TotalEnergies SE (TTE) Earnings Call Transcript & Summary

Ladies and gentlemen, welcome to TotalEnergies' First Quarter 2025 Results Conference Call. I'll now hand over to Patrick Pouyanne, Chairman and CEO; and Jean-Pierre Sbraire, CFO, who will lead you through this call. Sir, please go ahead.

Good afternoon, everybody, or good morning if you're connecting from the U.S. Before Jean-Pierre will go through the details of the first quarter results, I would like just to make some few opening remarks on what appears to be today a more challenging global environment and the way that TotalEnergies intends to leverage our consistent strategy to deliver resilient results benefiting from our energy production growth and attractive shareholder returns. We have indeed entered into a period of heightened macroeconomics and geopolitical uncertainty. We've, and this list is not exhaustive, current fragile negotiations on the Ukrainian-Russian conflicts, the new but fluid tariff policy enacted by the U.S., decision of OPEC+ to unwind its voluntary production cuts. Even if the impacts are not yet fully appreciated, it might evolve in the coming months. This moving context is creating uncertainties, notably on oil demand, along with volatility in the oil markets oriented on the downside over the past few weeks and also on costs for new projects in the U.S. because of tariff impacts. In this quite, I would say, fluid and landscape, TotalEnergies has and will, I would say, continue unique strengths that we have consistently built over the last 10 years and our efforts are paying off. First of course and foremost, we have been strong and never gave up on oil and gas. We have built over the last 10 years, one of the best low-cost, low-emissions oil and gas portfolio with more than 12 years of reserve life, which today gives us substantial leverage through strong and accretive growth that clearly differentiates us versus our peers. Delivering this growth is, of course, one way to protect our future cash flows. We are growing companies with 2 pillars, including the second pillar on electricity, which is not dependent on the oil price, which give an additional resilience to our model. As you will see, with Jean-Pierre, this quarter, we delivered robust year-on-year production growth on nearly 4% in oil and gas and 18% electricity, which represents a unique TotalEnergies production growth of close to 5%. But we are also, at the same time, in control of our costs. Our CapEx first, because most of our CapEx have been engaged and are based on lump sum EPC contracts but secure the level of the CapEx. But also on the OpEx side, we have maintained in the last year despite the inflationary trends, our cost per barrel or OpEx per barrel is lower than $5 per barrel and again, this quarter. And finally, we are benefiting and our balance sheet remains strong. We are confident in our ability to achieve our growth objective for '25 and keep the gearing under control. Because we have confidence in our business model, the Board has decided to maintain attractive shareholder returns despite the uncertain environment. The Board first and foremost confirmed the first interim dividend, which was announced in February at EUR 85 per share, which is a 7.6% increase compared to '24. In dollar terms, I would say it's even more than that. It's more than 10% at the current exchange rate of $1.14. As you know, dividend is a first priority in our capital allocation framework, and we will continue to maintain and to grow the dividend in future years even in these uncertain environments. Remember that we did not cut the dividend during COVID period. After 12 quarters in a row of $2 billion more of share buyback, the Board has once again announced share buybacks of up to $2 billion for the second quarter. Despite the softening price environment, we went below $70 per barrel since the beginning of April and in an uncertain geopolitical and macroeconomic context. Just as we have done during other volatile times, the Board will continue to monitor the buyback on a quarterly basis. Within the guidance we gave to the market last September to maintain a $2 billion buyback in reasonable market conditions. And to conclude this introductory remarks, as you will see again today with our Q1 results, I think we are well equipped and well prepared to navigate in certain environments. We remain focused on delivering on our 2025 objectives and to maintain attractive shareholder returns. On that note, I will now turn over to Jean-Pierre, who will go through the details of the first quarter results.

Thank you, Patrick. So my first comment will be on the price environment in the first quarter, that was globally similar to the environment we had in the fourth quarter of '24. So Brent was at $76 per barrel versus $75 per barrel in the fourth quarter. TTF European gas price was $14.4 per MMBtu, up 6% compared to Q4. And the average LNG price was $10 per MMBtu, down 4% compared to Q4. And the ERM, so our indicator for European refining margin remained weak, averaging $29 per ton over the quarter. So in this context, the company reported adjusted net income of $4.2 billion and CFFO of $7 billion for the first quarter of '25. Profitability remained robust, with return on capital employed for the 12 months ending in March at 13.2%. Furthermore, TotalEnergies continued its strong track record of attractive shareholder distribution with $2 billion of buybacks executing during the first quarter. And as Patrick mentioned, a 7.6% year-on-year increase in the first interim dividend of '25 to EUR 0.85 per share, which is up 20% versus pre-COVID level. Now moving to the business segment results and starting with hydrocarbons. '25 is off to a strong start. First quarter production was above the high end of the guidance range at 2.56 million barrels of oil equivalent per day, representing nearly 4% growth year-on-year. Production benefited from continued ramp-up of projects in Brazil, in the United States, in Malaysia, in Argentina, in Denmark. In addition, we continued to be successful at keeping operating costs at low level. It was $4.9 per barrel equivalent during the first quarter. Looking forward, second quarter production is expected to grow 2% to 3% year-on-year, reflecting more planned maintenance compared to the first quarter, which had an impact of around 50,000 barrel of oil equivalent per day. Given the strong 4% growth achieved in the first quarter, we reiterate full year '25 production growth guidance of more than 3% compared to '24. Moving now to Exploration & Production. So the company continues to execute very well. E&P reported strong and growing results with adjusted net operating income of $2.5 billion and a cash flow of $4.3 billion in the first quarter, up 6% and 9% quarter-to-quarter, respectively. Cash flow benefited from accretive new low-cost and low-emission oil production. We generated roughly an additional $100 million cash flow above what the portfolio average would have delivered during the first quarter. We anticipate additional accretion throughout the year with the Ballymore offshore field in the U.S., having achieved first oil earlier this month and Mero-4 in Brazil expected to be online in the third quarter, both of which are adding high-margin barrels that will enhance the cash flow. Moving on to integrated LNG. LNG sales were stable at 10.6 million tons and integrated LNG achieved adjusted net operating income of $1.3 billion, up 6% year-on-year and down 10% quarter-to-quarter, in line with the evolution of the average LNG price, I've already commented. Compared to last quarter, cash flow of $1.2 billion was impacted by the timing effect of dividend payments from some equity affiliates. LNG trading continues to perform in line with expectations for '25. Gas trading results were impacted by the unexpected downturn of European markets following new elevated uncertainty on the evolution of the Russia-Ukrainian conflict. Forward European markets expect gas prices to remain elevated in the second quarter '25, in a context of inventory replenishment in Europe. Given the evolution of oil and gas prices in the recent the months and the lag effect on price formulas, TotalEnergies anticipates its average LNG selling price will be between $9 and $9.5 per MMBtu in the second quarter '25. For Integrated Power now, first quarter adjusted net operating income was $500 million and cash flow was $600 million. As anticipated, this quarter results do not include any positive impact of farm-down, which are expected later in the year. Thus, it's a matter of timing. And it's driving a 1% temporary decrease in ROACE to 9% this quarter, which is expected to reverse as farm-down will progress. Looking forward, the company is on track to achieve the annual cash flow guidance. Additionally, we are progressing on multiple fronts in the Integrated Power segment. TotalEnergies signed premium clean firm power contract with STMicroelectronics of 1.5 terawatt hour over 15 years during the first quarter. In addition, the company further deployed its differentiated integrated power model in Germany. With the launch of 6 new battery storage projects developed by Kyon, the company that we acquired last year during the first quarter and the closing of the acquisition of the renewable developer, VSB, closed earlier this month. Turning now to Downstream. In the context of weak refining margins together with declining petrochemicals and biofuel margins in Europe, Downstream posted adjusted net operating income of $0.5 billion and a cash flow of $1.1 billion in the first quarter '25. Cash flow this quarter was impacted by several factors. First one being the usual seasonability in the market and services businesses and the timing impact of dividend payment from equity affiliates in refining and chemicals. But beyond that, the macro environment remained challenged with refining, petrochemicals and biofuel margin lower than our planning case, impacting cash flow by about $150 million. On operations, we encountered some issues at Donges refinery and Port Arthur refinery that negatively impacted cash flow by about $200 million. These issues at Port Arthur have been resolved and work continues at Donges refineries. However, there are no systemic operational issues and performance was strong at other sites such as Antwerp or Leuna, boosting the global refining utilization rate to 87% in the first quarter of '25 from the 82% in the first quarter. Let's move now to the company level. At the company level, net investment totaled $4.9 billion during the first quarter, and we reiterate full year '25 guidance in the range, $17 billion to $17.5 billion. We reported a seasonal working cap build of $4.4 billion in this quarter. Thus, I have to remind you that it's less than the $6 billion reported in the first quarter of '24 and in line, in fact, with $3.4 billion to $4.4 billion range reported in the first quarter '22 or '23. The drivers of this quarter working cap builds are mainly: first, a $1 million reversal of exceptional working cap items reported in the fourth quarter '24; secondly, a $2 billion seasonal effect from gas and power distribution activities in Europe and related to advanced payments occurring in the first quarter of '25; and third, a $1 billion impact from evolution of the business related to stocks and sales increased at the end of the quarter. Lastly, the balance sheet remained strong. Gearing is at 14.3%. But as indicated earlier, the $4.4 billion working cap build this quarter is highly seasonal. Excluding this impact of seasonality, the normalized gearing would be 11%. Now, Patrick and myself are available to answer your questions. So please open up the line.

[Operator Instructions] The first question is from Doug Leggate of Wolfe Research.

I think the reaction to the debt move this quarter, JP, is obviously weighing on your stock. And I think this is probably -- thank you for the explanation on the moving parts. But I think it begs the question, how do you think about sustaining the 40% payout share buyback? If that means that you end up leaning on the balance sheet to fund the capital program, what is the trade-off? How resilient or how much would you be prepared to continue to do that? Is there a limit where the buyback would become or the payout become under question? And I have a follow-up, please.

To be clear, the 40% cash flow for buyback is not -- 40% of cash flow is not at all into question, it's clear and strong guidance. So we'll be above 40% by the end of the year. I am committed to that. What we said about the buyback, I remind you the guidance we gave you in September is that -- and I repeated it in my speech, is guidance is to maintain a $2 billion buyback per quarter in reasonable market conditions. The Board obviously considered that these conditions that we experienced during the first quarter and even since the beginning of April, where I remind you, power was between $65, $70, I think going down, is still giving a set of reasonable market conditions. Of course, will be appreciated. It's a global -- it's not one -- there's not specific price limit, it's more global, I would say, approach to the macroeconomics. So we observe like you. In fact, the world, as I said, is very uncertain because this tariff seems to be a hit, but it's quite fluid. And we could expect maybe the U.S. to come back to more reasonable approach and all that. It's not impossible. We have to adapt ourselves. That's one of the difficulties. And so in fact, the reaction of the Board, like we've done during COVID, is first, no panic. The fundamentals of the company are strong. We delivered a strong cash flow. So why should we overreact today? No, let's look because we could see some policies change on one side. The other side, it's true that the oil markets and, in fact, I'm more looking to -- on our side to what the OPEC+ will do. In fact, it's more important for us really in this type of environment. So that's why 40% for sure of cash flow and distribution keep it as a strong guidance. But I remind you, last year, we were even at 50% or 40%. And by the way, I think if we -- the first 2 quarters with $4 billion of buybacks, plus a strong commitment to the dividends, as you said, and I repeated what I said permanently, in fact the first dividend is the first capital allocation. It means that we are on the basis of $12 billion at least and more between $12 billion and $16 billion. I would say, obviously, you make the math, you will find your 40%. So no point about it. You can be sure of it. And again, the second important part of that, it's why -- what we monitor at the Board level is what this concept of normalized gearing that we shared with you, which was not -- because I was sure about the reaction of the market in this context. And we monitor it. And in fact, as we told you at the beginning in February at $70 per barrel, we are targeting gearing by 12%, 13% as of the year. Today, without excluding the seasonal effects, we would be at 11%. So honestly, there is nothing maybe if the price is at $65 for the whole year and at $70, it will be something around 14% instead of 12%, 13%. That's again guidance which works well. So at the Board level, I think we are confident in the fundamentals low growth is coming. The growth is delivered, which is, of course, fundamental. It's not just growth, growth controlling our costs. We have a strong experience and a track record on that. And so we think it's the best signal we should send to our investors is -- as I said, like for the strategy to no consistency. I think the word I want you to have in mind is TotalEnergies is a consistent company and even more when the environment is unstable, rather than just making short-term reactions. It's not at all the way we monitor the company for the last 10 years, and the Board is aligned on this great attitude.

Patrick, my follow-up is related to that. You have built in capital flexibility to the plan, particularly around integrated power. You've talked about a $2 billion flex. What would it take for you in the macro environment to consider a spending reduction on your net capital guidance? And I'll leave it there.

No, I think -- honestly, I think I'm clear as well, we have a plan. We could have some flexibility, no way today to activate that. Again, we are at $65 per barrel. I'm confident in the way to move forward for this environment. So it's not the point. The point might be on what could be led us is more of the impact on the tariff, on the supply chain of -- for example, renewable projects in the U.S., or batteries project in the U.S. If you apply some tariffs, 20% or 25% on importing Indian panels in the U.S., obviously, we could save some money there, just to be clear. I say that because we just took that decision recently on -- there was a 600-megawatt project, which was approved by the [ XCOM ] by end of March. After the tariff impact, we asked our teams to look again to it. And we say, okay, let's pause it. We'll not invest. We will postpone it, maybe because of tariffs because obviously, we are not exactly -- without tariffs, this project was more but around 12%. With tariff, it's less than 10%. So we said pause. We are not in hurry. It's not volume, not of value. We have to take care. So that's the type of things which could happen. But again, it's more -- on the cost side, the impact on the CapEx side is more because of the tariff and we need to monitor that precisely and not to be driven by volume over the value. So -- but again, I'm comfortable to maintain the guidance on the CapEx. The question of flexibility is more if we go down like during COVID. When we go down to lower than $50, then we will have to act. And as you follow us for long, Doug, you know that during COVID, we were able to save $3 billion. So we are not there. We have some flexibility. And again, I know that Nicolas Terraz on the Upstream part, is beginning to ask his teams, okay, be clear, maybe $500 million could be activated. So he's beginning to take actions at his level. But at the company level, I'm fine and to monitor that with our balance sheet.

The next question is from Michele Della Vigna of Goldman Sachs.

I had 2 questions, if I may. First, I wanted to come back to your point, Patrick, on tariffs. It's pretty clear that they would materially impact the renewable business in the U.S. But I was wondering whether it could also affect some of the oil and gas projects and also if there could be any issue with the LNG vessels globally, given that so many of them are Chinese built? And then the second question, you may not have an answer, but I was wondering if you had a view on what happened to the Iberian power systems these days. And if there was anything in terms of structural change to the power systems with renewables that you think need to be addressed?

Okay. On the tariff, we have to be clear. As I said, I think this could have an impact on the new projects, which have to be sanctioned. And we have on our -- in most of our projects that we have already the Rio Grande Train 1 to 3 are secured. I'm not -- I don't expect any impact on the tariff because all that was secured in strong contract. EPC, which is going well, by the way, is in advance progress. Rio Grande is in advance, is already at 39% compared to 31%. We had a good news, by the way, during the quarter. As you know, the legal issue and the permitting has been pushed away. So it's growing. We were on Train 4 and probably 5. This is a topic on which we're expecting to see if there is an impact on the tariff because our tariff on steel for new projects that might have. Again, the difficulty might be more to be sure in which area tariff are we speaking about. Is it finally at the end of the day, 10% across the board, okay, that probably could be absorbed because, in fact, in the U.S. projects, remember the Trump policy was not only increasing tariff, there was a sort of countermeasure, which was to lower the tax, the income tax, in fact, the tax. So we don't have this part, but this is also something we have to keep in mind. It's not only a matter of cost, it's a matter of profits at the end. So if the countermeasures and the reconciliation bill, which will come before the end of the year is for me is very important. So for me, it's more at this stage a question to monitor a 6-month uncertainty. And I think we'll have much more clarity on the U.S. investment case by the end of the year because we'll have probably all the negotiations of the tariff will have landed on one way or the other. And on the other side, we will have the bill, which is lowering the tax -- the corporate tax, which, of course, is important in the U.S. system. So for me, that's the point, so the way we monitor that. But I don't see -- and the rest of the projects for us at this stage outside of the U.S., we didn't see any impact on the tariffs. To be clear, it's not an issue. Your second question on LNG vessel is interesting because that's true, but I think the U.S. understand that if they want to export LNG without Chinese vessels, I'm afraid the export will be limited. And I think it has been raised. I understand it, by the way, but there are a lot of discussions and negotiations about this idea to have a special tax on all vessels, which are not built in the U.S., but they begin to see some, I would say, amendments, a low way. I read a paper yesterday that we are going in the right direction. Honestly, yes, it has been raised to the U.S. authorities, but it could be a real issue for everybody, including for customers, including for us. So we know that it's -- how long will it last, again, let's look at it. So again, that's why -- again, at the Board, we took a position, which says okay no overreaction, no panic, let's look. We will have more clarity I hope and getting out of the small on the issues. There's a lot of noise, but I think at the end of the day, business will prevail, business interest will prevail for everybody. Iberian policy system, no, I don't know. I have no specific clue. There are lessons, I think, at the end. And I will tell you, Michele, what happened, in fact, we observed, what happened in Germany in February when we had one week without wind. That struck me because I can tell you, there was no problem in Germany, but one week without wind. If you don't have a full backup system with your gas-fired power plant, but here it was more a coal-fired power plant, then you have an issue. And I think the lesson for me of all that is that it's a good time when we think about integrated power and globally to speak about the grid, which needs to be adapted. We observed that when the grids have more than 30% of renewable, it become more unstable. So we need to investment in the grid. In fact, investment in flexible assets. I think the 2 lessons I draw from the February event, and I'm suspecting again, I have no specific idea, but Iberia might be the same type of, in fact, tax. We cannot think that full renewable system will work in electricity. This is not -- this is a lesson I draw, which in fact, honestly, reconfirm in our own strategy, which is to maintain this gas to power together with renewables. We gave a guidance, 70-30 between both, maybe we should adapt it in the future having more flexible assets to monitor this type of intermittency and impacts on the system.

The next question is from Lydia Rainforth of Barclays.

Patrick, if I just come back to the idea around the sustainability, affordability of the buy-back, part of the reason that there is that shortfall is that the pace of growth that TotalEnergies is delivering. And I'm just wondering, could you give us an idea of the difference in CapEx that you would need just to keep the business flat versus delivering the growth you are. So really, what's the growth CapEx? And the reason I ask that is that clearly, others in the sector are delivering slightly higher free cash flow, but actually are growing less than TotalEnergies is. And then the second one, just linked again to the balance sheet. It's clearly strong at the moment, but that weaker market always creates opportunities. So how should we think about how else you would look to deploy the balance sheet potentially for acquisitions? Or put another way, are there any holes in the portfolio that you would like to fill?

Great questions. Lydia, thank you. The first one, let me be clear. We are given by value. So we have some good projects delivering accretive value. So the growth is coming from accretive projects. So this one must be preserved. That's a medium and long-term industry. We need to develop it. Then, of course, again, if I have to cut CapEx, again, I remind you, I'm able to cut CapEx, but not on the fundamentals of the growth in oil and gas, where we will deliver accretive cash flows for our shareholders, that I will not -- that I have to other ways to arbitrate. If I need to invest less in EV charging, don't worry, I will do it. I will give you a list of things on which we can be on CCS. So we are spending some money. This will be reviewed. By the way, we are making our business plan exercise in June, July, and I will look at it with preparing the future '26 and our future investors meetings by beginning of October. We look at it obviously with a scenario, what happens if, and looking to flexibility and define it to arbitrate, but I will note arbitrate what is a fundamental future cash flow growth for shareholders. This is clear. It's already -- we have -- these projects have been sanctions. They are being -- they will be delivered. And in fact, the priority must be to maintain the budget and their timing rather than beginning to arbitrate. But we have enough when we speak about $17 billion budget, to find $2 billion is not so complex in a company like that. If we have to do it, we will do it. As we have done it in the past. And I think we have a track record over the last 10 years, we demonstrated you that we are able to do it. But I want to do it in a smart way and not again at the expense of the future cash flow growth. The balance sheet. You know my position. My position, in fact, it's always good to be countercyclical. So the question is, can we create value when we buy at a low price? And then the question for us is arbitration. Of course, buybacks today, price is low. It's cheap. And it's good to be, to buy your shares, they are cheap, even cheaper. And it's -- by the way, it's cost -- in terms of cost, it's -- the debt is lower than the cost of capital. So it's a good investment. But then we will have to compare that against, can we do a beautiful acquisition with cheap, which will be accretive for everything. But the way to think about it, the way to use, in fact, the balance sheet, this is the trade-off that which the Board will have to answer. Today, we are not there. Today, I'm sorry, I don't see $50, I don't see cheap acquisitions are more. We are divesting some few things and I continue to sell them at $70 per barrel, so we'll see. But this is the type of things, which I think we need to think again to the medium and long term and do we create more value, more cash flows for our shareholders, fundamental way to speak about the balance sheet and the way to use the flexibility, which we have. At this stage, the buyback is okay. Clearly, that's why we maintain this $2 billion for the quarter.

The next question is from Biraj Borkhataria of RBC.

The first one is just a quick clarification on the way you and the Board look at the normalized gearing versus the number that we see. Is it just the seasonal factors that are in there in the adjustments? I think as Jean-Pierre talked about $3 billion of seasonal factors, and I can't quite reconcile that with the 11% normalized gearing. And then the second question is just on the latest situation in Mozambique. Obviously, we're a few months on from the election, important project for you, just wanted an update there.

I could let Jean-Pierre, but to be clear, the calculation, yes, we took up $3.4 billion. We said you that $4.4 billion working capital build. There was $1 billion of reverse of exceptional elements we mentioned at the end of the year. So when you make the math with $3.4 billion and instead a minus $3.4 million, you find 11%. Jean-Pierre could give you and the team can provide you the details, but it's very easy. It's straightforward, in fact. That's what has been done because fundamentally, what we observed, and again, we, as a team, can provide you the slide and you can do it yourself because it's public, the build and the release of working capital for a year. In fact, we know that what is built at the beginning will come back along the year, except some exceptional elements. We mentioned to you voluntary, end of -- remember in February that there was end of '24, $1.5 billion exceptional, $1 billion has been reversed. There's still $500 million which should come one day. So this one, we cannot -- it's not seasonal. It's something which we lose. But again, so we are confident because we have observed the company and the way it's able to erase the seasonal effect along the year.

To release working cap during the...

So that's what I think, and you know there is more release by the end of the last quarter. We have a build at the first quarter, a strong release in the fourth quarter. In between, things are moving down and that's the point. The Mozambique update, Mozambique, I mean, we had the good news. So all the financing is back on track, thanks to U.S. EXIM decision. So now the shareholders have decided fundamentally to move forward with the projects. We are all working on it. We are still expecting 1 or 2 answers, but in fact, we could finance with our equity with -- and in fact, it's more a question of paperwork. On the ground, the security of the industrial area where we are building our projects, it's a huge area. It's completely secure. It's safe. So what we are working with contractors today is to be sure that all contractors will remain within the perimeter of this secured area. This is the point on which we work with them. And if there is no -- on the other side, as you noticed, we have worked in order to answer to some controversies about human rights. I don't know if it happens or not, these events have no proof at all, but I've worked, we've worked, myself, I went to visit the President to tell him, you need to take your general prosecutor. We want really an inquiry. We took the initiative to consult the National Commission of Human Rights in order for them to make -- to be sure that this inquiry will be done properly, and they will -- they are committed to make a report. So I think we have taken some actions in line on our side, which is our societal responsibility, I would say. And I think we have done it. So I would say, if I'm -- the target is to be able somewhere to relaunch this project by middle of the year.

The next question is from Irene Himona of Bernstein.

Going back to your adjusted gearing, it is obviously low at 11%. So there's no issue with a $2 billion quarterly buyback. But I was wondering if there is a level -- we cannot know if $65 brand is a floor. Is there a level for that normalized gearing where the Board would feel the need to revisit the $2 billion quarterly buyback? And my second question on Namibia. Is there an update on the time line of maturing that project and progressing towards FID?

Okay. I think -- thank you, Irene, for the 2 questions. I think I've answered somewhere by previously to Doug, I think. Again, we gave you a guidance at the beginning of the year, but the Board was ready at $70, to go to 12%, 13%. I just told you at $65, it will be something around 14%. So if I'm saying that, that we have -- that means we are comfortable with that somewhere. It's not an issue, but it's not a precise figure, but this is a range where we are comfortable to use the balance sheet. And secondly, honestly, I will not play that game, but I think in New York, I told you, at $50, obviously, we will revisit it, probably lower. At $55 as well, just to be clear. But we are not there. So let's monitor that one step by step. And again, I think we have preferred consistency rather than being erratic on that. Namibia, I was in Namibia last week. I visited Namibia for the first time, the authorities. We are working on this one. To be clear, we have a project, which we have given you some useful information, by the way, in February. I think it's a matter now to find a common ground between us and the authorities. It's a project which face, as you know, in fact, fundamentally some challenges. It's feasible. We have quite a lot of oil, and we have something like 750 million barrels of oil. So it's quite a big pool of oil. There is a low permeability. So it means that, in fact, when you reinject the gas, it's a longer plateau. So we need to have a long license to produce a 750 million barrel of oil. We need as well because there are some challenges. It's a 3,000-meter water depth, which means CapEx with the lines, pipeline, flow lines are more expensive. All that makes $20 per barrel, let me say. So in terms, of course, I express to the government that we have some thresholds in terms of, I would say, the IRR targets and that I need to protect my -- the project in case the price of oil will go down. So we have opened the discussion. It's premature. But I'm -- again, it's like -- I see a very similar situation. That's the one we had in Suriname 1 year ago, where at the end of the day, we find a way to find common ground between the government and ourselves in order to be able to move forward the project. So it was, of course, the first visit. I don't expect any answer. But I've noticed that there is a well in Namibia to open this oil and gas industry. We could be the first mover, which means sometimes also some additional costs because of logistics. So there, the authorities have also to take that into consideration. Again, we have a very large pipeline of projects. And as I said last year in Suriname, at the end, I'm not driven by the volume, the volume and we have already quite a good growth. So I think Namibia will be -- of course, it's our common interest, but it will be down if we find -- again, if we are fitting with our return targets for us. And if I spend my time to visit Namibia, it's because I think there is possibility to find a common space, but it has to be -- we need to two to be -- to have two persons to play a tango.

The next question is from Giacomo Romeo of Jefferies.

Two questions for me. I think your message on buybacks in the current macro environment is very clear. However, I just wanted to go back to what you showed in your slide in the CMD, where you were showing the community CFFO below $50. In there, you give us a flex level of capital investments. And you would expect those levels to generate free cash flow above the dividend. So is there a minimum level of buyback in that macro environment that you think you'll be able to sustain? The second question I have for Patrick is on Argentina. We have some -- we have seen some of your European peers taking early position in LNG projects in Argentina. There have been some headlines suggesting you're looking to scale back your presence in the country. Just waiting to -- just trying to get a bit of what you're thinking around the investment prospects in the country and whether you think there is some attractiveness around the potential for Argentina to become an LNG exporter?

Yes. So first, you refer to a slide, which was Slide #53, according to my colleagues, which gave me the slide, which you have the answer, I think, on the slide because if I remember, if I was reading the slide, we told you that at $50 per barrel, between a disciplined capital investment, which was down by $2 billion compared to the global guidance, we were able to deliver the dividend, of course, to grow the dividend, and there were some cash flows remaining for buybacks. So I think you have the answer to your question. So at $50, I don't think the buyback are going down to 0. It's not the case. It's not the idea. So you can make your math on that. But the teams will give you more information. So for me, the answer was clear. We have, in fact, a post-dividend breakeven, which is lower than $50 by the end on this period. So that's the way to monitor that. And by the way, today, the price was going down, I suspect we have done already $4 billion by the end of the half of the year. So the Board is confident if we maintain the $2 billion. I remind you as well that there is a strong guidance, which has been a little forgotten, and maybe we could have repeated it today, which is more than 40% of cash flow from operations. This is another guidance on which we told you repeatedly, it will be full cycles. So more than 40% of cash flow from operations full cycles, is supportive of the distribution to shareholders. We are committed to that. And this is not -- and so I know that you had a trend to forget it because we were up to 50%, but we didn't change the guidance of more than 40% full cycles. And in fact, we did change the full cycle because it's exactly what we want to cover in case the price is going up -- oil price is going down. So keep that in mind and you can make your math with it. Argentina, yes, there have been active. We have a lot of projects in the world in LNG. I think we -- it's a question of allocation of capital in LNG, and we consider we have better projects in our project. We have enough first, we have a lot in Qatar, in U.S., in Mozambique in Papua. We have enough and we didn't feel -- we, I would say, I know that today President Milei is making a lot of reforms. But in the last -- along the last 25 years, Argentina track record for investors, I think we managed to get some dividends 2 -- or 3, 2 years out of 25. So to invest in heavy infrastructure in a country which has quite an unstable, I would say, exchange -- foreign exchange policy is not clearly for me -- my priority. And again, by the way, we have other ways to monetize our gas -- Argentinian gas on which we work. We recently signed some interesting contracts to monetize our gas to Brazil to Bolivia. So this is more -- so I respect the decision of others to be clear. But on all sides, we didn't put -- and I visited Argentina last September, and I explained to the President of Argentina, but others can be, but for TotalEnergies was not a priority. So again, it's a question of portfolio.

The next question is from Matt Lofting of JPMorgan.

Two, if I could, please. First, I just wanted to follow up on the earlier comments on buybacks, payout ratios and gearing. If I understood correctly, Patrick, what you said earlier, the Board, it sounds like views, April conditions as well as Q1 is within the bounds of reasonable and 50% to 55%, it for a sustained period is perhaps where you review as you were referencing earlier that the mid-cycle payout is greater than 40%, when the Board thinks about 2026 and beyond, how mechanically and swiftly should investors expect TotalEnergies to revert to 40% plus as an underlying payout? And then secondly, I just wanted to ask you about working capital. The quarter-on-quarter fluctuations appear to have been quite substantial over the last 6, 12 months versus history, perhaps. So I wondered if you could touch on some of the reasons behind that and the extent to which you expect that to continue, perhaps related to evolutions in the portfolio set up.

So I mean, Matthew, I'm sorry, I'm sorry to correct you. I never said that it was -- I just took 2 examples, 50%, 55%. I never said there is a limit somewhere. It's true that this year, this quarter, that we are still at 65%, 70%, we are comfortable to move forward, which is not a surprise. It was a comment I gave you in New York in last September. And again, the 40% is not a mid-cycle. It's something which is sort of floor. Floor, we said you full cycles, whatever, will deliver a payout of more than 40%. So that's to remind you that. So it gave you the guidance, which means that it was, again, it's a fundamental one. I think it's -- it does not mean either that we'll take 40% as the strict what we want to deliver, it's at least 40%. Last year, we delivered 50% and the year before as well. So it's at least 40%. So and in fact, the reality is when considering the dividend of TotalEnergies, which is represent $8 billion. You are -- I can tell you quickly about 30% because of dividend never been cut. We continue to maintain. So even in a low price environment, if we generate the cash flow of only $20 billion, when you have $8 billion of dividends, you have already the 40%. So -- and so I mean just -- so don't try to guess more than what we said. I think we -- and again, we are monitoring that, as I said, as well, in the best interest of the shareholders as well. Obviously, when the share price is low, it's good to take -- to use the balance sheet to buy some cheap shares, and that's the case of buyback is a good one. So there is no -- when you ask me a question of mechanically, no, there is no mechanics. It's not mechanically. It's -- we appraise the situation, the macro environment geopolitics. It's not a Board. It's not just looking to one figure. There is no magic formula hidden. It's more a question of global environment. And again, yes, it's true that we have uncertainty today. But as I said, it's quite fluid, and it could be reversed. I think maybe after summertime, we could have some calm down after the [indiscernible], we never know. So -- and we are well positioned to weather the storm. So let's continue. Working capital. No, I think you have 2 explanations very easily. You have some, I would say, structural parts. Part of it is fiscal. We have some fiscal reversal. We have some debts which grow with working capital, fiscal working capital, which come back every first quarter in Norway or other countries. The other part, which is also seasonal, is the marketing -- gas and power marketing. People just people are heating their homes much more in winter times. And in fact, they pay their bill monthly on equal installments along the year. So you have a difference of revenues between the fact that we have some big consumption during the year and equal installments and that creates around $1 billion, at least this phenomena. It's really seasonal, but we know that at the end of the year, the people will have paid their bill. So this is the type of thing. That's why we have some real between the fiscal and this example. And I think we have 1 or 2, which we could qualify from seasonal. And that's the point on which we -- that's why we are comfortable. It will continue, yes. We have observed it for several years. Again, we are monitoring that internally this time because I was sure when I saw the jump from 8 to 14, that you will have some questions, we prefer to share that with you in order to be able to give you some better -- the way we ourselves. The way we think internally with the Board, which we put on the table, I propose to be share with you.

The next question is from Henri Patricot of UBS.

Two questions from me, please. The first one, on the integrated power business, you mentioned that ROACE is a bit lower this quarter because of the lack of farm down. So I'm just wondering whether it's something that's very much temporary? Or if you see actually some more challenges in agreeing on these farm downs given the increased uncertainty around renewables, in particular in the U.S.? And then secondly, on the integrated LNG business and the guidance on CFFO, you targeted earlier this year, $6 billion of cash flows. Looking at Q1 performance. I realize it would be more like a stable cash flow at $5 billion. Do you still see as that $6 billion target is achievable in 2025 in the current environment?

Okay. First one, nuclear, It's really a question of timing of the farm downs. You will see our anticipation already on Q2 is that we should have almost 2 quarters in 1, in fact. So -- in fact, the farm downs revenues represent more or less [ $70 million ] per equipment. On an annual basis, it's an amount of around $300 million, $280 million, $300 million of OpEx, which has to be taken in -- which are planned. So it's $75 million per quarter, $70 million, $75 million. In fact, this time, there was no farm down, but we -- I know already that we just have to close one in Portugal, which will generate what should have been done in the first quarter. So it's really a question of timing. We don't see much difficulty. We continue to do it. We continue to do the farm downs, including in the U.S., by the way. So we have a program to execute. We have put in place a dedicated deep specialized team working with many players, which is smart person. So he has to deliver. It's part of the business model. And so at this point, I can tell you, I don't see why the team would not deliver. There is no hint. Of course, it's not linear per quarter. We have quarterly results, but -- and that's more -- it has to come. So on the second quarter, you would have a result of farm down which will be, I would say, higher than what it was planned, okay? So no challenge on this one. Obviously, the main challenge is that interest rates are higher. But again, you have still quite a good, I would say, appetite from these type of assets from -- in platforms et cetera. LNG. So the guidance, yes, when I look to the slide in February, if you look carefully, it was target 6, but it was a shadow part. So it's between $5.5 and $6. It's true. We are -- on this one today, I would say if you multiply by 4, we are more around $5.5 and $6. But my teams have -- honestly, on this one, I want to make a comment on it, in fact, and I think like others, what happened in Q1 '25, the fundamentals of the markets were bullish. So we are long on gas. And unfortunately, as other players, by the way, and other competitors the geopolitics became biggish suddenly because of the comments on Russian Ukranian story, which was not anticipated to you. So in fact, we had a bullish position based on bullish fundamentals, which we are right because we've seen the inventory is declining. So it was the right position. And this bullish position were suddenly by an adverse market reversal taken back by mid-quarter to bearish geopolitical event. So that was difficult. And by the way the business of our traders is quite complex, to be honest, in this type of fluid and environmental environment because it depends on some -- we don't know what will happen tomorrow morning. So it's not -- the position was perfectly right. And so we were supportive of it. Suddenly, you have some -- so we experienced some few losses in February, which were reversed. But globally speaking, the LNG trading was good, was strong. It was mostly gas trading, which was hit. So I'm fine. We took a decision recently by the way, we have a new leader for all this gas trading which has -- wants to make some ID, so I'm supportive. And so between $5.5 and $6, just to clarify this guidance, and I'm maintaining today.

The next question is from Martijn Rats of Morgan Stanley.

I've also got 2 questions, if I may, which actually sort of just follow up on the question from Henry. I wanted to ask you about the -- about your thoughts on the true appetite that Europe might have for more Russian pipeline gas. So many sort of contradictory comments indicators. It's a real market concern, but clearly, connected, talked to a lot of people. I was wondering, Patrick, what your impression is of how likely this really is, say, on the time frame of sort of 12 months or so? I mean like multiyear view, probably all sorts of things are possible, but on a sort of 12-month view, how likely this is really. And then secondly, perhaps a bit of a technicality, but I want to ask about the guidance for LNG price realizations for the second quarter, down to $9 to $9.5 per MMBtu. I would imagine that doesn't fully capture the impact of recent sort of spot price declines given the lag that is sort of built into the system. If you had to think about that for the third quarter, how much would that sort of incrementally fall assuming, say, oil prices stay the same ATM stays at sort of current levels, would we see a drop below $9 to $8.5, $8? Is that sort of a trajectory that we should be thinking about? I was interested in your comments on that?

Okay. First one, I think -- my view on that is to be cautious first because I'm not sure that -- I'm just observing what happens on the geopolitical scene. It doesn't seem that easy to land between the different parties. So I'm cautious about it. And I think the market has overreacted to some news. It's a very complex situation. What I observed as well is that on one side, you have quite a lot of pressure within the trade negotiations between the U.S. and Europe to buy more U.S. gas, just -- and that, in fact, the U.S. LNG is obviously an obvious case to fill the gap. And I think the -- honestly, the European authority seems to be quite inclined to please the U.S. from this perspective, which is a good news for TotalEnergies, by the way. As you know, we are quite involved by business of U.S. between -- of LNG been the U.S. and Europe. So I see that as a good support for all our business. And I think on the other side, politically, the Europeans do not -- are not so happy with what happens on the other side. You've seen that when I look to the program of the new coalition in Germany, I don't see a lot of support for a lot of Russian pipe gas in that platform on the contrary. And so -- and I know that there are the Brussels, they are working on a sort of platform to -- which is up to exist from Russian fossil fuels because of security of supply. In fact, today, in fact, it's interesting to observe that European, I would say, narrative on energy is going from green to security of supply. There was a conference in London with all the leaders speaking about security of supply, where renewables could contribute. But from this perspective, I don't see much stage today politically to take a lot of Russian gas. So I think it's more U.S. LNG, which will come again than Russian gas in Europe. That's my comment. And over the next 12 months, I can even confirm that I would be very surprised to see suddenly sort of Russia gas coming to Europe in the next 12 months. It will take time all that before. It's also a matter of trust between customers and producers in fact, fundamentally to rebuild the trust. On the guidance, okay, look, if we gave you a figure $9 to $9.5 when we gave the guidance, when you are making the math, we have some cautiousness. So if there is $0.50, it's because of the spot price because on the -- I would say, on the long-term contracts related to Brent, generally, you have 2 months of time lag. So it's quite easy to anticipate what will happen on this contract for the next quarter. On the spot, of course, I'm not sure. So this is why we gave you $9 to $9.5 differently to a bearish one on the spot, which was, I think, around something like it was between $9 and $12, I would say, that we tested between $9 and $12 European gas. Today, we are between $10 and $11. So you should be in the middle of the range. I don't know what will happen. First quarter, again, I am not a magician, but it's quite clear that the drop of the oil price during the second quarter, which is today what April will impact July. That's quite clear. Again, if you want me, I don't have the math in front of me and it's uncertain what you propose as a range is probably quite reasonable. But again, let's -- it's very difficult today, again, these markets are super fluid. Maybe tomorrow, the tariff will disappear and certainly the oil price will jump. So let's see.

The next question is from Lucas Herrmann of Xmariba.

A couple of quick questions, if I might. The first, just going back to debt, but also balance sheet and what's been going on with currencies. In fact, maybe, Patrick, I should ask you more broadly on currency and impact. But the question specifically was the debt that you hold a proportion of it is euro denominated. And the question simply is the impact that a strengthening euro rate has had on dollar reported debt last quarter, and I guess, if currencies remain strong. We should probably expect absolute debt to see a modest uptick as well as a consequence of currency moves. But maybe talk more broadly on given the volatility we've seen in the dollar the way that plays to your business? And secondly, just a quick question on cash flow and associates. JP, where should we expect the net associate contribution to end up for the year as a whole. Clearly, there's been $400 million of profit booked in the first quarter, which was not covered by dividends. But, how do you see things for the year as a whole? What should we be modeling?

Sorry Lucas, we didn't -- the second question, I didn't catch it up. I mean as a $400 million were related to what?

I was just looking at the associate move, the difference between dividends received and for the year -- impact for the year?

Yes, yes. Okay. Good. Thank you for the 2 questions, Lucas, and your support. The first one, the debt, I will let answer -- I will let Jean-Pierre answering. But what I can tell you on the FX. In fact, the dollar euro foreign exchange rate does not affect our global results. The only positive impact it has today is the dividend is expressed in euro. And when then the dollar is at [ 1.15 or 1.14 ], in fact, we lowered the burden of the dividend by the equivalent of 5%, which can make something like $400 million. So it's not neutral. But the rest between the difference, in fact, when I look to the global cash flows and the results, the plus and minus are, in fact, equal. When we make the test around portfolio, we have no global impact. We have some -- on some businesses, of course, but globally, it's not an issue. The impact when the dollar is weak, it's better for us on the on the dividend. And of course, that means by the way that our shareholders in the U.S. would not see 7% or 10% or 10% or more increase of the dividend. So -- but I will let -- on the equity affiliates, honestly, it's just because we have some equity affiliates, which are run on -- not on a quarterly basis, but on a yearly basis. So some of them are delivering their dividend by the end of the year. Some of them like Nigeria LNG, for example, they make second quarter, third quarter, a big fourth quarter, but no first quarter. So we don't have a Nigeria LNG. We are not only -- it's not only us in control it's more of the JV of this equity affiliates, which are run by Board. And so you have different, I would say, timing of releasing dividends. Of course, our interest, I can tell you, all Board members are pushing to maximize that. So I'm honestly, this $400 million. I will come back, unless, of course, they are affected by the price environment and that you have lower results. But the timing -- so maybe it will not be $400 million but $300 million, but it's not -- I have no doubt that this equity affiliates will deliver dividends because generally, they are all run with a single concept of maximizing the dividend release respecting, of course, the debt ratios, which may have some debt, that's the way it works. Jean-Pierre, I gave you the time to think about the complex question.

Not to confirm you, my debt is in dollar. Because even if I issue bonds on the euro market, given that my business is in dollar, I swapped this bond into dollar. So my exposure to FX on my debt is very, very limited because of that.

So in fact, I should have known the answer, but it's better expressed by the CFO. You trust him better.

The next question is from Paul Cheng of Scotiabank.

Patrick, you guys signed the agreement with Egypt and Cyprus to export the gas there. Can you give us some idea what's the time line? What's the next step and the size of the project?

Okay. There was a big step down by -- Eni is the operator. So Claudio is better positioned than me to answer to you because the operator has and I trust that we support them. There was a good signature in January in -- it was quite an achievement because we managed to have the scheme now to be able to bring the gas from Cyprus through some existing facilities Josoft was one of the LNG plants. And in fact, the main discussion for us, the important point was to be sure that we could export the gas. And so I can tell you, even if there is one provision where some part of the gas could be delivered, but on the netback to the Egyptian market. At the end, we're protected, and it will be, in fact, LNG going through an existing plant in Egypt in Damietta. So for us, and for ENI and thanks to ENI works and also the Egyptian authorities, in particular, Minister Badawi for all the work he has done, the support, I think it's the optimal position to monetize this Cyprus gas. And so we are there supportive of the project. And so the next step will be for Eni, I think, to go to the FID by '26, which is the target. So there is some technical work which is being done and of course, some paperwork development plan. But for us, in fact, as TotalEnergies, we were putting this agreement as a precondition to spend any CapEx even on the engineering side. We didn't want the teams and the operator to spend some money as long as we have not secured a real political agreement between the 2 countries, which was supportive of an acceptable scheme. Some engineers really love to spend money to make nice design. But at the end, if you don't have the commercials, nothing is not given. So as it was a complex situation. So it's quite -- it's a good progress. We have 50% of the projects Eni being the operator with 50% and this progress comfort us that it will -- by the way, it was not to be clear, it's another project which will come. It was not feeding the growth by 2030. So maybe, by the way, the delivery. I know Eni is very good to time to market. So we'll see how long it will take. But it's something which you could fit will fit will feed the growth because the scheme as we are using existing facilities is mainly subsea and the pipeline. We don't build a lot of processing facilities, there is no processing facilities. So we should be able to deliver the gas by 2029. So it will feed our growth of production in the future.

Okay. Second question, if I could. the U.S. have a new rule in the Gulf of America, the downhole commingling that allowed the multi-zone to be tapped. Is that much of an opportunity for TotalEnergies there?

Paleogene, I don't think we have Paleogene or no. I know if Anchor is Paleogene, Anchor is a Paleogene, Anchor with Paleogene. We have some [indiscernible] of Paleogene, Jack as well, I think Jack of and [indiscernible]. And so what can we do? I didn't know that rule. But again yes, obviously, this is a good rule. By the way, one of the objectives we have. I said that in Houston during [indiscernible] week, is to -- we are discussing with some operators to take again exploration in the U.S. Gulf as a priority. I think it's -- there are good things. So you know we don't want to operate ourselves. So we are discussing with some other companies. But one of the idea of -- in terms of -- for the future renewal of reserves is to take again because we are happy with what we've done with anchor with Ballymore. Ballymore came on stream last week, I think, or very recently. And Chevron again is a very excellent operator in the Gulf of Mexico. So doing more in the Gulf of Mexico and exploring again is for me one of the -- I would say, the new action plan for our exploration teams. So that will help to increase production and reserves to lower the cost, so it's a good rule.

Next question is from Christopher Kuplent of Bank of America.

Just a quick one to follow up on cash conversion, $7 billion in CFFO relative to your full year guidance. So what I picked up was LNG and gas trading, the farm downs that are missing and associate dividends let us know if you can point to other improvements for cash conversion later in the year. And the remaining question I had was, Patrick, regarding your appetite for more renewable growth. I thought it was quite important to see at the end of March, new or tighter, even tougher net zero targets. You are now competing against utilities that are being told to do buybacks and stop growing as fast. So I wonder whether you can comment on the competitive environment in this new world, leaving the tariff uncertainty for one moment out of the debate and just looking at your competitors in the low-carbon space.

Okay. [ $7 billion compared to $29 million, $7.4 billion make $28 million ], price environment for E&P has done well has delivered more than what we were anticipating for the full year. So if they are in line with our guidance. I told you that there was where the $1 billion is a little from gas trading, I explain you why. I mentioned to you a $500 million, $5.5 billion to $6 billion. All integrated power, I'm very fine with the guidance we used more than $2 billion, $2.5 billion a year, we will be there. So we are online, and there is a growth coming sometime. And the Refining & Chemicals is more challenging, to be honest, and you will observe it. Having said that, I had the good news when I wake up this morning. I've seen that the European margin is up to $50 per ton. So maybe, again, we could have some good news. Prices going down. Integration will work. And I think this is our business model. I did not mention that during my speech as the strength of the company. Because it's difficult to argue when you have results which are not so strong. But in fact, so you could have a sort of effect where you would have less on one side, more on the other side, $50 per ton. I hope my refineries are already full and they capture the $50 per ton this day. So I would say, again, it's not the $1 billion, which will make any difference on our global framework that we gave you in January, but you capture. Well, the issue sorry -- Chris. No. Look, on the growth, renewables, we are on the way. It's not only renewables, it's integrated power. I mentioned to during an answer, so that we are looking a lot also, not only our renewable flexible assets because it's the integration which makes money. In fact, and we need both. At the end, we serve the customers 24/7 power. So yes, I observe that others are more under pressure. Maybe will be -- easier to capture some licenses [indiscernible]. We are -- that's possible. But again, our model, we are quite clear on what we will deliver. We are targeting some countries. We build on it. So I mean it's not a matter of net zero world for me. It's a matter of demand. The news of '24, when you look to the results of what happened in '24, electricity has grown by 4% in '24, the global electricity demand, the demand, not the supply, the demand has grown by 4%, And all the strategy of the company is fundamentally driven by moving part of the company, remaining, of course, strong on oil and gas because this is the energy of today. This is where we can deliver accretive growth, et cetera, but moving part of the company to a market which offer clearly some good perspective for demand. All these tech companies, the data centers, AI is driving this increase of electricity demand. And by the way, it's good because this again, as I mentioned in my answer before, electricity is not linked to oil. So it's another way as well in our company to have a certain resilience not the same upside, but it's like marketing and selling. You have a resilient business. So for us, the fact that other competitors maybe have more pressure, less competition, that means access to assets might be better, easier. But we are -- it's not a matter of net zero world. It's a matter for me again, comforting the TotalEnergies business [indiscernible] in the future, delivering growth and in a resilient way and in a profitable way. That's what is driven -- what are the drivers of this strategy.

The next question is from Jason Gabelman of TD Cowen.

The first one is on the integrated LNG business. And I -- it's difficult to see the benefit from the SapuraOMV acquisition quarter-over-quarter. I know you've said in the past that, that production is linked to global gas prices and given where they are, I would have expected to see a step up in earnings from that new production. So can you just talk about kind of what that contributed within earnings if it's masked by perhaps lower trading quarter-over-quarter? And then somewhat related to that, one of your large peers noted this morning that the trading environment is a bit more difficult given the new macro risks that the market is dealing with. And I'm wondering if you're seeing that in your own oil and gas trading books and for the duration that the tariff risk kind of remains, does trading become a bit more difficult?

Okay. Honestly, it's SapuraOMV acquisition is delivering some results. Obviously, the teams -- I don't have that in mind today. I mean I don't have the details. We don't give the details asset by asset. It's easy to find, if you want to look to WoodMac 1 year ago when it was isolated and you will find some figures. But teams Can come back to you on this one, but I'm not able to. And I think Jean-Pierre, you can or your cannot as well. So we are not -- we look to the global one, but it's contributive. And in fact, you will see. I mean we are working today to capitalize on this position in Malaysia to move to more assets and it's not only one asset, it's a larger story that we are trying to build, and we are willing to build today together with PETRONAS, which is a strong strategic partner of the company. And we work. So I mean that's the point. On trading, I understand the comment. I mentioned it. I think the macro environment makes it more complex. All traders told us it's very difficult for them to the fundamentals of tomorrow, which they think could be hit suddenly by some comments or could have an impact or reverse impact. So it's a difficult market to trade. There is some volatility, but difficult to anticipate. So it's true, but for traders, it's not the best way. It's not the easiest environment. And I can only -- I would say, trust them. I'm trusting them. I know their business. They know what they can take the level of risk they can take. It's up to them. We are not guiding them on this one. It was them to do it. Honestly, the oil trading has done well during this quarter. I'll remind you that the TotalEnergies trading is more trailing around assets rather on the market. So we are valorizing our assets. We have a lot of position with storages, inventories. So this is the way we trade, hedging some assets, et cetera. So I think it's -- again, the oil trading has done very well during the quarter. So I can say. And the gas trading has done well, the LNG part was very positive. The gas one only because of this reverse trend. We are in the right position, again, bullish on it a long position, suddenly, we had to reverse it, bearish projects because of the political comments on Russian gas, whereas I think the market has overreacted, which is something which will be -- take time, as I mentioned. So yes, it's true. Having said that, again, I think through quarters, we trust the team to deliver some strong results. And so I'm not -- I mean, if I'm coming back to the guidance we gave you at the beginning of the year, what has been taken as coming from more different trading because it's not only oil, gas, we have power trading which has done well, as well which is part of integrated power. We are in line with the contribution of trading to our global guidance for the year.

The next question is from Alejandro Vigil of Santander.

Related to both questions about the downstream business. You have flagged some improvement in refining margins in the short-term, but I'm more interested in your thoughts about the medium-term outlook for this division? And the second question is about marketing. We have seen some weakness in the first quarter, probably just seasonality, but you can comment on that.

The seasonality is quite easy. People are less driving its winter than in summer. It's true in Europe. It's true everywhere. So in fact, there is no surprise. In fact, because we maybe you don't take attention, but the results of -- this first quarter is in line with the first quarter of 2024. Even we have lost some few -- but it's in line, $260 million, $240 million. So there is no -- it just seasonal. And then there is marketing results are higher during the year, that just -- so for us, it was -- I see some comments this morning but for us it was not a surprise. So I'm not -- I think the marketing and services is on the contrary, a very resilient division. Generally, when then will deliver on the year, $2.2 billion, $2.3 billion, $2.4 billion, they deliver their cash flow. So it's quite -- so it's less volatile than others. So it's more a question just less drivers. You don't drive as much just consumption. On the first one, let by the downstream. It's true, as I come back on because it was an important announcement by the company, which was not commenting until now, which is we have announced we closed shut down one cracker in Antwerp which is quite an important decision. When you decide to shut down a cracker in it's a big unit with a lot of people involved. It's true that European refining and European petrochemicals are under pressure and even from different -- the consumption is going down. The pressure from petrochemicals from other areas is quite strong, including from the U.S. unless there are some tariff there, but also from Asia. So I think for us, it's true that we have to medium-term outlook is more to question to monitor, I would say, this decline of the market or this pressure on the margins. And it's true that from this perspective, we contributed the restructuring of petrochemical by taking the decision that this cracker in Antwerp will be off the market by '27. So it took 3 years to execute it, but we'll do it. And we are looking to that, in fact, for -- to other assets, as we know it. So this is a point, but we have to do it properly, including our social responsibility, and that's important to me.

The last question is from Henry Tarr of Berenberg.

My question comes back to Russia, actually. And in the event that we do see some sort of peace deal with Ukraine, how do you see your sort of interests in the country and how you might sort of look to approach that?

It will all depend on the condition of the peace deal which I don't know today. Having said that, we have a very strong asset with Yamal LNG, which I consider as a prime asset in which we continue to work on it and which is the anchor of the position. This one is a long-term asset. For the rest, I think it's just difficult to make some forecast on geopolitics in this way. So that I cannot comment more than that. I think I told you where we are.

And this was the last question. Mr. Pouyanne. I'll turn the call back to you.

So thank you for your attention. And to all of you, I think the company, again, has very strong fundamentals on which gives me a lot of comfort again to weather the storm and not to overreact. And I think through these results of the first quarter, we demonstrated some of the strengths, in particular, Again, our E&P division has done well, delivering the growth, strong cash flows. This is the core of the company. Integrated power is in line and the others, we face some more difficult I would say, downstream environment, but the teams are mobilized to run the assets and to capture better margins when we will come. So thank you for your attention, and see you soon, all of you.

Ladies and gentlemen, this concludes the conference call. Thank you for your participation. You may now disconnect.