Ecopetrol S.A.

Good morning. My name is Natalia and I will be your operator today. Welcome to Ecopetrol's earnings conference call, in which we will discuss the main financial and operating results in 2024. There will be a questions and answers session at the end of the presentation. Before we begin, it is important to mention that the comments in this call by Ecopetrol's senior management include projections of the company's future performance. These projections do not constitute any commitment as to future results, nor do they take into account risks or uncertainties that you materialize. As a result, Ecopetrol assumes no responsibility in the event that future results are different from the projections shared on this conference call. The call will be led by Mr. Ricardo Roa, CEO of Ecopetrol, Rafael Guzman, Executive Vice President of Hydrocarbons, Camilo Barco, CFO, and David Rianio, Executive Vice President of Transition Energies. Thank you for your attention. Mr. Roa, you may begin your conference.

Welcome to the Operational and Financial Results Call of the Ecopetrol Group. We met our operational and financial targets, consolidating a growth path which set the foundations for a solid beginning for 2025 and enabled new possibilities to progress in the energy transition. I want to highlight our resource replacement results. The reserve replacement ratio was 104% with the addition of 260 million barrels of oil equivalent of proven reserves, maintaining an average reserve life of 7.6 years. This doubles the addition of proven reserves when compared to 2023, which reflects our commitment to the country's energy security. Around 99% of these results respond to organic management and was complemented by the acquisition of Repsol's 45% stake in the CPO 9 block, which added 32 million barrels of oil equivalent to our reserves. We renewed the agreement with OPSI to extend the development plan in the Permian Basin with an estimated investment of $885 million in 2025, including the drilling of 91 development wells. we achieved an average production of 746,000 barrels of oil equivalent per day, exceeding our annual goal on the highest level of the last nine years. In exploration, we surpassed our 15 wells target by drilling 16 wells with a three-year exploratory success rate of 43%. where the Sirius II, while in the Colombian Caribbean offshore, stands out as it is a key to expand the country's gas potential. In this trend, we exceeded our annual goal by transporting an average of 1,119,000 barrels per day. This achievement proves our resilience and operational flexibility, ensuring the supply of crude to the refineries and products to our customers. Regarding downstreams, we faced electrical reliability challenges while successfully completing the annual plan of shutdowns and major maintenance, achieving an average operational availability of 94.5% and reaching an average throughput of 414,000 barrels per day. In the commercial front, our trading subsidiaries in Singapore and Houston continued their support in markets and customers diversification, improving the crude margins when compared to 2023. Let's move to the next slide, please. We accomplished a year of strong economic performance that generates value for our shareholders, despite external factors such as chain rates and inflation, which affect us recurrently. In 2024, we record total revenues of 133.3 trillion pesos, an EBITDA of 54.1 trillion pesos with an EBITDA margin of 41%, and a net income of 14.9 trillion pesos. Excluding external factors, net income would be 21 trillion pesos, an increase of nearly 10% compared to 2023. We invested over $6 billion of CAPEX, including the acquisition of CPO9 in line with our annual plan. Additionally, we collected the entire account receivable from the Fuel Stabilization Price Fund of 2023 and celebrate the 63% reduction of the 2024 balance. Efficiencies, which have been important to mitigate cost increase, reached 5.3 trillion pesos, surpassing in 43% the year's ambition. Meanwhile, consolidate payments to all our shareholders, Richard. 42 trillion pesos. In line with the above, we just announced the proposal for a dividend distribution of 214 pesos per chair, which will be submitted for approval in the coming general shareholders meeting on March 28th. Let's move to the next slide. In terms of TESG, Ecopetrol obtained the second best global rating on the oil and gas industry in the Dow Jones Sustainability Index. On the environmental front, I would like to highlight three achievements. First, the reduction of greenhouse gas emissions by more than 462,000 tons of CO2 equivalent since 2020 which represents the CO2 emitted by over 840,000 cars. Second, an 81% of water reuse in our operations, increasing 7% in terms of volume when compared to 2023. And third, in biodiversity, the stored and avoided emission through natural climate solutions projects. On the social side, we invested over 606 billion pesos in the sustainable transformation of the territories, our leadership in the national allocation of works in lieu of taxes with a 45% share, and the various projects we promote to the benefit of hundreds of Colombians. In innovation and technology, we became the first Latin American country to join the International Energy Agency's Greenhouse Gas Research and Development Program, which we boost through the Colombian Petroleum and Energy Transition Institute. In governance, we were recognized as the best company in Colombia for attracting and retaining talent by Merck. We also transformed our organizational structure to become more agile and efficient according to the needs of each business line. Finally, I would like to highlight Ecopetrol's contribution to the regional GDP within Colombia of over 1.3 trillion pesos, proving that sustainability investments generate financial benefits and promote economic development. I now hand over to Rafael Guzman, who will talk about the results in the hydrocarbons business line.

Thank you, Ricardo. In the hydrocarbon business, we are focused on profitability and sustainable cash generation. This is demonstrated by the Ecopetrol Group's successful incorporation of proven reserves in 2024. achieving a reserve replacement ratio of 104% and maintaining an average reserve life of 7.6 years. We added 260 million barrels of oil equivalent in proven reserves, doubling the 2023 addition. In this regard, I would like to highlight the following. Improved reserves revisions, the contributions of Rubiales and Cañosur Fields stands out, thanks to the outstanding results of the drilling campaign and the maturation of new projects. Management efforts were focused on economic factors, mitigating the impact of a lower price of Brent, which decreased by $3 per barrel compared to 2023. This was possible thanks to the implementation of initiatives such as cost optimization measures, the strengthening of the crude oil basket, and agreements reached with the ANH regarding their economic rights. These actions not only mitigated the impact, but also resulted in the incorporation of over 6 million barrels of oil equivalent in reserves. Now, the primary contribution derives from the expansion of improved recovery projects in Colombia, amounting to 97 million barrels of oil equivalent. representing 37% of the total incorporation. Extensions and discoveries include the commercialization of Arrecife, Saltador, and Toritos. On inorganic incorporation, the main contribution relates to the acquisition of Repsol's 45% stake in the CP09 block, located in the Department of Meta. This purchase added 32 million barrels of oil equivalent to 1P reserves and enabled nearly 8 million barrels of oil equivalent of organic incorporation through synergies with the Chichime field. Additionally, we executed divestments, resulting in a net addition of 29 million barrels of oil equivalent. It is noteworthy that 89% of the total proven reserves are from fields in Colombia, where we achieved a 109% reserve replacement ratio. Lastly, on the gas front, in 2024, we incorporated 15 million barrels of oil equivalent, following two years without adding proven reserves of this hydrocarbon. In addition, as part of our effort to strengthen the CAST portfolio, we increased contingent resources by 1.3 trillion cubic feet, mainly from the Sirius discovery. Let's move to the next slide, please. As part of our active and efficient portfolio management, we successfully completed important deals in 2024. to ensure the profitable sustainability of the hydrocarbon business. Regarding acquisition, and as previously mentioned, the purchase of Repsol's stake in the CP09 block, this transaction strengthens Ecopetrol's position in the Llanos Orientalis basin, providing benefits in reserves, production, and potential volumes to be developed of over 250 million barrels of oil. This also enhances decision-making agility and creates synergies in the development and operational cost, as Ecopetrol now holds 100% interest in the cluster that includes the Chichimene, Castilla, and CP09 assets. Furthermore, we extended the joint venture between Ecopetrol and Oxy in the Midland area of the Permian Basin until June 2026. with the possibility of signing a new extension of the development plan in the future. The contract for the development of the Delaware sub-basin will remain in force until 2027. Likewise, we implemented a dilution strategy, resulting in the signing of 10 agreements with TAREX, aimed at reactivating areas with high exploration and development potential. Under these agreements, PADEX plans to carry out investment exploration activities in Piedemonte and Farallones. Likewise, in Putumayo, PADEX will invest $350 million as carried in exploration and development, with the expectation that both companies will incorporate resources in 2025 as projects mature. Simultaneously, we continue to advance our agenda with the National Hydrocarbons Agency and the Ministry of Mines and Energy to maximize activities within the areas of existing contracts and agreements. This effort has resulted in the extension of 15 exploration contracts across various regions of Colombia, as illustrated on the map. All these milestones will serve as future sources for reserves incorporation. Let's move to the next slide, please. In exploration, we progressed with the drilling of 16 wells compared to the 15 initially planned, with an investment of $454 million. As a result, seven wells were successful, including Caripeto I, which confirmed the presence of hydrocarbons during the initial test in January 2025. Two wells are currently under evaluation, and seven wells had no commercial hydrocarbon balance. In addition, we highlight the progression of resources to proven reserves with the commerciality of Arecife, which contributed to a total of 6.8 million barrels of oil equivalent. Lastly, in 2024, Ecopetrol acquired interest in four additional blocks in the Santos Sur project in Brazil, with a 30% stake for a total of 11 blocks. Let's move to the next slide, please. In 2024, the Ecopetrol Group achieved a production of 746,000 barrels of oil equivalent per day, exceeding the target for the year. These results were primarily supported by the performance of the Permian and Cañosur fields. Additionally, the continuous contribution of assets in Colombia, such as Castilla, Rubiales, Chichimene, and Piedemonte, which generated 42% of the Ecopetrol Group's production. Fields with improved recovery technology contributed with nearly 41% of Ecopetrol Group's total production. Regarding the production levels in the fourth quarter of 2024, it is important to note that the lower levels were anticipated within the projections and are mainly attributed to the anticipation of permanent activity in the first nine months of the year, environmental events due to the rainy season causing electrical disruptions mainly in Rubiales, Yarguí, Chichimene and Castilla. hurricanes affecting Ecuador, America, regular low-well gas sales during the end of the year. In 2025, we estimate a production between 740 and 750,000 barrels of oil equivalent per day, which incorporates production from the acquisition of 45% of CPO9, but also consider social unrest risks. Let's move to the next slide, please. In 2024, transported volumes increased by more than 5,800 barrels per day compared to the previous year, primarily driven by graded deliveries of Castilla Norte crude oil from the Barranca Bermeja Refinery and the implementation of commercial strategies that facilitated the addition of barrels outside the transportation network. Thanks to mitigation strategies, enhanced operational control, and coordination with government entities, more than 7 million barrels were evacuated from the Caño Limón field through the Bicentenario pipeline, following the suspension of the Banadilla-Ayacucho section of the Caño Limón-Coveñas pipeline. In 2024, this segment achieved the highest net income amounting to 5.2 trillion pesos and recorded the second highest EBITDA reaching 11 trillion pesos and contributing to 20% of the total EBITDA of the Ecopetrol Group. Let's move to the next slide. In 2024, the refineries achieved a throughput of 414,000 barrels per day with an average annual operational availability of 94.5%, despite a challenging market and operational environment. The gross refining margin decreased by $7.7 per barrel compared to 2023. In 2024, it stands at $9.9 per barrel. 78% of this impact is due to the decline in international fuel prices, mainly affecting diesel, gasoline, and jet fuel. 11% primarily due to the effect of the lower availability of segregated light crude oil at the Barranca Bermeja refinery as a result of the attacks on the Caño Limón-Coveñas pipeline. And the remaining 11% was the result of operational events such as the limitation of the coke compressor and the power shutdown at the Cartagena refinery. Regarding the latter, we continue advancing in the comprehensive plan to restore refinery's electrical reliability, having completed four of the 16 planned milestones. By 2025, we aim to advance 10 milestones. As a result of the aforementioned factors, the segment's EBITDA stood at 2.2 trillion pesos in 2024. 69% less than previous year. When normalizing for exogenous factors, the EBITDA would have been 6.9 trillion pesos with an EBITDA margin of 9.9%. In 2025, the segment's efforts are concentrated on levers to enhance business profitability and mitigate exogenous effects such as cost and expenses optimization, focus on operational and logistical efficiency. initiatives to maximize business profitability to the production of higher value products including petrochemical asphalt and chemical recycling and the execution of energy transition projects aimed at sustainability and diversification of refining products into new markets such as renewable jet and diesel production automatic petrochemistry low emissions hydrogen production and improvements in air quality Let's go to the next slide. In 2024, the Ecopetrol Group continued materializing its efficiencies strategy with a contribution of 5.3 trillion pesos, exceeding the target proposed for the year. As shown in the lower left figure, the efficiencies were able to offset the increase in total unit cost by $0.97 per barrel. resulting in a total unit cost of $47.71 per barrel in 2024. Lifting, transportation and refining costs were impacted by exogenous factors such as exchange rate, inflation and gas prices. This year, we will continue to execute our efficiencies program with new initiatives aimed at increasing the profitability of our operations and investments. maximizing asset value, enhancing synergies within the integrated hydrocarbon chain, and identifying optimizations in our supply chain. The program aims to achieve efficiencies by 4.6 trillion pesos. Now, I'll turn it over to David, who will discuss the main milestones of the energies for the transition business line.