Newmed Energy Ltd

Hi everyone, thanks for joining us today for the NewMeds Energy Financial Results for the second quarter of the 2026 webinar. All participants are in listen-only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. I am pleased to introduce Nils Darne, CEO of NewMeds Energy. You may begin.

Good afternoon, everybody. I'm happy to open the Q2 2020 Thanks New Med Energy conference call. Next to me, I have Tari Sabusha, Deputy CEO and CFO in Gilbashan. My name is Niv Sarney, CEO of New Med Energy. I have joined the partnership about a few months ago as a head chairman, and beginning of this month, started the role of CEO. Before we jump into the results and main activities of the month, I would like to take the opportunity and thank the previous CEO, Yossi Abu. Yossi has taken this role for more than 15 years and has led NewMed to new peaks and new heights. You all know him because of his achievement, but we also know him on a personal basis, and he will be missed to all of us. So from here, from us, from everybody, we're wishing you all the best. and your legacy will stay with us forever. And now I'm happy to start with our financial results, and as you have seen in our first segment, yes, we'll bring up the presentation in a second. We had a very strong QT performance, started with high production of about 2.7 BCM, high gas prices resulted from high oil prices, which leads to a bottom line of about 118 million dollars net profit for the quarter. In addition, we have completed playing the third pipeline from the field to the platform which has increased our production and also have completed or INGL more correctly have completed the looping between AASHTO and AASHTELON. As well, we are progressing with Leviathan expansion phase 1b as we call it and have seen good progress and momentum on the OfferData field as well. We will also update on two seismic surveys that we are going to conduct in the next few weeks and of course we'll wrap up with the dividend. So on the production level we have produced 2.7 bcm for this quarter compared to 2 BCM on previous quarter 2025. What's most important is to mention increase in all of our three markets, Israel, Egypt and Jordan, with the highest increase of almost 0.5 BCM to the Egyptian market. On the pricing side, the average price per quarter was $6.5 compared to $5.6 on Q2 2025. What is important to notice from this chart is the strong price, which is obviously on the export contracts linked to the Brent price. And as we're seeing, high Brent price, we're going to see high gas prices. There is some lag between the gas and the Brent price as we are calculating the average of the previous three months. And therefore, regardless of where the Brent will go in the next few months, we'll still see a high price in the next few months. We have successfully completed the third pipeline from the field to the platform. and following the completion, we have been able to produce at a peak rate of 15.8 BCM on an annual basis. Just to compare that to our initial program, which stood at around 14.5 BCM, which means that we'll have an extra 1 BCM of capacity to sell to our markets, and we hopefully, with the completions of the midstream infrastructure will be able to meet this high peak value rate. Furthermore, we are continuing and progressing on the expansion of the Vitan project. We are on track on time, which is expected somewhere in the second half of 2029, and on the total cost of the project, which is around $1. around $2.4 billion. Current project is at the level of 23% and most importantly, the drilling rig is expected to reach our region towards the end of the year and conduct three new production wells for us. After a long delay, I'm very happy to informed that INGL has completed the looping or the offshore pipe between Ashdod and Ashkelon, which opened a de-bottle of this stream to the Egyptian market. This will increase our delivery capability of about two BCM on an annual basis, but it's important to mention that all that 2 BCM will be allocated to the Leviathan Park. This is not reflected in the Q2 results. This completion was done in month of July, and we will see the results in the quarterly reports. In addition, the two other projects, FIGER compression and the Mitana pipeline, are progressing as planned. We're expecting to complete the Roger compressions project towards the end of the year and the Netana pipeline ahead of the Leviathan phase 2 expansion. Afrodita, as you have seen in recent weeks, we have sent out several announcements. We are progressing with all the main contracts that are needed for us to reach a financial investment decision somewhere in the first quarter, first half of 2027. There is a good momentum, and we're hoping to make progress over the next few months. In a related note, one of our partners, Shell, has announced last week their intention to sell their share in the field to Moll on Virginia. for value of $720 million, which on a very simple calculation gives a value of about $2 billion for the asset. Just kind of like in our books, we have a value of about $190 million, so there is, from our perspective, a hidden value Thank you Mir and thank you all for joining us today. First, I would like to thank Yossi Abou. Personally, it has been a real pleasure working with Yossi.

I learned a lot from him and from his leadership, his vision, and the way OCC is the bigger picture. I wish him all the best on behalf of NUMED and myself. I wish him good life and all the best, of course. And to you, Liv, a welcome to NUMED. In the second quarter of 2026, we had revenues of about $293 million, production of about 2.7 BCM, and net profit of about $117 million. This compares with Q2 2025 when revenues were $191 million, net profit was $81 million, and production was around $2 billion. The increase in the net profit in Q2 was mainly driven by the following factors. Please go ahead with the presentation. Thank you. Net revenues increased by $86 million compared with the same quarter last year. $59 million of that came from higher natural gas production. Another $25 million came from a higher average gas price per engine fuel. And $2.1 million came from an increase in condensate sales. This was partially offset by higher costs and expenses of $21 million, mainly due to a higher operation cost and depreciation. We also had an increase in net finance expenses of $26 million, mostly due to the re-evaluation of pay-per-vision planning royalties. We also recorded $6.8 million in other revenues as a result of assessments related to our economic rights in Iran license. The final impact was income from a discontinued operation of $7.7 million related to numerous former holdings in Tamar project. Tamar was sold in 2021. This income mainly reflects an adjustment to the self-consideration following Tamar levy expenses. Regarding the net financial debt. Moving on, regarding the liquidity of the U.S. Following the repayment of Leviathan bonds series June 25 and ahead of the repayment of the next series in June 27, the total net debt is approximately $1.4 billion. We have $560 million available credit facilities from Israeli banks as of today. In this context, maybe it's important to mention and to remind that the partnership has a private program. Under that private program, which covers the 2027 and the 2030 bonds, to date, we have bought back about $95 billion. I think this does conclude the main points of the Q2 financial statement, so thank you for listening. Thank you.

And as we are demonstrated in previous quarters, we have been announcing that we will also pay this quarter dividend of an amount of $60 million based on our strong performance and high debt income. Before we wrap up and go to questions, I do have one last update. on two seismic surveys that we will be conducting over the next several months, which will commence in the upcoming weeks. The first one is Zone I. It is conducted in the new area of the northern part of the economic waters of Israel. What is interesting in our perspective, we have bought two new international energy players, SOCAR and BP, into this license. and we see that as a good indication or positive as the potential that could be in this zone. And also, very importantly, we will be conducting a unique and first-time survey, OVN, ocean bottom nods for the Leviathan. We will be placing about 5,000 nods of the yellow one that you see in this picture on the, bottom of the ocean and to conduct a 3D survey of both the gas fields of Leviathan. Since we have started producing 2019, we have not yet conducted a seismic survey and that will allow us better to analyze the field and see how it is performing and also continue our exploration of deeper Oil Prospect Beneath the Gas Field. With that, we'll open it for questions.

Thank you, Niv. So, we've got a little question. Okay, so just a couple of questions. The first one with regards to Aphrodite. What are the milestones that are missing in order to achieve an FID in the Afrodite?

So, good question. In order for us to reach an FID on the Afrodite field, I think there is, on one part, is all the commercial agreements that we need to put in place, the GSPA, the hosting government agreements, and the midstream infrastructure pipes. We have signed a letter of intent on the GSPAs and are working on to conclude this as a full agreement and I think those will happen in the next few months. In parallel, Chevron as the operator is continuing its work on the front-end engineering design and Hopefully that will be completed as well, so at that point we'll be able to take a final investment decision.

The second question with regards to Leviathan, if we can give some cover on the progress of the expansion and if the situation in the area affects the timetable of the expansion.

So, again, good question. Regardless of the international tension that we have seen in the region, Chevron, as the operator, is able to move forward and progress with the project with no any hurdles or delays. To date, everything is on time. We have ordered already the long lead items. and the critical ones on the critical path, so that is also behind us. And I think the next step is bringing in to the area the drilling rig, and as we are aware, it will be on time and even come a little bit earlier.

Okay, this concludes the question and the call for this quarter. We take the opportunity to thank you and to express our appreciation and welcoming you. Thank you very much. And this is only the first one.

Any comments? We're very much looking forward to our next quarterly call, and I'm happy to be here, and thank you for coming. Thank you all. Thank you.