YPF Sociedad Anonima

Good afternoon, ladies and gentlemen. Welcome and thank you for joining us in this special day. Today we celebrate the 30th anniversary of YPF on New York Stock Exchange. Before we start, I would like to point that you have some paper and pens on your table in case that you have any questions, we will collect it at the end. is an integrated energy company which generates energy efficiently and reliably through the development and production of conventional and non-conventional gas and oil and renewable sources such as wind, sand, land and water. With the development of Vaca Muerta Geological Formation, YPF is a leader in the production of unconventional hydrocarbons in Latin America. And through three industrial complexes located in La Plata, Lujan de Cuyo, and Plaza Huincul, it generates fuel, petrochemicals, and lubricants, offering a full range of products with a strong commercial presence in retail, agriculture, industries and LPG. YPF has as well a logistic network to supply more than 1,500 service stations across the country. And because of that, it has become the network with the largest coverage in Argentina. YPF is a leader in the fuel market. Its products ensure performance, adequate protection for each engine design, sustainability and environmental care. It provides electric power to Argentina, with thermal generation plants a renewable energy source, as well as fertilizers and special products to the entire Argentinian countryside. In addition, starting this year, YPF has embarked on the search and exploitation of lithium in the country, together with CONICET, the National Scientific and Technical Research Council. They formed Y-Tech, a technological innovation and development company for energy production. And now, yes, it's the moment to hear from the director and chairman on the board of the directors, Pablo Gonzalez. And later on, the CFO, Alejandro Leo, along with the CEO, Pablo Juliano, are going to share with us the annual results for 2022. Thank you.

Good morning to everyone present. Thank you very much for joining us on this day so important for YPF and I would say for Argentina. You know that YPF has a social composition of 51% of the national state. Of that 51%, 26% is the national state and another 25% of the production provinces. And the other 49% is listed here, in the New York Stock Exchange. That is why I want to thank the New York Stock Exchange for lending us the place to be able to celebrate our 30 years of entry to the stock exchange. I want... there are many friends, I hope, surely some will forget me, but I'm going to try to name those who are with us today and who are with us with their presence. First to the Argentine ambassador to the United States, to my friend, my dear personal friend Jorge Arguello, a person who is permanently close to YPF and helping YPF. And many of the achievements that we are going to tell you now that we have had fundamentally last year and the previous one, Jorge is also part of this. To Flavia Rollón, to the Energy Secretary, who accompanies us and who also obviously works with us on a daily basis. Agustín Jerez, the president of Narsa, who is doing an uncomfortable task with Mr. Kirchner's gas station. among others, among others of his works, the product that will be finalized on June 20. I also want to thank the presence of the Consul of Santiago Villalba, I want to thank Carlos Raimundi, to you Carlos, thank you for being here. I also want to thank the journalists who have come to Argentina to accompany us, to cover this event. Thank you for being here. And I want to thank the workers and the workers of YPF. I also want to thank the unions related to our activity. They are the ones who have achieved what we are now going to announce, much of which was announced yesterday when the Directorate approved the balance of last year, but the projects that we are going to tell you now can only be carried forward by what is the most valuable thing that IPF has, which are not its reserves, but its people, its workers and its workers who have managed to reverse a situation that in the year of the pandemic determined to lose a billion dollars to this reality of growth that today that we are here to tell you. I would also like to thank the trust of the President of the Nation and the trust of the Vice President of the Nation, who had the vision in 2012 to create, to recover YPF and create this associative system between the public and the private that is bearing fruit. Yesterday the Directorate approved the memory of the financial state of the year 2022. I'm going to give you two or three more data because the rest will be explained better than me, Pablo and Alejandro. The 7.2% production jump in equivalent barrels is indeed the most important organic jump in the last 25 years. Compared to 2014, there was a higher interannual organic drop, but it was due to an absorption. At that time, in 2014, the Apache company was bought, and you know that it is not the same as drilling wells and putting them in production, that buying a company with wells in production. I say this for something that I have read today in some medium of my country. 7.2%. In equivalent barrels we have grown last year. Last year we had revenues of 18,757 million dollars. And we had expenses of 13,682 million dollars. We had an EBITDA of 4,947 million dollars. It is one of the highest EBITDAs in the company's history. It is one of the highest EDIPTAs in the history of the company. And you know that when I talk about EDIPTA, I am talking about the development of wells, I am talking about efficiency, I am talking about work, I am talking about a growth both in oil and gas, which is the heart of YPF, which was not registered many years ago. In CAPEX, we, post-pandemic, We had a year of 2,700 million dollars. Last year, the Directorate approved a CAPEX of 3,700 million dollars. Look, at the end of the year we corrected it to 4,100 million dollars. And this year, the Directorate has approved a budget of 5,500 million dollars. We have prudently reduced it a little to see the financial year and the context as it tells us to continue, but it is a year of growth. Evidently and absolutely it is a year of growth. In terms of gas, you know that the dead cow reserves are 308 trillion cubic feet and Argentina consumes 1.8 trillions of cubic feet per year, with which we have reserves for 170 years at this level of consumption. What is IPF doing? It is carrying out an associative process with one of the largest projects of the last few years, which means nothing more and nothing less than monetizing those gas molecules and exporting GNL to the world. We are waiting for the National State to refer to the National Congress the Marco Law and from there a different work begins. Every three months we have committees of work with Petronas. Two days ago we were with the CEO of Petronas and Houston. It was a very good talk and the truth is that The final reflection of the last committee... Of course, I am a lawyer. The final reflection of the last committee was... All of them, both the executives of Petronas and YPF, said, well, the work of lawyers and accountants is over, and now the work of engineers begins. That is, we have been carrying out a process that will determine, tomorrow, export 25 million tons annually, at the peak of the project. That means approximately 460 ships. We are going to make a gas pipeline, very similar to the one here, it helps us a lot, the expertise that Enarsa has had and how Enarsa has led that process. Once this gas pipeline is finished, there will be a Petronas ship and from there the platforms will be built. Also today we are going to tell you that one of the objectives that we are going to have is to see how we get, we associate ourselves to be able to exploit the reserves that the australian basin has in Palermo-Aique. When I told you that the reserves of Vaca Muerta were of 308 trillion cubic feet, we thought that the potential of Palermo-Aique is in the 130 trillion cubic feet. This is a challenge that we have already started to talk with our partners, with the IPF partners that have accompanied us during these years. In terms of oil, you know that Vaca Muerta has 16 billion barrels of reserves. IPF production has been growing last year in non-conventional, interannual oil, and IPF has grown by 47% of production. Still, conventional oil produced by IPF is superior to non-conventional oil. But it won't take long, obviously, for it to surpass it in gas. It is already surpassing it. In gas. Non-conventional gas from IPF is already surpassing the production of conventional gas. 38 million cubic meters. We believe that it is time to also look at the Moaiq in oil where we think that there may be 6.6 billion barrels to be able to exploit. We have also advanced with offshore and we have the possibility to carry out a potentiality that I do not say that it will be similar to Permian, but it also gives it great possibilities of IPF. There are about 7.5 trillion barrels that are believed to be there. We have had a meeting with Equinor about 48 hours ago. It is the first time that the highest authorities of the IPF meet with the highest authority of Equinor, where we are willing to keep moving forward. Always respecting environmental standards, always investing in energy transition, always enhancing IPF-Luz. In 15 days we are going to inaugurate the first solar part of YPF in San Juan, a project called the Sonda. It is an investment of 300 million dollars and we are about to add 200 million dollars more. We have incorporated, we are incorporating a new wind farm to YPF Levalle in Córdoba with an investment of 150 million dollars and today YPF is the second producer of renewable energy in Argentina with 400 mega. Therefore, while the heart of YPF is oil and gas, YPF will continue to invest in renewable and clean energy as well as lithium YPF and will continue to project a new Argentina through ITEC. I wanted to give you some data, nothing more. The rest will be explained by Pablo and Alejandro. I have to thank the director of YPF I have to thank everyone who permanently collaborates with us. Last year, a journalist told me, what you are saying is very good. We see that investors do not gain confidence. Something is happening. The numbers indicated that we were growing in production, that we had very good standard of efficiency, that we are close to Permian in our levels of efficiency, that our people have learned, that this cost of development is a cost of development that has taken us ten years. We have gone from a conventional exploitation in decline to a non-conventional exploitation that marks the future of Argentina. From this talk with this journalist, here. In the New York Stock Exchange, where I suppose that, let's say, something is understood, the financial system of the capital market, the IPO share has grown 130% in dollars. So, I thank you for your presence here. I ask you to continue to accompany us in these growth challenges. that we keep thinking and we all believe that this public-private system does work. It does work. And here are the numbers that they will explain to you much better than I do. So, to those who are listening to us in Argentina, happy 30 years, to the IPF workers, and thank you very much for joining us. Have a good day. Thank you very much. I give the floor to Pablo and Alejandro. We always joke with Pablo since IPF's CEO, the share price has increased by 130%. So I want to thank the work of all IPF in the name of Thank you all for coming.

Both of you listening on the live streaming, thank you for joining us. And all of you here coming to downtown Manhattan on a Friday afternoon. I know it's a lot of effort, so thank you very much for being here with us today. In terms of the financial release for the 2022 fiscal year and also the fourth quarter, we decided to spare you from the trouble of listening to us for like 30 or 40 minutes. So we decided to modernize ourselves and put it together in a 10-minute video, which we believe is going to be much more comfortable than listening to us. And after the video, Pablo and myself, we go through a strategic outlook presentation, which we believe is important. it's going to be also even more relevant for you to listen to us on that and, of course, into Q&A. So, if you can please go ahead with the video.

Thank you. 2022 was a very special year for us at EPF. We celebrated our 100th year anniversary and we managed to deliver exceptional results. After being able to stabilize our hydrocarbons production decline in 2021, in 2022, we achieved the largest organic growth in our oil and gas production of the last 25 years, a remarkable 7%, backed by a capex plan of $4.2 billion, almost 60% higher than in 2021. Our focused CAPEX deployment in unconventionals permitted us to maintain a healthy reserve replacement ratio of 124%, permitting our total audited proven hydrocarbon reserves to record a new annual increase of 4%, totaling close to 1.2 billion barrels of oil equivalents. We also led the process of putting forward major infrastructure projects related to the de-bottlenecking of Vaca Muerta, including the new Vaca Muerta Oil Norte Pipeline to connect to the existing Trans-Andean Oil Pipeline to export into and through Chile. the major expansion of the Old Vivald and OTA systems to more than double current export capacity through the Atlantic, and the engineering of a completely new pipeline and terminal system to enable further export growth potential from 2026 onwards through the Atlantic. All in all, these projects shall involve investments of around $4.5 billion over the next three years to be shared among participating oil producing companies. Despite intense cost pressures, we still managed to consolidate from adjusted EBITDA of almost $5 billion, the third highest mark in the company's history, and we recorded an all-time high net income of more than $2 billion. During 2022, we continued prioritizing the safety of our people, although we had to regret two fatal accidents that further increased our focus and our commitment to secure operations with zero fatalities. In 2022, we expanded by more than 70% the total training hours for our direct and indirect workforce, contributing to achieving the lowest mark of injury frequency rate for the last five years. at 0.32. We also continued working hard on reducing our direct greenhouse gas emissions, deepening the path to become not only a low cost, but also a low carbon energy producer. Our total GHG emissions declined in absolute terms by 7% compared to the previous year. more particularly within our shale operations during 2022 we achieved meaningful progress by reducing our carbon intensity by 20 to an average of 15 kilograms of carbon dioxide per barrels of oil equivalent during 2022 we also continued expanding our boundaries in relation to new energy solutions not only advancing on a solar project in the province of San Juan through EPF-Elus, but also launching our first lithium exploration project in an area of 20,000 hectares in the province of Catamarca. Shale Operations The positive evolution in our shale output was once again the result of a determined strategy to accelerate the monetization of these unique resources, taking advantage of the world-class competitiveness already achieved. In that sense, in 2022, shale oil and shale gas expanded 45% and 47% year-over-year, respectively. as we continued accelerating our well construction activity, reaching a total of 154 horizontal operated drilled wells, 36% higher than in 2021. During 2022, we also continued with the strategy of developing vacuum water beyond our core hub blocks. To the south, we tied in two wells at our fully-owned Lajas Este block and drilled two new shale gas wells in Las Sacanas While in the north, we completed six new wells along the year at Baco del Toro Block and drilled four wells at our fully-owned Loma Amarilla Block. Conventional Operations On the conventional side, we continued making progress in stabilizing our oil output, which remained flat on a sequential basis in the fourth quarter. we continued extending tertiary recovery techniques, reaching new production records in the Manantiales Bear Block, and obtaining promising results from the key three pilots deployed at Chachahuén in Mendoza, El Trebo in Chubut, and Los Parales in Santa Cruz. Downstream Review During 2022, we managed to reach historical levels of supply of fuels into the domestic market, effectively facing the largest ever demand of diesel and gasoline. Our sales of diesel increased by 10%, while dispatched gasoline grew 14% compared to 2021 levels. This incremental demand was partially based through a successful effort in maximizing processing levels, which increased by 5.7% year over year, and also through higher-than-average imported volumes during certain times of peak demand. However, a reduction in domestic diesel demand in the fourth quarter and even higher capacity utilization rates of around 89% at our refineries allowed for a normalization of imported volumes, which represented 9% of all fuels sold in the fourth quarter. The average local fuels price in dollar terms increased by 28% during the year, partially tracking the rapid rally in international reference prices. And although the volatile global environment led to a widening of the gap between local and international prices in the second quarter, such differential has been reduced over time, standing at 25% in the fourth quarter and between 15 and 20% so far in 2023. Financials Review Even though our free cash flow in the fourth quarter turned negative from the back of the acceleration of our CapEx activities and an extraordinary income tax prepayment for 2023, we closed 2022 as the third consecutive year delivering positive free cash flow. With more than $750 million of FCF accumulated in 2022, we ended the year with a net leverage ratio of 1.2 times. Going forward, our healthy liquidity position, which comfortably covers our debt amortizations for the next 12 months, and the low outstanding debt levels within the local capital markets and with our relationship banks, should provide us with enough flexibility to tackle our even more ambitious plans for next year. Target 2023. For 2023, we're targeting a CapEx plan of around $5 billion. Once again, focused on our shale block, in which we're allocating about 50% of the total. With this focused plan, which also contemplates the allocation of resources to the midstream initiatives, and the continuation of our multi-year investments in upgrading our refineries, we anticipate another year of very healthy production growth, with particular emphasis in the expansion of crude oil output. In summary, we are proud of our achievements during 2022. and are even more excited with the opportunities ahead of us. Although we envision 2023 to be a challenging year on the back of both global and local uncertainties, we are committed to remain focused on delivering the historical opportunities that we have in front of us. The capital efficiency achieved in our Vaca Marta operation along the last 10 years and the financial flexibility gained along three years of prudent deleveraging, coupled with a talented group of professionals that form our company, should pave the way for us to deliver outstanding value to our shareholders, employees, partners, suppliers, and the Argentine population. We are ECFA. We are the past. We are the present. And we definitely are the future.

Hello. Hello everyone. Thank you very much for joining us today. Those of you are physically here with us as well as the many of you that connected to the live streaming. It's very important for us to know that we count with all of you on the very special day for YPF. It's been a while since YPF management presented a strategic plan beyond the bits and pieces that we have been commenting on certain events. And we understood that this occasion of celebrating the 30th anniversary of our stock being listed in this institution, the New York Stock Exchange, was the right want to share with you our strategic outlook focused on addressing the unique opportunities that we have in front of us. Our company celebrated its 100th anniversary last year. It would be very strange to imagine such a long trajectory being smooth or linear. Many things have happened along the way. Some very positive and others not so, but together they have set the grounds for building into the future. And at this very juncture, we find ourselves facing unique opportunity to grow our company in a leap of ways, with a very focused approach on what we know, how to the best. which is generating value by providing affordable and reliable energy that also contributes to the global decarbonization process. Since we initiated our journey in Vaca Muerta over 10 years ago, we understood we have a tremendous opportunity in front of us. But the challenge is and fears abounded. Ten years later, after going through a remarkable learning curve, where we have invested over $10 billion on a net basis, we are proud to say that we have managed to make the dream come true. having proven the quality of their resources and having achieved levels of competitiveness that rival those top of the class within the US shale industry. And achieving these levels of competitiveness in Vaca Muerta makes the cornerstone of our focused strategic path going forward. particularly within the global geopolitical context that puts energy back at the center of economic and social debate. Piggybacking on the global trends, we have immersed ourselves into the task of accelerating the monetization of Vaca Muerta, with a first-stage plan Priorities in the crude oil opportunity targeting to become once again an ex-exporter of crude oil. To then overlap in coming years with the massive monetization of our shale gas resources through the development of LNG capabilities. And even though we expect that the crude and natural gas opportunities have many years to be played out, particularly natural gas, even if now the well-accepted role as a transition fuel. We also envision further opportunities in the long run that should further expand the company's portfolio of energy solutions toward clean energies. We are therefore already positioned ourselves to take advantage for our unique stance within Argentina to participate in the development of alternative clean energies, given that our country is also blessed with other unique natural resources, beyond Vaca Muerta, including particularly renewables as a key factor for green hydrogen and lithium. We are convinced that this renewed strategy has a tremendous opportunity to generate value for all our stakeholders while contributing to the global decarbonization process. In that sense, developing and exporting crude oil and shale gas from Vaca Muerta will contribute to replace carbon-inefficient energy sources such as coal. the most carbon emitters of the three main fossil fuels, which still represents over 25 of the global energy matrix. Furthermore, when looking at sustainability in this full conception and not just a pure environmental approach, the monetization of our hydrocarbon resources generates an extraordinary transformation of the country's energy balance of payment. The country's energy, providing the international monetary reserves that are so critical to unlock economic growth and in turn improve living standards for the Argentine society. Let me now walk you saw the main pillars of our strategic outlook when looking to our key short-term opportunity concentrate in the monetization of oil we clearly focus on our activity in our back and mortal blocks including not only our key core hub assets but also but also expanding in other areas conforming the North and South Highlands.

Short interruption.

I continue. And to that end, we have already devised and implemented a detailed program of mid-team de bottlenecking, including the expansion of existing pipelines, The construction of a new pipeline expanding the connection between Vaca Muerta and the Pacific while putting back in operation the Trans-Saharan oil pipeline. And the engineer and initial delineation of a completely new system connecting Vaca Muerta to the Atlantic expected to be up there running by 2026 and that should serve as a key enabler for the future growth from 2026 onwards. Beyond Vaca Muerta, we also have the opportunity to establish our conventional oil production. Even though our unmaterial conventional blocks have been in constant decline for many years, the successful introduction of EOR in Manantial's rare field has transformed that reality. On the back of that experience, we are finalizing the pilot stage in three other areas in the provinces of Santa Cruz, Chubut and Mendoza that are so far rendering very encouraging results, providing the possibility to increase recovery rate from those reservoirs and expecting them to serve as the main contributor to the stabilization of crude oil conventional production in coming years. We also expect to move forward with multiple exploration opportunities in coming years. For instance, during 2023, we expect to drill the Argyris Well, the first ultra-deep-water exploration well in Argentina to be drilled at 1,500 meters below sea level in the Cantian Bloc. where we partnered with Equinor, the operator, and Shell. Should this prospect render positive results, we could be entering an appraisal phase in the upcoming years and then a capital-intensive developing phase not before 2028. Moving to our second strategic growth vector, natural gas, We expect only moderate growth in the next few years, with opportunities concentrated in the local markets and limited to supplying our renewable and increased commitment under the recent planned gas auctions. But even with moderate growth, we shall be tackling immediate needs in the bottlenecking needs. particularly involving the expansion of our subsidiary Mega natural gas system to separate and monetize the richer gas out of Placa Muerta, as well as local gathering and overground facilities. But to truly unlock our shale gas potential, we will continue to move forward in coming months, together with our partner Petronas, with the technical and economic analysis of large-scale LNG projects. As previously announced, the full project targets total processing capacity of 25 million tonnes per year and should represent the key way to place Paca Muerta's shale gas in the global market. turning YPF and Argentina into a world-class LNG exporter. Finally, as we take comprehensive look at the global energy market and the transition towards clean energy solutions, we believe there is also a very relevant role for us to play given Argentina's world-class resources in lithium and renewables. In that sense, In the next few years, we shall continue expanding our footprint and renewables, throw YPS loose by developing about 100 to 150 to wind and solar capacity per year, reinforcing the penetration of renewables within the local power mix and over time becoming the basis for an attractive green hydrogen opportunity. On this particular topic, we have recently led the formation of a consortium to participate in the German initiative Hydrogen Global that will provide funding for a pilot project involving 30,000 tons a year of green ammonia to be sourced from outside of Europe. We also recently stepped into the lithium business by signing an exploratory concession in the province of Catamarca with processing techniques to make lithium carbonate production more efficient and sustainable still under development. We decided to tackle the lithium opportunity in a conservative way. That is why we decided to take advantage of our geology and exploration expertise going for a greenfield project as opposite to validating elevated entry price for projects that are a few years ahead in their development phase. I will now dive a little deeper on three main growth vectors. Before concentrating in the outstanding opportunity that we have ahead of us in Vaca Muerta with total recovery resource of about 16 billion barrels of oil. Let me just briefly mention that there are other opportunities for further growing oil production in Argentina in the medium to long term. The two largest and most attractive of those opportunities are the scale formation are the shell formation of Palermo-Aique located in the Austral Basin, particularly in the province of Santa Cruz, with total recovery resource in the order of 6.6 billion barrels. And the offshore Cancian block located out of the coast of Buenos Aires, with estimated recovery resources of about 7.5 billion barrels, where we have set ourselves on the path to explore their potential in coming years. In that sense, we shall drill one or two horizontal wells in Palermo-Aique before the end of this year, while as previously mentioned, also planning on drilling the Archerich Ultra-Deep offshore well. But it is clear that Our major opportunity for the next five years shall be the efficient development of our Vaca Muerta Acreage. So far, since we started with the delineation of Vaca Muerta back in 2012, we have concentrated on the development of our core hub at 215,000 Actors' extensions are composed of the Loma Campana, La Amarga Chica, Bandurria Sur, and Aguada del Chaniar blocks. The former three working on JVs with the international partners Chevron, Petronas, Equinor, and Shell, and the latter being a more recent initiative, 100,000 by YPS. And even so, we have tremendous progress in terms of operational performance. We are still at a very large stage of development. In this regard, we estimate an aggregate portfolio of about 3,000 horizontal wells for full field development of the core hub assets. And so far, we have only drilled about 20% of that, expecting not to exceed 50% in the next five years. despite the acceleration of our development plan. And more recently, we have also moved forward with the delineating new blocks in the north and the south of our core hub, estimating total full field development potential of another 2,850 wells just considering the main blocks. Within these blocks, during 2022, we drilled six new horizontal wells, four at Loma Amarilla and two at Sur de los Lagos blocks. And completed and tied in total of eight wells, two drillers in Sur de los Lagos and another six drillers in the previous year in Bajo del Toro, all of which complementing activity from previous years in those same blocks. Moreover, we are also verifying the efficient limits of Vaca Muerta by drilling two horizontal wells in South Mendoza and potentially drilling one or two horizontal exploratory wells in the province of Rio Negro next year. Finally, let me highlight the economics behind this development. Based on the experience accumulated so far in the main blocks within our Vaca Muerta portfolio, in the next five years, we expect an average development cost of around $8 to $10 per barrel of oil equivalent, and a listing cost between $4 to $5, leading to break-even at net price of around $0.35. to $40 per barrel in constant currency. Assuming a long-term cost of capital. Therefore, we expect our business model and key strategic focus on the monetization of Vaca Morta Oil to remain resilient among changing global dynamics. Now, Into our second pillar, let me start by highlighting that given the vast estimated recovery of shale gas resources in Argentina's subside, which could last for centuries at current level of local consumption, we are committed to development LNG infrastructure to enable this rapid and efficient monetization. Already very well now, based on estimates from the International Energy Agency, Argentina holds the second largest shale gas reserves in the world, hosting recoverable shale gas resources of around 800 TCS, with Vaca Muerta representing the lion's share of those resources to about 300 TCS. In addition, another interesting but yet untapped formation, Palermo-Aique, in the Auxerre Basin, is estimated to hold another 130 PCF. With this level of resources and having already proven the efficiency of Bacamorta Shales gas on the back of different initiative plans put forward by the Argentine government, we believe we should now embark in an ambitious journey to unlock its full potential. To that end, last year we announced the signing of an MOU with Petronas, which has been a partner of YPF in La Marga Chica block since 2015, to analyze technically and economically a large-scale integrated LNG project. This project under analysis considers a total liquefaction facility of 25 million tons per year to be developed in several stages. The first of which is then designed for a capacity of around 5 million tons per year. It is key for the project to consider a minimum scale to justify a dedicated pipeline connecting the upstream blocks in Vaca Muerta with this facility. Under a new regulatory framework that is expected to be enacted in coming months, the export-oriented project should have no interference from local imbalances that could affect its normal operations. So far, we have been making steady progress in firming up technical considerations and we expected FID for the first stage by the second half of next year. And also, there are alternatives under analysis that could accelerate the time to market At a smaller scale, to as close as 2026, the bulk capacity of the first stage would probably not be ready for commercial operation before 2028, once and only if the world capacity is built. We estimate this project could add total export revenues of about $20 billion annually to Argentina's balance of payment, becoming a game-changer in terms of international monetary reserves and still having plenty of room to grow even further. The last growth vector of our Strategic PAL stands for Clean Energy, which Despite not having a major value generating visibility in the short term and medium term, it does involve a tremendous opportunity in the long term. As mentioned before, Argentina has unique resources that can help it become a world-class player of the energy transition. With an estimate to over 100 billion tons of lithium carbonate equivalent resources, our country stands as the second largest lithium reservoir in the world, representing more than 20% of worldwide lithium resources. And given the expectation for lithium-based energy storage, to become mainstream in the not-so-distant future. We find ourselves extremely well positioned to advance on this opportunity. To this end, as mentioned before, we have entered into an explored concession agreement in Catamarca province on a 20,000 hectares block to explore for economically viable lithium-brane concentration. We have already finished work on surface exploration through systemic surface sampling and vertical electric sounding and now plan to drill a first exploratory wheel within the next two months. Subject to positive results, we shall continue with subsequent development phases which within five years will require about $50 million in total investment. Finally, should the different exploratory facets render positive results, we should enter a commercial phase involving the construction of industrial-scale ponds, carbonate plants and other facilities required, with an aggregate investment of about 300 to 500 million dollars to reach a production plateau of about 15 to 25,000 tons per year by 2030. Separately, as I already commented, YPF has a unique opportunity in coming years to participate in the development of green hydrogen, taking advantage of Argentina's competitive renewable energy resources. It is important to highlight that electricity costs represent a large portion of the electrolysis process to produce hydrogen, making efficiency of renewables a key factor to be competitive in green hydrogen generation. Therefore, the opportunity to build large-scale onshore wind farms in southern Argentina with average capacity factors while exceeding the world average that could be commonly located near deep world ports on the Atlantic Ocean, provides for a unique competitive advantage for future green hydrogen development. Its potential efficiency has been laid out in recent research piece released by Bloomberg New Energy Financing that shows Argentina as a potential top three green hydrogen producer. Based on a comparison of level listed cost of production and adding the scalability of wind power generation in Patagonia, we could consider a scalable green hydrogen project that could grow to be as large as 8.5 MTPA in a single location if we limit it only to the maximum wind power capacity that could be gathered through an efficient isolated transmission system, aggregating about 100 gigawatts of installed capacity, equivalent to 2.5 times the total installed capacity currently available in Argentina. We are convinced of the opportunity of monetize our vast hydrocarbon resources. We remain very conscious of the efforts required to minimize our carbon footprint. We are well aware that global energy transition is not going to happen overnight and that the diversification of 80% for fossil based current energy matrix will require a decisive commitment and will definitely not be cheap. In that sense, when considering sustainability in a broader way, the social impact of more expensive energy will crash with the average of climate change if we do not contribute with more affordable, more reliable and less carbon-intensive fossil while transition to a cleaner matrix. To that end, given our growth prospects and value generation proposition coming primarily out of our Vaca Muerta development in coming years, we have identified the key opportunities to reduce our Scope 1 and 2 CO2 emissions, even though our back-and-forth operations already reached relatively low carbon intensity levels in 2022, averaging 16 kilograms of carbon dioxide by We have many initiatives that should allow us to further reduce that metric to about 15 kg by 2023 and to less than 10 kg by 2030. Let me give you some examples of these initiatives with more than 50% of current carbon dioxide equivalent emissions in our back-and-forth operations coming from flaring. We have already designed a plan that should continue to evolve over time to invest in liquid separation, compression, reliability, and gathering that should allow us to completely eliminate routine flooding and minimize total flooding by 2030. In addition, deploy and leak detection and repair program and with vapor recovery units furnished facilities now being our norm. We also expect a significant reduction in methane fugitive emissions, well above the 30% commitment by Argentina during COP26. And last but not least, Incorporated technology to electrify our operations, including a first electrical power grid and introducing dual fuel frag sets should also contribute to reduce our carbon footprint as early as this year. And beyond that, we are challenging ourselves towards an even more ambitious objective. yet to be firmed up to commit to net zero back-and-forth operations by 2030. We shall continue our emphasis in coming months to put together a comprehensive plan to reduce the carbon intensity of back-and-forth operations and to identify different alternatives to manage residual emissions, including natural-based solutions, CCUS projects, and or carbon bonds that will allow us to determine the real viability of such a commitment. And now, let me turn to Alejandro to go through the main figures that relate to the strategic outlook.

Thank you very much, Pablo. I couldn't be in any other way, right? The CFO was talking about the numbers. So let me just start by commenting a little bit and tackling on what the platform from which we are going to start our plan for the next five years, which is what happened in the last two, but very quickly. We went through the video already, but just to summarize it, we clearly managed to stabilize our production in 2021. That was the big challenge that we had ahead of us after five years of continuous decline, which was further accelerated in the pandemic, where we declined by 10% in our hydrocarbon production. So 2021 was the year where we challenged ourselves to manage to stabilize the total oil and gas production, and we managed to do that through a very conscious approach and focusing on our CapEx plans since very early on that year, even though we were still in the middle of, or coming out of the worst ever crisis that the company had underlived in its 100-year history. And then after that, we managed to go into 2022, projecting or forecasting the largest organic growth in the company's history, or sorry, in the last 25 years, actually. And we managed to achieve that, even though we were slightly behind our expectations, where we started the year announcing a guidance of 8%, which then increased by almost 9%. Finally, the number came at 7.2% in oil and gas. But still, that was primarily the result of a decline in our gas production in the fourth quarter due to lack of demand. So at the end of the day, we still feel very comfortable with our achievement, and particularly with how we managed to grow our oil production, which is, as we have mentioned already, our key priority. And when looking into that also, back at Muerta, our shale operations continue to be the main responsibles for all of this growth. In 2021, we managed to grow our shale oil and gas operations by 36%. And in 2022, as mentioned in the video, it grew by 45% and 47% for oil and gas, respectively. So, clearly, we feel very proud of those achievements and of the operating efficiencies that we managed to achieve in our back-and-forth operations along these last few years. This clearly has allowed us to improve profitability, recover our healthy operating cash flow. And in that way, we went back to levels of EBITDA, which topped the best years that this company had. As we mentioned, 2022, we reached almost $5 billion. That was in line with our target. And that represents the third largest EBITDA mark in the company's history. And while we did that, we clearly managed to accomplish our investment plan's objectives, being able to not only tackle the initial investment plan that we announced at the beginning of the year, but further than that, we increased that by another 10% and we deployed with an exceptional amount of activity in the fourth quarter of $1.4 billion invested. We accomplished our target of $4.2 billion of CAPEX investments. which does not only accomplish, as I said, our gains at production growth, with the exception of, as I said, the natural gas decline in the fourth quarter because of lack of demand, but also positions us very well for taking or tackling the opportunity that we had ahead of us to continue the acceleration of the monetization of the back and water resources, as we are going to comment in a minute. And finally, clearly as a result of this, the positive free cash flow that we had in the last three years, 2020 for the bad reason, clearly we had to cut back on the CAPEX plan in an aggressive way because of the financial restrictions. But after that, clearly 2021 and 2022 ended up being very positive years for cash flow generation. All in all, among these three years, we accumulated about $2 billion in net cash flow, even though in the fourth quarter of this year, due to the acceleration of the CAPEX plan, we had a negative free cash flow of a little bit over $150 million. But through that, We ended the year with a very healthy net leverage ratio of 1.2 times, which clearly forms one of the pillars or the basis in terms of financial flexibility for tackling the opportunity that we have ahead of us. As mentioned in the video, what does this mean for our plans for 2023? We have established ourselves in an even more ambitious plan than in the last couple of years. We are targeting for 2023 to invest about $5 billion, clearly in all of our operations, but with the focus remaining in our upstream operations. where shale will remain clearly the largest, will gather the largest of our attention or our focus. On that regard, we are expecting about $2.3 billion to invest in our shale operations. Clearly, our focus, as mentioned before, will remain in oil. We believe that, as Pablo mentioned, in the strategic path, We believe that the short term, the next five years, is going to be mostly about monetizing or accelerating the monetization of our crude portfolio. Clearly, with a slower growth in gas, but knowing that gas, we will have further room or further time to tackle that opportunity as we move into LNG and become a net exporter of natural gas in the future. But then clearly our CAPEX plan is aligned to that with about two-thirds of our upstream investments going to oil and one-third roughly going into natural gas. And when looking into the breakdown of shale, what we have is that, of course, the main focus is going to be on well construction in drilling and completion activities. But still in this year, we are having a larger proportion of investment in facilities than is the norm for the long run. For this year, we are targeting slightly over 30% of roughly $700 million in facilities investment related to not only tackling the facilities that are needed in the short term, but also preparing ourselves for the outstanding opportunity that we have in the years to come. So many of these infrastructure investments includes a portion of mixing, but mostly it has to do with gathering of natural gas and on-ground facilities for oil treatment and gas treatment that will unlock and enable the opportunity, the growth opportunity that we see in front of us. With this CAPEX plan, we are targeting to grow our overall hydrocarbon productions by about 5% this year, 2023, but really focusing on the oil growth, which we are expecting to achieve about 8% year-on-year growth in oil, while we expect end of year, basically December, of fourth quarter 2023 compared to the year before to be growing by about 10%, so closing on very low double-digit rates, but of course very healthy and ambitious growth rates. And on the other hand, as consistent with what I was and what Pablo mentioned before, given our low expectation for growth in natural gas in the coming years. We are targeting only a 3% growth in natural gas, mostly related to tackling or supplying our commitments or renewed commitments under the most recent planned gas auction. And Here, one relevant thing, you probably recall last year we had announced that we committed to a maximum net leverage of two times for 2022. We clearly over-accomplished that, finalizing and finishing the year at 1.2. For next year, as we are expecting this ambitious plan to result in a negative free cash flow for the year, we would expect to take, or we are planning to take on extra net new debt And so we are committing to still a prudent financial policy, but allowing ourselves to grow or enlarge our indebtedness given the very healthy level that we are starting with. So for next year, we are basically committing to not exceed 1.3 quarters times in terms of net debt to adjusted EBITDA along the year. And now into the longer run, I would say. These are clearly not a full-blown business plan, but at least some broad ideas in terms of the numbers that we are working on. As we said in the video, next year or this year, 2023, is clearly going to be a challenging year. We expect volatility, both coming from international markets, as you well all know, and as well as in the local market. So it's difficult to put together a comprehensive medium-term business plan with that volatility right in front of us. But we still believe that the levels of capital efficiency that we have already achieved in our back-and-forth operations, we believe that provides us with enough resiliency, as Pablo was mentioning, for the first time ever we are announcing break-even prices for our shale oil operations. As Pablo was saying, break-even at net prices of $35 to $40 per barrel for the next five years in constant prices. So clearly that provides us with enough resiliency to be able to show or explain the views that we have for the next five years, right? Which could be faster or slower, but we believe that in five years time, we should be definitely around the variables or the metrics that we are presenting here. So in summarizing it, we are expecting to double our total oil production when comparing 2027 to 2022 results. We are expecting to grow a more moderate 30%, roughly 30% of our gas, total gas production. And we are planning on doing that by achieving to stabilize our conventional oil production. And this is mostly through the investing in EOR, in tertiary production, where we expect total tertiary production to reach about 20% of our total conventional production by 2027. That is part of investing about $800 million in tertiary production along the years. And through all of that, we expect to be able, by the end of this five-year period, to be exporting about 35 to 40% of our total oil production. That is roughly, in terms of numbers, that would be about 150,000 barrels of oil per day. And if we manage to do that, and based on, of course, some assumptions in terms of prices, that could potentially be representing about a third of our EBITDA by 2027. So if we manage to do all this, we will be probably reaching the largest levels of oil and gas production in the company's history by reaching about 800,000 barrels of oil equivalent by 2027 and reaching about 450,000 barrels of oil just in terms of oil. And as we also see in the second column there, particularly in terms of shale, we are expecting to multiply by four our total oil production and doubling our shale gas production. This would basically represent about 70% of our total hydrocarbon productions by 2027. And in doing this, it's not that we are projecting or assuming, I would say, lunatic levels of further operating efficiencies, but rather we definitely believe that there are some there is some room to further improve in terms of drilling, particularly in drilling and completion. But then given cost pressures, we are not projecting massive reductions in development costs by rather assuming about the 10% door to door in this five year period, 10% reduction in our overall development costs. I'm going into numbers for this. If we manage to do all this, we will require an average of $5 to $6 billion in annual capex, so similar levels to the ones that we are putting in place for this year, probably slightly higher, but within that range, we could accomplish, given the combination of factors that we are putting in place, we believe that with a level of $5 to $6 billion in annual capex, we could accomplish these levels of growth opportunity. And as Pablo was saying before, and it was implied in the charts when he was talking about monetization of oil, we would be drilling in this plan about 1,200 horizontal wells of oil and about 500 horizontal wells of gas in our shale operations and that is consistent with this amount of capex and that would be consistent with the production growth that we are showing here and in doing that as mentioned before 2023 is likely to be a year of negative free cash flow and probably 2024 as well but then we clearly see with the ramp up in production that we expect to be accomplished through this focused capex plan, we expect to become a structural positive free cash flow generator from 2025 onwards. And in that way, we are establishing an objective to top our net leverage ratio at 1.5 times at the end of this five year period. So we expect to continue achieving further decline in our net leverage ratio. And even in doing that and capping it at one and a half times by the end of 2027, we are estimating to have a total of about $6 to $9 billion in remaining resources, cash resources to be deployed to long-term investments. So I know that many of you are wondering when we are talking about the massive or large LNG project, how we are assuming to finance that well clearly it's part of the plan and of course we have to deliver on this ambitious plan but we believe that the capital efficiency that was already that has already been achieved in Vaca Muerta allows us to think of this not as a dream but as a palpable reality that we of course need to put in place in coming years and And to finish up on these numbers, and let me take some time on this chart or on this slide. We are here putting sort of sources and uses, comparing what was the period of the two years of 21-22 with the next two years, 23-24, and then the three years beyond that, 25-27, clearly separating between a negative free cash flow period on 23-24 and then a positive free cash flow period in the three years after that. And when looking at this, of course, in 2021, what we are seeing is that our cash flow of operations was more than enough to cover for our interest expenses and our CapEx plan, and that's why we have excess cash that was deployed towards reducing our net leverage. And for the future, of course, we try to put some sensitivity analysis to different scenarios in terms of international oil prices. And there we are playing with levels of Brent at $60, $80, and $100. I would say that we are centering it around $80 because that's sort of where we expect Brent prices to be, I would say, in a conservative way in the coming years, clearly, Forecasts in the industry are all over the place and it's going to be extremely hard to pinpoint a specific number at this specific point in time. But that's why we wanted to show an ample range of what our cash flow could be under these different scenarios. And so when we look into 23-24, the range of the years for the average for 23-24, we see that With the roughly average of our estimates, which would be the second part of the blue chart, the middle light or middle solid blue column in the middle of the chart, we see that that will be slightly short of cash to completely fund our interest expenses and our capex plan. And that's why we are saying that we are likely to be a negative free cash flow generator during those two years. However, if Brent prices were to rally once again, of course, We would not, and let me tackle clearly local prices, we would probably not expect, as was the case last year and probably is going to be remaining this year, we would not expect to fully track those international prices, although we are not expecting to be completely decoupled from the international reality either. So for as long as we see international prices going, either running too fast or well beyond historical averages, We believe that there is a higher chance for the local market and YPF to have to absorb some distortion in terms of local prices to international parities, of course, both in the crude oil side and in the fuel side. And that is just, you know, looking at reality that has been the case in the history. And for as long as international prices go back to more or closer to historical levels, we assume that the local market tends to converge to international prices. So that's how we are sensitizing also our numbers. So in this sensitivity analysis, it's not that we are assuming that if Brent goes to $100 that we are going to capture $100. the full benefit of that. But of course, as we grow our export base and clearly as the rest of the market benefits from a larger export base, that will also allow the local market or the local prices to absorb some of that distortion. But in summary, so for 2023-2024, under the scenario of rallying international prices, even though considering some further gap in local prices to international parties, we could become, we could be, again, cash flow positive. Clearly, this is a combination of, you know, 20%, about 20% of our revenues that are priced at international prices. Those are products out of our refineries. We keep on saying this, probably we are boring you on this, but we have about 20% of our revenues coming from products of our refineries other than fuels that are sold either through exports or in the local market, but priced at international parties. And then also clearly some correlation in local prices to international parties that also help us in benefiting from that rally. So that's the sensitivity analysis. And let me just mention it's very small in there. There is a very light green portion of that bar in the 23-24 period. We are considering the possibility of an active dividend policy strategy. And of course that will depend on whether we manage during those first two years of our five year outlook, whether we manage to make sure that we can fund First of all, our opportunity in terms of capital investments, which we believe that that's the first priority to generate value for our shareholders. And for as long as we manage to do that within the levels of financial prudency that we mentioned, keeping at below one and a three quarters times net leverage, we would expect to at least have some dividend being paid out. And that would also depend on the ability to access the FX market on the back of regulation that would provide that, but that still requires further implementation to be fully in place. So, subject to those two variables, we would expect as early as this year, and same for next year, which are similar years in terms of financial flexibility, to have at least a modest dividend to be paid out. But again, depending on those two variables, right? Prioritizing capital investments and also depending on the ability to access the official effects under the current regulation, which is basically Decree 277. And then moving into the third range, the years 25 to 27, clearly we there see that our plan becomes resilient even under much lower global conditions. So what we see is that even with Brent prices at $60, we should be able to fully fund not only our interest expenses but also our capital investment plan as well as more, I would say, more reasonable or more in line with, I'm not going to say industry standards because there is no standard these days, but clearly a larger dividend payout ratio. And of course, when we look into the range of expected prices and closer to the $80, that's where we start to be significantly cash flow positive. And that's where we generate the resources that we were mentioning that could be generated and be spread up to invest in long-term capital plans or projects in the future. With that, I will turn to Pablo for some... Key takeaways. Pablo, thank you.

Thank you, Alejandro. Before ending our presentation and jumping into the QA, let me briefly recap the key takeaways from our strategic outlook. It was well known for many years that Vaca Muerta had a tremendous potential given the level of recovery resources that set the Neuquina basin as one of the few super basins around the world. And over the years, we have led the industry in transforming Vaca Muerta from a dear dream into a palpable reality. Teaming up since the very early days with reliable international partners that brought their experience to Vaca Muerta was a key factor that not only contributed with capital injections, but also incentivized technical innovation and operational efficiencies of partnerships have allowed us to undergo a very productive learning curve enabling us to rival top of the class scale producers into the USA in terms of capital efficiency. In spite of our smaller scale and younger development stage. We therefore have aligned our short- and medium-term strategy to be as focused as we can in accelerating the monetization of these very unique resources. And in doing so, we should grow Argentina's role as a relevant energy exporter. expanding on the crude oil export, replacing the current natural gas imports and allowing the country to become a relevant worldwide LNG player. And in the long term, we shall embrace clean energy solutions based on Argentina's unique natural resources with opportunities to become a world-class producer and exporter of green hydrogen and a large exporter of lithium, a key mineral that should enable further penetration of intermittent renewables within the global energy matrix. The opportunity is clear. And we are determined to grasp it.

Thank you very much, Pablo. Sorry, we are trying to coordinate for some closing remarks from the Ministry of Economy, who was unable to join us physically, but who wanted to give at least a virtual presentation I would say salutation, if you may call it, and provide some closing remarks. So we are trying to coordinate. That's why I was looking at my phone. We are trying to coordinate the specific timing, but I think he's going to be with us in just one or two minutes, the virtual connection. And in the meantime, I just want to mention we are, of course, going to handle a Q&A session, mostly directed to our analysts. As you know, this is formally also the conference for the financial results of 2022. And so we want to provide, as we typically do, a space for analysts to ask any questions that they have. that they want. There are some of them here present in this room, and many of them are virtually connected. So we will try, after the closing remarks, we will handle that Q&A, and we will prioritize those questions. And, of course, then any questions from the audience here physically, we can, of course, undertake that as well if time permits. So if you have any question that you would like to raise in the order of organization, if you would please write it down. There is a piece of paper and pens on the tables and we will collect them. And again, depending on how many questions we get from analysts, then of course we could also leave some space for answering some of the questions of you here in the room. I'm not very good at that. Okay. Very good. They're asking me to extend this. So, as you know, I'm a financial guy, so I don't know how to do that. I could be talking about more numbers if you want, but I guess I will bore you. Maybe what I would suggest, I know it's going to be a discoordination, and maybe... The people coordinating this will kill me, but maybe you can grab some coffee while we wait for the minister's closing remarks and then we go into the Q&A. Maybe that's a good idea, no? Yeah, let's do that.

Oh, there he is. Sorry. Okay. I didn't see that.

Well, good afternoon for us in Argentina. Good afternoon for you in New York. The truth is that I would have liked to be there accompanying them and that was the objective. Unfortunately, obligations typical of the closing of the fourth quarter review and the Argentinean perspective 2023 in its program with the fund forced me to continue working in Buenos Aires to announce it as soon as possible to the market, so That is why I am here in Buenos Aires, in the IPF building, a symbol of Buenos Aires and Argentina, and a symbol of the leadership of our company in terms of what it represents for the business sector and for the energy sector of Argentina. I am convinced that with what I have done so far in our country, managing to attract international companies to the development of Vaca Muerta, with thousands of perforated wells, of an increasingly important production in the Argentine energy matrix, we have sown the seed to have an energy-exporting country and be a relevant actor in the crude market, but even more so in the gas market, whether through gas pipelines in our region or through liquefaction and GML for the whole world. Today we have record production levels. Hydrocarbons with 573,000 barrels per day of oil and 134 million cubic meters of gas per day, a figure that our country has not seen in ten years. When I say that we have planted the seeds, it means that we still have great challenges and projects for that seed to grow strong and in the future of its fruits. These challenges are real and concrete. and it means the next stage in the development of our energy resources. Today, Vaca Muerta is a reality. Hundreds of thousands of barrels are produced and every year hundreds of new wells are drilled. The challenge now is above the ground. As we expand the existing transport capacity, which for decades has not had major changes in our country, and we adapt it, We improve and rethink to not only reach places where gas does not reach today, but also to facilitate our export to the world. Beyond Vaca Muerta, Argentina has, like in the United States or other non-conventional planes, also challenges to explore and develop. This potential is enormous and I am sure that the opportunity is now to put them in value. It is thus, as YPF, together with the General Fuel Company, is about to explore the austral basin in the Palermo-Aique formation. This formation is the generating rock that, like a dead cow, has generated a good part of the hydrocarbons that are produced today in Santa Cruz and Tierra del Fuego in the last 40 years. Our geologists estimate that it can contain more than 10,000 millions of barrels equivalent to oil. Today there is close infrastructure and the potential for export to Chile or also via Tierra del Fuego to the Atlantic Ocean. The program is to drill the first wells this year and somehow confirm the potential for eventual development. For you to understand, we are talking about Palermo Hayque representing a third of what Vaca Muerta represents in terms of barrels and in terms of TCF of gas. In some way, it represents the opportunity of Argentina to multiply even more its capacity and its energy-exporting dream. These growth opportunities can take us in the next four years to exceed the million barrels per day. and reach 170 million cubic meters of gas daily, 30% higher than the current one. I am convinced that the role of the IPF in pushing most of these projects is a huge opportunity for the hydrocarbon industry in general and for the country as a whole. For this, decision and accompaniment with public policies are needed, that encourage the production and work of this industry whose multiplying effect in our country is enormous. I want to mention to you some of those most relevant projects that, once realized, will allow us to achieve those production objectives, unleashing and promoting the dream and the true energetic potential of our country. the reactivation of the Transandino oil pipeline, a pipeline that allows us to export crude oil to Chile and that, as a result of the fall in production in the country, has been closed and abandoned for more than 10 years. Today, EPS has initiated the reactivation of this pipeline, which in the coming months will allow us to export oil to our brother country of Chile with a capacity of 18,000 cubic meters per day. This implies Argentine currency and quality work, broadening the productive horizons of our country. Additionally, the construction of a new oil pipeline called Vaca Muerta Norte is added, with an investment of 260 million dollars that will allow to connect Vaca Muerta with the Transandino oil pipeline. We are also setting up the expansion of the DEVAL, a 40-year-old polyhub that takes the Neuquén crude to the ports of the province of Buenos Aires, with the consequent expansion of the Ovil Tanking terminal to the effects of giving storage to that level or to that volume of crude. In this case, we are going to duplicate the transport capacity for measures of 25. To finish, the other great project in logistics investment that YPF is promoting is the Bacamuerta Sur oil pipeline, which will allow Neuquén to connect with the Atlantic Ocean. This project, which in this stage of basic engineering and material acquisition, once completed, will involve the investment of 200 million dollars and will allow to transport 60,000 cubic meters of oil, expandable in the future. All these oil transportation expansion projects involve an investment of more than 4 billion dollars for the next 2 to 3 years, with an export capacity of more than 10 billion dollars. These projects are obviously added to the new gas pipelines to evacuate cow dung gas. Among them, the one that is already under construction and that we hope to finish on June 20, the Néstor Kirchner gas station with a capacity of 24 million cubic meters for the first phase and another 20 million cubic meters for the second phase. Este proyecto contempla una inversión de 3.400 millones de dólares y además la sustitución de 2.000 millones de dólares al año de importaciones para la Argentina. Otro proyecto fundamental para nuestro país obviamente es el Reversal del Norte con el objetivo de abrir Vaca Muerta to Bolivia, to Brazil and to Chile from the north with an investment of 740 million dollars that has a first section of financing already approved by the CAF of 540 million dollars. And the most important project to transform our molecules into exports that can mean a paradigm shift in Vaca Muerta, is the possibility that Argentina becomes a world player in the production of GMO or liquefied gas. For this, YPF was associated with Petronas, the Malaya State Company, the fourth world player in the production of GMO with more than 40 years of experience in this activity. Esto implica una inversión aproximada de 10.000 millones de dólares, solo en la primera etapa, lo que le permitirá a nuestro país producir hasta 5 millones de toneladas año de GNL. La inversión en pozos, ductos y plantas de tratamiento de gas producirá un impacto en varias generaciones, Impulsando el desarrollo de nuevas industrias y fortaleciendo la economía de cientos de pequeñas y medianas empresas proveedoras de insumos y de servicios. Cuando el proyecto esté finalizado, se podrán exportar más de 25 millones de toneladas al año de GNL, convirtiendo a nuestro país en un actor muy relevante en el mercado mundial de gas. In this sense, and to accompany this IPF initiative, we have decided to promote a bill that establishes a proper regime and framework from the point of view of the availability of visas and tax regimes to give legal security in the coming years to those who develop investments of this type. This is to value our resources. with political decisions that do not look at the short term, but that bet on developing and adding value to our natural resources. They are projects to expand the capacity of transportation that allow us to resolve the existing bottlenecks and, over the next few years, triple the capacity installed in Argentina, which will allow the country to be a true energy exporter. It is key for this that we have the capacity to associate ourselves with world players and to finance ourselves with market rules. That is why YPF will carry out joint venture projects to push, promote and promote exploration and exploitation in Palermo-Aique to the effect of accelerating investment processes. And on the other hand, also to the effects of consolidating the growth that the balance results showed as a revaluation of the action of the last year, is that it is the decision of the Ministry of Economy and those who lead centrally Pablo González, the company, that next month's shareholders' assembly, the Argentine State will go with a dividend distribution proposal to consolidate YPF as a player, not only in the energy and hydrocarbon market, but also in the financial system, to the effect of continuing to recover the value of a company. which is the flagship of the Argentine oil and gas growth and development, but it is also one of the flagships of Argentina in the international financial market. I want to congratulate the IPF driving team for the performance, not only for the balance sheet results, but to put YPF back as a central player in the energy market and in the international financial market. From Buenos Aires, I send you a hug and I transmit to you a huge dream, which is that, just as the agribusiness sector has been for many years one of the great promoters of the generation of currencies in Argentina in the next 20 years. Gas and oil transform Argentina, definitely having an exporting matrix with two wheels or two turbines that feed that economic development. A huge hug and many congratulations for these 30 years.

Thank you so much for your time, Minister, Economy Minister Sergio Massa. Now we are going to start to read the questions that we have been receiving during the whole event. So you can tell us. First question, first person has four questions. Frank Magan from BOFA. He wants to know if the official FX witness more notably over the next 6-12 months How is this likely affect your cash flow generation? How long could it take to adjust gasoline and diesel prices? Follow up on effects on CAPEX?

Thank you, Fran, for your question. I guess you're listening. Clearly, that's the million-dollar question, right? Of course, how we are going to tackle... Price adjustments. Of course, as was mentioned before, we would expect to continue in a global environment with prices well above average. We would expect to continue, of course, aiming at aligning ourselves, although we understand that reality to be hard to achieve, as was demonstrated in recent months or in the last couple of years. But still, if you look at how 2022 price adjustments took place, we managed to improve our dollar denominated prices or our dollar equivalent prices of fuels in the local market by close to 30%. So tracking very closely what happened in the international markets, of course, with some lags like what we have in the second quarter where we got to a point where we were almost at 40% discount to international reference prices. But then we finished the year at closer to 25% and for what we have been seeing or we have been managing along 2023, so far we've been in a range of 15% to 20% discount to international prices. Going forward, we will expect to continue or aiming to continue adjusting prices in a way to compensate to the largest possible extent for the devaluation of the currency. And then also, depending on the evolution of international prices, of course, maintaining a relevant correlation to those variables. in terms of how quickly we could adjust among a steep devaluation scenario if that were to occur, which no one have the ability to predict precisely. That will depend. In the past there were periods where there was a faster adjustment and periods where there was a slower adjustment. Clearly we would aim at adjusting as fast as possible to avoid any deterioration in our dollar margins. But that is very hard to predict and of course we need to remain very conscious of the realities of the local economy, the inflationary environment, and, of course, taking all of those variables into account, we will aim at maintaining our dollar margins as close to current prices as possible. And then, of course, if we were to suffer, if the country were to have a steep devaluation, And if we wouldn't manage to adjust very quickly, of course that will affect our cash flow generation. And that's why, you know, we said that we are going to prioritize capital investments because we believe that that's the way to generate the most value for our shareholders. But then if we were to require to cut back on those CapEx plans, To maintain financial prudency, that would be the idea to tackle that. But so far, we are not expecting that to happen. We will expect to maintain healthy cash flow generation in the months to come.

And the second question that Farma came from Bofa has is, How are you planning to structure the investment in LNG and Vaca Muerta Sur? What stake could take YPF? Could we structure an independent equity entity? How much could be financed through loans from support agencies or other sources?

Okay, in terms of the LNG project, we are still on an early stage of analysis of the project. Of course, we have signed the MOU with Petronas. We are working very closely together on the technical and economic analysis to get to a final investment decision, as was mentioned at some point next year, with the idea of having an FID before the end of next year. We have not fully tackled the financing of the project yet, Of course, we still have some time ahead of us, but we definitely are not aiming at, or clearly we would love to, but being realistic, we are not aiming at a typical 80% to 90% project financing for such a project, but rather a much more conservative level, significantly lower than that. So both parties understand that to get to FID, we need to clearly put together a clear financing plan that we will, of course, discuss internally first and negotiate or work with financial institutions towards that. And definitely we would expect probably some multilateral support, even though many multilaterals are closed these days for financing hydrocarbons, but we still believe that there are some others that are capable of looking at financing natural gas, like the Corporación Andina Fomento has recently announced potential financing of infrastructure, pipeline infrastructure in Argentina, understanding that natural gas is a transition fuel. So we believe that the same way that gas has done, we expect to be able to work with some multilateral agencies and ECAs to also put together a reasonable plan financing plan for that. So all in all, of course, it's going to require a further equity contribution from the partners. And that's why, as mentioned in the presentation, we believe that our plan for coming years should enable us to provide our fair share of that investment with the amount of resources that we are likely to release through the monetization, primarily the monetization of our crude oil opportunities.

Her question is, what is the minimum level of capex necessary to maintain your operations with the existing levels of oil and gas output?

Okay, we tackled that question in the past. Of course, the larger proportion of shale in our mix makes capital intensity more relevant. as well as cost pressures or cost increases also have increased our overall minimum capex required. So there is no specific number that I can provide, but I would say that probably it's in the range of $3 to $3.5 billion per year at current prices, at current cost levels, to stabilize our hydrocarbon production level.

A last question from Frank McCain from BOFA. is how should we think of the decline in oil reserves? Given the oil growth perspective, do you see significant upside reserves?

If I understood the question correctly, in terms of our forward looking for the evolution of reserves, Clearly there is a particularity when considering P1 reserves for shale resources because it's a different way of assessing and pricing those than comparing to conventional resources. So you need to be developing your resources to... be able to fully transform them into P1. So clearly, as we move into full development of Aka Muerta and mostly the core hub and also the north and south blocks, we would expect to continue generating healthy recovery ratios in terms of how we manage to maintain our reserves, P1 reserves in a healthy level compared to our production levels, which is What we have managed to achieve last year and this year as well, where even though we clearly this year have grown our production by 7%, both in BOEs and also in oil in particular, and still we managed to grow our P1 reserves by 4% with a reserve replacement ratio of around 124%.

Liz Carvalho from UBS has three questions. With elections coming this year, What are the challenges, risks, in case the country continues facing tough economy environment, high inflation, and devaluation?

Sorry, can you repeat that question?

Yeah, sure. What are the challenges or risks in case the country continues facing tough economy environment, high inflation, and or devaluation?

I'm not sure that the question is... If it's clearly a political question on how the country could evolve under different political scenarios, of course I'm not the person to talk about that, definitely. If the question is more related to how we would expect YPF to continue evolving under different scenarios, I would just say that we heard it from the Minister, we heard it from our Chairman and our CEO, I think the resilience that has already been achieved and the focus that the country has on monetizing and transforming the energy sector into a sector that can help transforming or leading a transformation of Argentina's balance of payment, I think that the realities for the sector and for YPF should be positive in any political scenario and clearly we believe that if anything the sector should be part of the solution to any complicated economic situation.

Second question from Luis Carvalho from UBS. Company had a good year managing to increase prices and balancing cash flow. What is the outlook for 2023? What can we expect in terms of further price adjustment?

Well, I think I already tackled that. So I guess for the interest of time, I would just keep it. But clearly, yeah, I think it was more than answered before.

Okay. YPF and Argentina has relevant infrastructure projects undergoing. What are the main priorities? How are they going to be financed? Please update on main projects.

I think it was already also most of it tackled in the presentation. For coming years, we have a very focused approach and strategy in investing in mostly and monetizing our oil opportunities as a primary objective while we continue to supply our commitments of natural gas and while we work in pilot projects for the long-term energy opportunities, as Pablo mentioned, in lithium and in hydrogen. that we definitely believe that are part of the future. But in the short term, the main objectives, the main focus is monetizing oil and investing in the infrastructure that is required to be able to monetize that oil and, of course, to continue to handle the larger portion of our back-and-forth gas production out of our total portfolio. So midstream, the bottlenecking, the Minister mentioned the several projects of oil mixing that YPF is leading, some of them being joined by the industry, some of them, or I would say most, all of them joined by the industry at different levels of participation. But those are key to being able to generate the opportunity or to truly make the opportunity come true of becoming a relevant and large oil exporter. As you probably know, the country has already become an oil exporter In 2022, YPF has still focused in fully supplying our own needs in our refineries. But down the road, we believe that the opportunity to continue to grow exports is very appealing. It's a great opportunity for the country and the pipelines that need to be in place and the new back and water sewer project that YPF is leading for putting together a whole new pipeline system connecting back and water to the Atlantic into a new port terminal those are the clear key projects, infrastructure projects that we have ahead of us. Of course, while we do that, we continue to invest in our multi-year program for revamping our refineries. That's part of also becoming clearly updating our refineries or improving our refineries to reduce the sulfur content of our fuels, where I didn't mention it, but in our plan we expect to be our fuels having less than 80% of oil, sorry, 80% of our fuels becoming low sulfur fuels produced in our refinery. So those are clearly our main projects.

Another question comes from Credit Suisse from Regis Cardoso. She wants to know if you can give us more details on YPF's plans for lithium exploration. Size of opportunity, capex, and timing.

Well, some of that was already tackled also. Clearly, so far, we have become involved in an exploration project in the province of Catamarca. It's a 20,000 hectares site where we believe that there is interesting brine concentration for us to work on. Of course, there is a competitive advantage that YPF has in terms of the seismic information that our company has from past works in the northern of the country, in the north part of the country. So that is a competitive advantage for YPF to work on lithium exploration as well. And because that's clearly not that I'm an expert, but our geologists tell us that that's a key competitive advantage. And so, so far we did decide that we were not going to enter into a more evolved project, paying, you know, prices or costs that we cannot, you know, at this point, make sure that those are fair prices. And so we decided to go for an early exploration, so a green-free project, and clearly we are looking for further opportunities. But so far, that is our main project. We expect to enter... probably into production if we are successful in our exploration to enter into a production phase before 2030. And to get there, we probably need about It's not a large investment, probably in the order of $50 to $60 million in the next three years to prove the available resources and to apprise them. And then if we enter into a production, clearly into a production phase, that would probably be somewhere north of $300 million in investment, but to put together the facilities required to enter into a full production mode, targeting somewhere in the order of $25,000 tons per year at this site.

Andres Cardoso has another question. Can you also provide more details on what you believe will be IPF's right in green e-hydrogen, capital requirements?

At this point it is very difficult to answer that question. Clearly what we do have in mind is that a key variable or a key input for the future evolution of green or the competitiveness of green hydrogen depends on the capacity to provide efficient renewable electricity. And that is where Pablo Tackle also in his presentation We see Argentina having a tremendous potential there with capacity factors well above the world average. Particularly in our case, through YPF Loose, our capacity factors in wind farms in the south of the country is also above the Argentine average, where we have one wind farm at 60% average capacity factors in Manantiales Verde, for example, and an average at 52%. So we definitely think that Argentina, and as was put out by BNF a few months ago, Argentina is a top three competitive player, potential competitive player for green hydrogen production, given its low cost for renewable electricity. So at this point, again, we mapped out in the presentation that We could put together efficiently in a very ambitious way a group of wind farms in Patagonia aggregating 100 gigawatts of total capacity. That would be a size that our technicians consider that would be efficient to transmit to a center point that could be an H2 producing facility and that would imply or a plant for producing about 8.5 million tons per annum of green hydrogen. So clearly that's extremely ambitious. You know, 100 gigawatts is 2.5 times the current total installed capacity in Argentina in terms of power electricity or power generation. But that's just to give an idea of, you know, the potential scalability of such opportunity. But, of course, it depends on Going into that will depend on how, you know, technology, how electrolysis evolves and whether H2, actually a green hydrogen, becomes mainstream, as many are expecting, which is still difficult to know, right?

Andres Cardona from Citi has the following question. Regarding Maxus, what is the status of the claim. Do you expect any update on the future, on the near future?

What to expect for the near future is difficult to say. As probably many know, The trial was scheduled to start around these days in March and to last until late April. Recently, the different parties to the claim have submitted a joint request to the court to postpone the beginning of the full trial and that was postponed to late June and that should take place between June and July. So the latest that we can comment is that the trial process was postponed by request of the different parties on the claim, and the court basically accepted that and authorized that on the same day that it was requested. And so that's the latest that we can comment on the Maxus case.

From Morgan Stalin, Bruno Montanari. How sticky is the CAPEX budget in coming years?

I mentioned also when talking about the numbers that we expect CAPEX to be in the five to six billion dollar range for the next five years and that should be enough for us to tackle the opportunity that we see ahead of us. yeah, I believe that we should remain within the levels that we are expecting or estimating for this year, for 2023, and we shouldn't be doing anything beyond that. Of course, that does not include any significant capital investment on the LNG project, which is still subject to FIV. So clearly a footnote on that chart was that the 526 does not include any relevant capital investment in the LNG project.

From Berkeley, David Herzberg wants to know what type of debt do you anticipate raising in 2023? Will it be local market that line the two local issues you place in January or will it come from different sources?

Well, Clearly, as mentioned, we are expecting a year of negative free cash flow, unless there is any positive surprise. And in doing or in tackling those needs, we are concentrating mostly in the local markets and in our relationship banks. On both sources of funding, we have lowered our exposure in a very meaningful way along the last three years. You know, when we're using our total indebtedness, most of the reduction came from the local capital market bonds and the debt outstanding in the financial institutions. Clearly, that was shorter in nature, and that's why we, at maturity, we pay down all of that debt. So, At this point, we are at very low levels of outstanding, so we believe we have ample room to grow or to tap those two sources mainly. Having said that, we are also working on potentially enlarging and extending the existing AV loan facility. that is led by CAF. It's a multilateral AV loan facility. We are working together with CAF and some financial institutions to potentially extend and enlarge that facility. But all in all, our key focus would be mostly in the local capital markets and tapping on mostly trade financing. Recently, we have issued a $300 million loan or a combination of two bonds in the local market for a total of about $300 million equivalent. The main portion of that being a $230 million link bond with a three-year tenor at 1%. So, of course, there is a very interesting arbitrage to take advantage of in tapping the local capital markets. And also in trade financing, we just raised – a couple of pre-export financing with two-year tenures at 2.5%. So clearly, we would definitely tackle those opportunities before considering other sources.

From Puente, Constantinos Papalias is asking, could you provide an estimate on fuel imports for 2023?

Yeah, it clearly will depend on how demand continues to evolve. What we have seen so far in the last few months, diesel demand has come down, primarily on the back of the realities in the agribusiness sector, and gasoline continues to go higher. But all in all, we ended the year 2022 at an average of 11% in terms of total fuel imported. as a proportion of our total local sales. And that is slightly above average and above historical average after a peak that we had in the third quarter. So we will expect probably similar levels for 2023 as well.

From Itaú, Alejandra Aranda is asking, could you give us an idea in terms of YPF crude oil exports going forward?

Yeah, clearly as a five-year plan, we will expect to reach those 150,000 or so barrels per day that we are targeting. Clearly that would depend on us being able to deliver on our growth expectations. But we should be... starting to become an exporter of crude as early as this year. Hopefully, if things go well, we should start exporting through the OTA-OTC pipeline that the Minister mentioned also into Chile as early as May of this year on an initial phase before the new Vaca Muerta Norte pipeline that will connect and will increase the capacity to export to transport oil from the center of Vaca Muerta into the northern part of Neuquén where the Trans-Sandian pipeline starts. So we would expect an early stage export of about 40,000 barrels. That's not only YPF. YPF and some partners that are teaming up with us for that opportunity and probably raising that to about 70,000 barrels today once the Vaca Muerta-Norte pipeline is fully up and running probably at some point in the fourth quarter.

And the last question comes from Santander. Walter wants to know, what is your bid and margin expectations in 2027 by 15 to sell cheaper oil?

I'm not sure about the cheaper oil, last part of the question, but basically based on the numbers that we put out, The margin would be probably in the order of 35 to 40%. But again, assuming the, you know, clearly there is a lot of sensitivities that need to be taken into consideration for that. But roughly speaking, we believe that total margin should trend upwards and clearly Vaca Muerta being very profitable. And so we would see probably margins trending upwards from where we are today and getting closer to the 40% mark. So somewhere in the mid-30s to high 30s would be our expectation.

Thank you so much for your accurate answers. And now we are going to hear again Pablo González, Director of YPS.

Well, very briefly, just to thank you again for your presence here. We have provided the information, we have told about our projects on a solid basis. It is a financial and economic situation that you saw. We have a debt of 1.2 of the EBITDA. We have lowered our debt and we invite you to join us. I saw, yes, it caught my attention, there are some questions related to with hydrogen and lithium. You know that YPF, through YPF Tecnología, where there are 260 scientists who are working every day thinking of a better Argentina, there is the Hydrogen Consortium, led by YPF, with 50 companies that are working on the development of hydrogen. In terms of lithium, we created YPF Lithium in the middle of the 21st century, Prior to ITEC, our scientists have developed the know-how of lithium cells, so today we are already manufacturing lithium cells and batteries. I would like to propose to all those who are interested, through a platform, we can inform on the projects that IPF and Lithium are carrying out, as well as the Hydrogen Council and ITEC. So that interest of many investors and of you also motivates us to spread with great pleasure all the work that we are doing in our country in renewable materials. So thank you all very much for joining us. Those who want to stay, at 4 p.m. we are going to close the round and these 30 years of IPF existence in the stock market leads us to reaffirm the commitment to continue on this path. I insist again, we are going to continue working in the same way, understanding that the only way we have to make these projects grow and take these projects forward, as you saw, is from the hands of private capital. There is no other way.