Q1 2021 Ecopetrol SA Earnings Call

One trillion pesos the EBITDA for the quarter was half the EBITDA for the full year 2020 and the net income was one eight times. The net income of the 12 months of last year. These financial results were achieved even in the midst of operating conditions that will continue to affect production levels and.

Better conspirator, Chief operating officer will expand on this later as relevant milestones of the quarter I want to highlight the following first a threatening of the realization price for the crude export basket by a 43% compared to the first quarter of 2020 evidencing our successful commercial strategy second.

The advance of our gas strategy with a production increase of 12% as compared to the first quarter of 2023rd the positive performance of our refineries with and integrated margin per barrel, achieving double digits and fourth the announcement of our net zero carbon emissions targets for 2015, whose details I will further.

<unk> and other matters, we highlight our successful general shareholders' meeting and a fully virtual setting for the second time, where dividend of <unk> 17 per share was approved equivalent to 0.7 trillion pesos rocky filing our ability to generate profit even in very difficult conditions.

Began to work and the due diligence process for the East acquisition and established a special committee of the board of directors of Ecopetrol to assess evaluation and the price of that potential transaction and the Ecopetrol group, we continue to learn from crisis and to overcome them in and Igl safe and efficient manner. Although there are still some risk.

Instantly monitored the results presented today are proof that we are moving and the right track, let's move on to the next slide.

And is committed to mitigate climate change and thus chicken to advance on the energy transition on our key ESG agenda, we became the first oil and gas company and Latin America and commit to a net zero carbon emissions target by 2050 or emissions and scope, one and two ratifying our commitment with both the sustainable development goals.

And the Paris agreement According to a de Carbonization plan by 2030, Ecopetrol and seeks to reduce its cotwo emissions by 25% and scopes, one and two compared to the 2019 baseline. This reduction represents between five and 6 million tons equivalent of <unk> less by year 2030.

Equivalent to the restoration of and area of 13 times debt of a city like Bogota and Colombia. In addition, ecopetrol seeks to reduce 50% of its total emissions and scopes, one two and three by 2050 compared to the 2019 baseline mature technologies that are currently available as well.

As emerging technologies were considered when setting the targets and the short and medium term that is 2025 and 20 <unk>, respectively. We will focus on the maturation of solar wind and geothermal energy projects as well as in energy efficiency reduction of routine flaring in our operations.

And methane emissions reduction projects this will be complemented by a natural climate solutions portfolio.

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By 2050, we plan to develop initiatives that might include hydrogen gas.

Carbon capture use and sequestration and energy storage through batteries and shrink both the competitiveness and value potential generation of each of these alternatives.

Important to emphasize that and the 2020, one 2020 three business plan, we have included already more than $600 million.

Of investments for the de Carbonization agenda, mainly debt to fund renewable energy projects as well as energy efficiency and fuels quality projects amongst others. The short and long term initiatives and technologies included in these roadmaps will always be evaluated and implemented under strict capital discipline criteria essential pillar.

And of our corporate strategy, let's move on to the next slide the Decarbonization agenda, just mentioned and as part of the four pillars defined in our energy transition and roadmap during the first quarter of 2020. One we made progress in all of them and their competitiveness pillar and the oil and gas business our core business on our main focus will continue.

To make efforts and put forward strategies to achieve a more efficient operation, which resulted in efficiencies of some 264 billion pesos derived from actions focused on strengthening the EBITDA margin and Capex efficiencies. Additionally, we've captured benefits of $12 million in the digital agenda. Thanks to the progress.

And projects such as the digital investments management tool human talent gross refining margin and integrate fields and the diversification pillar, we continued to advance and the due diligence process and support for the potential acquisition of a controlling stake in Asia, a company that will contribute to the Ecopetrol group with stable and predictable.

And sources of income solid alternatives of profitable growth and our unique positioning within the energy transmission sector in Colombia and in some Latin American countries. Likewise, a hydrogen task force has been created dedicated to Carryout. This initiative, we started a research process to determine the potential for green hydrogen production.

And we continue to advance and the construction of the San Fernando Solar farm, which is expected to start operations and the second half of this year. Finally, I want to highlight <unk> 52 per cent reduction in routine gas flaring and our operations between 2017, and 2020 and DT ESG pillar aligned with our strong corporate governance tender.

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