Gustavo Mariani: But I think I already covered this. To summarize and to make it easier, we accounted for a 40% haircut. We think worst case scenario will be in the 50% haircut. So we will have to provision or to reflect a loss of an additional 10% of this ARS85 billion that is the total amount that is being that is not paying in cash that will — that the proposal of the government is to pay the bonds. So assuming that we accept this proposal as CDs, we might need to take a further 10% haircut.
Raquel Cardasz: Thank you, Gus. Next question says, could the approval of the late day assets have any impact on your operations and our strategy.
Gustavo Mariani: I think going forward, what is very important, not only for us, but for all our colleagues is the RIGI, the scheme that incentivize big infrastructure project. I think that is for many infrastructure projects that could where Pampa or its subsidiaries as TCS could participate. This is an important issue that comes with the late day assets.
Raquel Cardasz: Thank you very much, Gus. Next question comes from Ezequiel Fernandez from Balanz. The first one, he wants to know, for the oil and gas segment. If I take the cubic meters of gas sold at the reported price and the gas sold at the reported price and calculate the sales, I end up quite far from the total sales reported for the segment. What’s the difference? You’ve seen a conversion factor of 0.053 for cubic meters BTU in gas.
Lida Wang: I will give you later the answer, but I think you are converting wrongly. But we produce what we sell, we don’t buy trading so far at least in this quarter.
Raquel Cardasz: Thank you. How many unconventional wells were connected in 2023 and 2022, net at working interest?
Horacio Turri: In 2022, when we say unconventional, we are talking about tight gas and shale. So in 2022, we drilled 20 wells to 20 tight gas wells. That’s a 100% participation in El Mangrullo and 2.5 wells at the working interest in Sierra Chata, and during 2023, we drilled 25 wells in Sierra Chata and El Mangrullo together out of approximately half and half El Mangrullo and Sierra Chata. So that would end up with 18.5 wells at the working interest.
Raquel Cardasz: Thank you very much. Next one, he wants to know about Rincon de Aranda any updates on how you plan to proceed timing initial context, number of wells, perhaps looking for a partner to develop the area.
Horacio Turri: I think we already covered this question. As we mentioned before, we will be drilling two parts by the end of ’24, beginning of ’25. And depending on the results, we will keep on with the developing land in the coming years, subject to obtaining a vacation for the production. There are no partners.
Raquel Cardasz: Thank you, Horacio. Next one Fazio wants to know if there is any update on hydro concessions.
Gustavo Mariani: No, again, we haven’t had any talks with the Secretary of Energy other than the issue of the payment. So I understand for those that have already matured, there’s going to be a further extension for a few months and that as supposedly, after that, they will return to state-owned by ENARSA. But I don’t know what are the plans going forward, whether there will be auction for operational maintenance. I don’t know. No information.
Raquel Cardasz: Thank you, Gus. Next one from Florencia. She wants to know when we start to see lower CapEx.
Gustavo Mariani: I think CapEx will be lower than the previous year. For example, in terms of natural gas and thanks to the excellent productivity of the last wells that we have drilled, we don’t need to drill any new well until the beginning of next winter, just a few wells in order to maintain production flat approximately three, four wells. Yes, three, four wells to keep production flat and those willing to be in operation by the beginning of next winter, winter of 2025. And the CapEx that will continue to be high will be in order to develop Rincon de Aranda, which we are eager to do them.
Raquel Cardasz: Thank you, Gus. We have one more question from Ezequiel Fernandez from Balanz. He asks, when could Pampa start paying corporate taxes, do you still have tax assets for lost harvesting?
Gustavo Mariani: We believe, yes, we continue to have a tax tariff forward loss that will probably extinguish 1.5 years from now, so probably in 2026. It will be the first that will be a year where that loss carryforward will extinguish.
Raquel Cardasz: Thank you very much. Next one is from David Pardo from Puente Hermanos. He says as YPF and [indiscernible] have recently retained the international markets. Do you expect to issue new debt during the year?
Nicolas Mindlin: So, hello, everyone. So as of today, we have a solid financial position and we don’t have significant maturities until 2027. So we are not in a hurry to issue new debt in international markets right now. So I think we will only do that in the case we need financing for an M&A opportunity or if there is a really good window in the market, but there is not a particular need right now. Also, in our last shareholders’ meeting, we approved the issuance of our convertible one. So probably if market conditions are met, we could do that, and it will be an interesting opportunity to finance the company at very competitive rates, also taking into account that we repurchased almost 30% of our ADRs at much lower price.
Raquel Cardasz: Thank you, Nico. Next questions are from [indiscernible]. First one says, what would be the impact of the new investment regime included in the omnibus bill for Pampa?
Gustavo Mariani: The impact will be that big infrastructure projects that are difficult to finance and this scheme makes it more possible. So though that is the benefit of the scheme that big infrastructure projects that have a modest IRR, the fiscal incentives makes it possible. That is not for Pampa, that’s basically the incentive of the RIGI for all big infrastructure projects.
Raquel Cardasz: Thank you, Gus. The next one says, if CapEx is lower this year, could we expect a dividend distribution?
Gustavo Mariani: We haven’t taken that decision within that Argentina has proven to be — has always proven to be a very volatile market and Pampa’s strong financial position has proven to be the right strategy and you can see that in this situation, we have almost, we have not received any payment from CAMMESA, which is accounts from 40%, 45% of our sales. We haven’t received any payment for four months. That would have put us in a stress situation that is basically $200 million working capital need. And so we are very happy to have the strong financial situation that we see. On the other hand, it allows us to pursue M&A transactions that we don’t have anything in the pipeline write-down, but we like to be ready if an opportunity appears. So that’s a corporate strategy as of now.
Raquel Cardasz: All right. Next question from Ignacio [indiscernible] I think it’s pronounced from Iberdrola SA. Do you think that there’s still room for lower lifting cost in shale oil? Or at this level, the company reached bottom?
Horacio Turri: Hi. We definitely see the possibility of lowering significantly the shale oil lifting costs because we are basically working today with extended testing facility. So once we have the final facility in place, we will see a significant reduction in our lifting costs.
Raquel Cardasz: Thank you, Horacio. Next question from Santiago Herrera from Allaria. He says, in respect to Transener, CAMMESA paid in April, the outstanding debt of 42 — $25 million on previous quaters.
Horacio Turri: All the transmission companies, CAMMESA is current on transmission with transmission companies, the CAMMESA. There’s been an — I think it was in February a resolution of the Secretary of Energy given transmission company priority vis-a-vis other creditors of CAMMESA. And so transmission companies are being paid on time. So I don’t know what the ARS42 million deb that he’s referring to. I don’t know what is that.
Raquel Cardasz: Thank you. Next one from David Pardo from Puente Hermanos. This is what do you expect –what do you expect Pampa’s output through Duplicar to be once it is online.
Horacio Turri: We acquired 1,000 cubic meters per day of additional capacity through the Duplicar. So that’s going to be the additional out. That’s 1,000 cubic meters, 6,000 barrels.
Raquel Cardasz: Thank you, Horacio. Next question comes from Fabio Brando. Could you please explain the deferred tax account in more in detail? Has it had a significant impact on the net income? Also why does higher inflation and currency depreciation affected?
Nicolas Mindlin: Perfect. So the basic explanation is that for tax purposes, fixed assets are valued in pesos adjusted by inflation. So when inflation is higher than the valuation, they are appreciated in dollars. Consequently, the depreciation for tax purposes is higher than the one in the balance sheet, generating a tax credit for the company. This happens basically because our financial statements use the US dollar as its functional currency. But for tax purposes, you have to use pesos.
Lida Wang: There’s a lot of questions, but we hit the top of the hour. Actually we are —
Gustavo Mariani: Anything relevant that we haven’t covered?
Lida Wang: No. We covered most. Do you hear me well?
Gustavo Mariani: Yes.
Raquel Cardasz: Yes.
Lida Wang: Fair well. So we covered all the topics, the most important topics of this quarter. We are 1 hour 15, the few questions left, they are very minimal, but we will, as you know, Raquel and I will cover you. We will try to reach you all and answer them or if you have any questions that we didn’t have in this call, I think we did, just don’t mind to contact us to reach us out and talk about it. We thank you very much for joining our call. It was a pretty full one. If you have any questions, you know how to reach us out. You can e-mail us or contact through the website. Thank you so much and have a good day.
End of Q&A:
