Margarita Chun: Thank you, Lida and Gus. The next question comes from Juan Jose Munoz from BTG Pactual. Do you foresee any changes in plan gas once the new administration is selected?
Gustavo Mariani: Juan Jose. No, certainly not. I think every time there’s been a change in administration and the market and there’s has always been fears of change in contracts. Fortunately, what we have been seeing in the last couple of changes in administration is that contract had been respected both on electricity PPAs and on the plant gas. So — and I think we are seeing the benefits of that. I think in plant gas, the country has seen the benefit of that of how competitive the auction has been, how aggressive producers were in terms of pricing. So I think the government officials and politicians are understanding that there’s a reward once there is a trust that contracts will be respected. I think it’s important to highlight that at the beginning of this administration and the fear by the end of past administration, what was going to happen when Argentina files for default on the sovereign bonds, what is going to happen with the PPAs. Unfortunately, what happened was that despite the fact that Argentina defaulted on its sovereign debt, they have respected all this contract.
And I think that is a very good — how do you say please .
Margarita Chun: thank you, Gus. Our next question comes from Solera Candelaria from Banco e-securities. I wanted to know if the administration of will be changed the operation, maybe means to YPF from June 2023.
Gustavo Mariani: That is the agreement that every 4 years, we swap the administration of the plant. We have been talking about it. It’s really — it’s not a big issue. We both know how to do so. We have an excellent relationship. And we are analyzing how to do the administration, basically because it’s not cost effective to move all the systems from one company to the other. So we have to figure out what is the best way to do it. We will certainly reach the best solution available; so that is my answer. The answer is yes. Administration goes to YPF in the next 4 years. It has — in the same way that it has been in the past 4 years, despite who had the administration is a share and teamwork. So we are convinced it’s going to be the same way the next four years.
Margarita Chun: Thank you, Gus. Our next question comes from Daniel Guardiola from BTG. Would like to know your thoughts on the possibility of distributing dividends.
Gustavo Mariani: Frankly, honestly, that’s not something that we have been discussing lately, not this year because of 2 reason: one, the capital controls that make it expensive. We could have, because of the 277 which allow us an excess — access to the official exchange rate, thanks to our increase in production. So we could have access to dollars at the official exchange rate in order to pay dividend this year. But I think we are going to use that extra access in order to do the liability management of the 2023. Also this year, we have, as I mentioned earlier, a huge CapEx plan. So for the first time in the past few years, we are going to be free cash flow negative and we are going to finance that in the local peso market.
So, I don’t — especially this year because of all these reasons, it’s not a good moment to think about dividends. And as we always say, we have a huge or very profitable investment opportunities. We have not been asked by our shareholders to pay dividends. So we are comfortable with continuing with this policy.
Margarita Chun: Thank you, Gus. Our last question comes from which is the impact of recent adjustment to legacy remuneration in power generation.
Gustavo Mariani: The recent adjustment, I think you are referring to the one that dollarized portion of the remuneration, so going forward, it’s not going to be 100% peso-denominated but I think something like 34% dollar-denominated. It’s a small percentage. I don’t recall whether it’s around 25%. Yes; so a portion of the current remuneration is going to be defined in dollars. Taking into account what we are — our projections of inflation and devaluation of the official exchange rate for the rest of the year, the impact is of around $15 million from what we have projected in our budget at the end of last year. it’s positive, it’s not huge. It’s rather marginal.
Margarita Chun: Thank you, Gus. This concludes the question-and-answer section. So we’ll turn to Lida for final remarks.
Lida Wang: Thank you so much for joining our conference call. Gus, would you like to add something, Nico, would you like to add something that we didn’t address. So basically, I think we — it was a great call. If you have any questions or anything that’s it’s not covered here, please contact us and we will be happy to assist you. Have a nice day.
