Committee, and it will be the opportunity for you to discuss and speak directly with them around these roundtables. I welcome, by the way, there is one new face within the team, which was not there 2 years ago. It's Thierry, which is in front of me. The -- he became in the middle of the COVID, the President for Marketing and Services. And so this afternoon, [indiscernible] they will be led roundtable around mobility. So you will have also the opportunity to meet with them. We have organized the lunch and you are seated because we wanted you to have also the opportunity to discuss with my -- all the colleagues. So just a word about safety. Thank you, Nicolas, for your safety moment. I would say that on safety, the image today is a picture that I will describe is mixed. I have mixed feelings when I saw the [indiscernible] slide. Of course, we continue to -- we have a continuously improvement program, action plan, the one which was described to you by Nicolas, about the golden rules. And we translate that in this line which is total recordable injury rate, which is going down. Of course, at a level of 0.73, it's becoming tough to go down, but we maintain this continuous improvement and compared to where we were some years ago, even 10 years ago, I think we are among the top of the benchmark. So that's positive. Unfortunately, this picture is tarnished by 3 fatalities that we experienced this year '22. It's a terrible results for me. I cannot be happy. This is -- I will be more positive about the presentation, but 3 fatalities is much so high. We suffered one last weekend, a road accident, a driver from I would say, gasoline truck, which losses control of its trucks and on the French roads. Transportation was part of our issues 10 years ago. We did not suffer too many facilities in transportation, but we have one. And 2 other facilities, one in -- I think it was in Mauritania, if I remember, Burkina, sorry, I know it was in Burkina Faso, where one worker was hit by an electrical arc who has a scaffold, which was going under a power line. It should never have gone under, but unfortunately, I would say, it's a sort of technological accident, I would say, and which should have been avoided is a role we have been pursued. We have reinforced the rules. And another one in Argentina, where a worker, which was working in a quarry. In fact, there was a cliff fall, and he lost his life. That's back -- this is more complex, this one because it's back to the competence of course, of our subcontractor and the supervision. But all that is high, too high. It tarnished our records and I cannot be happy with it. After this, I will be more positive in the presentation, but I had to state it. And because the only way to progress in terms of safety is to face the reality and to speak up about the problems and to draw the lessons and it's really down. So now after this introduction, I will leave the floor to Helle, which will come back on the energy markets, and then I will do the strategy.

Thanks, Patrick. Good morning, everyone. It's a pleasure to see you all I would say, live and not just hear your voices online. Energy market supported by the energy transition. Yes, indeed. Looking beyond the unprecedented short-term market disruptions, we are finding ourselves in an industry that has to invest in both the energies we are using today and in the energies that will become mainstream tomorrow, knowing that clean energy requires a lot of new infrastructure. So that does indeed provide a very supportive multi-energy outlook for companies like ourselves. As you know, the V-shaped recovery of 2021 resulted in multiple market tensions in terms of logistics, raw materials, spare parts, components and so on. And this happened well before the war in Ukraine. These tensions, of course, have only escalated since February 24. So we are now in a high inflation environment due in particular to shoring energy prices. Energy security is on the top of the agenda, together with energy affordability. Central banks are trying to counter inflation with more restrictive monetary policies. And I'm sure that you have all followed the various announcements on that front. So it's honestly a little hard to say what 2023 is going to look like. But you will hear from us that we offer a very solid framework for growth and for cash generation and that we are well placed to benefit from the current environment and from the more secular market trends. So let's look at a couple of markets one by one. Starting with oil. Oil markets are tight because investments continue to lag demand growth and because spare capacity remains extremely limited. To make a long story short, we're some $100 billion behind the investment levels needed to balance markets. So the message is pretty simple. We need more oil projects. This is all the more true as OPEC+, OPEC and Russia and a handful of other countries continue to manage supply with a lot of discipline. And also U.S. shale producers are focused on the same discipline. The oil product markets are tight as well because of the massive refining capacity reductions that have taken place mostly in the U.S. and in Europe over the last years, and you can see that to the right of this chart. On top of that, the Atlantic Basin is short on distillate, which has yielded record margins in 2022. And this short will now be amplified by the ban on Russian products, product imports that will be starting in February next year. Moving on to gas markets. Here, the big structural change is, of course, that the EU is putting an end to its dependency on Russian pipe gas which means replacing some 35% to 40% of its gas supplies and which creates a massive call on LNG. In other words, LNG is becoming the cornerstone of energy security in Europe. What we've modeled here to the left is a scenario that assumes zero pipe gas from Russia to Europe next year and onwards. And the 3% decline in European gas demand every year until 2027 because we're showing the markets until that year. So zero Russian pipe gas and 3% decline in demand every year. This creates a need for 100 million tonnes of LNG, which is equal to 25% of the current LNG demand. So of course, it's an absolute game changer. Europe is now competing with Asian to attract LNG, which drives up prices to unprecedented levels. We know that there will be demand destruction due to the lack of regas capacity in Europe short term or in Asia because of the high prices. But as you can see to the right, we do expect markets to remain tight for several years. The reason for that is that it's simply impossible for supply to match the step-up in demand overnight. Most of the new sizable LNG projects will only come on stream in the years 2026, 2027. Once supplies do pick up, the new price floor in Europe is going to be set by the U.S. LNG import cost. So that means a new floor for TTF. One last important point. The European crisis clearly demonstrates the critical role of natural gas in the energy transition. When you don't have any gas or you don't have a North gas, what do you do? You burn coal or you revert to oil. This is partially what we're seeing in Europe right now or in other parts of the world in Asia because the LNG goes to Europe. That's bad for the environment, and that's bad for sustainability. And just for memory, keep in mind that 99% of our LNG customers around the world, they do have a net zero ambition. So the role of gas, we think, is heightened by the current crisis, LNG becomes a very, very attractive market for us. I'll finish with the power markets. How is the fastest-growing energy on a global scale? More than 5% in 2021. The market opportunity for solar and wind, in particular, is massive, notably in the EU and in the U.S. with these 2 regions capturing around 40% of our estimated growth in capacity between now and 2030. And this is what is shown to the left on this chart. Of course, there are other excellent markets out there, but we just wanted to flag the importance of the European and American markets. The accelerated penetration of intermittent renewables, solar and wind also triggers a need for flexible, dispatchable power solutions, a market where we feel that we are well positioned, and you will hear more about that. In terms of capital budgets, now moving to the right. According to the IEA, the world is currently investing some $700 billion per year in renewable generation, and that's including hydro and in power networks. That number would need to increase to $1 billion to $1.5 billion per year starting next year. This is the IEA analysis. For all of us to be on the trajectory matching the pledges of those countries that have committed to carbon neutrality. In other words, and this is what we're showing on the chart, we need to multiply these clean power investments by 1.5 to 2 when spending has only been growing 3% per annum in the recent years. So you may question the feasibility of this uptick in clean power investments but it does certainly create attractive market opportunities for companies like TotalEnergies that have decided to invest in clean power in addition to oil and gas. And with that, Patrick, I hand it back over to you. Thank you.

Thank you, Helle. So let's go into our outlook with the title, by the way, that you will notice is reversed compared to the previous years is first growing shareholder returns while transitioning. And again this Russia is excluded all the future figures. So what -- just to make the link between the presentation and our strategy. I would say what, of course, is obvious to us is that -- there is -- today, there is a balanced strategy between all LNG and no electricity is quite well matching with the market trends that Helle has described. Along the last years, we developed in the oil business strategy, which is to refocus all our portfolio and to high-grade it on, I would say, a low breakeven, low emissions portfolio. And so going down on a breakeven to $25 per barrel. Of course, this -- today, we take the fruits, I would say, of this strategy in all -- we have -- and I will come back on the future for that, but it's the first point. On the LNG, of course, we make an aggressive and big bet, and that's the fact that it was -- so growing hydrocarbon, I would say, market for the future. It's, of course, quite heavy in terms of capital investments. But at the end of the day, this large portfolio of LNG in an integrated portfolio between the upstream, the midstream, the downstream with what is happening is, of course -- and I think one of the news from '22 is that all the political leaders in this world that is covering the world LNG. They don't know what it means. Now they know about it. They try to understand the market. It's more complex. But what we recognize is that it's just maybe needed or even for the transition. And I think that's a strong message that we have today. So our company is very well positioned, of course, and we will come back on it without Russia, it was with Russia, it will be without Russia, we will come back on it. And the last market, which of course -- and my -- I will tell share with you that for us, it was quite a strong belief that this electricity, which is at the core of the transition. If we want to make this energy transition, we need to develop heavily electricity demand market, offer supply and demand by almost doubling. So that means there will be some tensions on these markets, including in terms of prices because the way to grow is to introduce in the supply intermittent sources of energy which means that you create tensions. And from this tension, you create, I would say, higher prices. And I'm not surprised to see, I'm surprised about the IEA levels that we observe in Europe, which is linked to the exacerbation of the war. But I would say, fundamentally, there is a trend there where you see prices should go higher. This is why, by the way, when we think our future in electricity. We don't think it has a secured revenue of low profitability. We think it as a capacity to develop a portfolio and the business in the same way we have done it in the past in oil and gas, leveraging on balance sheet and benefiting from the volatility of the power markets. But as I said, this match, of course, it's translating into figures. And for us, as I said in my introduction, we are entering a new era because this historic high cash generation of '22 have, of course, an immediate impact on, again, the financial strength of the company will -- we have divided our net debt by [indiscernible] down by the end of the first half '22 and the $13 billion of net debt will be lower by end of the year. Some of you planned that it should be -- we should be a net zero, I would say, by in terms of debt, not in terms of climate by middle of next year. So I think, of course, it gives us a lot of flexibility. But the result is not as I can read in newspapers coming from the sky. It is -- we today benefit from much higher cash flows, and I think the chart on the left for me is quite interesting because it's demonstrated that Total is more profitable, more efficient company than we were in the past. You can see that we have taken the cash flow which was generated in the first half, multiply it by 2, identifying the gas European surplus, European gas surplus, so putting aside, you can see at the same level of price of the barrel we generate $15 billion more cash flows than 10 years ago when the price of the barrel were above $100 per barrel. It's a demonstration of the huge efficiency improvement we have led. Thanks to all the work of the teams and the I would say the core focus we had on rotating our portfolio on lower breakeven, and this is a chart in the middle because this explains, in fact, both the breakeven -- lower breakeven from going down from $100 per barrel down to 25%, the result of discipline, in particular, in terms of capital expenditure, but also to focus on the cost control and on the efficiency. So that's, of course, open us some new perspectives for our future. And that's why, of course, and by the way, for this time, I don't make a French presentation, I make a U.S. one. I begin by the conclusion and then we'll have the demonstration, which is maybe more efficient in terms of marketing. This is what I learned from some of you. So I take your advice. So I go to the conclusion because it was, again, the focus of all the Board works in the last months and weeks. About, okay, now we are having this balance sheet of do we think our cash allocation strategy for the future. In fact, it's -- I made the remark, we had a different order of allocation in the previous slides. But during the COVID period in 2020, in fact, we gave the priority already to the dividend because we maintain the dividend and we reduce the CapEx. So I said to the Board, we've done it. It's the way we behave in this room. It's not the way which was written. So maybe we should realign what we say. And by the way, it's much easier today because with a balance sheet which is so strong, we have the flexibility to put first the dividend, the ordinary dividend. What we want is a sustainable dividend through the cycle. That means that we -- any increase of dividend shall be supported by an underlying cash flow growth. Of course, it's all -- but this -- and you will see in the presentation that we have at least a $50 per barrel, $4 billion of cash -- of underlying cash flow growth in the next 5 years. So we have this support. And this is comforted by, of course, a strong balance sheet and the share buybacks, which, of course, might be -- will be translated in some, I would say, dividend increase. So with '22, we had a guidance that we led on the 5% increase of interim dividends. We'll not move it but because we are using another instrument that I will describe on this slide. The second part is the capital expenditures. So I'm sure that some people will say they lose a discipline. We don't lose the discipline. It's just quite logic. We have been, I would say, such a strong balance sheet. But we come back. In fact, to the previous guidance we had in 2018, which was going up to $18 billion. So for me, it's just the fact to have the opportunity to realign what we think is a sustainable level of CapEx between $14 billion and $18 billion. The range is a little larger because it's true that we'll pilot this level according to the cycles because we want I think the best strategy in terms of CapEx is try to maintain it through the cycle. The balance sheet will offer us this opportunity. And so I will explain you how we intend to spend this $14 billion to $18 billion per year. The balance sheet is strong. Grade A credit trading through the cycles. That was already, I would say, the guidance. There is no way to change it. We don't give you any guidance of gearing. It would be strange today we have a gearing which should go down next to 5% by the end of the year. if we are entering into a world of being net positive in a treasury net positive, that would be fine, I'm happy with it and give us the flexibility to capture countercyclical opportunities, if any, in the future. And then the surplus cash flow. Of course, there is a surplus cash flow and the question was, how do we share it with our shareholders. And we've also, by the way, our employees that we do not forget, even if there is no announcement today, but there are some discussions and dialogues with them, and I want that to come for the social dialogue, not only from the top of the company. It's showing the surplus. So of course, we have the buybacks. And question to the Board, but what do we do when we have very high prices, do we pile up more buybacks? Or do we go to direct cash to our shareholders, a choice which has been done is that -- as we tested some of you, there is, of course, an appetite for a buyback, but also an appetite for cash, I would say. So what we will combine is both [indiscernible]. Why? Because -- and I think maybe it's the most important message. It's the first time, I think, you write it on the slide in TotalEnergies, which is a guidance of payout for the cash payout through the cycle, 35%, 40%. It's not one figure. It's a range. That limit -- don't consider it's a limit at 40%, could go beyond. It's just to tell you that we are -- we will monitor the various instruments, dividends and surplus and sharing buybacks and special dividend to reach that. And we will apply it as of 2022. As you probably noticed, after all the announcement until the end of July, we are under 30%. So of course, we had to fill the gap and the gap will be filled by this EUR 1 per share special interim dividend. So 2022 cash flow will be in the range of 35%, 40%, but by the will of the Board. So that's, again, for me, a very important message in the way we think the finance and the cash allocation of TotalEnergies for the future. Another reward to shareholders will be that in '23, there will be a sort of special reward to shareholders as we intend to exit our Canadian Oil Sands. These asset Surmont and Fort Hills are generating in '22 more and $1.5 billion of cash flow. So it's quite a good situation. We think it's the right time to try to get the value out of it. We are not the best shareholder of these assets because as we have a climate strategy, a climate strategy, we don't want to invest in these assets. We declared that in 2019, we made some write-offs, but these assets are there. They generate assets. So after having a look to various solutions, we think that the spin-off because we have that in our hands. It's up to us to execute it. It does not depend from others, is a solution will create a SpinCo to put Surmont and Fort Hills play the midstream and trading-related activities. We intend to list this Canadian company on the Toronto Stock Exchange to retain a minority shareholding to smooth the transition and then to leave it moving as an independent company. We will work to that our objective is to be able to submit such as been spin off by to the vote of the next Annual Shareholders Meeting in May '23, and our shareholders will get shares from this company, which is quite a good value. So that's another point. Then the company itself. So without Russia, without Canada somewhere. Again, that message is the one we delivered to you last September. So there is no fundamental change except that the figures you show in terms of fuels are lower because we excluded the fuels from Russia. But the fuel company is around 3 pillars, I would say, let's say, 4 activities, but 3 pillars. One is oil. On oil, we reiterate that we want to maintain this oil because this is a cash of the transformation. That's for the production. And so on the decade, more or less stable, till increase, but let's say, 1.3 billion, 1.35 billion barrel of oil per day. We have some condensate as well coming from the gas, but let's say, it's more or less stable. But on the oil -- on the energy sales, we have a more aggressive strategy because we want to anticipate to a lower demand and so to realign our oil sales to -- on our production sales or downstream is larger than upstream. So that's the program for the decade. We are already engaged. We said minus 30% on the oil sales, in fact, between 2019 and 2030. Then we have the gas where, again, growing LNG at the core of our growth for the future will remain and we want to develop it. So you can see that the gas sales are, in fact, becoming larger than the oil sales on the decade. And then you have the, I would say, the energies of the transitions, which are either electrons or molecules. For the electrons electricity, we are on the path, I will come back on it to go up to 130 terawatt hour per year. And then on the molecules, I will explain to you. We have some focus areas, sustainable addition fuels, some biogas and carbon capture and storage. So that's, I would say, the menu, we need to finance it. And of course, to this growth, which by the way, I come back is you will notice that the ambition is to continue to grow. It's more energy. It's 4% per year of growth that we target through this strategy. And so in terms of capital investments, the allocation of capital investments in the range $14 billion to $18 billion as we increase the range, we'll be around 45% to maintain all the oil business. That means production but also don't get the refining and our marketing oil business, which will go through the we maintain. So that's 45%. 20% for greenfield oil projects and exploration, exploration is around $500 million in our planning. We have, of course, 20%, 25% on LNG and gas. In gas, we introduced, by the way, the petrochemicals, which is fundamentally developed on gas, but it's LNG, which is there where we dedicate a big nice share of our capital investments. And then for the new energies, it will be offered between, I would say, electricity and renewables and the new molecules. In fact, in this 33%, as it's written on the right, you have -- we have also decided that we need to -- we have the necessity to meet our objectives in terms of emissions and lowering down of Scope 1 and 2 to increase what I call -- we call the carbon reduction program, which is a mix of energy efficiency of carbon capture of methane also. We have some commitments. So we have -- we think that we have to invest around $1 billion per year in this carbon reduction program. So it's higher than what we were planning before, but it's an opportunity to meet quicker with our commitments. I will come back on it. And then again, on the energy transition businesses, in particular, electricity renewables. We'll spend in '22 more than $4 billion per year. So you have there, I would say, the global capital investment strategy to support our transformation for the future. Of course, another challenge we'll face is inflation, and we need to keep the discipline on the costs through an efficiency. So first, there is no change in our criteria. It's very fundamental on the hydrocarbon projects, oil and gas projects. We have -- we are sanctioning them on the basis of $50 per barrel, $100 per tonne. We don't change these assumptions, but the way it's written in climate resolution on our say on climate that we submit to our shareholders, which have been approved at almost 90% last year. So -- and I think it's -- it's a discipline. We -- it's thanks to that discipline, but we managed to lower our breakeven. But today, we get some quite high cash flows. I mentioned the additional $15 billion of cash generated at the same price environment. That's -- so we'll keep the discipline to focus on low-cost projects less than $20 per barrel or $40 per barrel, maybe it will be more challenging because we might have some cost inflation in the industry, but it's fundamental for me, that was the main lesson of the year 2007, 2014, we need to keep the discipline in the way we sanction new projects. We have, of course, an advantage of the operating expenditures targeting less than $5 per barrel. Nicolas with me, it's more even more challenging. But to be honest, if we -- Canadian Oil Sands asset exit a company, we take a small advantage there. So that will give some margin for Nicolas' team and Namita teams to reach to meet the objective. But it's really keeping this discipline on tight cost control. And we have a new challenge which is our energy costs because we are benefiting, of course, as we are an energy company for the high environment, but for Bernard Pinatel, when we see some high margin in refining in Europe. In fact, people speak about, I don't know, $100 per tonne. Today, with the gas prices and all that, half of it could disappear in energy cost in fact. So that's something which people have to -- I'm exaggerating a little, but $30, $40 per ton just going in that. So we need to work on that. And so first, our colleagues have taken actions. They don't wait. They have shifted more than 50% of natural gas consumption of refineries is today has shifted to LPGs, which are priced more on the oil products rather than gas. So that's the first action. But we think it's also an opportunity for us to put a strong emphasis on energy efficiency, energy savings. So we have decided, as we have again this additional cash to allocate 1 build to launch a program -- worldwide program of dedicating $1 billion for the next 2 years on launching several projects in order to save energy. It will way to control our energy costs. It's also a way to accelerate our emission reduction. And I think it's a good investment for positioning the company and again, on the trajectory and even accelerating on the trajectory we are targeting in terms of combining hydrocarbons and climate challenge. So again, I show you the conclusion and mention it, and I will make the demonstration. In fact, in the last perspective, when we look to our medium-term plan, 5-year plan, what we can see. Again, 21 of this charge is including Russia, 27 is without Russia. But we have a cash increase, cash flow increase of around $4 billion in quite a moderate environment in terms of assumptions, $50 per barrel, $8 per Million BTU for European gas and [indiscernible] $3 in that scheme, which would increase if we just shift $60 and $10 per Million BTU, this additional cash would be $7.5 billion. So we have quite an upside, quite a long strong upside to the oil and gas price. So this, I would say, underlying cash flow -- which is coming, by the way, not only and you will see from -- coming from all the segments, including from electricity, there is $1.5 billion coming from electricity and renewables because, of course, this more we invest cash will come out with the segment is coming from oil, from LNG, from the downstream and from electricity and renewables. This additional cash flow growth, underlying one will support the sustainable dividend growth for the coming years. So -- and our plan is more energy, more cash, but less emissions. On this chart, it's just a summary of all road map for the next 10 years in terms of emissions. There is no change compared to [indiscernible]. No announcement today. In fact, we have decided that as we make a sustainable and climate report every year in March of each year, it will become an annual one. We'll make, by the way, is an annual presentation around this report, like we've done last year, updating the strategy. This chart will be updated by beginning of next year. In fact, we just signaled the free -- I mean, the 3 targets that we might update. One is Scope 1 and 2 net emissions because as I just told you that we are launching an accelerated efficiency -- Energy Efficiency Program, we should see the results and so we will work on it in the -- before year-end and in order to review this 2025 target there is certain logic there. Then the 2 other targets for '25 are at the request of some shareholders. Remember before the Annual Shareholder Meeting, we had a Board committee that we will fulfill all the gaps, including in 2025, what could be -- so targets for the Scope 3 worldwide oil and Scope 3 worldwide emissions. Honestly, for the last one, I think you have a good chance to find yourself what will be written in the box. Because, again, on Scope 3, our last comment are strongly committed to the scope-free intensity. I don't want to limit the growth of the company because the Scope 3 absolute value, which is linked even if we work hard with our customers, the company objective is to provide more energy to the world, which requires more energy and will not be limited because of the Scope 3 absolute value. The Scope 3 intensity, yes, Scope 3 absolute value. It's for me, it's more related to -- yes, on oil, we have a strategy to decline the sales because we anticipate lower demand. On the gas, we have a growth strategy, and we'll assume it. So now I've given you the conclusion. So I'm supposed to make the demonstration. To be honest, I'm not sure I'm a little year after year, I'm older. So I will not make the full presentation because my colleagues will help me through term and through their ramp table this afternoon. And so I just have a few slides. I will not make all the detailed comments, and you will have the opportunity to come in to dig into some -- most of these topics this afternoon. And on these ones. So first, gas and LNG because I know that is one of your expectations. Or do we leverage? Leveraging is quite easy. The gas price today is high, but we develop these integrated LNG positions. But I mentioned to you. Again, Helle told you, it's quite what is happening. It's a real shock of demand on this market. You know in this slide, it's a 400 million tonne market, where we have 10% of this market, by the way, which have a shock of demand of almost 25%, 50 million to 100 million tonnes coming from Europe. Of course, of the high LNG prices, we will destroy some demand. That's clear. And we see some countries shifting from that. But it's -- and we also know that it's a business where to invest in new capacities, it takes 5 years. So all cater enhancements, we come on stream by '27, '28, but before in the new U.S. plants, same pattern. So we have 5 years, I would say, we will have quite a stress. Of course, it depends on the duration of this world, but whatever will happen, Europe will never come back to 150 BCM imported from Russia. I mean, there is no way. So this demand is there. And so that's given us with our integrated position among the top 3 companies in the world, quite an interesting advantage. In '22, we'll sell more than 40 million tonnes, excluding Russia, again. And I think that's proof that we are the activity is strong. I remind you that we were last year, the U.S., first U.S. LNG exporter, and of course, the spread between the Henry Hub, even if Henry Hub is higher and the European gas price is so high, but there is a benefit there. So by the way, our European position is not only on regas capacity, where we are holder of the largest capacity, 18 million tonne in Europe of gas capacity, which have been filled by Stephane and his teams almost than 90% or quite -- it was, I would say, liability, it's quite an asset today, all these regas capacities. We intend to grow them by bringing 2 FSRUs, one in France, were another one in Germany on which we work to try to speed up these projects so easy because of various regulations, but we take. But I also remind you that among the major companies, we maintain a strong production -- a strong position in the North Sea as a gas producer in particular in Norway and in U.K. and the Maersk Oil acquisition contributed to that. We have a production which is more or less stable, I would say, around 200,000 per day of [indiscernible] gas production and U.K. and Norway, Denmark, which will increase with the Tyra redevelopment. So of course, this gives us as well a nice position to benefit from these Europe's new gas demand to fill the gap with the Russian gas. And we have some projects. We have a project, by the way, in the U.K., like the [indiscernible] on which we work again because at $8 per Million BTU, even if price is much higher today and it's quite profitable. So on LNG. On this chart, what we want the message is when we look today, Russia represents more or less in terms of equity, 5 million tonnes. And we will be able, between today and '27 to replace all Russia. There's even a little growth. '27 is a year where we have some projects which will just continue to ramp up like Cameron, like P&G, like many others. So -- when we look to the full ramp-up of the portfolio we have and where we have added again North Field East and North Field South, which will come between '27, '28, '29, we have the increase of production is 40%. So that's, I think, the answer. I already mentioned in the previous presentation that we have a large portfolio of LNG opportunities. So we are working on them. Cameron Phase 2 in the U.S., Jean-Pierre will come back, has been -- is accelerated with our partners, and we'll sanction it in '23. And Papua LNG, we also launched a feed upstream and will target a sanction next year. And in Mozambique, I will come back on it. Of course, security is today improving, but yet to have to improve before we can restarted to project, but the project is there, and we are working to see how we can relaunch it. Qatar, it's not only a question of growth a question of profitability, obviously, for me, it's more important. First, I would say that these are quite efficient projects in terms of costs. Upstream plus the LNG plant, the CapEx for North Field East is around $900 per tonne, $29 billion for 32 million tonnes. So you can make the calculation. LNG business, it's quite efficient. And also, these new projects is at 22-kilogram per CO2 per barrel, which is much lower than the traditional 30%, 35%, I would say, in the LNG business. So that's very important. So it's fitting well with, I would say, our framework for approving new hydrocarbon projects. We are in line with all offices. In terms of economics, it's quite attractive. First, these 2 projects represent the production under the life and life projects around 1.3 billion of barrels of production, it's 30 years, I think. So it's quite long. And there is very low acquisition bonus. I cannot give the detail, but that is quite low. And then there is a cash generation, which will be around $1 billion per year with a sensitivity, which is given to you for both projects. So that's, again, contributing profitably to our expansion of our LNG business. And I mentioned to you that it represents a share of 3.5 million tonnes per year. which will, of course, go to the -- in the hands of the teams of Stephane to get the most of the marketing of this 3.5 million tonne per year directly by TotalEnergies. So at the end, and again, Stephane will come back on the detail of the various projects and the way we create value. Under '25, '21, the next 5 years, increase of the cash coming from LNG will be $1 billion per year without Russia. So oil, oil is of course, as I said, maintaining oil, but we have -- we can leverage in this type of environment all the strategy we delivered. Just to remind you, and I think it's good to show that this strategy is really why do we have to make more cash. On Maersk Oil acquisition, we invested $7.5 billion some good quality assets, [indiscernible], Berkine in Algeria, Jack in the Gulf of Mexico. And after 5 years in the middle, we have already recouped $9 billion more than what we invested. So it's -- you can make the math and calculate the return of this type of countercyclical acquisition. It works very warm, and it's even accelerating. I would say the same with Brazil last year, by the end of December, we decided to acquire some shares in both fields of Sepia and Atapu. We were a little surprised not to have more competition because, in fact, the bonus were representing something like, I think, $2.5 billion, $3 billion. But this year '22, beginning only in May, we'll get $700 million of these assets. So I mean, having back in 7 months, 25% of the purchase price. And in Brazil, in fact, we have built since, I would say, last year, 10 years, a position. We reached this year 100,000 barrels per day. It will be 200,000 barrel per day because these assets have the growth. So Mero development, but also 2 new FPSOs on Atapu and Sepia. One of them should be sanctioned very quickly, if not both of them, in fact. And so you can see that in terms of organic net cash flow, it's a country which becomes contributive to our business. Even at $50 per barrel, represent around $1 billion per year in terms of organic net cash flow and at $80 per barrel, it reaches $2 billion. So that's a position which has been built on oil. And again, it's deepwater, it's a field of knowledge. It's also low cost and low emissions projects. So efficient project because very large resource base, which has which is being developed in this deepwater environment. We have, of course, we come back with short cycles. I remember that in 2019, we are mentioning 2018 among the $18 billion worth of short-cycle projects. With the COVID, we arbitrated them because it was not the right time. So we -- this year, we have relaunched some of them. We have sanctioned many of them in Angola, for example, close Phase 2 and 3, Begonia, say, short-cycle projects have been sanctioned this year. By the way, you can see on the chart in the middle that in Angola, thanks to all these works on Block 17, we maintain a production of around 400,000 barrel per day going down to 350,000, but it's quite an activity. All this is being done with a CapEx of less than $4 per barrel because it's mainly fundamentally infill wells, so additional subsidy development, but linked to existing infrastructure, it's Brownfields. So it's -- there is a lot of value creation in this deepwater environment when you are able to add -- to develop additional reserves on the existing platforms or FPSOs. We have in our portfolio around 1.5 billion barrels of resource, which could be short-cycle projects have been identified, more -- most of them are all in fact. And so that, of course, is one of the source of the acceleration of CapEx, I would say, will dedicate some CapEx, of course, to the short-cycle, it's the right time to do it. It's good -- they are flexible, so we can stop and it's part of when I say we will pilot the CapEx level between 14 and 18 in terms of low cycle. This is exactly the type of activity that we can arbitrate. The only point is that, of course, they have to be short, including in terms of rig commitments. But we have also some new oil projects in the portfolio. So we have sanctions in '22 -- beginning of the year, the Uganda project and we are working to deliver it by '25, progressing. It's quite a big project for us, of course, considering the stake that we have in the projects. And it will contribute to maintain oil production because if we want to maintain the oil production as we have a natural decline in oil around 4% to 5%. We need to invest in new greenfields. What Helle said at the macro level is valid for total energy. There is no miracle. And so that's part. We have another new projects because we have made some positive appraisal on Cameia and Golfinho in Angola. It's a new hub with a new FPSO Block 2021, not as big as the others, 70,000 barrels per day, but profitable, and the intent is to sanction that very soon, beginning '23. We are working with the authorities and could deliver $500 million of cash flow as well. And last but not least, we had some success in -- maybe we are leaner in our exploration plan, around $500. But we are maybe also more efficient. We have this Suriname discoveries. I will answer to some questions on it, if you have any. But we are working on appraising to launch our first development and we have also in Namibia, it's only one well. I know there is a lot of excitement around this discovery, but I'm like -- I like to see the appraisal coming in order to be able to speak about it, but it seems to be quite a very large discovery or giant one even. So in oil, again, maintaining the production, we exclude Russia. You have the figures for Russia on this chart, but you know them because we report on Russia independently. We have a small increase and a $1 billion, I would say, underlying cash flow, which will feed the increase of our dividend in the future. Oil is also a matter of downstream and because this is also in refining, in particular, but also we have European petrochemicals on NAFTA and for marketing and services. Of course, here, very easy, as you know, in refining, except biorefining, but I will come back on it, biofuels. There is no growth appetite from our company. But Bernard and his teams are working on to increase the utilization rate, 22% from this perspective is improving -- above 80%. It's key energy efficiency, and we have some modernization in [indiscernible] going on. Petrochemicals, we have started our U.S. -- new U.S. ethane cracker in Port Arthur. So it will get -- it's also a good asset to benefit from this environment. And I will come back on our investments in low-carbon products because also it's area refining and chemicals where we implement on one side, delivering most of our assets and on the other side, transitioning to new products because they are growing markets. In particular, the sustainable aviation fuel, where we have already some plans and some production, but we intend to -- we target 1.5 million tonnes per year, which could represent 10% of the market by the end of the decade and also on circular polymers. Marketing & Services is also having -- facing its own transition. As I said, we intend to realign our sales to our production, so around 1.3 million, 1.4 million barrel oil per day which means that in order to maintain the value, we are working to develop, in particular, in our retail stations, the nonpetroleum revenues. We target to increase them to represent more than 50%. So that's one of the key focus for all the marketing activities. We have also, of course, investing in new mobility, in particular, in e-mobility. Thierry will be there with Bernard this afternoon to answer to all your questions about it. The question there is, of course, to find the right business model, the right because there are different markets, which are the most profitable ones. We -- in which we monitor our positioning. It's not only a matter for me of number of charging points because I could put plenty of charging points in the street of some cities without having very low revenue. So be careful about the number of charging points. I think the question is what are the key markets in particular, high charging points in strategic areas where we need to develop the concept to be able to get some profitability out of these investments. And again, that's an area of development. Globally speaking, we expect over the next 5 years to generate $300 million out of these new businesses on Marketing and Services. I mentioned for -- when I was speaking about Bernard business, the new molecules that we really required for energy transition which I would say the molecule business is almost a natural continuity from our oil and gas business. We have biomass, and we have, of course, other type of molecules. I describe what we want to do on the biofuel, which is to focus fundamentally on the system into a [indiscernible]. Why? Because we think that in the long term, a liquid fuel will be required for these planes, even if there are other IDs and it's best valuization probably for this market. The key point is to have access to waste and residues. So I would say the bottleneck there is a supply. It's not the outlet, it is the supply, which is, by the way, that this market is a good market because if you have less supply than demand, I feel that is good for the economics. We have made an announcement this beginning of the week in France -- in Europe, I would say, because it's with a German company to secure waste and residues for feeding our Go-Green project. We see some integration. There is no way to -- if we don't secure that there is such a competition, but it's -- it could become a bottleneck to meet our ambition in terms of growing this business. So we have an innovative, I would say, scheme where we become shareholder of their waste and residue business, waste of oil, waste of fats and they become shareholders of our projects. It's a way to integrate, but I think it's a way to grow in that business, and we might replicate in the future of this type of business scheme. But we are -- and I say quite satisfied to have been able to secure with a strong player this feedstock. A word about biogas, it's another source biomass. Biogas, what is interesting is that there, again, we see quite a good demand, strong demand. A lot of, I would say, transportation businesses, either road transportation trucks or marine transportation, container shipping which went to gas, we shifted from oil to gas are willing to green the gas. So they are asking for bio-LNG or bio-CNG. And there, again, the supply of biomethane is not so high. So you have a strong push. There are some customers from these transportation businesses, which are ready to pay for having I would say, biofuel in the biogas in the ways our goods are transported. So this one will intend to also develop. We have a position in France. Now we're developing activity in the U.S. And we are looking to more in Europe because there is a strong push. And we feel on both sides of the Atlantic, new schemes are supporting the development of these businesses. Hydrogen and fuel, that's for the longer term, but we have taken this year on hydrogen another step in order to position ourselves on one large project in India on Green Nitrogen. We'll develop it through phases and it's a great ambitions, but we need to find the market. They might -- we might have a market in India on green urea because Indian government is subsidizing urea. It's a way to and importing urea, so it's a way for them to have domestic production. We look if we can -- this platform could be used as well to export green products, either methanol or ammonia, green ammonia to exporting markets. And then we are progressing as well on the decarbonization of our refineries. We have just been selected at the European level for projects in [indiscernible] to green to -- I mean, decarbonized and make green hydrogen for the full platform, by the way. So it's we require a large project of 120 megawatts, which will require some subsidies, which have been confirmed to us last week by the French government. So that's beyond hydrogen, it's e-fuels in which we begin to invest in some, I would say, more pilot projects. But clearly, we will need this type in the future of liquid fuels if we want to make this transition. So globally, what we invest -- we will invest as I said, let's say, 5% to 10% of our CapEx in this new molecules. We are monitoring that, and we expect the generation of cash flow of in 5 years of $0.5 billion to $1 billion coming from South coming from biogas fundamentally. Last part of this, I would say, all trajectory because when we develop hydrocarbons and we want to also to contribute the capitalization of our customers, it's carbon capture and storage. So of course, we are 2 pillars of these developments of CCS. One is to reduce the emissions of our own assets, I would say, existing assets, where we are today in Australia. We have been awarded a license together with our colleagues. We are working on Cameron LNG as well on carbon sequestration project. We have our own refineries on which I work like Normandy. And of course, when we look to greenfield projects like in Papua LNG, we went from day 1 to integrate this technology in order to manage the capture the emissions on the upstream side, in fact, on this one. But we also are already considering and not only considering we have no teams to develop some services to transport and store CO2. Our key target is the North Sea. We are a partner of the Northern Lights projects, which is a good, I would say, way to learn and to -- even to develop the markets, to interact with customers. But we also intend to develop our own projects, in particular, in the Netherlands, it's Aramis and in Denmark is a Bifrost project. We are also because we think the U.S. By the way, the last bid and law has given quite a strong support to develop CCS in the U.S. We will consider to develop this business as well here. So $300 million per year investment. The last pillar of the strategy is electricity and renewables. There again, there will be this afternoon, I would say, a roundtable with Helle and Stephane. Just the first message, we don't think to what we want to do only as renewables. Of course, we are growing our production arm and renewable. But we want, in fact, we consider that the way to get some added value is not to have, I would say, a protected or secured return on renewables is, in fact, to have an integrated business and to be able to take some merchant risk like we do in oil and gas. But when we develop LNG in the past, at the beginning of the history of LNG, we were building a plant only when we had long-term contracts, secured contracts. Now today, we launched some projects with not all the contracts being secured because we know that we have the capacity to get value and to face the market from trading storage. Of course, the balance sheet from this perspective is quite an advantage. So this is a way to think to that. So we intend the objective, as I said before, is 100 terawatt production by 2030. We will need to develop some storage, that is 5 gigawatt. We also need to have some flexible power plants in our portfolio, I mean, gas-fired power plants in order to manage this intermittency for the customers because the customers at the end they want firm power. So that's a business, and we think to electricity. And by the way, we'll organize the company so that with Stephane will have on one side somebody in charge of renewable to produce a little like E&P in effect for oil and gas. And on the other side, electricity President some person in charge of making this integration in particular, on the deregulated markets, Europe and the U.S. for us. So -- how do we make value out of renewables? I think we have built a portfolio of 35 gigawatts, which is worth around $35 billion by '25. So it's a big asset. I will come back on it. But we've done it, for -- I would say for 2 pillars. One, of course, is to try to be selective on some M&A activity. And I will say you have some 3 key -- I would say, transactions that we have negotiated. One was at renewables. We paid $2 billion in '21. It's worth today $10 billion. Clearway, we've negotiated an innovative transaction with GIP where we combine cash payments and using some -- half of our shares in SunPower to finance it, which gives a multiple -- an aggregated multiple of 9x EBITDA. So it clearly was among the top 5 renewable developer and with a company which is listed [indiscernible]. And so it's a good position. Again, we think it's attractive for shareholders. And I remind you that -- and we will exercise next year the option, the call option we have on Total Eren, where we own 30%. So we acquired the 70% at multiples we were negotiated in 2016 before the hike of the renewables companies, I would say. Last but not least, we have ourselves our own platforms. We have teams to develop projects in particular, in solar and offshore wind. Total Eren will be fully integrated into TotalEnergies, so we'll become an operated company by TotalEnergies. Adani in Clearway will remain non-operated. And it's linked to the next slide where I just to understand now the model. I know some people ask us, what do you do with all your puzzle of renewables. So now the vision is clear. For us, it's exactly the way we think to that. Again, let's take upstream for oil and gas as a comparison. We have an operator some operated assets. The objective is to have, I'll say, 50-50 between operation and non-operated. So by '25, out of the 35 gross installed capacity will be 40% operated, 60% non-operated. The operated path we continue to grow. We have -- '22 will deliver the growth of 6 gigawatts that we have announced beginning of the year. So we have yet to deliver 19 gigawatts. We've seen that for next year, the 6 gigawatts are already into construction. And -- but I would say, in fact, the portfolio is larger than 35 gigawatts. My team were pushing me to increase the figure, but I want them to deliver 45 gigawatts and really big. And as some of the analysts begin to look to this portfolio. It's a portfolio which is worth by that time, considering the EBITDA, which will be proportionate EBITDA, not far from $3 billion, something that more than $35 billion of value, which is embedded within TotalEnergies. And you can see also on this slide, the split between technologies by 25%, the offshore wind is still small because it takes time to deliver. It's more 2030, where technology will go. So it's solar and wind. And you can see the spread about the various geographies. I would say half of the portfolio is developed U.S.A. and Europe in unregulated markets, ACD, which are 2 big markets because the support by, I would say, not only government but customers is strong, and we can again develop our 30% merchant business key model that we have in mind. And half of it will be in other geographies, India representing 20%, 25% in the rest of the world. So that's more regulated markets. So that means that, again, at the end, this is what is of interest for us. It's to develop an electricity and renewables business. By the -- on the decade, we gave you the indication of $25 production will be 50 terawatt. And the increase of cash flow coming from this business between today and '27, it's around $1.5 billion of cash flow and the return a global return on equity of more than 10%. But again, you could ask all the question of this question of profitability on electricity and renewables to Stephane and Helle. So it's the end of my presentation. And just to come back on the business case of TotalEnergies. This slide was presented to you, I think, in February or March. We just adapted, in fact, the increasing attractive and sustainable return to shareholders because I think that's the key message that we delivered to you today. 35%, 40% payout through the cycles. The cash flow growth will support dividend increase over the next 5 years, comforted by the balances and share buybacks. And we have a strong financial situation, which allows us to accelerate the capital investment strategy to deliver additional cash flows in the future. And the business model is built on the pillar, which is fundamental on hydrocarbons of remaining a low-cost producer, a breakeven and $25 per barrel, continuing to grow in LNG and finding the -- we have the portfolio to fit that growth, as I show you, without Russia once again. And in developing these electricity and renewable arms of this new molecule business, where we have some, I would say, competitive advantages, one of them being we are able to manage complexity in such -- it's our DNA, I would say, of these projects. And they are not so simple. The larger we go into these projects, we larger they are, more project management capacity they need technology, they need and we have that. It's our DNA. So we feel comfortable by going in -- quickly in that businesses. And again, on the electricity value chain, the key will be to manage this business as we've done on oil and gas, accepting and not only accepting, taking the opportunity of the volatility market to improve the returns and not remaining in a secured profitability business. So that's for my presentation. And now I will leave the floor to Jean-Pierre. We had 1 hour 50 minutes. It's perfectly on time, Renaud. So Jean-Pierre will give you the U.S. strategy in action in the U.S., and then we'll take your questions.

Thank you. But it was obvious being with you tonight or today in New York that we have to present how we develop our multi-energy strategy in the U.S., and as Patrick already mentioned, I think that the U.S. is a perfect illustration of our strategy in action. So what is the presence of TotalEnergies in the U.S.? So you see here the different activities with the different pillars and activities. So the first one, LNG. So for obvious reasons, given the vast natural gas resources in the U.S., the U.S. is positioned to play a dominant role in the coming years in the future growth in the LNG industry. With that in mind, we began building our LNG business here in the U.S. about 10 years ago, mainly through countercyclical acquisitions such as the ENGIE assets and the Toshiba uptake. We build on this position through our partnership with Sempra, at Cameron and Energía Costa Azul, I will come back later on that. Today, TotalEnergies is the leading offtaker and exporter of U.S. LNG and by integrating this leading position into our global LNG portfolio, we have a competitive advantage in the U.S. to Europe trade. Second pillar, Energy & Renewables. Over the last 18 months, successive acquisitions and successful bids enable TotalEnergies to take major positions in solar, wind, both onshore and offshore and storage. TotalEnergies is well positioned to be in the top 5 renewable power developer in the U.S. with 25 gigawatts of growth power generation by 2030. That means that the U.S. will significantly contribute to the company objective of having 100 gigawatts of power generation by 2030. Our position here benefited significantly from our recent investment in Clearway Energy, as Patrick already mentioned, which has accelerated our growth trajectory and provided us with a more integrated position in the U.S. It is a balanced portfolio between operated and non-operated assets and an integrated portfolio combining power generation, storage and trading. Last but not least, our focused oil portfolio, which generated strong cash flows. In the Gulf of Mexico, we have 2 projects, Oncor and Ballymore and in the downstream, we are further developing our [indiscernible] platform towards high-value petrochemicals with a new ethane cracker and integrations on polymers. LNG and renewables are the core of our multi-energy growth strategy. The U.S. has provided us with ample opportunities in both markets to demonstrate our ability to execute and deliver on this strategy. And we will continue leveraging on LNG and renewables to rebalance our global portfolio towards the U.S., this country becoming a major pole of activities for the company in the coming years. So first focus on LNG. This is a graphic illustration of the different milestones in building LNG portfolio in the U.S. Our strategy to develop a strong position as U.S. LNG exporter, predates, in fact, the current situation in Europe by more than a decade. In recent years, totaling has become the leading exporters of U.S. LNG with more than 10 million tonnes of long-term U.S. supply, most of which has been exported to Europe in recent times, contributing to the continent security of energy supply. The most significant step was the 2018 countercyclical acquisitions of the ENGIE LNG assets which led to our entry in the 3 first trains of Cameron LNG projects. I would say the icing on the cake was being paid to take over Toshiba long-term offtake from Freeport in 2019. Having success in building this position, we are benefiting from the unique leverage that it provides. With [indiscernible] with a less than $3.5 per millimeter liquefaction costs combined with our fleet of LNG carriers and leading position in European regas capacities, we have been able to profitably leverage this position through our global trading network to supply LNG in Europe at competitive price. And in the future, we developed a partnership with 2 new projects but I will come back on. Thanks to these projects. So Cameron LNG and ECA. From our leading position of more than 10 million tonne of long-term U.S. supply today, we plan to grow further to 13 million tonnes by 2025. And it's a good transition to my next slide. Zooming on our partnership with Sempra. So Total entered the Cameron LNG project operated by Sempra through the acquisition of ENGIE Upstream LNG businesses in 2018. So Phase 1 of the Cameron Energy project includes 3 trains, as you know, each train having a 4.5 million tonne per annum of capacity. We have a stake of 18.6% in this project, and it represents more or less 2.2 million tonnes of equity production and an offtake from this first ring of Cameron of around 5 million tonnes per annum. And now we are developing 2 additional projects with Sempra with the same equity stake, 16.6%. The first one is in Baja, California. So is the Energía Costa Azul project, project with a capacity of 3.3 million tonne per based on pre-existing Regas terminal and with the supply from the [indiscernible] assets. First, LNG is expected in 2025. It will add 0.5 million tonnes of equity production with an uptake of 1.7 million tonnes, 50% of the volumes. The second project is increasing capacity on -- in Cameron LNG trains. This expansion, in fact, includes the development of a fourth train and the debattleneck of the existing Train 1 -- Train 1, 2 and 3 with an increase of 5% in terms of capacity. Under the terms of the HoA, TotalEnergies will take its equity stake of the new train 4 and 25% of the projected debattlenecked capacity, and it will represent an added equity production of 1.1 million tonnes and an uptake of 1.2 million tonne. So all in all, the development of ECA and in function of Cameron Energy will contribute to LNG growth from 10 million tonnes at present time to 13 million tonnes in the coming years, as already mentioned. Turning now to Power. So we have accelerated our growth in the U.S. in this strategic business. Over the past 2 years, we have an integrated portfolio, combining renewable storage and trading activities. You have here on the slide the different acquisitions, the different transactions made since 2021. In large-scale solar energy, our portfolio includes more or less 8 gigawatts acquired from SunChase Power in 2021 from Core Solar in '22 plus different projects in partnership with [indiscernible] Energy. In solar distribution generation, TotalEnergies acquired in the first quarter of 2022, the business and commercial solar activities of SunPower with the objective to develop more or less 100 million watts per year of additional capacity. In offshore wind energy, we have secured 2 leases very recently for a global capacity of 4 gigawatts, I will come back on that. And the recent transaction with Clearway complements this portfolio with 7.7 million tonne -- gigawatt in operation and a portfolio at advanced stage of 15 gigawatts. That means that by 2025, we're concentrated mainly in solar with 8 gigawatts of installed renewable power generation and the mixed between operated and non-operated assets. With the portfolio we have in our hands, our ambition is to grow the U.S. portfolio to more than 25 gigawatts by 2030, that means that U.S. will account more or less 25% of the company global target that Patrick mentioned before of 100 gigawatts by 2030. So zooming now on the acquisition on the 25% acquisition of Clearway Energy Group. The transaction was closed, in fact, 2 weeks ago and expands and diversifies in fact, our presence in the U.S. renewable energy and storage markets. With this transaction, TotalEnergies is establishing a major position and is acquiring critical size in the U.S. TotalEnergies becomes the fifth largest scalable power developer in the U.S. with a broader presence in more states, more wind assets in the mix and more skilled people on the job. Clearway Energy Group developed renewable projects and owns 42% of a listed subsidiary CWEN, into which projects are dropped when they reach commercial operations. The beauty of this transaction is that we're able to generate this opportunity through direct discussions and agreements with the GIP. And looking at the numbers, the transaction is clearly a compelling and value-creating deal. We pay $1.6 billion in cash, and we transfer it to GIP, 50% our stake in SunPower. So that means that GIP will become a shareholder of Sunpower at 25%. That means that, in fact, we used our ownership in SunPower to pay partially the transaction, valuating SunPower at more than 30x the EBITDA. Globally, given the multiple we pay for the CWEN shares, the transaction is valued 9x EBITDA, net for the 2 listed companies. The return on equity is above the 10% hurdle rate that we have set to ourselves for renewable activities. This is a strong partnership benefiting all parties, both TotalEnergies and GIP. As a part of this partnership, TotalEnergies will contribute to enhanced Clearway's growth projects, prospects by providing CWEN in the U.S. with access to its broader trading capacities. Clearway will become for a privileged vehicle for our own project [indiscernible]. And with more projects in the pipeline, the partnership will benefit from access to TotalEnergies' large customer base of corporate [indiscernible]. At the same time, we are building long-term position in offshore winds. We have already secured long-term leads through 2 tenders for global capacity of 4 gigawatts. The first one through the New York by tenders. It's a very long-term lease. It's a 50-year lease, located not very far from here. And with the [indiscernible] we have in our hands will accommodate the generation capacity of 3 gigawatts, enough, in fact, to provide power to about 1 million homes. And the project is expected to come online by 2028. And the second tender was the North Carolina one. It's a 30-year lease, located 20 nautical miles from the coast, able to generate a capacity of more than 1 gigawatts and the project is expected to come online by 2030. To be clear, we do not intend to keep 100% of these assets in our portfolio to manage the global exposure and to execute our business model, we plan to fund down in the next future, part of these projects. In addition, we are pursuing future opportunities through announced tenders. So it's the case in California, Oregon or in the Gulf of Mexico. And we are preparing the upcoming auctions. So oil. Our multi-energy strategy includes, of course, oil and gas. And from the time being, of course, it's the main cash flow generator, funding shareholder returns and our future investments in new energies. So in the Upstream, our focus here in the U.S. is in the Gulf of Mexico. We have 2 producing assets, 2 producing fields, Tahiti and Jack. And we have 2 projects under development, [indiscernible], Anchor and Ballymore. So we anticipate a strong growth from our Gulf of Mexico assets. So you will see that the production is the red part in the graph. So the production in the Gulf of Mexico is supposed to remain stable between now and 2024. And after that, with the start-up of the 2 fields, Ballymore and Anchor, the production is supposed to triple and to reach something like [ 775,000 ] barrels per day by 2026. And the projected 2026 cash flow from our Gulf of Mexico assets is $0.9 billion at $50 per barrel, but $1.4 billion at $80 per barrel. That means that these assets are able to leverage to benefit from the upside and have a strong price sensitivity. Onshore, nevertheless, TotalEnergies is an operator in the Barnett shale gas play, with a net production of about 60,000 barrels of oil equivalent per day. The Barnett produced low-cost gas that provides the hedging, in fact, for our Upstream side of our LNG business. And we're running 1 to 2 rigs over the period 2022, 2026 on the field, should stabilize the production at the current level around 0.5 Bcf per day, 100%. And very important as well, it's a low-cost gas assets, and we anticipate to reduce methane intensity to less than 0.1% in the coming years. So the Downstream. So our Downstream business in the U.S. is centered around Port Arthur, 1 of our 6 refining and petrochemicals integrated platforms worldwide. I just call it's a fully owned high conversion, 240,000 barrels per day refinery with a [indiscernible] units, enabling to process heavy crude and transform into sulfur fuels integrated with a 1 million tonne per year mixed feed cracker go on with BASF. It is also integrated with our propylene splitter in Mont Belvieu and 3 polymer sites located in Texas or in Louisiana. Thanks to these developments to this deep conversion and integration, the platform is well positioned to capture the current favorable environment, it generated around $400 million in the first semester of 2022. The second pillar is a New Ethane cracker and PE projects. Our growth ambition has been directed at high-value petrochemicals as I already mentioned. And we are starting up through our JV 50-50 with [indiscernible], a new full Ethane-based cracker with a production capacity of 1 million tonnes per year of ethylene [indiscernible], as well as a new polyethylene unit in Bayport of capacity about 600,000 -- sorry, 600,000 tonnes per year that will complement the existing 400,000 tonne per year units and ensure a full monomer/polymer integration. The cracker fully runs on ethane, capturing maximum upside as oil price goes up. And cash flow is anticipated to double with Brent at $80 per barrel versus $50 per barrel. The last pillar. The Port Arthur refinery and cracker has not only integrated with Bayport polyethylene sites, but also with our propylene splitter in Mont Belvieu and other polymer production sites. So Laporte, a 1.2 million tonne per year polypropylene production sites, it's the largest one in the U.S. and in Carville, Louisiana, an integrated styrene and polystyrene plant with a polystyrene production capacity of 600,000 tonne per year. Integration as well as very high utilization rates, enable TotalEnergies to leverage unfavorable environment and capture high polymer margins, generating more than 500 million tonnes CFFO in 2021. And we expect more or less the same performance in 2022. Our U.S. activities benefit from strong leverage to the higher price environment. The first half 2022, I think, is the perfect illustration of that leverage. You have here the comparison between the cash flow generated in 2021 close to $2.4 billion -- $2.5 billion. So comparison to our annualized first half 2022, and you see that the cash flow increased by more than $1 billion, benefiting in particular from both oil price increase on E&P and very strong refining margin in the first half. And as I already mentioned, in the future, the start-up of the ethane cracker will bring additional leverage to oil prices. My last slide, just to summarize our strategy here in the U.S. to grow our multi-energy model. So first message, TotalEnergies is #1 U.S. LNG exporter, and we keep growing this activity. We will be top 5 -- the top 5 renewable power player in the U.S. with more than 25 gigawatt capacity by 2030. We are also growing in oil with oil production tripling to [ 775,000 billion ] barrels per day in 2026. And an additional 1 million tonne ethylene production capacity with the ethane cracker startup. The underlying cash flow will increase by $1 billion from 2021 to 2026, at constant environment, mainly driven by E&P projects and incoming contribution from renewables. Capital allocation is expected to be in the range of $2 billion per year over that period, which is consistent with expanding our activities here, 12% of the company's capital employed is here in the U.S., having grown significantly over the last couple of years, as a result of the acquisitions, the developments that I've already highlighted during this presentation. Last but not least, the U.S. represents an increasing part of our institutional shareholders, [ 40% ] end of June. That means an increase by almost 3% compared to end of last year. And we feel that in many ways, U.S. investors understand and appreciate our strategy, we hope so. To conclude, I will say that the U.S. offers TotalEnergies everything it needs in terms of markets and resources to grow the company here and to develop its multi-energy model. The country will become a major pole of activity for the future. And as Patrick earlier mentioned, for sure, it will be more U.S. in the company in the coming years. And it will. I think it's time now for the Q&A. Thank you.

Please check the mike.

Yes. Okay. Thank you. So thank you, Jean-Pierre, for the presentation. So I think now the floor is yours to answer your questions. And Renaud will organize this Q&A.

Yes. Michele, you are the first one.

Thank you very much. Michele Della Vigna from Goldman Sachs. I wanted to come back to the shareholder returns. And I think it's very welcome today to see a further increasing shareholder returns. But I wanted to understand a little bit better some of the thinking behind the special dividend, especially at a time when, at least on our estimates, the market is severely undervaluing the value of what the TotalEnergies business has created. I was wondering why go down the special dividend route and not a buyback that could take advantage of this valuation dislocation around the shares? And thinking about a macro environment next year, which could be less benign than this year, especially if the global recession gets worse. I was wondering how you think about the special distribution. If you had to scale it down, would you start scaling down the special dividend or perhaps the buyback? Like what would be your priorities? And how would your thinking go around it in a more difficult macro environment? And then last question, I promise, on the shareholder distribution. On the dividend side, you've got a discrepancy in currency between a dividend that is declared in euros and the business, which is clearly dollar-based. And I was wondering if that was something that perhaps you would want to address in the future to make sure that you had better currency consistency between your cash flow and your cash returns. And that was the last part of my question. Thank you, Patrick.

Okay. The last question first. We started it, it's not possible. We are a French company, and in fact, all our accounts have to be done in euro. And in fact, we have some technicalities in particular. We are obliged to declare the dividend in March to organize a general assembly in May. So you have 2 months. Exchange rates could move in between. So it's basically -- it's technically difficult to declare because the dividend will have to be always declared in euro. So even if we monitor in dollar, at the end, we have to convert in euro. So we have a problem of risk of exchange that, which is difficult to tackle. The only way would be to convince the French legislators to allow a French company to have accounts in dollar then to declare the dividend in dollar, which is the law when you are in the U.K. or it's a law when you are in the Netherlands, it's not a law in the French law, our nationalism in France, so I'm afraid, but I -- we reduced it again and it's technically too complex. And in fact, start to monitor that. Having said that, we took in that account that I would say, part of the answer why we're selecting the special dividend is also to cover the point that this year when we announced a growth of 5% in euro for our U.S. shareholders, it's a decrease of 10%. So of course, we had a problem. So initially, we wanted a special dividend to cover that difference or an increase of dividend. And then in the discussion came to us about how do we monitor the various instruments. And that's linked to the second question, maybe I have not been clear enough, but the way it's written in the slide is important. The buyback comes before the special dividend. We put special dividend only in case of very high prices, which we face today. The buyback is obviously the first instrument to act because for the company, no buyback shares, you diminish the burden of dividend, and you support your -- I would say your -- the share value, I would say. So it's obvious to us. So this is why we put this caveat. It's because we are in a specific position where we have very high prices, so I'd say very high returns and cash flows, but we consider this special dividend. So to come back to your question, you will refer the dividend, then the buyback and then potentially the special dividend. So it's clear in the way it's established in the mindset of the Board. The first question, that was a debate. But you know the French people are French people. Now in fact, honestly, we know that we have to increase. We want -- the fundamental discussion was about what is the cash payout we are willing to deliver to our shareholders. And we knew that we were since the beginning of the year, lagging around 30%, but it was compared. I think we know it's very important in the valuation of the company. By the way, it's quite clear when you look to our peers, the higher the cash payout is the better valuation, so it's a quiet relationship. So I know it's your job to be analysts, but we don't have to be -- it's not so -- it's very clear. So we went back this discussion, 35%, 40% for me is the important message, it's a range that we target. That's the key message today and through the cycle. And we are comfortable even at $50 per barrel to be able to deliver 35% to 40% of cash flow, which has not been the true reality of the history of the company. So I mean, I know that when we analyze that, we are more under 40%. So we make a step change in the way we look to that. So that's the key point. Then that was -- what is the way to do it. To be frank, we are -- maybe were a little afraid about seeing taxation on buybacks in Europe. And I will be -- we -- by the way, it has been introduced in a law in the U.S., maybe 1%, but you know crossing the Atlantic, you never know. And so -- and by the way, when we discuss also with some investors, we see some appetite -- direct appetite for cash. So it's for the debate to be clear. There is a trade-off which has been selected to maintain to make a global amount of almost $9.5 billion, $10 billion split between the 2 instruments. But buyback come first, let's be clear in our mind. By the way, when we regard -- I can share with you another information is that, since 2015, we use shares to pay some dividend than to acquire [indiscernible]. We issued 400 million shares. We have already bought back 250 million shares. So by the end of next year at $8 billion, we'll -- have bought back all the shares issued during the period. So dilution will be -- so this is also, for me, an objective in order to have a clean sheet as soon as possible.

Lydia?

Two questions, if I could. On the CapEx side and the investment part, that $14 billion to $18 billion, how much of it is organic versus inorganic? And related to that, on the cash flow increase -- the difference between that cumulatively over 5 years is best part of $20 billion. How much -- in terms of the uplift in cash flow of $4 billion, how -- is that based on the $14 million CapEx? Or should we expect it with CapEx being higher cash flow should also move higher [indiscernible] EBITDA?

In fact, the figure is almost the same in organic and inorganic because in our plan, we acquire assets, but we divest this as well. And so that's true but when I see electricity we required to continue to make inorganic acquisition like we've done. That's clear. Next year, totally it will be a new source of investments. But at the same time, we continue to manage the portfolio because we still have some assets. And by the way, in this type of environment, it's important to constitute to manage the portfolio in the way we've done it. And so I would say the organic figure is more or less the same. We consider maybe there is $1 billion of net between acquisition and divestments. Just to give you a figure, to give you an idea. But this is the way to do it. So that's the way to create value. The cash flow side, when we make this type of plan it's fundamentally coming from the organic. The -- I mean, when we say we generate $4 billion of extra cash at $50 per barrel which is coming from the existing portfolio. There is not in that figure, the results of some acquisitions. So it's mutualized, I would say. Except the TotalEnergies, which is identified.

Christian?

And thank you for an excellent presentation. It's good to see you looking to grow energy in such a holistic way. Two questions. The first on Slide 7. Massive underinvestment in oil. The world needs more oil, you're pivoting 1/3 of your portfolio towards renewables. I just want to understand why the rush in getting involved in renewables when it's very clear that there's huge amounts of cash flow to make and what is really profitable fuel and you could accelerate cash flows as a result, and you've -- TotalEnergies has been one of the best in exploring and producing oil for many, many years. And that links to the second question, which is -- is there a risk that Shale Version 2.0 is effectively what renewables is where you have all the money from God to invest in renewables? Everyone is doing it. We see massive inflation and your profitability targets, like the industry just got pushed out as growth becomes the priority. So I just want to understand how you mitigated that risk particularly in the context of inflation and ability to control that as we've seen in the past through growth industries.

Okay. First, again, we invest in oil. We have a natural decline of 4% per year in all to maintain the production. It means that we need to invest in oil. And I think I described to you different projects -- oil projects. And by the way, in my view, when I mentioned countercyclical opportunities, it's not the right time for hydrocarbons, but I don't exclude TotalEnergies to acquire like we've done in Brazil, some micro carbon assets, because it's not only renewables, not at all. And last year, we have capacity to acquire these assets in Brazil, we captured them, okay. And so I'm -- it's a balanced strategy. It's not only renewable -- forget -- don't look at it. It's the fact that we have a strategy where we think that all these 3 energies all LNG, gas and electricity will need investments. That's true, but our capacity to select the right opportunities in oil and LNG are probably better because we have a longer story. I would say I recognize that, and I'm proud of it. And we have built on it. Having said that, on oil when you decide to keep your discipline on -- we sanctioned a $50 per barrel, and we want the emissions to lower. It's not the same world that we had in the past. I have some playing fields like Canada, like others, but which we don't want to invest like Venezuela all over. So it's trying to continue to have the discipline to focus on the playing field where we can find these assets, but we'll continue to do that. And by the way, it's not fully true that we did not allocate part of the CapEx to that because that are short-cycle projects, which will represent $1 billion per year, it's oil. No, it's not renewable. So it's a similar question. At the end, if you take the high range, which is not the case, but this year, it's $12 billion, which is dedicated to oil and gas out of [indiscernible]. So that's true that compared to before, it's less. It's a choice. It's a choice because -- and your second question. Again, your question, you speak renewable, renewable. It's not only a question of [indiscernible]. It's a question of very electricity value chain. A lot of the value is first, I think -- let me clear. In renewables, if you compete with others, you lose money, okay? I said that. I declared it. This is why when you look to the main transaction we've done, to direct negotiation, trying to establish relationship to find a way to create the value. And the Clearway, I will tell you, it would have been put on auction by GIP. I think we would have escape as way I spent my time to say to my colleagues stop losing your time to go to this because we face some competition coming from financial institutions. We clearly are not ready to pay NPV4, NPV5. So that's important to find a way to create the value. What I think is that we have one advantage in particularly of electricity, the utilities is our balance sheet or capacity to providing we are able to build -- obviously it's a different element of the value chain, including we need some gas fire power plant. We need some storage. Of course, we have a trading arm. We have to think to that as -- as the merchant part of the business is interesting. Managing exactly what we've done in oil and gas. So it's not the same approach, but looking to secure low-return portfolio. It's not what we think. But we need to have a producing assets. If you don't have the producing assets, there is no way to grow the business. So that's the way we think. So it's a choice. But I think it's a longer-term choice. But again, like Brazil, it takes maybe 10 years to establish a profitable policy. But at the end, we generate a position. You have to consider that we'll find a way to create that position. And when we say to you, it's more than 10% ROE. This is what we have in our plan. This is the way we select the assets. So again, I know that the reputation of this renewable business is not very high in terms of profitability, but the way we select our portfolio is to fit with our agenda, okay? So that's my question -- my answer. I hope it's a good question, but the way I'm lot surprised there's a question, okay? But it's also true that if we want initially to keep the discipline on oil, we need to continue to be -- because it's not true, but will be at $100 per barrel forever. I don't repeat the same mistake that we've done in the past. That's also part of our agenda.

Martijn. Martijn, go ahead.

I only have one question. So quite a lot of what we do is just sort of interpreting the signals that you're sort of sending out and trying to read between the lines a little bit. And an interesting one is the objective to have zero balance sheet gearing. And I think the traditional interpretation of that is somewhat defensive as in -- it feels a bit like battening down the hedges, in for some tough time, we're better pay down the debt whilst we can. And I'm sort of just trying to understand -- I just want to make sure that I understand the objective to have zero gearing. Is it sort of -- you think we're really entering some tough period and is better to remove the debt from the balance sheet? Or is this more of a -- well, we can pay down the debt and there'll probably be some opportunities. But really, the debt capacity of Total remains unchanged in the long run? Can you sort of put the target to have zero debt in a bit of context?

But even to have positive treasury, I said. So it's not a question of defense. It's a reality of what is happening today. I think it's given a huge flexibility to the way to think to the future. It's because we know there will be volatile environment. So again, I would have been in such situation in 2020 when COVID came. We have no hesitate to continue to develop the product strategy where our brand should stress. So the lesson is that there is volatility. So today, we benefit from very high environment, cash. So having a company -- again, it's -- I think it's a full message for me. It's changing a lot the way we think the future of the company and the flexibility we give in particular in both investments and return to our shareholders because, again, we know that even if tomorrow price will go down to $50, I don't know which crisis, a huge financial crisis on the markets, which is possible, we are in a strong situation that we could use the balance sheet to go through the storm, which was not really the case in 2015 when we are at quite a pile of depth and 30% of gearing. So I think that -- so for me, it's not a question of defense. It's a way to be even more offensive on both sides, return to shareholders and investments. So it's something that we did not anticipate. It's why we use the world New Era because we don't think in a holistic approach of the way we think the TotalEnergies is the same way than before. And I think I had some of my peers, U.S. peers were in that situation in 2015. I think we were much more comfortable for them to deploy the strategy and where we were when we're at 30%. So that's a lesson. So let's benefit first from, I would say, this additional surplus cash flows to deleverage the company. And I think, by the way, that's the first point. That's -- so you can see that defensive. I see that more as a capacity to be offensive through the cycles because in a company -- in an energy company, we invest in the long term. And what is always difficult to manage is volatility in our investment policy. You dream to be able to go through all volatility in return to shareholders. I think we suffer to have a sort of volatile. I remember in this room, in 2019, we announced an increase of dividend for 5%, 6% per year, by the way. And then COVID came and we scrapped, we maintained the dividend for sure already an effort, but we stopped what we announced. And so -- and so that I think is not very good, including for investors. I prefer to be -- maybe to have this position to have a sort of message for the cycle, which will be better because this is an industry where we need to also to be able to -- we know that we face volatility and that the investors have still these companies being able to spend a lot, then not to deliver what they return they announced -- so this is for me a unique opportunity to enter in a more stable framework. That's what we want to do. And to face -- because I'm sure that we had COVID then we had Russia and we don't know what we'll have next year. Inflation, macro environment will face crisis. But the company is much stronger with a low balance sheet. So for me, it's -- maybe defensive, but defensive to be more offensive in fact, to maintain the strategy to develop the strategy and the returns.

Okay. Oswald, yes, please?

The first question, just on renewables again, 10% return on equity. And I just wanted to see if you could tease out an investment like India, Adani, $2 billion in them. I noted recently, one of the credit rating agencies were saying Adani was deeply overleveraged. So I just want to think how do you convince people that if you pull out that project, that's a 10% return on equity project. Could you walk through the steps of securing that? What -- who are the customers on the other side of that, that really secures that project, please? And then secondly, just on LNG. I know we're talking about ex-Russia today, but we still have [ Yamal ] to think about. I think you pointed to being more or less unhedged in 2023, but how should we think about you placing those cargoes over this 5-year strategic window that you're talking about today, please?

On the second question, again, you know the position is as long as Europe does not sanction the Russian gas, we have no way to escape from this contract. So we execute the contract. What we've done in this presentation is excluding all the cash, which could come because what we think that things could change because as soon as Europe would sanction the Russian gas, we stop all this contract. We have contractual clause. So that's my point. So again, I think what I observed is that this lower unfortunately could last. We are entering into something which is more and more complex. But on these aspects, we are -- I would say we are monitoring that according to the European regulations and sanctions, and we will obey to that. If we don't have the volumes, we don't have the volumes, that's life. And what we'll lose it, but that's a lost opportunity. But I would say there is no way for me -- for us to not to obey to all these sanctions. At the same time, as long as there is no sanction, we have no way as well to exit this contract because it's a huge liability. On the first question, Adani, I think maybe we should make -- explain you the Adani Green model, but you know Adani has a -- Adani Green because its Adani and Adani Green, where we are investors. There are some contracts with some Indian CFDs, I would say. And Stephane could answer to that question more extensively. But I think honestly, there is a way to do it, which, by the way, we have begin to do is to just to -- I'm not sure we'll keep the 20% for long. If you managed to monetize part of your equity that we invested that and you -- and you value term. It's a matter of monitoring that. So it's a source of potential cash. It's not a growth. It's not a question of volume. For me, it's a question of clearly docking the value. I mention that, of course, we take care of the position of Adani Green as a company. And I think the balance sheet for me is safe, but maybe Stephane wants to elaborate on the -- I think maybe the best would be to -- I take the point, but to give you more information about the portfolio which exists -- existing portfolio. It's not a pile of that are developing projects and which have some revenues, which are, I would say secured, it's in [indiscernible], you take the [indiscernible] risk, like always in electricity, you take the local exchange risk. But I'm not uncomfortable that is the valuation of $10 billion for 20%, the right valuation, but we'll be more prudent. I'm observing that is back to what -- it's back to something more fundamental. What are the markets are valuing a lot this type of renewable company, the Indian market, by the way, more than others. But including here, and that means that, as I said, 1 day, it's difficult for us to make any transaction unless we have some specific access to that. So I mean, it's -- we -- I'm not convinced that the valuation we made so high for long, but between 2 and 10, we have some room. And I think that if we would like to make some of the -- transaction of some of these shares would accept a lower price, okay? But -- so the 10% on this one, I think it's a question of liquidity of investment, okay? Because what is true in your model again, as there is a lot of debt, you don't have much dividend. So we see probably your question. So to ensure you -- so it's part of our model, and we intend to dedicate part of the holding to ensuring the return.

Bertrand Hodee, Kepler Chevron. One question on the shareholder distribution and the dividend again. I appreciated you move now dividend as #1 priority in your financial framework. But why haven't you raise a step-up given the dollar strength knowing that your cash flow is in dollar. And also why haven't you committed under, I would say, an oil price scenario to a dividend increase, 4%, 5% over the next coming years. I haven't seen any numbers. So I -- you hinted some gross, I think at Q2 conference call, but I didn't see any numbers.

Because last time we committed to a special figure, we lose 5% because it could be perceived as too low. So we are committed to distribute 35% to 40% of the cash flow. We have a cash flow growth, which is giving more 5%, represent $400 million more or less. So why should I limit you today to 5%? So we just give you a lot of information. So I think it's more important for me and for the Board to have a conviction to deliver 35%, 40% of cash flow payout but beginning to say and all the [indiscernible] -- you know we are French mathematicians, I know. Last time, we've done it, 5% per year. Proration of the stock market was not so good, because some people think why do they allocate only 40% of the cash increase to that. It's because we are in a world where the volatility of the market, they are entering into high price. So maybe it will be higher than that. And so that's the reason why. And so I prefer to deliver to you that we'll target 35%, 40% of cash flow payout, which is again for -- in the history of the company, a strong commitment to the market, when the beginning to the year, it will be [indiscernible]. Let's give some flexibility between the various instruments. We put dividend first, like you remark. So it's a strong message, I think. So that's the reason. Very simple. And that's the point?

Amy Wong from Credit Suisse. Thanks for the deep dive on your U.S. operations. Let me switch it over to that a little bit. Just wanted to get your thoughts on the recent Inflation Reduction Act and what that does for your renewables and low carbon business in the U.S. And then the second part of that is you've got -- you said I think you mentioned about 12% of your capital employed is in the U.S. So what's your appetite to raise that exposure in this country?

Normally, we have a policy, which is not to have more than 10% in 1 country, because of geopolitical risks. There is a risk to invest in the U.S. We have lower risk in the U.S., it's not a geopolitical risk, it's more lower risk. But again, no, we have some appetite -- on LNG and on renewables, we can do -- renewables to be honest, we have already in 2 years, made quite a big step. Now I think it's time to deliver all that. So I will be very transparent with you. We have the opportunity. We identified very quickly in the U.S. as a strong market, reinforced by the Biden act by the way, because we have some, and it's quite efficient what you do in the U.S. It's simple and clear. It's through fiscal incentive. You can calculate easily -- what you do is not so complex that sometimes in Europe with CFDs and complex mechanisms where the states could come back on their commitment. Of course, Biden act has given some perspective of it. So I think it's given the only other -- but in the U.S., if you want to develop this renewable and electricity business. Of course, you have to face merchant, to invest in storage and to be along the chain. Otherwise, you could be trapped in something not enough. If you were only limited to renewables it will not be enough. So maybe the next step for us will be to reinforce in the U.S., I would say the other speak about flexible power, et cetera, in order to establish this value chain. LNG, we can do more. we are looking for opportunities, to be clear. Because you have -- and linked to LNG, there is a question mark for us about gas production because if you control your gas cost, it's better than if you buy and [indiscernible]. But there is room to do more. I think you have a huge resource base at quite a low cost. We are comfortable with that. And that's -- and the U.S. well located to arbitrate between Europe and Asia. So we are looking to -- if we have opportunities to go beyond Cameron, we'll do it. So it's a question to find the right one, knowing that we don't want to be only off taker, we like to establish the integrated position. So it's -- we want to be equity holder of the plants. We don't want to leave some money to infrastructure funds, which we have quite high returns. So that's the position. So we are looking to that. I said it's more cater and more U.S. than I answered to LNG.

It's Lucas Hermann, Exane BNP Paribas. Two, if I might, Patrick. The first is broadly windfall taxes. Just how you've incorporated them in the cash flow outlook. I mean conceptually, there's nothing there by 2027, but then it's [indiscernible], it's windfall taxes. So who knows -- and the second was just going back to Russia. Firstly, just to be clear, and I want to understand the cash flows that you expect to derive from trading the offtake from Novatek or from Yamal is excluded from these numbers. But secondly, in the real world, that cash flow is still there. So how should we think about the excess that you are generating? And I mean that is -- and I guess the question that ties with that is how much of the cash left are you receiving cash? Do you still expect to be able to receive cash from Novatek, be it by a dividend from Yamal, be it via dividend, could be it via trading LNG, I think the latter is obvious, but the other 2 just some guidance as we strip everything out.

But it's not easy to receive some cash. That's why we are prudent as well in our expectations, you know, we are -- lesser financial circuits between Russia and the rest of the world are leaving complex for Western companies. So to be transparent, yes, we have received something this year, but I see some complexity months after months. I'm not convinced we will continue to have any flows of Russia in the months to come. Now in Russia, we have been proactive and we don't just wait. We have divesting. We have said that we progressively will exit business. We have done it on [indiscernible], we have done it on [indiscernible]. So it takes time. Our positioning allow us to find a way to make this transaction. But again -- so it's why I'm very comfortable not to plan anything with Russia because I'm not convinced that in the cash flow that we managed to get at the beginning of the year will continue.

Windfall.

What is included in all that is the windfall from the U.K. because we consider it will be maintained. In fact, just because we know that even -- the U.K. has a lower taxation when prices are low, they increased the prices are high. It's quite impressive what we'll pay this year because the gas price is so high, but of course, the sensitivity that I gave last July, $500 million was...

$15 million [indiscernible].

$15 million, but if the price is higher, we'll pay more, obviously. It's quite proportionate. And so that's something -- it's -- no, you have this big debate but, in particular, in Europe about windfall taxes. You can see that I'm pricing against the ID that they should be able to tax refining business. We lose some money. So I'm trying to -- we have some support from some government. We have these European initiatives, which, by the way, for us, would represent something today around, let's say, EUR 1 billion on this year. It seems to be because of the legal basis of this Europe initiative is quite narrow. It's -- really, they are using an article of the treaty to make a contribution. It's not a taxation without the unanimity of the country, which is -- they would not get unanimity probably only to answer to crisis, which means that it should not be a permanent one. It's a difficult debate to be honest, because we -- of course, we explain to everybody that European policymakers that -- even a more today when the day we make money, why do we want us to invest tomorrow, and we will not -- we will remember that. I was very clear on the Front National Assembly. Having said that, that's the debate, not only in France, in many countries. Today, they are all looking for money to finance their rebates or blocking the electricity, gas price, subsidizing for side fuels despite what we explained to the world that it's not a good way to work, but we do it ourselves. And they like to finance that. Remember also that all these governments have spent a huge amount of money during the COVID period, not for us because we use any support for many government, but -- so they want to recover some cash if there is a temptation. We have to fight against that something reasonable -- has to be outcome. We prefer clearly a European framework when something which will be country by country because it's -- I think it's better. There is probably -- but I think the debate is there. It's a political debate. And you see we have made some -- on onset some initiatives, for example, to make some rebates at gasoline price. It's a huge success in France, at least popularity of TotalEnergies is growing up. I can tell you. It's a huge communication investment, we lost only 2 months. It has a cost. But I think it's also maybe a way to politically to say, okay, look, for the customer point of view, citizens, they see part of the super profits, which are far from them. So it's difficult to avoid the debate and to be -- and again, the main answer is to explain them that any taxation will influence the way we locate our capital. That's the main answer. By the way, part of the answer to come back to Christian question, I think the good answer for all energy companies politically is also to invest in new energies. And I think it's also part of the answer. I think it's a way to protect, I would say, for me that's the positive answer to them. It's whatever them, okay. Look, -- we have this cash. But today, we continue to invest more and more. By the way, when I'm looking to the, I would say, French companies, for example, European companies, $4 billion today this year, we are quite a large investor -- so it's also the best positive one. Doing that, we can protect, I would say, the cash flows coming from the -- and trying to avoid this type of taxation. So that's a positive answer for me. And I prefer to keep in the company part of this value, but now it's going to grow the taxes but state budgets.

It's Biraj Borkhataria at RBC. Two questions. The first one is on your LNG business. As you're looking to expand, I was wondering if you can talk about some of the behavior you're seeing from the buyers because there seems to be a bit of a contradiction, particularly with the European buyers on their willingness to sign kind of long-term contracts. And Asian buyers tend to be more price sensitive historically. So any commentary on -- color on that would be helpful. And the second one is going back to the capital structure, pointing to zero financial debt, but you also have hybrids in the capital structure. I'm wondering if you're thinking about higher for longer commodity prices at least for a couple of years. Is -- are those still required in your capital structure at this point?

But our rates are at a 2.4% [indiscernible] or do you want me to -- when interest rates are growing up to have this cheap source of -- I'm not sure to fully understand why I should do that now.

[indiscernible] other than the expensive.

So yes. So first, so that's my answer. On the yes, it's true. But let's -- fundamentally, our belief, my belief is that and I think strongly believe who will need gas for a long in this planet. Maybe it's difficult to say. LNG and all that. Even Europe, there is no way to make a reliable electricity power system without combining renewables and gas-fired power plant. You could make nuclear. Otherwise, you make coal, it's coal, but you need to have some, I would say, flexible power plants. It's just a fact. So I know you all are saying we would like to get rid of it, but it will take a long time before to do that. So I think we should -- and I know that -- so -- and when discuss the government, of course, there is politically something strange that they want to say, no, we'll exit for side fuel. But the reality of the planet is today, when we went -- when they announced, they are so afraid to announce to customers that they could have some limitations in electricity or gas supply, but they are easy to pay any price today. So I think this is where a company like TotalEnergies must have a longer view. And my long view is that these LNG markets is therefore continuing to develop on the long term because it's connecting the markets. One of the points which might be difficult is not Europe. It might become -- of course, in Europe, one of the demand factor, which could disappear in Europe in the long term is the industry demand. I'm afraid to see the impact of these high gas prices, high energy prices, on the -- it's not my business in industries in Europe. And I think we will see some disruption because you had -- if -- I mean, I don't know if it's politically correct, but clearly, the Russian gas was a source of competitiveness -- but low cost in Europe for many industries, not for us, but for any industry. This source disappear. So I think this manufacturing business might relocate their business by the way also in the U.S. It's we'll see some trend. So that part of the question about the assumption of 3% per year of decrease of gas demand is maybe low at this price. If you make 5%, could go quicker. The other point on this one is that, yes, you're right, the emerging countries, Asian countries have much more pro-sensitive to price. And that's something which for me is more complex to maneuver, which is in this business. We might make see some demand destruction also in Asia because of these cash buyers losing trust in the fact that gas is well fitted for their economies. I'm thinking to India, where clearly, for them paying more like $6 -- $5, $6, $7 per MBtu is too high. The economy has not supported today. And we have something to be careful, which is, of course, in the LNG business, it's becoming a seller business today. I mean -- so I see some trends to the famous percentage of Brent, 10%, 11%, 12%, I'm -- [indiscernible] 13%, going come back to 14%. All that, maybe it's good in the short term, I'm sure it's good for the long term. And we have to be careful not to afraid some customers, but -- by the way, a percentage of Brent today is better than linked to a GKM or I don't know which gas index. I think, by the way, the lesson for buyers should be to mix Brent gas index, not to be only related to one to go fully. By the way, it's a lesson for Europe as well. In the past, we had some Norwegian gas contracts, which we are linked to oil. We decided to move all of them to spot index to TTF. Today, Europe is paying the price, and they want to cap the Norwegian gas price, which is another strange mechanism. So that's -- so again, I think the gas demand in Europe, if there is an issue, would be more coming from the manufacturing base for Europe where you could see some distraction rather than some policymakers because -- policy, again, there is still some coal in Europe, which has to be shifted to something as a natural shift is to gas. And when these regas terminals will be built in Germany, of course, maybe there will be too many capacities, but they will use them. And not only to make hydrogen in the long term, gas will come.

A question on that side? Henri?

Two follow-ups, please. First one, again, on the financial framework, and you commented earlier about the capacity to be offensive with a stronger balance sheet. And I think Patrick during the presentation, you said that 40% that's something that could maybe go above at some point. So how should we think about that with maybe the balance sheet going into net cash then need to be looking to return more to shareholders? Or do you balance that this is CapEx at soft saving on the shorter returns and more of a [indiscernible] CapEx, and then second one, following up on LNG. You mentioned earlier that you're interesting adding capacity in the U.S. Is that just in the U.S. or will be looking to portfolio also outside of the U.S. on top of what you've already done in Qatar.

No, first question, please, we announced 35%, 40%, okay? So immediately, why don't we more, okay? It's a permanent -- so let's stick to what we announced today, which I think for me is a good step forward to our shareholders. First time the company is committing and writing to that level. Again, I didn't want you to take it when we monitor between both and to take the 40% as a limit. It's why my comment is not a limit. It's just a range that we target. And we don't know exactly what will be the cash flows we have to monitor that. It's -- so that's the spirit of it. So I just want to -- don't take that as a limit. If it's no limit. It's just that let's deliver the 35%, 40%. It's already better than what we've done in the past. So it's a positive message. Again, if I am in the world of $100 per barrel for many years, high gas price, your question will be valid. Let's look. Look, barrel of -- price of barrel begins to decline. We maybe enter into recession next year, its high possibility, you could have a financial market crisis. So what I'm paid to know that newer tool with linear future is far from what we observed in terms of many, and that this world is going from one crisis to another crisis. So it's not because so I'm happy to look to what is the situation today. Let's see, step by step. And if we have to, can do more, we'll not object to that, okay? The second question was about LNG. What are that place of LNG who holds LNG today. It's -- you exclude Russia, you have Qatar, Australia, U.S. and then we have our portfolio with P&G with Mozambique in which we can work. If there are opportunities today, it's more in the U.S. than elsewhere. I think there are more projects being developed here. So the question is to find the, I would say, the -- it's a question of cost as well for me because we begin to see some increase in the CapEx, including here because you have a sort of overheating of the Downstream business, not only because LNG is linked to refined biorefining. It's the same type of contractors. So you have some overeating. So let's find the right opportunity. And from this perspective, I would say that brownfield projects are better than greenfield because if you have -- when you have to pay the whole infrastructure it's already more expensive. But if you have any ideas, I'm to give it to me because we can be proactive on LNG. I'm ready to take your ideas.

Ryan Todd at Piper Sandler. Maybe a question on the renewables business. If we look versus the guidance from a year ago, the CapEx over the multiyear plan on an annual basis is maybe a little about $2 billion a year higher. And the gigawatt of capacity adds certainly at least on the electricity side and the EBITDA targets are effectively unchanged. So -- as we think about the incremental spend versus where we were a year ago, is that predominantly cost in place that we're seeing? Is it a different mix and where the spend is going? Or is it timing of when kind of the capacity and the EBITDA generation come on stream? And then maybe one follow-up. If you seem fairly comfortable with at least some level of merchant exposure going forward. Can you maybe talk a little bit about your appetite for merchant exposure on the power side and the role of the power trading business. I mean it's certainly profitable as we see in the LNG business, and it's time like today, it's hard for us to forecast certainly. But -- so I guess, appetite for merchant business and trading within that as we think about kind of the certainty around that cash flow stream going forward.

I'm trying to guess your $2 billion because honestly, it's not linked to inflation. It's more linked to activity, potential activity. I'm not sure to understand where you come with your $2 billion. It's because you take the maximum multiply by 33%, but in the 33%, you don't have any renewables and electricity. Last year where the guidance was given on 25% out of 16 only on renewables and electricity. In fact, you have more or less $1 billion there. You don't have $2 billion. Because as I said, we are also allocating part of this 33%. You have the carbon reduction program, the energy efficiency and you have the new molecules on which we make some additional, I would say, investments in biofuels, sustainable [indiscernible] or biogas. So maybe the -- if we had given today -- I mean, just I think we'll have to keep 25% in renewable electricity and 5% to 10% in new molecules and overall reduction -- carbon reduction programs if we would have given the user split between both we decided to aggregate them in a sort of surplus. So for me -- so it's not linked to inflation merchants. In fact, the idea is to more or less what we've done, by the way, historically in LNG is to have to keep in the unregulated markets because it doesn't work in regulated markets. In unregulated markets to keep 30% more or less of the portfolio being merchant. And we begin to apply that to some of our portfolio, for example, in the U.K., our first offshore wind farm, [indiscernible] Scotland. We decided not to apply for CFD, which were at a very low level. We applied for CFD to a high level because we didn't want to lose some value and we are comfortable to manage part of this merchant exposure. Of course, might face some difficulties, but when you commit to the CFD at today in Europe or something, let's say, EUR 50-megawatt hour on average, look to where the market. So it's fundamentally what do you think is a perspective of this power market in the U.S. or in Europe on the longer term, knowing that we have to invest heavily in those markets and that intermittency will create some problem of supply and less wind, not enough solar less side or all this. So it's becoming a business where volatility is probably, I mean, on a pace which is quicker than the oil and gas, but which could offer some opportunities. I would also say that when we invest in offshore wind, to come back on your CapEx. Offshore wind is more CapEx intensive than the rest of the renewables. So when you want to develop -- and that's, by the way, a strategic question where we are not so clear what is the real amount of offshore wind portfolio we want to have because all that it's like E&P. It's you explore, you invest money. And the cycle on offshore wind is more 8 years, 8, 10 years than 3, 5 years like onshore, solar or onshore wind. So of course, the exposure in terms of CapEx is higher. That's also part of the -- and by the way, like Jean-Pierre said in an answer in his comments, on the U.S., we will make JV revolvers, we will not keep, there is a license 100% because the exposure would be too high. And I prefer in this business like in E&P to have 50% of 2 projects, 100% of one project in terms of running the risk is much better. And even 3x 33% is a high better for us than 100% or 2x 50%. So that's also an approach to implement.

It's Peter Low from Redburn. Just a couple of questions on some of the guidance you put out today. So the $4 billion increase in underlying cash flow, you're guiding to by 2027, does that exclude any contribution from oil sands? I'm just trying to understand if it will be higher and closer to the $5 billion you talked about last year without that spin-off. And then the second question was just on the $1 billion. You're spending a year or increased investment, I should say, in carbon footprint reduction programs. To what extent is that investment just offsetting higher energy and carbon prices? Or will there actually be operating cost efficiencies and potential revenues from things like CCS and native solutions that are from that investment, too?

So yes, this is excluding oil sands. We consider that oil sands as we announced, we want to make this spin off. So it's excluding last year, it was still there, but it's not here. And you have also Russia out. So in fact, when you -- at Canada plus Russia out, the $4 billion compared to the $5 billion is quite -- is not unfavorable. In fact, I think -- and again, we take assumptions $50 European gas price, which today are be considered as low. So that's clear. Second question. No, fundamentally, at this horizon, there is not much revenue, but it's mainly -- it's an investment which is -- but when we invest in energy efficiency, when we -- at $100 per ton of CO2 taxation, I mean in ETS in Europe, you save some money at a certain point. So all that is as a return the point. So obviously, the energy costs being higher. We have a benefit on one side, which is on our business side. It's good to control the costs. I mean, CCS revenues has risen -- CCS revenues for me it's -- we will invest in some projects, but they will come beyond 2030. So I'm not expecting revenues at this point, okay? But it's important if we can manage our costs, including our CO2 taxation, remember, we use $100 per ton, by the way, in the European market at that level today. Yes.

Irene Himona, Societe Generale. I had a couple of questions specific to Europe, if I may. Obviously, there is an energy emergency, there is massive intervention subsidies, windfall taxes, a lot of short-term actions. Is this situation perhaps impacting at all to the appetite to grow or not renewables in Europe. So how do you see the European renewables opportunity? And the second question, can you give us a broad number, just a ballpark number for the cost to the company this year of the combined windfall taxes, EU solidarity tax cost of French discounts, et cetera?

It's a good question because, honestly, looking to the government, manipulating, I don't know what, but electricity market design and a little -- we are -- I mean, it's a good question because we want to understand where they want to land. And it's true that the European government seems in this -- and I'm a little afraid that the short-term panic could let them to take actions, which could be detrimental to the global framework, which is not the case in the U.S., by the way. And so that -- so the appetite to renewables in Europe is also limited. In fact, I mean, it's not -- it's limited by the fact that it's more costly to develop there because all the projects are smaller, I would say, except offshore wind where you can see some size. The others are smaller. And so there is a lot of competition, it's smaller. So it's less efficient, I would say, than in other parts of the world, I would say. So -- but again, -- when I say it's unregulated market, I would like to be sure that the power European market will remain unregulated. I don't know what they -- but I think they don't know themselves, to be honest, there is a lot of -- so that's part so it's a very sensible question, I would say, and we have to monitor that. On the second one, the Sun. Again, the Sun, the U.K. will depend on the gas price, but let's say it's more probably at the end if we are more a $30 per [ MBtu ] about 15 -- it could be [ $1 ] billion maybe -- it could be $1 billion. But again, the revenues are higher than the taxation, so we keep part for us. But I mean, it's a question of -- it's the difference between how much do we get how much we pay. It could be $1 billion. And the European taxation -- as it is framed today, we evaluate that around $1 billion contribution in Germany, Denmark, Italy, Netherlands, Belgium, France, 6 countries. And our voluntary contribution will be around $500 million, more or less. It's becoming a lot of money. But as I declared to National Assembly of France, if there is a taxation, the voluntary contribution might be stopped. Yes. True.

Paul Cheng, Scotiabank. Two questions. Patrick, can you talk about the inflation pressure you see in your system outside the U.S. Have you seen any major pressure point? Secondly, in the sustainable aviation field you're talking about focusing on the feedstock in ways we see -- just curious that what kind of technology you guys are targeting? Are you using the [ HEFA ] or that you're trying to use FT or the other technology, what kind of ways that we are talking about -- and how you're going to be able to acquire that?

Bernard will answer to the technology. I think the first one, but Bernard can take -- you have the real answer specifically. On the first question, which was.

Inflation pressure?

Inflation pressure, yes, we've seen -- we begin to see -- we see it, of course, in all these renewables is clear, but you have a lack -- it's a product supply chain. I mean the urgency is to develop alternative supply chain to the Chinese supply chain, otherwise, will be trapped. That's clear. But then, again, one way to tackle the inflation, and we're implementing that is to massify the way we purchase for ourselves. So today, what we are doing at the global level is we have many projects around the world that we -- we use our purchasing power, I would say, to go to the markets by making some long-term massive purchasing of solar sales in order to diminish the cost. That's the way to do it. Then -- for the time being, we didn't see too many inflations in the oil and gas business, but I suspect it would come because the story will repeat again. Remember, in 2005, when the price beginning to come, we were up. The costs were much lower than today. And -- and then, of course, the contractors begin to say, we want a share of the cake. And not only the states who want to have windfall taxes but ourselves, we would like to have a better thing. It depends on the segments. And there have been some consolidation, so we might face, in particular, there is a competition, which will frame a little between offshore wind and offshore oil and gas. The same contractors today are working for both segments. The reality is that they lose a lot of money in offshore winds, so they begin to be cautious, that might, in particular, on some instruments, I mean, some heavy lifting capacities or elsewhere, we could face some inflation. And I observed that some of our nice trends of the drilling services, announced that they want to increase their price by 10%, 15%. So it's something that we'll face for sure. That's why we need to act and to deliver a message of discipline. But it's also some time. You know I can tell you that we are not obliged to accept all the inflation we faced with Nicolas a question of ordering the steel for pipeline [indiscernible] pipeline. People explained us that we had to accept 40% increase or more -- we said, no, let's wait. We are not in a hurry. And we have -- without delaying the project, we can more cope with it. So -- and let's organize a better competition. Let's open the scope of suppliers, not only 1 or 2, and I understand that we are in proceed -- it was probably a tough but wise decision because the price of this is increasing. So I think that is also a lesson for me, which was -- it's a lesson taken from the year 2010, 2015, where we were so rushing to volumes, but we are ready to accept any cost make the project. And at the end, we had with white elephants that we had in the portfolio in [ '15s ]. I can name the project in our portfolio. Where, of course, after that, it was a burden. And so the rush to volume, it's for me the key things to avoid. It's true for renewables. It's true for Upstream. So -- and I know this is why also I'm a little prudent about increasing oil to come back to Christian question, which is a perfect sensible question. But I know that we'll face again inflation. And we have to be careful not to rush again on the volume. So I'm more comfortable today to say I will maintain my production and managing the costs rather than beginning to say, we have to do it. We have this Block 20, Block 21 project in Angola. People begin to tell me, we will have to accept your $20 threshold is too tough or your $30. Yes, but if we live through the discipline, it's a whole mindset and spirits. So we are not driven by volume. And that I think the key lesson we should keep in mind from the year 2010, 2015. And otherwise, there is no way we will -- this inflation will come, we'll accept it. And the more we accept the more we create a vicious circle. So -- and that's, I think, for me, the duty of the top of the company, myself and my colleagues. I know it's tough because already they all want to push the project they are paid for that. But if we don't respect the budget we consider are right, we have to say, let's wait [indiscernible] will not disappear -- again. And we have -- I think we should not underestimate as well that in this business. TotalEnergies is one of the company who have a purchasing power. We can also because they like to have orders from us. We are reliable customer for them. And so we should not underestimate that and be ready to open to -- diversification of the supply chain is clearly something on which we need to work. But I mean -- and I know when you look -- you know when we are embarked in this battery business. I begin to see some all these raw materials, copper is becoming something we'll begin to hear from customers, but they might face a problem of delivering copper -- cable copper for electric cables. It seems that they begin to see a shortage of that. I don't know if it's true maybe they invent the shortage to make to increase the price, but we'll have to become more expert of all these raw materials to be able to challenge them, by the way. And it's true, but we are increasing our dependency on all these materials today -- minerals sorry.

To answer the question on the technology or sustainable aviation fuel. But HEFA, which is the most cost competitive technology. The 2 others you mentioned, [indiscernible], there is a factor of 1.5 to 2 more expensive than the gasification, [indiscernible] is factor 3. So by far, this is the most competitive one.

This is what we invest.

I'll ask about Suriname, because I think you told us too.

I was trying to avoid the question.

Well, all right. You read it wrong. Is there a scenario where its commercialized and developed as a natural gas asset or so you're just only...

No. Listen guys, no gas market. You should find it to give me the idea. No, honestly, it's no. And no, I don't see it. There is no domestic demand. If you want to go to Trinidad, you have to cross the NAS Venezuelan Waters look to the map. So you could avoid it. No, I think it has to be developed as oil and recycling gas. That's the base scheme on which we work. And the question is to find oil pool, which allows to develop an efficient oil projects. I'm -- it's more today, to be honest with you, it's more a question of -- we are drilling. We made a lot of discoveries, but we have a problem of predictivity of the seismic. The appraisal wells are never fitting with our expectations, which is strange. It's the first time. So there is a lot of [indiscernible] but -- and productivity is important if you want to develop a field. We need to be able to -- we commit some CapEx. That's a part of the reservoir engineering, which is difficult today. But we have some wells going on and the objective is to be able to have a project by middle of the year.

Sorry, maybe one more because I was short. But you had a quarter a result earlier this year where your power margins went down because of price controls but your overall segment results in the gas and power segment were up. And that is good because it demonstrates the value of integration, but it's also good for consumers because you could absorb price controls, whereas an IPP would probably go bankrupt, if they had their margins compress in half. So the question is, is that benefit recognized by any policy makers and do you anticipate European policy or broader global policy kind of recognizing and making more room for an integrated model because you've sort of had a proof point earlier in the year?

Stephane, you have an answer, if they recognize anything today? I'm not -- I mean...

Yes. I think that there is a recognition that you need to have big player to ensure security to supply to the end consumer and that going through the crisis, many players have disappeared. So I wouldn't be too surprised to see some rules put forward by regulators saying you need to have next balance sheet to be able to do that. And so going forward, you should see less competition on the Downstream.

That's clear. I fully agree. No, it's a good point. I think, yes, the integration is giving -- and the big difference between us and some of the IPPs are more as well, the size of our balance sheet. We are able to absorb this type of shock. Today, the European markets of gas and power are facing problem of liquidities, because you have huge margin. Of course, we, in this business, have some ways to manage all that, but others do not have. And so that's also part of it. The integration is clearly probably securing some, yes, having said that, they always make a difference. I'm surprised, strangely, but these policy Americas are making the trend between gas and electricity. We try to separate. There is a real difficulty to be honest for them to understand that all that is interconnected. They want to disconnect as if -- because electricity is a local energy and gas are world markets, so our continental markets. And in fact, it's really interconnect. You cannot manage one without the other. So this way our positioning is probably better.

Jason Gabelman from Cowen. 2 questions, one on the power growth. In this environment, is it -- do you see any challenges to growing just given the volatility in power prices and inflation on the cost side? Does it make it more difficult to kind of agree to PPAs and get projects off the ground. And then the other question, just maybe an easy one to answer on cash flow growth. $4 billion a year is what you outlined. If I add up all the numbers from the segments, I get to something closer to $5 billion, maybe above $5 billion. So I don't know if you built in some conservatism in there or if there's some offset? I know you mentioned the U.K. windfall tax, which maybe is not explicitly in any other segments. But any help there as well.

Yes. The second one is quite easy. Yes, we are a little conservative sometime. But at the same time, I'm pragmatic. I know that is 5 years. And yes, and I think prefer -- and by the way, yes, it's a little conservative. But as there is no mathematical formula despite your neighbor question between the cash flow growth and the dividend growth, consider we have room. It's not a mathematical formula. So -- but again, we know that all that will -- it's never -- again, it's not a road map. And again, I would have surprised you that I think keeping 5 without Canada without Russia, would have been a challenge, to be honest -- that point. The first one -- I think this volatility demonstrates that the PPA business is one where people want fixed price. It's not a good idea. You need to be a little more, I would say, imaginative, creative because there is no way for us to take a fixed price PPA in the long term with costs going up and with what a losing part of the upside. So it's back to and it's back to, I think, a normal way to evolve. It has to be a little more ready, that's fundamentally, you continue to drive down the cost in that phase, it's an industry where costs will permanently go down to zero is a wrong idea. It's a wrong idea. Again, that was the -- because all that was subsidized somewhere by many people somewhere, and it's not true. So I'm not surprised to see costs going up and then we have cycles everywhere. So that means that when you sign the PPA, you need to keep -- to have formulas where part of the upside could be shared and they help to secure -- so to launch a project, but we need to find a way to a formula to keep the upside. Stephane, you want to comment on that?

No, that's what you say. What -- in the recent PPA we have signed, we start to see clever signs a just a fixed price [indiscernible] corridor, the upside on merchant price and so on, that's one. Second, what we see is that clearly PPA price are increasing because inflation raise and costs, it's coming. And to be honest, even some projects that we have signed, we have been able to negotiate -- to renegotiate them, because the demand for green PPA is much higher than what the market can offer. So yes, on one side, you have a cost increase. But on the other side, you have a demand growth as well.

I didn't hear the voice of Kim.

This is Kim Fustier from HSBC. I was just wondering, in terms of the 100 gigawatt target for renewables by 2030, how much of this target is already secured in your portfolio? And could you perhaps talk about the bridge between where you are today and how to get to the 100 gigawatts? And my second question is on power prices. I mean you disclosed your assumptions on oil prices, gas prices, refining margins, but you don't disclose your assumptions on power prices specifically in Europe, for example. So without talking about specific numbers, are you able to just give general thoughts as to how you view the current forward curve in European power prices, which is at unprecedented levels. And how you think this is going to shake out and particularly the uncoupling between gas and electricity?

But power price for us, we still believe in the connection between marginal prices for the gas-fired power plant. So it's quite easy. When I use $8 per MBtu you can derive what is the electricity price, which is there. It's -- you multiply by 3. You multiply it by 6, in fact, and you add the cost of CO2, so reach something like EUR 70 -- or EUR 70 per megawatt hour. But there is a -- we still consider despite what I hear, but it's the right way to price electricity. Might be higher, but let's say it's -- sorry, it's a little conservative, but it's linked to be dollar, okay? Why a dollar value, I did not recommend it. It's just that, okay, don't consider we use $8, that's why it's conservative because for the next [indiscernible] told you, for the next 3, 5 years, with all what we see in Europe with lack of regas capacity where LNG supply, which is stretched, would be surprised to see $8. $8 is more a long-term view. But in a stable world, if you have enough LNG on this planet, then the gas price in Europe should be driven by the cost of U.S. LNG going, coming, going to Europe. And when you make the math, you find $6, $7, $8, I mean, $8, but it's conservative $8, which is, by the way, a fundamental shift before compared to last year in our assumption because last year, we were using something like $5, I think, just because we had the Russian gas in the system, when you eliminate your Russian gas, you have much more LNG coming to Europe. So that's changing a lot, of course, the perspective on European gas. But I would be surprised to see $8 next year. I mean I'm more betting, I don't know, 25 or something like that, then $8. $85 that means that for electricity around but the famous 180, by the way, that the European wants to establish, in fact, as a sort of ceiling and over which they want to take everything out by the way, the 80 -- 180-megawatt -- euro per megawatt is $25 per MBtu in fact when you connect them. The point of the [indiscernible]?

And the 100 gigawatts?

The 100 gigawatts, Stephane can answer to that. I think we are more 70 today in our portfolio, 70, okay. It's strong. We have time. But again, it's -- yes wanted to increase it. No, no, no, don't afraid. No, no, I want to keep the capacity to arbitrate between all your projects. Just to come back, by the way, this is a segment where some -- we say no to our teams in renewal bot. We see more now to our teams in renewable, but in E&P -- because their projects are not fitting our profitability targets. But again, this as earlier described to you and on the U.S. area, there is a lot of opportunity. So we have time to identify the right ones. And what I think as well, what I hope is that we are building on many more people. We begin to have quite a number of direct employees. So I'm waiting for them to have organic growth in order to create the value, and so that will be also the engine of the future growth. Lucas, you have the right to ask a second round of questions. It depends on the question. I might reserve my right to answer.

Actually, that's probably a sensible approach because it's slightly conceptual, but I think it's reached that point in the meeting. I've got 200 [ Bcma ] of gas year kind of stranded in Russia. I look at an LNG industry that clearly, there's great need, et cetera, supply at the moment. And you can see a lot of layers pushing quite aggressively try and build and construct their project. Do you worry that there's a point over the next -- lets just call it several years where some kind of a [indiscernible] unsurprisingly is reached between Europe and Russia. And that a good chunk of that 200 be -- that stranded gas starts to work its way back in -- and I asked because you can see that 5 to 6 years' time, all this LNG capacity is coming on stream, which people committed to. And then unfortunately, certainly 2030 Bcma doesn't have to be a big number, just works its way back into Europe and power.

I -- but it's a political question, this one. My view is I don't -- if we want to -- if we have to exit from this war and to find piece in our continent again. So gas business will happy to be part of the piece between Russia and Europe, but not at the level it was before, not at 150 bcm, but I will not be surprised to see 50 bcm continuing to flow somewhere. Is it LNG? Is it pipe gas? I don't know, LNG offer more flexibility to everybody rather than pipeline, which, by the way, seems to have some issues. So maybe the pipeline will -- what I mean. So -- but yes, I thought it's a -- if we are optimistic, I'm not too there because I don't see any -- unfortunately, the way it developed is quite frightening. But yes, I think gas business will come back, but not the same volume. Any other question? We are perfectly on time. Thank you. We are -- it's 12. So I think the program is to have lunch and then to come back at 1:30.

Yes, correct. All right. Thank you very much for your time and for your questions.