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Operator: Good morning, ladies and gentlemen. Welcome to Galp's Third Quarter 2025 Results Presentation. I will now pass the floor to Joao Goncalves Pereira, Head of Investor Relations.
Joao Pereira: Good morning, everyone, and welcome to Galp's Third Quarter of 2025 Q&A session. In the room with me, I have both our co-CEOs, Maria Joao Carioca and Joao Marques da Silva as well as the full executive team. But before passing the mic for some quick opening remarks, let me start by our usual disclaimer. During today's session, we'll 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. With this, Joao, would you like to say a few words?
Joao Diogo da Silva: Thank you, Joao, and good morning, everyone. We have a couple of Joaos around here. Well, the third quarter was a strong one for Galp. Solid operating performance according businesses testifies our strong operating momentum. In Brazil, upstream production continued elevated with 115,000 barrels per day, driven by high availabilities of the fleet during the quarter. This gives us confidence on ending the year close to the upper end of our 150,000 to 110,000 guidance. On top of that, Bacalhau reached first oil just a few weeks ago, a very important milestone, a key project for Galp, which will drive our free cash flow growth in the coming years. Well, but meanwhile, in Iberia, we've captured strong seasonal trends in downstream businesses, particularly in refining and in commercial, where we posted a record high quarter EBITDA. As EVP of Commercial as well, congratulations to the team with results above pre-COVID levels. Although macro environment continues volatile and challenging, Galp operates a highly resilient portfolio with a 2026 dividend breakeven just below $40. Resilience and short-term growth underpins our distinctive investment case. Maria Joao, a few comments.
Maria Joao Carioca: Thank you, Joao. Indeed, quite a few rounds around here, but strong operating performance across businesses translating into robust cash delivery. I believe that's the highlight for this quarter. Just looking at the 9 months operating cash flow, we are flattish against 2024, whereas Brent is down more than $10. So this is illustrative of the resilience that we just discussed. And on that same note of execution towards resilience, this quarter, we further reduced net debt and reinforced our financial position. Net debt is now at 0.4x. This is a reassuring level when facing the current volatility in commodity prices, it's also a solid ground on which to develop our value-accretive opportunities in the portfolio. Looking at the full year and even though we're not upgrading guidance today, we're confident that we will exceed our group EBITDA and OCF guidance based on the strong performance across the asset base so far. We acknowledge that Namibia remains the most relevant aspect in Galp's equity story. So looking into the ongoing bilateral discussions, these are showing good progress, and we maintain confidence in our time line and in establishing a strong partnership that will allow us to accelerate and to prioritize Mopane. Operator, we may now take questions. Thank you.
Operator: [Operator Instructions] We will now go to our first question today and the question comes from the line of Alejandro Vigil Garcia from Santander.
Alejandro Vigil: Congratulations for the strong results. The first question is if you can -- of course, very difficult. If you can give us some color about the -- what are you thinking about the Mopane farm down in terms of the structure, in terms of the -- in general, how you are seeing this -- the momentum of this transaction? And the second question, also probably difficult at this point is in terms of next year. If you can give us some color about how is projections about production next year Bacalhau start-up. You can give us some color initial, even qualitative about the next year guidance.
Maria Joao Carioca: So let me start with Mopane. As you know, we've been commenting on the fact that we are very, very focused on achieving a partnership that will help us drive the asset forward. So at this time, we're still not diving into details. I believe it's still critical for us to make sure that our priorities are clear. And I think the conversations we've had so far and the bidders we've engaged with speak to those priorities. We were very keen on making sure that we had an experienced operator with us to make sure that the asset moves forward at the pace and with the priority that we see conducive to good value creation for Galp. We've been reporting and we're very glad to continue to engage in conversations with bidders, and those bidders are all very experienced operators with very relevant track records. So this is where we are. I think with those bidders sitting down to talk to us, what we're doing is making sure that we get very clear alignment on progressing Mopane. And that has been conversations, that has been the tone of the conversation and progressing well. So we're very confident on making this partnership a success by year-end. And I think that is clearly the focus and the color available at this time. On next year, so Bacalhau is very, very early days, but it's a good start. We've been, of course, testing and making sure that the early numbers and the early performance of the assets are consistent with what we were expecting so far, good news. So excluding Bacalhau, we were expecting production to be fundamentally flattish. So this is on top of what are, we believe, best practice declining rates in our assets in Brazil. So we continue to have an expectation of under 5% decline rates, particularly in Tupi and Iracema. We're working towards not only sustaining, but actually making sure that we perform above those thresholds. So there is an infill campaign under execution to continue to drive the performance of those assets. So that leads us in the end to this flattish performance that I mentioned. And on top of that, you will have Bacalhau. Bacalhau will, of course, be ramping up. So we don't expect it to get to full plateau until 2027.
Operator: Your next question today comes from the line of Biraj Borkhataria from RBC.
Biraj Borkhataria: The first one is just on CapEx for next year. There's obviously one big uncertain piece, which is Namibia and any carry you might get. But are you able to give some color on what you expect to spend in 2026 CapEx if we were to exclude Namibia? And then the second question is just on the financial framework. You have now EUR 1.2 billion of debt and obviously, Bacalhau is ramping up as well. In the past, you showed a chart highlighting that you had roughly EUR 1.2 billion of capital employed in your low carbon segment. I was wondering if that's still the case. And the reason I ask is I'm trying to understand if there's a sort of structural level of net debt for that part of the business because it would be helpful to think -- as we think about sort of excess payouts and uses of free cash flow.
Maria Joao Carioca: Thank you, Biraj. Very comprehensive set of questions. So on CapEx and adding a bit more color to what I mentioned before, we're not revising our net CapEx guidance. So still at a little bit under EUR 0.8 billion per annum on the '25 to '26 period. So that is still the overall guidance. Now this year, we had, of course, approximately EUR 800 million from the announced divestments. So this leaves us with gross CapEx of about EUR 2.4 billion accumulated in the period. Now for 2026, we do expect numbers to be slightly lighter than in '25, but it's still a challenging year. So Bacalhau is still going to be ramping up. We are going to be keeping pace towards conclusion of our transition investments in Sines. And we have what is our normal run rate, so to say, of approximately EUR 400 million per year of CapEx. So if you dive a little bit into what that entails other than the upstream run rate CapEx, you also get maintained investments in renewables. We're still foreseeing approximately EUR 150 million to EUR 200 million in our renewables portfolio. And commercial has an ongoing transformation and digitalization program, and that is approximately another, I'd say, EUR 100 million per year. So all in all, we're maintaining, of course, a very disciplined approach. We continue to aim for a capital-light structure, but still guiding up to approximately EUR 0.8 billion per year because we are still in the critical stage of a number of these investments we have in the portfolio. On the financial framework and following up from our CapEx approach, so in terms of capital employed, you mentioned the numbers for our transition and for our low carbon investments. I believe we now hold approximately EUR 1.5 billion to EUR 1.6 billion in our capital employed that pertain to that type of assets and that type of approach. On debt, fundamentally, what we have is debt being managed at the corporate level. So in terms of what we see as our structural level, this reflects to a large extent, the free cash flow generation we have in our businesses and of course, the fact that we continue to drive our CapEx towards -- a significant portion of it being towards transition. Approximately, I'd say it's about 65% of our CapEx is still transformation. So there, of course, the numbers that we were guiding for in terms of CapEx and hence, net debt.
Operator: Your next question comes from the line of Matt Smith from Bank of America.
Matthew Smith: I wanted to ask -- try a couple of questions on Namibia, if I could. And the first would be, I mean, you're clearly focused on seeing the asset developed as soon as possible. So I just wanted to double check the details on that, whether that meant taking FID on the Northwest region as soon as possible, given that region is fully appraised? Or would you be open to seeing the Southeast region appraised as the next step? Or is there a red line on that topic? Or are you open to discussions with a potential new operator? So that would be the first part. And then the second part, perhaps more high level, you're clearly looking to solve for alignment on the acceleration of these assets. I mean I just wondered whether you're able to share any high-level thoughts as to how you think that can be achieved as part of the deal structure. And perhaps like a bolt-on to that, maybe it's related, maybe it's not, but a question that we're hearing more and more, would you be open to any form of asset swap as part of the transaction, if you're able to comment on that?
Maria Joao Carioca: Thank you, Matt. So on Namibia, indeed, the focus is very much making sure that we align with our partners. So we do have our own technical teams looking at the assets and incorporating all the information that we absorbed. So again, it feels like it was a very long time ago, but we went through a very fast stage of drilling and finding new information. It was critical to derisk the asset, and we are now using that information, processing it ourselves and also sharing it with our prospective buyers and developing a perspective on the asset based on that. So we're very open and the teams have indeed been progressing as we acquire more knowledge and as we -- part of the conversations with our partners has also been conducive to that shared understanding, open to perspectives on the asset, not closed on which of the Northwest versus Southeast clusters needs to be the core driver for an initial development, very open to a perspective that is just the one that drives the best space for the asset overall. As for the deal structure, again, very, very early to close on what could be a deal structure. We are, of course, trying to make sure that debt structure sets the right alignment and the right perspective in moving forward with the deal. So here, I guess, fundamentally, what we're trying to make sure is that when we are considering eventual asset swaps, those are open in the discussion as long as they allow us for clear visibility on the type of return we're getting out of the Mopane assets and as long as that those also don't hinder our visibility on how to progress further with Mopane.
Operator: Your next question comes from the line of Pedro Alves from CaixaBank.
Pedro Alves: The first one on the 2025 outlook. Perhaps if you can share a bit more details on what drives the upside to your latest official guidance. I think we have here different moving parts in upstream production, clearly with very good availability of the fleet. But in Q4, probably you will resume some stoppages. And then in Industrial and Midstream, which probably carries the bulk of the upside to your targets, certainly above the EUR 800 million of EBIT last guided. But it's also true that you will carry heavy maintenance in refining now in this Q4. So at the consolidated level, I think it was widely expected that you would exceed guidance. I guess the question is, are you comfortable with the consensus now at around EUR 3 billion for the full year? And the second question on the recent Orange Basin discoveries in Namibia and some of your neighbors. Have you noticed that this is driving any change in the market appetite or dynamics in the talks as you engage with your potential partners for Mopane. I mean these new finds obviously raise visibility on the basin, but does waiting longer for Galp risks giving prospective buyers other alternatives to elsewhere in the basin?
Joao Diogo da Silva: So I'll start with the 2025 guidance. And in fact, we are on the back of a very strong quarter, but we will not be tweaking every quarter the guidance. We are very comfortable with the previous guidance. On that revised guidance, we revised also, well, the trading conditions, we've included the Venture Global volumes. That was the major point. And as you say, we will have a last quarter with a turnaround in Sines. That's what will hit us on the fourth quarter. We still have some support on the margin side, on the refining margin side, well, supported by demand that we could call stronger than expected, but also with the supply underperformance on the new capacity, which is not coming into play as it was expected. We are also -- well, entering into the heating season and some refiners as ours will go into maintenance that will also make some support. And overall, on the downstream, we have a very strong position in Iberia. We delivered very strong results in the third quarter, but we are entering the low season. So we expect to be prudent, maintaining the previous guidance. Midstream will be, for sure, supportive, and that's all for now.
Maria Joao Carioca: Thank you. So maybe I'll pick up on the second question from Pedro on our perspective concerning Namibia and recent developments, if I recall correct your question. So Pedro, we normally abstain from commenting on what we see in the market coming out as news from other players. But generally, yes, I acknowledge the perspective you put forth as we hear news from other players and from drilling ongoing, -- and as we see what's coming out of the different players there, I mean, recently, we've heard news from Rhino. We've heard news from BW. What we still see is a basin that is very young in terms of its prospective development, but one where there's a convergence of developments that give it room for growth, and we see the concentration of interest there as very conducive to that growth actually taking place. We also see alignment in its core stakeholders. Relationships with local authorities with the government continue. There's continued interest. There's a good vision of what is the importance of having full support to the development of the asset. So all in all, what we're seeing is still a very young basin, but one where prospects continue to be conducive to investment taking place, and we continue to like the risk of the assets. So we will be farming down a bit, but still holding on to a relevant perspective -- a relevant percentage. So I think that speaks the loudest on the overview we continue to have of the basin and of Mopane in particular.
Operator: Your next question comes from the line of Alessandro Pozzi from Mediobanca.
Alessandro Pozzi: 2 for me. The first one on commercial, strong results in Q3. And just wondering if you can maybe give us your view on whether the results that we've seen in this quarter is just a function of a much stronger seasonality than usual or whether there is a structural change that would support a further improvement into 2026? And the second question is more on financials. Working capital, I think it was a positive movement during the quarter, but still negative for the 9 months. Maybe if you can give us any guidance on Q4.
Joao Diogo da Silva: Thank you, Alessandro. It's indeed a very strong quarter. On commercial, we need to assume, well, we have some tailwinds. It's always the stronger quarter of the year. So when you perform well on the stronger quarter of the year, it's an important one. I would, well, divide in 2 main aspects of the business referring to your transformation claim. So we have, of course, better news from the Spanish side after -- well, a number of volumes were removed from the market related with players that were not playing in a level brownfield. So that's one. So very supportive volumes with around 20% year-on-year growth on the fuel side. But on the second hand, we have a fully revamped nonfuel business. nonfuel as per today is contributing nearly 30% nonfuel and new business, nearly at 30% of the full delivered value on this business. So that's something that we need to sustain. Today, more than half of our tickets are nonfuel, less than half are tobacco, which was clearly a very strong anchor on the path. So if you ask me on the 2026 view, we will be clearly aiming to surpass the $300 million. That's what we will deliver this year. But of course, with the growing electric mobility network that is already on the breakeven, we've crossed the 9,000 charges mark this year, and that's also very important because as of today, we are offering a complete diverse offer to the customer when he enters into our commercial retail network, and that's one, but also supported as an integrated play. So the play with industrial, the play with midstream, it's an integrated play. And we are taking advantage of that also. So strong results and surely for the next year, above the EUR 300 million.
Maria Joao Carioca: On working capital, so maybe to put in perspective, the 9 months of this year reflect the fact that actually we ended 2024 with a particularly low level of working capital. There were very few cargoes in transit. So overall, we had a working capital level that we knew was going to be adjusted throughout 2025. And a couple of events up to the beginning of that early 2025 that impacted, the bad weather and the blackout in the Iberian Peninsula had an impact in our accounts. But fundamentally, we're returning to regular levels, not much to highlight there in terms of working capital all within expectations.
Operator: Your next question comes from the line of Alastair Syme from Citi.
Alastair Syme: In your negotiations on Namibia, are you finding broad agreement on the asset resources? I ask simply because it's quite a long time since you've updated the market on the resources. You've talked about EUR 10 billion plus in place, significant volumes of light oil. I mean are these statements that you think the prospective buyers agree with? I ask because I think this is why the sales process broke down last year. So just to get a sense of where that's at. And then secondly, very quickly, can you talk to upstream tax rates? You were low in 2Q, you're low again this quarter. What's going on? And what do you think the rate is that we should be using in our models going forward?
Maria Joao Carioca: Thanks, Alastair. So let me pick up on the Namibia. So no issues in terms of agreement as to what our asset resources in place in Mopane is. It's a topic for technical discussion, of course. But actually, as we share information and as we have the technical teams engaged, I believe there is significant alignment and the vision we have on where the most interesting areas of the assets lie and what those represent in terms of potential overall asset resources have not been an issue of stress or an issue of disagreement at all. Quite on the contrary, very supportive and aligned discussions. So on upstream, the second part of your question, what do you see in tax rates? Actually, I believe you see it on the overall tax rate for the integrated portfolio, it does reflect the fact that in this quarter, in particular, the weight -- the relative weight of upstream in our overall portfolio was lower. So as upstream usually has a higher tax incidence when you have very good performances across other businesses, so industrial delivering, midstream delivering, commercial, as we mentioned already, with record high levels, that brings our overall tax rate down, and I believe that was what you were referring to.
Operator: Your next question comes from the line of Joshua Stone from UBS.
Joshua Eliot Stone: 2 questions, please. One on Venture Global. Just if you can give any indication of when you expect a decision on the arbitration there and any expectation around what to expect, noting that we've seen different outcomes for different plaintiffs so far? And then second, on Namibia, thank you for the additional insight. I just wonder, are you able to say how many partners you're still in talks with after your short list? I'm just trying to gauge competitive tension and how that's changed during the process, which seems quite important for you.
Joao Diogo da Silva: On Venture Global, we are not expecting any outcome before next year, and that's it.
Maria Joao Carioca: On Namibia then, we're not commenting on how many partners. It's plural. I think the critical thing to us all very experienced operators, as I mentioned before, competitive tension has been in play, productive conversations. So I think the conditions for a good progress have been met, and we've been engaging with partners, different paces, but still good conversations and good progress so far. Thank you.
Operator: Your next question comes from the line of Irene Himona from Bernstein.
Irene Himona: My first question is on refining in the fourth quarter. Your maintenance will last about 6 weeks. We can work out the utilization. But can you give us a sense of where your unit margins in refining may move to in relation to the $3.2 in Q3? Are we looking at something around $5, for example? And then my second question on the upstream in Q3, you alluded to the fact that your sales were higher than your production. Can you perhaps quantify that? So what were your sales in the quarter? And what was the EBITDA benefit of that overlift?
Joao Diogo da Silva: So on the first one, so we -- well, we are expecting the turnaround to go until mid-November. We will have Plant 1 and the FCC around 50 to 45 days together at the same time. So on the quarter, we are expecting negative contribution from refining. That's what we are taking at this point. Of course, this contribution will be offset by a strong continued contribution on the midstream side.
Maria Joao Carioca: On upstream, I believe what you're referring to is the fact that this quarter, we have a lower number of cargoes in transit. So that equates a little bit to having sold more than what we actually produced. The overall impact we estimate from that, so it was approximately one less cargo in transit that we had before. The value we estimate for that is of approximately EUR 40 million, that's EUR 4-0 million. All in all, what we see is still strong production being at the top range of what is our current guidance of 105,000 to 110,000. So this effect we registered in the quarter was fundamentally ongoing normal progress of operations and just transiting the cargoes as they come into our possession.
Operator: Your next question comes from the line of Ignacio Domenech from JB Capital.
Ignacio Doménech: The first one is on exploration on Sao Tome e Principe. So Shell recently spud a well there, and I would assume that will be looking to do the same in 2026. So just wanted to know your thoughts on the exploration campaign there, if there is any commitment by that to do any drilling in the next year? And my second question is a follow-up on the declining rates in Brazil. I think you mentioned that production, excluding Bacalhau, should be flat next year. So if you can elaborate a bit on the declining rates there? And maybe if there's been any change in the recovery factor at Tupi?
Maria Joao Carioca: Thank you, Ignacio. So starting with Sao Tome e Prince, STP. No commitments so far. We do see the development in the recent activity -- the activity by Shell to be something that we will incorporate in our thought. As you know, we're looking at Sao Tome e Prince for its potential, high potential exploratory region. We do have plans to spud there in '26 to '27. But again, the information that is coming up on Block 10, and that's not a block we're in, but that information will be important in adjusting our perspective. Having said this, we are very aware of how important our growth profile is as a differentiating factor. So we're always looking at our assets and making sure that we're addressing them in a way that delivers at pace with our profile. I guess that's the perfect segue into your question about how do we see our declining rates in Brazil. So I mentioned that we're currently having -- experiencing declining rates of approximately 5% in the portfolio as a whole. And this is, as we see it very good performances. We would expect that for the type of depth and the type of assets that we're operating, declining annual rates would be in the neighborhood of 8%. We're actually delivering at below that in 5%. That delivery is in -- that concern with that type of best practice delivery is precisely what's behind the flattish production for next year. So next year, we will have the input or the uptick, if you'd like, from the infill campaigns that are under execution. So those when they come in, they allow us to halt a little bit the natural decline rate. It is already a best-performing decline rate vis-a-vis similar assets. So that's where we're standing there.
Operator: [Operator Instructions] And your next question today comes from the line of Matt Lofting from JPMorgan.
Matthew Lofting: 2, if I could, please. First, clearly, the second and third quarters have been very strong quarters operationally for Galp, which I'd like to congratulate you all on. You indicated this morning that you now expect to surpass the sort of the full year guidance, which was only updated in the summer. So I wondered if you could just expand on what areas of the business have outperformed the expectations or the baseline that you had in the summer? How much of that is a higher refining margin? How much of it is non-refining? And then secondly, I think you communicated earlier this month that Galp had formally notified Mozambique on the dispute concerning the capital gains situation in the country. Could you update on the latest status there, please, and your thoughts on it?
Maria Joao Carioca: Thanks, Matt. Let me start with how we performed so far and what the best tell us for our guidance. So I think overall, it's been good performance across all businesses. But looking into the fourth quarter, what we expect is that coming in on top of what has been very good production in upstream. So we still expect to be at the upper level of the reference we gave on 105,000 to 110,000. So that is, of course, a good driver towards our results. If you add to that the combined performances of the remaining businesses that will add to the overall perspective of delivering above the current consensus. So no particular focus there, just general throughout the portfolio, good performance, if anything, top-tier performance in terms of what we had guided for in upstream. Joao, do you want to comment on Mozambique?
Joao Diogo da Silva: I will. Thank you, Matt. So at this point, international arbitration was triggered, but we need to say that we are continuing to pursue a constructive engagement with Mozambique. Well, Galp is in Mozambique for more than 65 years at this point. We've invested more than EUR 1.1 billion in upstream projects. We are very, very, very present on the downstream business with terminals. So that's a country that we fully respect. However, on this case, the government estimates based on accounting books share capital disregards fully all the investments made in upstream. And Galp does not contest its tax obligation. But of course, we need to challenge incorrect and inconsistent interpretation of the law. And that's something that creates uncertainty and that we need to fight and to help Mozambique. So at this point, we don't have any provision recognized in the books. It's fully supported by our external assessment that reiterates our position. So we believe there are no legal grounds to sustain the account claim. But more than that, I finish where I started. We are very, very engaged to pursue a solution with the government and we fully respect. So hopefully, we will find that solution soon.
Operator: Your next question today comes from the line of Paul Redman from BNP Paribas.
Paul Redman: I wanted to come at Namibia maybe with a slightly different angle, but you talked about in your press release the fact you had a bunch of nonbinding offers through the summer and now you have a short list. I just wanted to ask, is there anything you can say on what drove that shortlist? Was it partner? Was it the valuation, FID dates, start of production date? Any color here would be really useful. And just also on Namibia, just trying to work out, I think I get a sense from who's answering which questions kind of as co-CEOs, who's running the process? Or are you both involved in the process? And then secondly, just on Mozambique, does the arbitration put any risk on the cash expected in 4Q '25? And secondly, have you thought about if Rovuma LNG does get FID-ed, how you would think to allocate that cash in 2026?
Maria Joao Carioca: Paul, I do tend to answer many of your questions, but we're all fully engaged, and I'm sure Joao would likely take up. But then again, on your question here, the shortlist notion is fundamentally taking into consideration the prospective offers we got, the pace at which the different bidders were able to address the questions that we engaged and actually the depth and the comprehensiveness of the analysis that was entailed in the initial offers. So fundamentally, we've moved at a faster pace with those players that had the best positioning and had the best ability to engage in the discussions that came in the later stages after the initial offer there. So on Mozambique, maybe just to comment on the cash issue, what Joao just mentioned, we continue a dialogue with the Mozambican government. We've also been continuing our dialogue with our advisers in terms of making sure that our position on what is the due tax is further explained and strengthened. So we don't expect any additional cash issues or cash risks in the fourth quarter concerning this topic. We do expect conversations with the Mozambican government to continue, and we do see conditions for us to continue our presence in Mozambique. I think I would underline what Joao mentioned before, this is a market where we've been for a very long time. We respect our institutional obligations. We are just pursuing the due course of the law. So finally, I believe there was an additional question there on Rovuma FID in 2026. For cautionary reasons, we do not include any additional proceeds in our numbers. So we've seen positive news in recent days. We'll see how those proceed. And hopefully, there will be an FID, but we will we will expect news on that front. We have not yet included that as an upside in our numbers. If those come along, it plays into the discussion we were having before then maybe is a big elephant in the room, a lot of what will be our future discussion in terms of how to go from there. It will be something that we will bring up once the deal is concluded.
Operator: Your next question today comes from the line of Nash Cui from Barclays.
Naisheng Cui: 2, please. The first one is on distribution. Galp delivered a very strong earnings and cash flow and net debt has coming down. I wonder if you could talk about how we should think about cash distribution in 2026, please? Then the second question is on refining margin outlook. I know your Sines refinery is going to be back online very soon. How do you see refining margin in November, December and into Q1, please?
Maria Joao Carioca: Thanks, Nash. So let me start with distribution. We are maintaining for now our 1/3 of OCF guideline. But we see that as something that has been very aligned to the type of consistency and predictability going together with the flexibility that we value considering ongoing processes such as Namibia. So the 1/3 OCF, again, together with what we've been delivering in terms of cash dividend growth, that's about 4% per annum with the flexibility to give an uptick such as the one we had last year, acknowledging favorable conditions. So this gives us sufficient room for -- as growth comes through our balance sheet and our P&L, we are indeed sharing that and distributing that to our shareholders. We like the consistency through the cycle of having a steady guideline based on OCF. And you have seen us use buybacks as kind of the plug-in number to ensure additional performance flows through to investors as we release it. So no expectations all in all to change this overall guideline. We do believe it will serve us well, and it will allow us to flow through any good performance in terms of cash generation straight through to our shareholders.
Joao Diogo da Silva: And Nash, on the refining outlook, I've made a couple of mentions to the demand -- supply-demand balance at this point. So we are we are expecting, if we think forward on the first Q, we are expecting some part of the underperformance of the new capacity, [indiscernible], we are assuming that they will come back in full potential. So that's one. On the second hand, we will be in the heating season and some refiners will be into maintenance on the last quarter, but they will come back, hopefully. That will be the case of Sines. So that's another one. And thirdly, at this point, we know that we have lower inventory levels on both sides of the Atlantic and a couple of Russian capacity at this point are affected. So around 20% to 40% of the Russian capacity is affected. So there are a number of factors that will add us to a much more prudent environment on the refining side. So we are expecting a lower margins on the first Q. But all in all, we are very focused at this point on the turnaround and to do it in a safe way, and that's where we are.
Operator: [Operator Instructions] And your next question comes from the line of Guilherme Levy from Morgan Stanley.
Guilherme Levy: I have 2, please. The first one, we have seen later last week that Petrobras has had a setback on its arbitration proceedings against the ANP on the ring fence discussions on the Tupi/Iracema [indiscernible] fields. Are there any updates that you can share with us? And are there any courts that you can take this process to after arbitration? And then the second one also related to the ANP, but are there any updates on the unitization proceedings of Berbigao?
Maria Joao Carioca: Thank you, Guilherme. So on the recent developments on the arbitrations, we see these as a lot of news flow here and a very important asset. So the discussions on the ring fence are, of course, very, very loud. But what we see here is not a setback, an ongoing discussion. We are progressing with our arguments. We see local authorities still engaged and making sure that we take the asset forward. We understand the conditions in Brazil. So we understand that there is the need to discuss the ability to generate value from that asset and to make sure that all the parties and stakeholders involved are driving the right value out of it. But fundamentally, what we continue to try to work on is an active dialogue with ANP, with Petrobras, our partners in Block and with the local government. The developments that we see are steps. We are -- we've acknowledged that we don't share in the vision concerning the way to treat these reservoirs. The geological data tells us those are separate reservoirs. So we continue to activate the appropriate legal actions to protect our interest there. So the recent decision has been focused only on future outflows. That means that currently forgot that we no longer have any cash outflows concerning our position in preserving our interest there. So overall, we'll continue to monitor. We'll continue to be very actively engaged, and we'll see how that progresses, but still defending our interests. On the unitization of Berbigao, so no fundamental decision. It's still an open matter. Thank you.
Operator: We will now take our final question for today. And your final question comes from the line of Peter Low from Rothschild & Co. Redburn.
Peter Low: The first was just on Bacalhau. Can you comment what you expect the production contribution to be in the fourth quarter? And then what the shape of that ramp-up might look like through 2026 and into 2027? And then the second question was on cash tax payments. They looked like they were quite low in 2Q and 3Q. Is there any kind of seasonality at play there? And should we expect a step-up in the fourth quarter?
Maria Joao Carioca: Thanks, Peter. On Bacalhau, so we had a very low volume expectation for this year, so for the fourth quarter of '25. The first oil did come up in line with what were our expectations. But overall, the contribution is still very slow. What we're seeing in terms of take-up from the actual operations is positive. It's good pressures and also what we're seeing is also good delivery so far. But we'll monitor and assess to make sure that the ramp-up takes place. What we have as referenced for the ramp-up continues to be our cost experience in the basin. So in Tupi, for instance, some of our best performers had the fastest ramp-up of approximately 11 months. So it's clearly a different size boat and some differences in the assets. So we do see ramp-up of at least a year. Again, going back to my prior mention of full contribution coming up only in 2027. So when it does come up, just as a reminder, that should be approximately 40,000 barrels per day share. And if the Brent holds at, say, 70,000, this should be approximately EUR 400 million in OCF per annum at plateau, but we'll see throughout 2026, and those are expected numbers only for 2027 as we plateau. Cash tax payments. So again, what we have is there's an element of phasing in our taxes. So typically, we have a pretty high first quarter, and that took place. Our overall guidance is still at the level of approximately EUR 0.9 billion. So no change there. And what you've seen in this quarter was, again, as a recall, just the impact of having a lower weight of our upstream business, which is more heavily taxated than our remaining businesses. So a mix effect in our overall tax rate with our cash overall payments expected to be fully within guidance for the year.
Operator: Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.