Good morning, ladies and gentlemen. Welcome to Galp's Second Quarter 2025 Results Presentation. I will now pass the floor to Joao Goncalves Pereira, Head of Investor Relations.

Good morning, everyone, and welcome to Galp's Second Quarter of 2025 Q&A session. In the room with me, I have both our co- CEOs, Maria Joao and Joao Diogo as well as the executive team. But before passing the mic for some quick opening remarks, let me start by our usual disclaimer. During today's session, we will be making forward-looking statements that are based on our current estimates. Actual results could differ due to factors outlined in our cautionary statements within the published materials. Joao Diogo, the mic is yours.

Thank you, Joao, and good morning, everyone. And the second quarter of 2025 was another strong quarter for Galp. Being resilient and having a strong asset base in a volatile macro context, give us comfort to execute our strategy. During the quarter, we saw strong performance with higher-than-anticipated upstream production, increased LNG trading flexibility, a good rebound in the Spanish oil products market and new renewables capacity coming online. Production stood at 113,000 barrels per day, reflecting limited maintenance performed in the period. And while remaining conscious of upcoming turnarounds, we upgrade our full year production guidance to a range of 105,000 to 110,000 barrels. And we are now fully including the LNG volumes from Venture Global on our guidance, following the successful lifting all on schedule of 3 cargoes in the quarter. The leadership team is focused on execution, and I see sound momentum ahead for Galp. Now I'll let Maria Joao comment more on the financial guidance update.

Thank you, Joao Diogo. Indeed, a strong quarter across the board with our operating performance overcoming a bit of a headwind from dollar depreciation and delivering strong cash generation. So for 2025, we are revising our ForEx assumptions, but leaving Brent and the remaining macro unchanged. Overall, backed by the improved operating performance, full year group EBITDA is now expected to surpass EUR 2.7 billion. This is an upward revision from EUR 2.5 billion. And consequently, operating cash flow is now expected to be over EUR 1.8 billion. As for Namibia, the partnership process is going according to plan. Late June, early July, we received nonbinding offers, that's a plural, all from highly credible players. I hope you understand that we will not elaborate more than this, as we will now progress further into the negotiations, but ultimately, the end game is very clear. We're seeking to secure a strong partnership with an experienced operator based on the solid alignment on how to progress with Mopane. So operator, shall we start the questions?

[Operator Instructions] Our first question today comes from the line of Matthew Smith from Bank of America.

A couple from me, please. The first would be on the production guidance. You noted you've upgraded that today. I just wanted to clarify whether Bacalhau featured as a moving part here at all. It sounds as though the project is on track for first oil in the third quarter, as I understand it, which would be a slightly quicker rate than anticipated back in February? And then the second question, perhaps turning to CapEx. You had a very light quarter for the group in 2Q without any Namibia exploration in there. Perhaps could you comment on the moving parts? And it does feel as though ex-Namibia, your sort of CapEx run rate should be much lighter going forward in future years than it has done in recent history?

Thank you, Matt. So starting with the production guidance update, and I think your question was fundamentally on Bacalhau, we are -- indeed, we've had a good performance -- a very good performance in terms of the first 2 quarters of 2025. Bacalhau is a very small piece in this. We are expecting very little over 3,000 barrels. So we continue to align with the operators' guidance on later this year for first oil. And other than that, our performance is fundamentally levered on the fact that we have sustained very high integrity levels across the fleet. We are, of course, keeping a bit of cushion for unplanned events in the second half of 2025. The first half was really a very good performance in that respect, nearly no unplanned events. So fundamentally, we are guiding based on our existing fleet and leaving a bit of room for Bacalhau, but very limited production contribution there. Thank you. On CapEx, so you're right. CapEx has a very different profile from 2025 and onward to '26. So '25 is indeed a year where we've revised our CapEx to below the EUR 1 billion that we had been guiding before. So our revised net CapEx for this year is the EUR 1.8 billion, and this is considering the proceeds we've already collected. But I think fundamentally, for the second half of 2025, we expect to have a bit of a heavier CapEx than the first half. We were a bit under EUR 500 million in the first half. Upstream should be relatively flattish. But in industrial, the low-carbon projects, CapEx will be accelerating. So we have a 2026 online date for both projects. So the second half of this year is going to be in the EUR 100 million to EUR 150 million expected CapEx. Commercial and renewables will continue to deliver. So commercial, as usual, we are fundamentally investing in transformation. So there are remaining investments in customer loyalty and allowing our operations to move closer to our customer bases there so that overall should be EUR 100 million by year-end. And renewables, again, we're maintaining our expectations. This should be around EUR 200 million for -- fundamentally for capacity rollout. So all in all, a slightly heavier second half of 2024. We expect the 2026 to then be lighter, as we complete a number of these investments.

Your next question comes from the line of Josh Stone from UBS.

Congratulations on the strong results. Two, please. Firstly, on the Midstream, I was hoping to unpick a bit more about the strength of that division this quarter. You received 3 cargoes from Venture Global. Are you able to maybe tell us the earnings contribution from that -- from those cargoes this quarter? And also, if I was to exclude Venture Global, how strong was the underlying Midstream result this time around? I'm just trying to get to where we're going for the rest of the year. Should I be extrapolating 2Q? It does look like if I was to do something like that, then even your guidance still looks quite conservative. So is there anything I could be missing inside the Midstream? Second comment -- second question even on Namibia, and I appreciate your additional comments made here and I understand you're in the negotiating phase. There's not an awful lot you're going to want to disclose and it's good to see a plural on the bids. But instead on the time line, when do you think is the earliest you could agree a farm-out of Namibia? And when we get that farm-out, what information do you expect to be able to disclose?

Thank you, Josh. Basically, it's clear. So we've guided you through a number of cargoes during 2025. We are expecting to get 10 cargoes overall until the end of the year. We've received 3 cargoes up to now. And roughly, it represents 60% of what we are getting in terms of volume overall. But also consider that we are having an uptick also on the -- on all commodities, on the power and on the oil side, consider also that we are raising an increased business in Brazil and also sales in Iberia year-on-year -- on a year-on-year basis are also growing. So that's what you need to consider overall, but mainly 60% of the increase comes from Venture. And you should expect to continue like that until year-end with the 10 cargoes.

Okay. So maybe if I pick up on your question on Namibia, Josh, and thank you for the question. So right now, we're very focused on making sure that this partnership that we are seeking, which we see as the natural next step for the asset is successfully derived. This is clearly our priority now. Having received the nonbinding offers, we're now naturally looking into analyzing those offers and to a great extent, defining the next steps will come from that. So the time line for this part of the process remains clear. This is a time line until the end of the year. It was good to deliver on time the nonbinding offer step. It's good that we continue to deliver across -- these markings across the process. We will now somehow step into more bilateral conversations to analyze these offers. But fundamentally, we're very happy that we have credible players engaging with us. We do see the year-end time lines as something that will be helpful. We are not in a rush. Again, we don't see rushing as value accretive for Galp. So the year-end time line remains as I referenced so far. Thank you.

Your next question comes from the line of Biraj Borkhataria from RBC.

Two as well, please. The first one is just a follow-up on the Venture Global volumes. Could you say what proportion of those volumes you hedged for this year and if you've hedged anything for 2026? And then the second question is just a little bit more broadly about shareholder returns and capital allocation because if I look at the starting point of Q2, and I think some of the working capital build comes back into the second half of the year, you've previously said the Namibia deal, I assume you'd get part of the CapEx repaid as well. It looks like at that point, post deal, you'd have close to no debt. And now you're saying CapEx will roll off into 2026, and you'll probably get some sort of carry on the development as well. So where does all of that and a very strong balance sheet and the growth from Bacalhau leave sort of capital returns to shareholders, as we're thinking about 2026 and beyond?

Thank you, Biraj. I'll go with the first one. So as you know, hedging strategy will always play a role within our overall Galp's hedging policy. At this point, we have no material hedges set for the long term, and we will not guide you through the short-term hedge that we have already in place with the Venture contract. But all in all, we will always assess options to protect value and derisk trading activities and while we will continue to reassure our portfolio diversification and flexibility. That's all for now. Thank you.

On the distributions and the capital allocation. Thank you, Biraj. So I think the fundamental notion there is, of course, we will not be sitting on the pile of cash. We do see the value in both having a very steady and what we believe performing distribution policy. So we continue to guide on an overall distribution policy that is a through-the-cycle policy. That is the 1/3 of the OCF with a steady growth on cash dividend. So we see extraordinary dividends as introducing a volatility in the distribution policy that we don't see as valuable. So fundamentally, what we are guiding on right now is based on the fact that we do see it as very important to maintain optionality and flexibility. Everything in the media is going according to expectations and to plans. But again, maintaining this flexibility and having the balance sheet work to give us leeway has been value accretive for Galp. And we will continue to be disciplined in our usage of the balance sheet. We will continue to be disciplined in investments. But for now, we see no need for a fundamental revision of our distribution policy at this point.

Your next question comes from the line of Alejandro Vigil Garcia from Santander.

The last time I asked you a question, there was a blackout in Iberia, let's fingers crossed for today. And yes, congratulations for the results. And my questions are, one, about the production profile. You mentioned that Bacalhau is not contributing this year. But can you give us an indication of next year the contribution and the plateau? When you're expecting the plateau of this project? And the second question is about the expectations of net debt by the end of the year. You mentioned that you are expecting a heavier CapEx in the second half, which is your expectations of the level of net debt, if you're expecting stable in comparison with the level of first half?

Thank you, Alejandro, and let's keep our fingers crossed, right? First quarter, we had a bit of an earthquake in Lisbon at the same day of the call, and then we had a blackout so we're keeping our fingers crossed for today. On the production profile for Bacalhau in 2026, I think we've mentioned this before. So if we start activities in 2026 -- 2025, sorry, later this year, we do see a gradual ramp-up. We don't have operator references at this stage. So we've been using as a reference, some of our previous experience in Brazil. So that leads us to a ramp-up of over a year. So fundamentally, the plateau, and that will be at 40,000 barrels. This is a plateau that we expect not to be -- we don't expect it to be achieved in 2026. So at Plateau, we do see this as being approximately EUR 400 million in OCF. This is with a 70% Brent, but that is beyond 2026. So our production profile right now is still very much geared on our current fleet. As for net debt, we don't guide to net debt by the end of the year. So what you've seen happen with our net debt in the quarter is very much driven also by the fact that these -- the first half of the year is rather intense, and we've had our dividend payment and a rather accelerated buyback execution. So fundamentally, by the end of the year, we do expect some of the working capital effects. We saw earlier this year to flow through the system. And with our revised ForEx calculations, that will, of course, continue to have some weight, as we have over 60% of our cash held in dollars, but we don't expect net debt to fluctuate significantly other than from these aspects.

Your next question comes from the line of Ignacio Domenech from JB Capital.

The first one is on LNG trading. I'm sorry if I missed a question earlier, but if you could help us understand the contribution from the trading division in the quarter, specifically, what is the approximate margin in euros per megawatt hour? And looking ahead, how do you see the structural arbitrage opportunity evolving between Henry Hub and TTF over the long term? What would you highlight as the key drivers sustaining that spread? Secondly, I have a question on the special energy tax in Portugal on CESE. There was a recent constitutional court ruling in favor of another company regarding this application on gas distribution assets. So I was wondering, given the provisions that you currently hold on your balance sheet above EUR 200 million, what's your view on the likelihood and potential timing of a reversal? And the third one, if I may, just if you could give us a quick update on the regulatory outlook in Brazil, if you can provide an update on -- particularly on any recent developments or discussions around changes to royalties or fiscal terms that we should be aware of?

Thank you Ignacio. I'll take the first one. And indeed, I make a couple of comments before about the contribution coming from Venture. We will not disclosure any margins coming from LNG, but for sure, at this point, we have already in the basket 3 contracts with volumes from U.S. A couple of them will come on the -- until the end of the decade. But at this point, the guidance I gave is that, well, we will be receiving 10 cargoes from the Venture contract, already kept 3 at this point in time, and those represent roughly 60% of the increasing guidance that we are mentioning at this point. And that's all for now.

No, on fiscal terms, so to say. So on CESE, our specific Portuguese regime, we see the recent decision as helpful in as much as we continue to defend our position that these are not justified and undue taxation. So this constitutional court decision is positive in that sense. It has very limited impact for Galp for starters because it concerns only gas infrastructure and in particular, only regarding the year of 2019. So on that year, we already had a view that the likelihood of this tax to be effectively due by Galp was very low. So there are no provisions in our accounts for that. So very limited direct immediate impact in our accounts. We do see it as a very positive decision as it confirms our stance concerning this type of taxation and regime. On Brazil, again, very -- a lot of moving parts there. We do continue to see Brazil as a country where the checks and balances work rather well. So we do understand that Brazil is very receptive to foreign investments. We've just seen a couple of new bid rounds happening there, and that to us is a good balance versus what we see as fiscal requirements and the need for gathering fiscal revenue in the short term. So we continue to monitor very, very attentively. What we saw recently, we see as very, very little direct impact, if anything, slightly positive recent developments as there are conversations that build on a notion that fiscal changes should actually boost earlier upstream projects. No direct impact for Galp at this moment. So this is a time to continue with our close monitoring and to continue to engage with Brazilian authorities to preserve this balance and to make sure that long-term foreign investment continues to be welcome in Brazil.

Your next question comes from the line of Alastair Syme from Citi.

Two questions. On Namibia, can you explain to me why you run this as a nonbinding office process versus perhaps moving straight to a more competitive auction? And then secondly, the adjacent joint venture, PEL 85, the Rhino block looks to have had some exploration success, I guess, right on your border just south of Mopane. So how do these results feed into your thinking? And do you have a formal data sharing arrangement in place with this joint venture?

Thanks, Alastair. So the choice of the nonbinding, I think, builds into the notion that, again, we're not in a rush. We do see the process of having as a critical element, finding a partnership where we are very, very much aligned with the operator. So we want an experienced operator, and we want to make sure that there is alignment in terms of progressing on Mopane. So we wanted to make sure that we had the basis to start what we believe will now be good conversations and that we don't just go for a competitive process where we do get the objective quantitative terms, but we do not get a good engagement in terms of discussing the alignment moving forward and the perspectives on how to develop the assets. So this is a significant asset for Galp. We want to make sure that we come to a partnership that is indeed value accretive, not rushing into it at all and taking the nonbinding as part of building on that dialogue. As for what's happening around us in Namibia, so PEL 85, Azule, all results feed into our understanding of the basin. This is a very young basin. So everyone we've been talking to is building on a perspective on how to best develop it. So we don't comment much on what's happening with our competitors, but we do believe that everyone we engage with is very committed to making sure that there's a path ahead of us for the basin. Local authorities is also very committed in building that path. So all of this feeds in, in a way that for now and with the recent developments, we see as positive. We've been sharing data with the potential partners engaged with us in the current process, and we keep tabs on what's happening in the market, obviously, but no further data sharing arrangements other than those.

Your next question comes from the line of Giacomo Romeo from Jefferies.

Yes. Two questions for me. First one, if I can go back to Namibia and the process. What are the next steps here? I understand that you're guiding for the process to continue to -- by the year-end. But is the next step moving into exclusive negotiation with one party? And what's the timing there? Second question is on -- sorry about that -- is on Brazil. I'm trying to understand what do you think -- what will cause the good uptime you had in the first half, if there's any particular change in what the operator has done and whether we could actually see a structural improvement in uptime going forward? I understand this is not reflected in your guidance, but just trying to understand what caused this better performance in the first half.

Thanks, Giacomo. So on Namibia, again, we're guiding for end of year achieving the -- concluding the negotiations towards the partnership. We're not guiding on any intermediate next steps. So we are now in presence of several nonbinding offers. So we're going to have to look into those, make sure we understand them, make sure we engage on conversations with these potential partners and assess the alignment that we are able to build with each of those, and that's going to take us forward. So again, this requires, of course, bilateral conversations, but we are not guiding as to when and how and if we are going to actually make this a one-party negotiation. And we are still keeping the end of year reference as the one to adhere to. On Brazil, good uptime on the second quarter and overall in the first half. I think the causes have indeed to do with the fact that we see the operator very committed to a steady schedule in terms of maintenance, and we do see the value of having that maintenance regular and preemptive, and we see that, that then builds into the good health and the performance quality of the fleet. So this is something that we continue to foster and we continue to work on. There were, of course, very few unplanned events. And those, by definition, are not something that we plan for. We try to prevent them as much as possible. But still, I think the underlying factor is around maintenance and how to manage it and how to drive it forward more proactively and more on a preventive tone. And I think I would highlight that more than anything else. Thanks.

Your next question comes from the line of Michele Della Vigna from Goldman Sachs.

Congratulations for the strong results. Two questions, if I may. The first one is on renewables. When I look at a lot of your integrated oil peers, they tend to rotate assets also to be able to take off balance sheet some of the project financing. I was wondering if that's something you would consider or if you think there could be a better market for that? And then secondly, could you please remind us how much contingent payments you're still due on the Mozambique and Angola disposals and some of the key conditions there?

Thank you for the question. So on renewables and asset rotation, that is, of course, one of the strategies to be considered. I think what we've been making sure is that we look at the stage in which our asset development is currently and also looking at what's happening in terms of market conditions, of course. So we are very focused on making sure we're executing in our current fleet and that we are exploring opportunities for accreting value to the fleet. So there's a lot going on in terms of how we see aspects of asset development, such as hybridization, such as battery deployment so there's -- and even ancillary services. So there's a number of aspects that we're considering. Not to say that asset rotation is something outside of our radar. We just feel that the current market moment and the current market circumstances are not those that would actually allow us to drive value out of that rotation. So something to keep in mind, but a lot happening in the fleet that has been taking our priorities. On Mozambique, we are continuing to discuss with the Mozambican authorities. We still have -- for the conditions and terms, we still have contingent payments emerging. Angola has been fully completed. So that one is closed. On Mozambique, we have 2 additional contingency plans payments coming. So one on Coral and then the other one on the onshore development. So the first one to take place, and we are seeking to confirm the dates. But right now, what we're getting is that the first one on Coral is approximately $100 million, and this one is positioned to take place in the more near future, so later this year, eventually. And then the one onshore is, of course, the one where force majeure events have been more determining. This is a $400 million to be received upon that FID taking place. And what we are seeing is that this is on a lengthier time horizon, probably well into 2026. So again, $100 million probably in the shorter term, $400 million coming up, both of these on Mozambique, Angola fully closed.

Your next question comes from the line of Paul Redman from BNP Paribas.

My first question is just on working capital. It looks like it remains a big build following 1Q and a little bit of a reduction this quarter, but still a lot of working capital on the balance sheet. I just wanted to see what your outlook is on that for the rest of the year. And then secondly, just on Namibia, you've got these several nonbinding offers and the word you're using a lot is credible partners. Have you got any more detail on what you guys class as a credible partner? I know you've discussed things before. Does that remain the same?

Thanks, Paul. So first, let me deal with working capital. So full year outlook. We've seen the first and second quarters, particularly the first one, with the bad weather causing some increase in working capital. We've already seen a lot of that buildup -- that initial buildup revert. So inventories that we built in the first quarter are already flowing through the production. So that's going to be a natural reverse. Now what took place in the second quarter had fundamentally to do with dollar depreciation. So there was a bit of reduced payables, but fundamentally, what you see is that the impact from dollar depreciation. So now all in all, what happens is you also need to take into consideration that the end of 2024 was at particularly low levels. So we do not expect those levels of the end of 2024 to be the steady cruise speed level. So there will always be volume slightly elevated from the end of 2024. Having said this, we do see the fundamental inventory buildup in the first quarter as coming through so we do expect some of that to continue. In terms of what is a credible partner, I think what we've been sharing with you fundamentally has to do with the nature of the asset, leading us to believe that we do expect someone with a strong operatorship record. So this is a young basin with deep waters, strong pressures. So we expect someone that has the operatorship track record to deal with that. And other than that, fundamentally, someone that has an active perspective on how to develop the asset and with whom we can engage in a dialogue that leaves us confident in terms of having full alignment on how to develop it. We've shared this with you before. We see Namibia as an asset where given its size for Galp, keeping pace and developing a strategy that actually makes sure we're value accretive in the way we explore it is important to us. It's important that we are aligned in that with our partners that Namibia is at the top of their priorities, and they have a strategy moving forward that speaks to what we would like to see in terms of pace and in terms of where does the assets stand in your list of priorities. So if you like, credible to us is a number of conditions. Fundamentally, those conditions speak to the ability to fully explore the asset and to do so at a pace that we see as the one that we see feasible for the asset.

Your next question comes from the line of Irene Himona from Bernstein.

Congratulations on a strong quarter. My first question is on upstream unit production costs, $1.20 in Q2, $1.90 in the first half. As Bacalhau comes in and ramps up next year, how should we think of that average production cost, please, for full year '25 and then 2026? And my second question back to Namibia. I wanted to ask, operationally, is Galp engaged in any specific activity? So essentially, I'm trying to understand if by year-end, aside of announcing the actual deal, the disposal, is there any operational announcement that we may anticipate?

Thanks, Irene. So let me take this in line. So production costs, indeed unusually low, if I may put it this way. So we're still guiding overall for $3 per barrel. This, we believe, to be a more sustained level and even as Bacalhau comes in, and again, we don't expect a significant impact from Bacalhau this year, so very little production expected this year. And then as we ramp up, of course, the numbers will still be reflecting the fact that ramp-up is not yet full numbers. You also need to take into consideration going forward that Bacalhau is not leased. So you may expect a little bit more CapEx there so it's just -- OpEx there, sorry. It's just the reflect of financial costs being shaped differently there. Other than that, I think this quarter, what we had was the combined effect of good production. So there's a bit of dilution effect there, of course. Also the fact that maintenance was performed according to plan, but there was quite a bit of it in Q1. So overall, when you take Q2, it was relatively reduced. And this always has an additional impact in the fact that the bonus associated with performance those were not there, as we had limited maintenance. So all in all, indeed, good OpEx performance, but let's keep the guidance of the $3. We believe those will be the value sustainable, and it's still very reassuring in terms of our portfolio competitiveness. On Namibia, nothing happening this year. So we don't have any further exploration activities this year. We received the seismic late March. So now everything we have planned on and everything we're executing on is very much on analyzing the data we got both on the seismic and on the data that we were getting from the wells. We had a very fast pace of drilling. So that left us with a bit of a, call it, backlog for lack of a better expression, but a lot of information to digest through, so that is the focus. No CapEx expected there, no CapEx foreseen there through the end of the year.

[Operator Instructions] And your next question comes from the line of Matt Lofting from JPMorgan.

Congratulations on a strong update. On Namibia, I wanted to just ask whether you could share Galp's latest views on the development concept of Mopane and the extent to which any views that Galp does have on that is directly feeding into the partnership negotiations or whether we should sort of think about that as something which follows establishing the partnership model into 2026 plus? And then secondly, going back to the earlier points on the Midstream business and the strong performance through the last 6 months, it strikes me that, that performance looks like it outperforms many industry trends through the first 6 months of the year. Could you just talk a bit about the underlying drivers behind that on a -- let's say, on a sort of an ex Venture Global basis?

Thanks, Matt, and thanks for the congratulations on the results. So on Namibia, we're not sharing views on the development concept. Actually, if anything, that is something where we will, of course, have a view, but we expect this view to also be built together with the partner. So this is obviously something that will be part of these early partnership establishing discussions. But more than that, we expect it to then be part of moving ahead with the asset and developing it together. So we expect to set up the conditions for alignment to be present in the partnership towards a joint understanding of how to develop the asset. But at this moment, the development concept is not closed, and it's not something that we are guiding in any way on. Maybe on Midstream, Joao?

Yes. Yes. Let me jump in. Thank you, Matt. Well, as I mentioned, it's not only the Venture Global contract coming on stream. It's also well across all commodities. We are having increased results, a strong set of results coming from our trading desk on the oil side, on the power side. But of course, if we want to highlight something, it will come from the increased flexibility that we have built it on our gas trading as a critical contributor at this point. So we have quite a complex sales basket at this point with different tenures and indexation. Venture and -- well, the contracts that we will be adding until the end of the decade will expand that exposure to the U.S., and that's -- we see it as a very strong point. But of course, I also mentioned our positioning in Iberia with a strong performance also on the volume side and also building natural gas business in Brazil. So we need to cross all those territories, all those commodities to support and sustain the -- well, let's call it, the continued outperformance that we have, and we are hoping to keep it.

Your next question comes from the line of James Carmichael from Berenberg.

A couple, I guess, just firstly on -- maybe again, apologies. I think in the past, you've been very clear that the aim of the farm-out process was to minimize balance sheet exposure to the development as well as obviously bringing in a credible partner, et cetera. I guess given the conversations we've had about the strength of your balance sheet this morning, I'm just wondering whether that and/or the sort of the integration interpretation of the well data and the seismic data is maybe making you sort of rethink that and maybe look to retain a bit more of the equity and a bit more of the upside as you go through this process? And then just secondly, on Industrial Midstream, you mentioned that the SAF and the green hydrogen projects will be decent drivers of CapEx through the second half of this year. I just wondering if you could remind us how we should think about them or how you think about them sort of benefiting the business once they're on stream next year?

Thanks, James. So on Namibia, I think we've been very clear on the fact that the way we look at this partnership and this farm down from our side is that this is the natural step for the asset moving forward. So this is a step towards making sure we have the conditions to develop the assets at the right pace. So we do like the risk. This is an asset in the basin and what we've seen so far, this is something that we do expect to keep a meaningful quota in -- a meaningful share in it, but we are balancing these 2 aspects, right? So we like the risk. We want to keep it in our balance sheet, but we do see a partner as being absolutely critical to make sure that the aspects we like about the risk do come through. So at this stage, what we've seen so far confirms our views of the assets. We're developing through it. We're analyzing through it, but it has not changed our view in terms of what we see as our target exposure right now. So we like the asset quality, but we want that asset quality to actually deliver in value. So concerning H2 and HVO contribution in 2026, Joao?

Yes, I'll jump in. James, thank you. And well, if we can call it, so at this point, Galp has a twofold focus. At one side, we are ensuring that our legacy business runs as efficient as possible. And we are performing quite well also on that side on the refining side. But on the other hand, as you asked, we are at this point, planning well and preparing the future. And on the H2 and specifically on the 100- megawatt electrolyzer, at this point, we are -- well, the site is ready to receive the electrolyzer in Q3. We are, well let's call it, closely monitoring the work and execution that is being done specifically in Dubai. And we are expecting the start-up in later 2026. And that is -- at that point, we will be replacing 20% of the gray hydrogen consumption. And that's a bold move that we took when we decided this project. And we still see very competitive returns. We are quite balanced on that, and we're quite confident also. So that's what we can expect.

Your next question comes from the line of Nash Cui from Barclays.

I'll ask something else. I have 2 questions on refining business, if that's okay. The first one is refining margin has been strong, especially diesel refining margin. I wonder if you can share some of your outlook for the second half of the year. I appreciate you may have some turnaround activities coming up in Q4, but still the forward curve looks quite strong than your guidance. So a bit of color on that, that will be good. Then the second question is on your Spanish blackout impact. I know you have about EUR 80 million impact. I wonder if you can comment on whether there's any possibility to get the money back from either third party or insurance?

Thank you, Nash. And hopefully, we could -- at this point, the second question, it's not -- well, it's not clear at all. But let me guide you to what we are looking at this point. So July to date, refining margins look really good at this point, near double digits, supported by the diesel and jet fuel, but also on the seasonal support also from the gasoline. Of course, we saw some lower utilization rates from the Chinese independent refiners. It's also supporting us at this point. But anyways, as you mentioned, we are maintaining our guidance through the year. We have a large planned maintenance in Q4, and that's the reason why we will not increase our guidance. Anyways on third Q, we are expecting really good availability, and that's where we are focused at this point.

We will now take our final question for today. And the final question comes from the line of Alessandro Pozzi from Mediobanca.

The first one on Namibia. You received the first nonbinding offers. I was wondering if we have a bit more clarity on how long it might take for the project to go to FID after you potentially announce the transaction. We're talking about 12 to 24 months and therefore, potentially an FID in 2027 could be likely? And also maybe in '26, whether potentially you're looking to resume exploration activities there? And second question on Mozambique. I've been reading in the press some disagreement around capital gains assessment. Can you maybe give us an update on where you are in terms of the capital gains assessments and payments in Mozambique?

Thank you, Alessandro. So on Namibia, way too early to have any sort of guidance on FID. So we're early stage. We would like to have that discussion with our partner. So no further guidance at this time concerning FID there.

On your end -- thank you, Alessandro. On the Mozambique, well, we have a long-standing presence in the region, especially through a relevant downstream position that we keep, and I can say that we've maintained a constructive relationship with the government until this point. So it's -- overall, the issue is on the capital gains on our recent deal completion, and Maria Joao just mentioned the numbers. And well, the government's estimate was based only on the accounting book value. And while it was disregarding all the investments to date, Gulf recently disagrees with this assumption. We are quite confident on our position. And at this point, we are prioritizing a diplomatic, let's call it, solution and not yet pursuing legal resolutions. But of course, we will actively manage the situation and of course, assess all and consider all options, including a potential legal dispute. That's what we are not eagering. But anyways, we are really supporting on that. We have an external assessment fully supporting it. So that's where we are at this point.

So the contingent payments that we talked about are already net of capital gains?

No, it's not -- that's the contingent payments that we will get, and that's it.

And then we need to take out the capital gains, okay? And just...

We are not expecting any capital gains at this point.

All right. And just on Namibia, I mean, would it be fair to assume a resumption of exploration activities in 2026?

To be discussed. At this time, we don't guide on that.

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.