Africa Oil Corp.

My name is Shell and I will be your conference operator today. At this time, I would like to welcome everyone to Merrin's first quarter 2026 results presentation. After the speaker's remarks, there will be a question and answer session. Please note that at any time, participants on the webcast can submit the questions using the questions button on the webcast interface. This event is being recorded and the recording will be available for playback on the company's website. I will now pass the meeting to Mr. Shahin Amini. Please go ahead, Mr. Amini.

Hello, everyone. Thank you for joining us today for Merrin's first quarter 2026 results presentation. My name is Shahin Amini and I'm head of investor relations and communications at Merrin. I am joined today by Oliver Quinn, our President and Chief Executive Officer, and Aldo Parasini, our Chief Financial Officer. We will begin with prepared remarks and then open up for questions. Before we get started, I remind everyone that remarks made during this session are subject to forward-looking statements which involve significant risk factors and assumptions that could cause actual results to differ materially. More detail on these risks can be found in our regulatory filings on CEDAW Plus and on our website. The information discussed is made as of today's date and time, and Meron assumes no obligation to update or revise this information to reflect new events or circumstances. The company's complete financial statements and related MD&A are available on the company's website and on CEDAW Plus website. With that, I'll hand you over to Oliver. Oliver, please go ahead.

Thanks, Shaheen, and welcome again, everyone, and thank you for joining us today for our Q1 call. Let me start on slide four, which really summarizes a very strong start to the year, underpinned by a high level of operational performance in our production assets, complemented with an improvement in our financial flexibility and the continuation of our shareholder returns programs. In March, we refinanced our reserves-based lending facility, significantly enhancing our financial flexibility and, crucially, our ability to fund the deep hopper of organic growth opportunities across the business and at a very competitive cost of capital. Quarter-end liquidity post-refinancing has risen to $366 million. On the shareholder returns program, we've now declared two quarterly dividends year-to-date to a total of just over $50 million. And again, in our operations, our Nigerian assets performed above plan through the quarter, and in particular supported by the post-turnaround recovery following planned Q4 2025 maintenance on the Agbami field. On the commercial front, we've also successfully executed an amendment to our gas sales agreement for Regina and ACPO, and that has secured higher gas prices, and crucially with an index that includes some exposure to LNG pricing. I'll now move to slide five and our production performance for the quarter. In Q1, we delivered working interest production of 28.4 thousand barrels. Thank you for your time and I will now pass back to the operator for any questions.

My name is Shell and I will be your conference operator today. At this time, I would like to welcome everyone to Merrin's first quarter 2026 results presentation. After the speaker's remarks, there will be a question and answer session. Please note that at any time, participants on the webcast can submit the questions using the questions button on the webcast interface. This event is being recorded and the recording will be available for playback on the company's website. I will now pass the meeting to Mr. Shahin Amini.

Please go ahead, Mr. Amini. Hello, everyone. Thank you for joining us today for Merrin's first quarter 2026 results presentation. My name is Shahin Amini and I'm Head of Investor Relations and Communications at Meron. I am joined today by Oliver Quinn, our President and Chief Executive Officer, and Aldo Parasini, our Chief Financial Officer. We will begin with prepared remarks and then open up for questions. Before we get started, I remind everyone that remarks made during this session are subject to forward-looking statements which involve significant risk factors and assumptions that could cause actual results to differ materially. More detail on these risks can be found in our regulatory filings on CEDAW Plus and on our website. The information discussed is made as of today's date and time and Meron assumes no obligation to update or revise this information to reflect new events or circumstances. The company's complete financial statements and related MD&A are available on the company's website and on CEDAW Plus website. With that, I'll hand you over to Oliver. Oliver, please go ahead.

Thanks, Shaheen, and welcome again, everyone, and thank you for joining us today for our Q1 call. Let me start on slide four, which really summarizes a very strong start to the year, underpinned by a high level of operational performance in our production assets, complemented with an improvement in our financial flexibility and a continuation of our shareholder returns program. In March, we refinanced our reserves-based lending facility, significantly enhancing our financial flexibility and, crucially, our ability to fund the deep hopper of organic growth opportunities across the business and at a very competitive cost of capital. Quarter-end liquidity post-refinancing has risen to $366 million. On the shareholder returns program, we've now declared two quarterly dividends year-to-date to a total of just over $50 million. And again, in our operations, our Nigerian assets performed above plan through the quarter, and in particular supported by the post-turnaround recovery following planned Q4 2025 maintenance on the Agbami field. On the commercial front, we've also successfully executed an amendment to our gas sales agreement for Regina and ACPO, and that has secured higher gas prices, and crucially with an index that includes some exposure to LNG pricing. I'll now move to slide five and our production performance for the quarter. In Q1, we delivered working interest production of 28.4 thousand barrels of oil equivalent per day, which is at the upper end of our full year guidance. On an economic entitlement basis, production came in at 31 thousand, again comfortably within our guidance. Looking across the assets, ACPO and Agena both performed in line with expectations through the period, continuing to deliver the steady, reliable base production we've come to expect from these high-quality fields. On Agbarmi, you'll recall we had an extensive planned maintenance exercise in the fourth quarter of last year, which weighed on Q4 production. Since completion of the program, Agbarmi has been ramping back up through Q1 and is returning to anticipated production levels. In terms of activity outlook for the remainder of 2026, we have progressed in line with the programme outlined at our 2025 full-year results and with the joint venture partners across all three of our producing assets preparing to start drilling campaigns through late 2026. The rig for Agbami and Akeja drilling campaign has been contracted and we expect to have a firm rig contract for Agena and ACPO campaigns shortly. I'll now hand you over to Aldo to take you through the financials.

Thanks, Oliver. Turning to slide 6. In Q1, we had one lifting at an average all-in realized price of $64 per barrel, which compares to the average dated brand price of $71 for the month of February. This cargo was under a forward sales contract with a fixed dated brand price that was triggered last year. Post-quarter end, we lifted two cargoes during April. The first was the final trigger price mechanism cargo with an all-in realized sales price of $64 per barrel. The second lifting was priced in accordance with spot price and achieved an all-in sales price of $122 per barrel. With the legacy trigger mechanism now behind us, our hedging program for the remainder of 2026 is focused on swaps and callers. These instruments are designed to provide meaningful downside protection while maintaining some exposure to market pricing. Moving to slide 7 and our financial highlights. Q1 EBITDAX was $100 million, tracking within our full-year guidance. The key driver in the quarter was the step-up in gas revenue following the amendment to the PML 2.3 gas sales agreement in January, as already mentioned. This secures a higher long-term gas price and includes a mechanism to recover the historical pricing differential back to 2020. We received a cash payment of almost $14 million and recognized a fair value of $27 million as part of the mechanism to recover the historical difference. Total revenue for the quarter was $114 million, comprising of $64 million from one oil cargo and $50 million of gas revenue, with $41 million of the gas revenue related to the amended gas sales agreement. Cash flow from operations before working capital was $79 million and reported CAPEC was $9 million. Spend was light in the first quarter, as expected, with activity expected to ramp up in the second half as we mobilize the drilling rigs. Free cash flow was negative in $36 million, driven mainly by $106 million working capital outflow. This mainly reflects a higher under-lived position and a build-up in trade receivables linked to the gas revenues. That service costs, including fees related to the RBL refinancing, also impacted the quarter. But the key message is that underlying operating performance remains strong, the business is resilient, and our full year guidance is unchanged. Turning now to cash management. We entered the year with a cash balance of $175 million and ended the quarter with $162 million, consuming about $13 million during the quarter. Cash flow from operations after working capital was negative in $27 million, comprising a healthy $79 million before working capital and a large negative working capital movement, given that only one cargo was monetized during the quarter. Capital investment during the quarter was $9 million, which was predominantly directed towards Nigeria. We drew down $14 million on the RBL to support our working capital and liquidity position given the phasing of cash flows. We incurred $10 million in fees and expenses associated with the successful refinancing of the RBL. Post-quarter, we are also pleased to announce the second quarter dividend of 2026 of approximately $25 million, bringing year-to-date distributions to just over $50 million. Moving on to liquidity position. Turning to our broader liquidity position, I'll give a quick recap on where we stand. The chart on the left shows the progress we have made over the recent years. reducing combined debt and net debt, lowering interest in costs, and maintaining a disciplined approach to capital structure. At quarter end, net debt stood at $208 million, up from $155 million at year end, largely reflecting the drawdown discussed on the previous slide. Importantly, net debt to EBITDAX remains very comfortable at 0.5 times, well below our target of one time. The key development in the quarter was the successful completion of our RBL refinancing, which materially enhanced our financial flexibility. There are three points I would like to highlight. First was the lender's appetite. We contracted commitments of $600 million with an accordion feature of up to $1 billion. The facility was more than two times oversubscribed which demonstrates the strength of our asset base and the continuous support of our banking group. Second, the terms. We extended the tenor to six years, including two-year grace period, and reduced our cost of borrowing with the loan life average margin down by 12.5 basis points. And third, the flexibility. The revolving structure allows us to draw and repay as needed, helping us to manage liquidity efficiently while executing our business plan. The accordion also give us additional capacity to support growth initiatives where appropriate. As shown on the right-hand chart, following the refinancing, we retain more than $200 million of RBL headroom, which together with our cash give us ample capacity to support our forward plans. With that, I'll hand back to Oliver to talk through the latest updates across the portfolio.

Thanks, Aldo. Now turning to slide 10 and an update on the portfolio and business outlook. Starting in Nigeria, we expect the drilling campaign for Akpo and Agena to start in late 2026 with the drilling of the Akpo Far East prospect. This is a very attractive near-field exploration target with an estimated 150 million barrels of gross unrisked resource, and if successful, subsequent first production will be through a five-kilometer tieback to existing Akpo infrastructure. The campaign will then shift focus to drilling infill wells across ACPO and Agena with first production from these wells expected in 2027. We also anticipate that Total Energies will drill an appraisal well on the extension of the Agena South discovery on the neighboring block, which will move the Agena South project further towards a final investment decision point. In a success case, this provides Merrim with another material, short-cycle, high-return growth project that, alongside the PreoE development, leverages our existing Agena FPSO as a tie-back hub and delivers more long-term, low-cost production. Moving across to the Agbami drilling program, which we now estimate to begin in the fourth quarter, this will commence with the appraisal of the Akija discovery. The development concept for Akija is a subsea tieback to the Agbami FPSO, and so like the Agena tieback projects, offers another compelling high return growth option using our existing infrastructure. Following the Akija appraisal, the rig will move to drill a six infill well campaign on the Akbami field through 2027 and into 2028, and that will start to deliver incremental production from early 2027. So in summary, after a period of lower activity in Nigeria, we're shifting gear across our deep water hubs. We have a clear and active program ahead across near field exploration, appraisal, and with infill drilling adding incremental production. Turning to Namibia, Venus continues to progress towards a final investment decision, which we anticipate in the coming months and with first oil targeted for 2030. The operator has completed the feed and submitted the field development plan with capital costs matured through competitive EPC bidding. Importantly, Merin remains fully carried through to first commercial production with no financial cap. That gives us exposure to a major long-term growth project without the upfront capital burdens. Finally, in Equatorial Guinea, we have secured license extensions of up to two years on both of our blocks, EG31 and EG18, and this gives us additional flexibility as we progress partnership discussions and define the forward plan for those positions. So overall, we are entering a period of meaningful portfolio activity with near-term drilling in Nigeria, a major development milestone approaching in Namibia, and continued optionality across Equatorial Guinea. Now turning to our capital allocation framework on slide 11. Our balance sheet remains in excellent shape with quarter end cash of $161 million and enhanced liquidity provided through the RBL refinancing that gives us $600 million of commitment and delivers significant financial headroom to support the next phase of our growth. Leverage remains low with net debt to EBITDAX ratio of 0.5 times. And again, this financial strength allows us to invest with confidence in the deep organic growth portfolio. It also allows us to return value to shareholders, and having distributed $100 million in dividends during 2025, we've now delivered just over $50 million year-to-date in 2026. So with the business streamlined, the balance sheet strong, we have the optionality to pursue inorganic opportunities where they meet our strategic, financial, and operational criteria. So to conclude on slide 12, Q1 has seen another quarter of strong performance and it's this consistent delivery that allows Meron to continue to deliver a differentiated investment case anchored by our strong pillars of financial strength, high net back production and deep portfolio of organic growth opportunities. I'm confident Meron is well positioned to both capture the value in our portfolio and to pursue the right inorganic opportunities as the sector continues to evolve. Thank you for your time and I will now pass back to the operator for any questions.

We will now begin our Q&A session. If you have a question, we ask that you please use the raise hand function at the bottom of your Zoom screen. Once your name has been announced, you can ask a question. If you want to withdraw your question, please lower your hand using the raise hand function. Thank you and a moment for the first question, please. If you would like to submit a written question, please use the Ask a Question tab on the right-hand side of the player window. Our first question is from Theodore Sveen Nielsen from SB1M. Please unmute your line and ask a question.

Good afternoon, can you hear me?

Yes, we can hear you.

Perfect. Thanks for taking my questions. A few questions for me. First one is on lifting schedule. You obviously lifted less than you produced in the first quarter. What should we expect in terms of lifting compared to production in second quarter and third quarter? Second question, that is on the balance sheet strength. You obviously have a very strong balance sheet now with net debt to EBITDA of 0.5, while the target through a cycle, as I interpreted it, is one times EBITDA. How should we think around that? Will there be an extraordinary dividends or are you preparing to ramp up CapEx significantly? And my last question that is on Venus development. I understand that Total is still working on that as you discussed, but I just wonder if you could provide some more color on what we know here in terms of first oil, potentially new resource support, et cetera. Thanks.

Okay, hi Theodore, Aldo here. So I will cover the first two questions and then I'll pass on to Oliver to cover the question about Namibia and Venus. So in terms of liftings, the expectation for the full year 2026 is between seven to eight cargoes with one cargo already being lift in the first quarter so the reason why i give you an estimate is just that oil prices have an impact on entitlement production as you know and therefore that can change the lifting schedule as oil price moves significantly right so right now we see a potential between seven to eight cargoes to be lifted and sold in 2026. now Coming back to the question about balance sheet strength, yes, I think we do believe between the cash position and the availability, the headroom in the RBL in terms of available liquidity to Maryland, we are in a pretty strong position to go through the year and the years ahead. The reason why we do that, as you know, we want to protect our portfolio of organic growth opportunities. and as well keep the company robust to continue with the dividend payments. Those are the priorities that we have. Now, in terms of extraordinary dividends for 2026, we do believe, first of all, it's a little bit too early to opine on that. I mean, we feel strongly about the base dividend that we have mentioned before. However, we need a little bit more time to evaluate throughout the year and the performance about any potential extraordinary distribution. At this point, we're not in a position to comment on that. I'll pass on to Oliver to talk about Namibia.

Yeah, thanks, Aldo. So I think on Venus, you know, we point to the operator guidance, really, which has been very clear in the public domain, which is their anticipated target for an FID at the first phase of Venus is July this year. So that's, of course, pretty imminent. And then, you know, typical for a kind of project like that, first oil is three, four years. So we kind of see that, you know, somewhere 20, 30 for first oil. So look, I think What's behind that? The project development plan is submitted to the government. The contracting work for this kind of subsea surf, all of the all of the critical path items, FPSO is mature. So really, you know, it's about closing out key items and pushing hard for that July timeline. So that's the market that we're looking for as as partner, if you like.

Okay, thank you. Can you just remind us of expected plateau production for the first phase here?

Yeah, so again, you know, the easiest thing is to point to the public numbers from the operator Total Energies. So its NFPSO gross capacity would be 160,000 barrels of oil a day. You know, with reasonable uptime, let's say it runs at maybe 150,000 um gross at the field level um and then through our kind of holding an impact which sits on the license net net we're just under four percent um of production there so call it circa six thousand but again as you know but we like to remind people um we're fully carried on on the capex and the upfront costs there so you know that's kind of six six thousand barrels but it's a very valuable six thousand barrels that comes um effectively risk-free to us okay uh thank you that's all for me

Thank you. Our next question is from Jeff Robertson from Water Tower Research. Please unmute your line and ask your question.

Thank you. Good morning. Oliver, with respect to the drilling campaign in Nigeria, can you talk a little bit about movement of reserves between categories that you might anticipate in 2027 and 2028?

Yeah, hi, Jeff. Yes, I think as we said on the call, we've got two rigs coming. So again, just to remind people, one is in Agbami field and the other rig will go between Agapo and Agena fields. So look, I think with Agbami, it's a six well campaign. So the first well will actually be the Akija appraisal well we mentioned on the presentation there. So after that well late this year, Rig moves into the field, and those are six infill wells. Then on ACPO and Agena, the rig, you know, the current plan is to drill this ACPO Far East exploration target up front. So that would be the first well. And then through late 26, 27, go in and drill, you know, a number of infill producers up producers there. So I think in terms of what that means into the question in terms of reserve categories, a lot of that is 2P because it's already proven in the field, if you like, or it's proven improbable in the field. So it's a matter of accelerating it into actual flowing barrels. I think when you look at Akeja and I think you look at the other tiebacks around ACPO and Agena, Some of those are 2P like pre-OE already, and then some are contingent resource. So, you know, the key maturation there is to prove up volumes on a Keeja, for example, Agena South, right size of development, and then that would remain 2C in the short term. But of course, as we progress towards FID, it accelerates that becoming 2P. So that would be quite an incremental step up for us in those wells.

As you move those wells from 2P to 1P, will that have an impact on the collateral and the borrowing base?

um i don't think hugely so because i think we you know the fields are mature the infrastructure has been there it's on you know it's all on stream so i don't think it makes a significant change i think what does make a change is maturing that 2c the kind of around the fields if you like so that we we get closer to those becoming developments and fid they become 2p so they become more relevant in that respect

And secondly, with respect to inorganic growth, can you just outline maybe the characteristics of an acquisition opportunity that would make sense given your portfolio, your current portfolio and your capital outlook over the next couple of years on your organic opportunity set?

Yeah, that's a great question. I think, you know, take a step back here. Short term, you know, to say the least, we're in a volatile world here. you know, in a geopolitical sense. And of course that plays straight through to, to oil price. So I think that does for anybody, you know, in that kind of MNA world, it makes life trickier in the short term. I think what's important from our perspective is fine. We deal with that, but it doesn't change our ultimate, um, strategy and direction. You know, it's a matter of how you execute in a, in a stormy world. It's not a matter of kind of, you know, let's, let's pause or anything like that because you just, you know, you don't know what's coming next. So we'll continue to be, um, Very outward looking, let's say, on that front. And again, despite the short term kind of volatility, the shape of that looks the same. And I think that focuses, you know, geographically priority Atlantic margin. I think that makes sense to us from an expertise perspective, you know, knowledge networks, both technical and above ground. So that's a geographic kind of focus. And then from a characteristic perspective, look, I think we see a lot of organic growth, you know, as we talk about in the business coming through and adding barrels kind of back end of this decade. And that's all very kind of high return opportunity, high net back. But adding in, you know, from an inorganic perspective, flowing barrels and scaling up the business ahead of that would be an important characteristic. I'll caveat all that, of course, with the fact that you know not just short-term volatility but we are super disciplined around that you know it's it's pretty hard to beat some of the returns we see in the organic portfolio and that's the hurdle that we we use to test the external opportunities right so they've got to be as good as or better than what we've got internally and again that's a pretty tough bar right i mean we see opportunities to do that but but they're select thank you thank you our next question is from david round from stifle please unmute your line and ask your question

Great. Thanks, guys. Just on your inorganic aspirations, how much firepower do you ideally want to have ready for a deal? And what happens with any excess? Because obviously we're in an environment now and you've already talked about the prices that you're realizing. I mean, you could end up in a very healthy position. I'm just sort of wondering sort of what happens to that. I'm nervous to use the word windfall, but, you know, that excess cash. And secondly, sort of linked to that, I guess, just if you wouldn't mind reminding us exactly what hedges you have in place in H2 and the extent to which you're benefiting from current prices or just any sort of ceilings on those collars we just need to be aware of, please.

Yeah, thanks, David. Let me take the first one and I'll hand over to Aldo around the hedging one. So, look, I think, as noted, the balance sheet, you know, came into the strong and clearly, you know, it's strengthening in the current environment. You know, we could all take a view on the outlook here, but I think, you know, the house view here is, you know, this is not getting resolved quickly and therefore very difficult to see a world, you know, where the oil price falls significantly in the near term. So that will help. So, you know, and again, you get into the nuance of what sort of transactions would you do? I think, you know, cash transactions today, pretty difficult. We have the capacity to do that. But I think, you know, how do you close up kind of buy or sell a gap in this environment is tough. And that takes you into kind of more, you know, other ways to do things that are kind of. merger type territory and those types of transactions, which of course may involve a component of equity, really. The measure on those, of course, is can you get an agreement on fair value? Can you be sure that you're fully valued in your own equity, et cetera, before you do that? So I think we're pretty open-minded as to what the best way to do things would be. And I think that firepower is significant. But again, I think the point that we'd really like people to take is we're super disciplined about using that. were very active in looking for opportunities, but again, they've got to, as I said earlier, they've got to compete with the organic capital allocation internally, and that's a pretty high hurdle. So, look, it's a good problem to have, you know, and it's a good challenge, and I think as we get through 26 and the outlook for the world, you know, we get stronger from a balance sheet perspective, and I think that just helps open up even more opportunity.

Okay. Yeah, and on the hedges, I mean, I realize that we We have in our MD&A the hedging position until the end of the quarter. And then I realized that the reference we make is in relation to what we call the post-tax net entitlement, but I think it would be easier to say the percentage that would tie with total production, right, which is easier to compare with other companies. So if you get our hedging book for the remaining of 2026, the remaining three quarters, In relation to total production, we are hedged a little bit below 40% of the remaining production. And within those hedges, we have a mix of swaps and some callers. That's for the reminder of 2026. Now, if you look at the next 12 months, the percentage of lifting volumes, we would be more towards the low 30%. So between 30% to 35% is what we have in the next 12 months. 12 months. And in 2027, what we are working, as you can see in the MD&A, is on placing more wide callers, which still provide us with a significant floor protection while keeping a substantial participation in the upside. So that's how we have been treating hedging in the current terms. Okay, makes sense. Thanks, Gus.

Thank you.

Thanks, Dave.

There's no further questions at this time. If you would like to raise your hand, please use the raised hand feature at the bottom of your Zoom application. I will now hand over to Shaheen Amini for any written questions in the meantime.

Thank you, Operator. A question on Aqaba Far East. If it is a successful exploration, well, what is a realistic timeline for monetising this asset using the nearby infrastructure?

Yeah, that's a great question. So I think It's in the presentation, but ACPO Far East is actually within the license of the ACPO field. So from a fiscal perspective, it's all ring-fenced, which, you know, as an aside, supercharges the economic success case. Development-wise, it's about five kilometers from the kind of western side of the structure back to the nearest ACPO subsea infrastructure. So I think, you know, as we see it today pre-drill, you would – look to have one, two early producers, possibly in two years, hooked up back to that template for early production. And then again, depending on the size of the discovery and the resource, you would step out with some more subsea infrastructure over at Far East itself. And that would be, you know, maybe one year, 18 months following the first oil. So it'd really be stage development with a focus to get early production and then follow that up again, depending on the scale with incremental build out on the subsea to fully develop the opportunity.

There are two questions on Equatorial Guinea. First one on the licence extensions. Did these extensions come up with any additional commitments? And the second question is, if you are looking to farm these down, do you still want to retain operatorship? What is the overall philosophy in terms of farming these down?

Yeah, so on the licence extensions, you know, we've got up to two years on each block. There are, in short, no significant commitments there. There's the regular kind of licence holding costs, but there's no firm capital work programme associated with that. And I think what's important to take from that is it reflects our partnership with the EG government, where we both recognise that You know, we're in the middle of this farm down process. We're in a very changing world where there's significantly increased appetite for West African assets and opportunities. And so it makes sense for us to have that extension for both parties, the government and ourselves, to continue to allow us to give us the best chance to get a good farm down deal there on both blocks. I think on the latter question, I think, you know, two different things there. So EG31 is an inboard block, it's shallow water kind of gas development appraisal opportunity. I think that's something that you would be comfortable to operate as Meron. And I think in the outboard EG18, that's a different type of opportunity. That's a kind of very traditional deep water, big exploration target. So I think, look, we'd be comfortable to drill an exploration well there. But, you know, that's something that a We partner with a larger company to develop, so I'd look at them in slightly different ways. I think, again, I would just reiterate what our aims are here is around capital allocation and discipline. So for the big exploration opportunity, just as we've done in South Africa 3B, 4B, it's a matter of using some of our equity to bring a partner in and then use that as a funding solution for the higher risk early stage. So that's probably more of a priority than the operatorship. I think there's some flexibility around the operatorship depending which way it goes in terms of partners.

Very good. A question on Block 3B, 4B in South Africa Orange Basin. The question is, now that the suspension on the appeals process has been lifted and a specialist panel has been put in place, do you see tangible operational logistical synergies that can be shared between your South African assets and the Venus development project in Namibia? And considering the processes in the orange basin ecosystem?

Yeah, so let me again preface the answer with what's happening there more broadly. So I think as many people are aware, the Orange Basin, you know, roughly two thirds of it geologically is in South Africa, and then one third is above the border in Namibia. And of course, you know, huge success in Namibia, both Venus and our interest there, but also more broadly, you know, multiple wells, billions of BOEs discovered, so prolific kind of basin emerging. But not really any wells drilled yet in the South African side, which again is two-thirds. So I think that is for above-ground reasons in the sense of the appeals process and the permitting process in South Africa has been a much longer process, let's say. But to the question, it is now moving again, so I think we've gone through a period where that was suspended in order to kind of reset the approach more broadly for the industry. And I think that's a good thing. And so, look, the next stage is to get through that appeals process. I think we're confident, you know, we've done all the right work there in terms of the environmental permitting to fulfill the regulatory requirements. But that's the next point is to get through that stage. Then you move to the operational bit. And I think, you know, again, first thing there, the prospects are mature, they're drill ready, the well planning is done. So in terms of moving from, you know, green light on the final permit appeal process through to drilling becomes an operational matter of rig availability and timing, but everything's kind of ready to go, let's say, which is good. And then to the actual question in terms of logistic, yeah, absolutely. I think, you know, there's going to be a lot of rigs in Namibia you know, development drilling on Venus, et cetera, appraisal, Mopane, all the rest of it, several operators. So, you know, that's bringing a supply chain that's emerging and growing in Namibia. And again, that could be useful in South Africa. Equally, you know, we've got, of course, very good infrastructure in South Africa with Cape Town, you know, as a harbour and a port. So I think, yeah, it brings optionality, but I don't think it fundamentally changes it. What's distinctly important for us is our partnership because, you know, we had a much higher stake in the block. And of course, people will recall, we farmed down to Total Energies and Qatar Energy in 2024. And look, you know, huge interest in the bloc, unsurprisingly, given its location in the Orange Basin. Part of the rationale for partnering again with Total was the fact that they're obviously, you know, they were at the time and even more so now kind of the biggest, most active operator in Namibia. And so, of course, we'll naturally benefit from the synergies that brings because they've got, They may be your activity. They've got other blocks in the Orange Basin in South Africa. And so, you know, we'd expect that to play through, again, a kind of cost efficiency on the drilling and logistic support more broadly.

Question for Aldo. And Aldo, you have gone into some detail on the hedging programme that we have, but I think a further colour from you in response to this question would be helpful. He says, please explain more about the predicted selling price in terms of hedging for upcoming cargoes during 2026. And I suppose we could qualify that question with reference to our previous trigger price mechanisms, perhaps. Aldo, would you please share your thoughts on that?

Yes, of course. So, yeah. I think now in the first quarter and as well as this cargo that we already mentioned in the second quarter that had the trigger price mechanism, they are based on this legacy instrument that we were using before the prime amalgamation back in March last year, right? So this one that we lift in April was the last one. So we don't have additional hedges using that type of structure. So the remaining hedges for 2026, they were placed late last year, early 2026, when we all expected a much tighter oil market, given all the situation in the past. With the war in Iran and all the consequences coming after that, what changes for us is not the hedging policy per se. We do believe that the hedging policy is something put in place to be agnostic to oil prices. The only thing that changes for us is the type of instrument that we have in use. Now, with a higher curve, we are able to place good protections for the downside, but while keeping material participation in the upside. So that's the only change. That's how we start doing in Q1 2027. So you should expect, for the remainder of 2026, prices, as you can see in our MDNA, so more towards, let's say, pre-war price estimates, but coming into Q1 2027, you should start seeing the different colors and a better participation in the upside.

Yes, sorry. There was another question on working capital profiles. for the rest of this year and the hedging. And Aldo, you've already answered this. And I just want to refer everyone that if you refer to the shareholder report on page 15, you'll have a breakdown of our hedging for the second half of this year. And again, just reiterate what Aldo has already said on expected cargoes from Q2 till end of the year, we expect seven to eight cargoes. And if anyone wants more detail, I encourage you to reach out to the IR team at Merrin and we can help you if you need to go into further detail. And on that note, there are no further questions. Oliver, do you have any final concluding remarks? No, just thank you for joining everyone and taking the time today. Thank you. And I'll hand back over to the operator.

Thank you. This concludes today's call. Thank you, everyone, for joining. You may now disconnect.