SNGN Romgaz S.A.

Good afternoon, ladies and gentlemen, and welcome to our conference call for discussing the results recorded by Romgaz Group in the first half of 2026. After introducing the speakers, Mr. Razvan Popescu, Chief Executive Officer, will make an opening speech. Thereafter, the Q&A session will take place. Please be advised that this conference is being recorded for internal purposes. On half of the company, the following speakers attend this conference. Mr. Razvan Popescu, Chief Executive Officer. Mr. Aristotel Jude, Deputy Chief Executive Officer, Ms. Gabriela Trambițaș, Chief Financial Officer, Mr. Adu Moldovan, Energy Trading Director, Mr. Ion Foitaș, Production Department Director, and our Investor Relations Department. Now I would like to give the floor over to Mr. Zvan Popescu, who will open the conference call with an opening speech.

Good afternoon, ladies and gentlemen. Thank you for joining our conference call to discuss the result recorded by the Romgaz group in the first half of this year. Today, we released the Board of Directors report, which comprises a detailed presentation of our economic performance and the consolidated interim financial statements. Also, an overall presentation of the group is available on our website in the investor section. I will start by highlighting some of the aspects of the gas market environment in the first half of 2026 compared to the same period of the previous year. We estimate that natural gas consumption in Romania increased by around 3% to 60 tera, while imported volumes declined by 14%, reaching a 22% weight in the total gas consumption. The European natural gas market remained challenging and highly volatile during the first half of 2026, Market dynamics continue to be shaped by geopolitical uncertainties, lower storage levels, and Europe's increasing exposure to global energy markets, while security of supply remains a key priority across the region. Romania, Romgaz activities continue to be influenced mainly by the ordinances issued to regulate the gas prices. The main legal provisions applicable to gas producers include regulated gas selling price of 110 Ron megawatt hour applicable starting 1st of April 2026 and up until 31st of March 27 for the gas sold to household consumer and their suppliers and to heat producers was higher at 120 RON per MWh and was applied to a slightly wider category of consumers. For the gas sold at regulated prices, payment of the WIP for profit tax is exempt and gas royalties are computed based on these regulated prices instead of the ZEG reference prices. Regarding the operational and financial performance recorded by the group in the first half of 2016, We recorded a natural gas production of 2.4 BCM, which exceeded by 22 million, or almost 1%, the level budgeted for the first six months. In Q2 alone, the natural gas production was 1.17 BCM, and we succeeded to narrow the production decline to 2.8% year over year, closer to our strategic annual goal of 2.5%. and an improvement compared to the decline recorded in the first quarter. The six-month output results were achieved through steady efforts aiming to consolidate the potential of our onshore production, which included intervention and completion operation, which allowed us to resume production at 89 inactive wells that improved production by over 62 million cubic meters, successful exploration activity and completion Gn Romgaz S.A. Gn Romgaz S.A. S.A. Gn Romgaz S.A. We continue to hold a significant position on the domestic gas market in the first six months. Romgaz was the leading gas supplier with a 43% market share in total gas delivery according to our estimates. Regarding gas consumption covered only from domestically produced gas, we have a 55% market share according to our internal assessments. lower by 10% year-over-year as a result of declining production and volumes extracted and sold from storages, but also a regulated lower price. Revenues from storage services were higher by 3% year-on-year at R284 million, with withdrawal-related revenues up by 30% and capacity reservation having a 54% weight. As of 30 June 2026, 86% of the operational capacity of our gas underground storages was already booked. Revenues from electricity added 149 million RON, adjusted by 16% year-on-year due to an almost half production of the old power plant to 182 gigs. Overall, Romgaz Group reported total revenues of 3.88 billion RON adjusted by 9% compared to 4.25 billion RON in the previous year based on the lower contribution of our gas segment. Regarding expenses, we recorded willful profit tax of 486 million RON and royalties of 284 million RON representing a total expense of 771 million, only up 0.4% compared to the previous year. S.A. In the second quarter alone, we recorded a net profit of 763 million RON, elevated by 4.7% compared to last year, and the highest net profit rate ever recorded in the second quarter of the company. On the capex side, the first half of 2026, Romgaz will be invested in a total consolidated amount of over 2.55 billion RON. Of this amount, 2.02 billion represented the investment in Romgaz Black Sea Limited and 429 million the investment that were made by Romgaz alone. 99 million was the capex for the depot gas subsidiary. Regarding our strategic project, Neptune Deep, the progress made this year is aligned with the budget and with the execution calendar. The Transocean Barrens drilling rig is currently drilling and completing well operations. Six wells have already been completed out of a total of 10 development wells across the project. Installation of the Neptune Alpha offshore production platform was achieved in July, representing a major milestone of the project of an unprecedented magnitude for Romania and the EU. The 160 km offshore main gas pipeline has been installed. This will transport natural gas from the Neptune Deep Alpha platform to the shore at Tuzla. and delivered into the national grid. Also, preparatory drilling works have been performed in H1 for the Anaconda 1 exploration well, with drilling scheduled after the Neptune Deep block drilling is completed. We aim to explore this new prospect in the Neptune Deep block. As a result of this significant development, Romgaz and OEV Petro are on track to safely deliver the first gas from Neptune Deep in 2027. and the project does remain within our 4 billion euro guidance for the total investments. Another strategic objective is the CCGT Power Plant in Yerba. The project has now entered an advanced implementation stage that comprises the execution of already awarded contracts and the procurement procedures for the remaining activities. The multidisciplinary team dedicated to the project Simultaneously managing design, procurement, negotiation, contracting, execution and monitoring activities. A memorandum has been approved by the Romanian government in May, aiming to facilitate the procurement process. It enabled the initiation and acceleration of award procedures, reduced decision-making times and facilitated the fast mobilization of all entities. As a result, significant progress has been made Gn Romgaz S.A. S.A. The shareholders approved the transfer of business agreement between Romgaz as a buyer and Azomurash as a seller. For Romgaz, the agreement's scope is to improve the gas value chain, provide new value-added products, and also assure a partial natural hedge against gas price volatility. At the end of the presentation, I would also like to mention the dividends that Romgaz distributed this year. We remind that on 29th of April, the shareholders of Romgaz decided upon total gross dividends of R606 million, which resulted into a total payout ratio of 19% for the last year and will allow Romgaz to partially finance its significant investment.

Ladies and gentlemen, the line is now open to take the questions. I would like to remind you that you have two options to address your questions, either to raise your hand and turn on your microphone or write a question.