Q4 2022 Vista Energy SAB de CV Earnings Call

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Yeah.

Good day and thank you for standing by welcome to the Vista fourth quarter 2022 earnings and full year webcast conference call. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a.

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Please be advised that today's conference is being recorded I would now like to hand, the conference over to your speaker today Alejandro Chip Nichols. Please go ahead.

Good morning, everyone. We are happy to welcome you to <unk> fourth quarter and full year two.

Hum.

I am here with me getting a little choppy.

And CEO , probably would have been four one.

Before we begin I would like to draw your attention towards cautionary statement on slide two.

Please be advised that our remarks today, including the answers to your questions.

No.

These forward looking statements are subject to risks.

Great. Thank you.

<unk> actual results to materially different from expectations contemplated by these remarks.

Our financial figures are stated in us dollars and in accordance with international financial reporting standards.

However, during this conference call, we may discuss certain non <unk> financial measures such as adjusted EBITDA and adjusted net income REIT conciliation of these measures to appeal for Cfos measure can be found in our earnings release.

That was issued yesterday.

Please check our website for further information on our company better.

Organized under the laws.

Richard.

And the New York stock.

Thank you Carol for common stock.

Victor if there was something he cannot.

The IFC and the New York City.

And just to clarify warrants btw Paul.

I will now turn the call over to Neil.

Thanks, Valerie good morning, everyone.

Today, I will share with you the fourth quarter and full year results of 2022.

In which we have continued to deliver strong operational and financial performance.

First I will present, the fourth quarter, we saw and then we move on to full year results and 2023 guidance.

Also comment on the transaction, we closed and announced yesterday.

Usually Q4 is it likely to total production of about 57000 <unk> per day.

33% increase year over year.

Oil production was up 41% year over year.

Even by the time of long haul wave pattern behind.

By the way and another in Alaska.

Total revenues were $380 million for the quarter.

Small increase of 57%.

Driven by higher production on a stronger realized oil price.

Lifting cost per <unk> was $7 $2 for the quarter.

Next in our success and continued cost pressure from a number of efficiency measures as well as some dilution to the feed cost through incremental production volumes.

Capital expenditure was $145 million.

Including the drilling and the completion of certain work during the quarter.

Adjusted EBITDA during Q4 of 2022 was $202 million.

73% increase year over year, driven by higher production and realization prices and lower lease vehicles per year.

During Q4 2022, we'll record positive free cash flow of $57 million.

Driven by robust adjusted EBITDA generation.

Our ratio at quarter end was 0.4 times adjusted EBITDA.

Adjusted net income was a solid one coming $71 million.

Including and not recurring positive acceptance of $98 million in Kentucky, implying a quarterly adjusted EPS of $2 per share.

We will now deep dive into our main operational and financial metrics for the quarter.

Total production during Q4, 2022 was $54 7000, Boe's per day up 33% annually and 8% sequentially.

Oil production was up 41% year over year, mainly driven by the timing, but bajada del Palo Este 14 analysts here at Citi.

Total shale production, which also includes a high level.

By the way.

We produced two.

36 <unk> per day.

Percentage, 79% oil production.

Moving to slide five I will share some details on our projects back Armada.

In Bajada del Palo Este, we continue to report robust.

<unk> 60 with today.

Which 40 exceeded three can be 60 days of production and net revenues in on evidenced three person about bajada del Palo Este.

During Q4, we completed.

Because of its value with <unk>, which was studied in late in the year.

But that's fine.

Which city, where language and legacy into either organically.

We are seeing very good bit of DVT readings in this world, which are performing above our type curve. After 40 days on production.

Also we recently started to drill four well pad.

The rest of <unk>, which we plan to dilute during Q2.

<unk> production increased to $5 8000, Boe's per day during Q4 2022.

The block contributed 14% of our total production.

But I love, it too and I walk that actually.

We have recently finished drilling four wells.

For London, two with local C. Not one way in the organic growth and one way you take kind of an age which we have not tested.

Well I'll say that so far.

We plan to complete and tie in the.

But by the end of Q1.

During Q4 2022, we made good progress in our piloting because valuation.

We drill complete and tie in one way in Bajada del Palo Este, London, and lack of Sienna and eastern part of the book we have.

And we've really bad.

Because by the way too which contains two words to our casino with plans with the aim is with you in April after.

Which we would have hoped.

Our investment commitment.

In <unk>, we completed our first two well pad in Shanghai, we landed one well in a casino in one way and really kind of.

We are currently working on the temporary production facility for the block, which is scheduled for completion in April .

Our plan is to tell you there was a tenant other than total revenues in Q4 of 2022 were $38 1 million and 57% increase year over year, driven by production growth and stronger presentation pricing during the quarter, we normalized our inventory with the build up 238.

<unk> bonds.

Satellite gold price for the quarter.

$68 $9 per bottle.

An increase of 14%.

As it relates to domestic price it was $67 two low that's pretty moderate.

This figure does not include trucking transportation costs on sales point to refinery, including such caused the domestic realized oil prices were $63 per market.

The average realized price of the export market was $74 $1 per barrel, reflecting a soft opening and higher shipping costs.

For the second and third quarter more than 50% of our total revenue came from the export market.

International market accounted for 52% for volumes and 50% of our revenues we.

We had a $34 five categories during the quarter for $2 2 million buttery. Therefore in total we expect to maintain this level during the coming quarters.

<unk> prices were $4 $5 per million Btu.

The increase of 65% year over year.

Mainly boosted by sales to our industrial customers $3 per million Btu applicable to 44% of our table.

Exports to Chile.

April in April .

Btu applicable to 26% of our assessable items.

Total leasing cost for the quarter was $36 $1 million.

We have successfully implemented cost savings initiatives, mainly that baseline.

Great attitude.

All right.

Which should reduce oil transportation cost.

Additionally, the boost in production volume continues to dilute fixed costs, leading to an 11% reduction in lifting cost per unit you had already here.

Adjusted EBITDA in Q4, 2022 was $201 7 million.

Implying at 73% growth year over year.

This reflects strong revenue growth and a reduction in lifting cost I mentioned previously.

Adjusted EBITDA margin was 65% during the quarter and indeed, I'm an improvement of six percentage points.

Netback was $41 per Boe.

A 30% increase year over year, driven by higher oil prices and lower lifting cost per <unk>.

During Q4 2022, we continue to generate positive free cash flow for a total of $57 2 million.

Josh Brolin operation activities during the quarter and 355% in June .

$15 4 million.

Cash flow used in investing activities was $158 2 million.

Capital expenditure was $145 2 million.

Accrual basis.

With Nike were invested in U S. In our like a multiple ship hitting 1 million facility and $60 million in another maintenance person.

Husky Ocean narrated by financing activities stood at $8 $8 million during the quarter.

We successfully refinanced $108 5 million of 2023 maturity a which.

$45 million are now viewing 2025 and 63 five in 2026.

We also refinanced $45 million for 2024 maturities, which.

In 2025.

This extended the average life a whole lot of debt from $2 40 years to eight years and reduce debt.

It goes from 6% to 44%.

Gross debt stood at $549 3 million at the end of Q4 2022.

Slight increase compared with Q3 2022 with driven by debt issuance to repay $22 5 million of our Standalone in Shanghai.

After these payments dropped that to us.

<unk> hundred $26 8 million.

After debt repayment and due to our successful refinancing that part and then the last year, we only have $45 million debt maturities remaining in 2023.

Net leverage ratio stood at a very healthy Cedar 0.4 times adjusted EBITDA at quarter end.

I will now move to our full year results.

During 2022, we have continued to deliver on our superior shareholder return proposition. We also achieved robust, but formula to be savvy, our 2022 guidance.

We further expanded our installed base, our Tijuana theft.

261, six medium D E R M.

Blaine, it's every claim in a ratio of 495%.

The acquisition of country stand up I wanted to say that I'm Lucky I noticed at MIT.

The addition of three coming your way through our inventory.

Also our successful results in the first two words Callaway.

Callaway fit.

Net to an addition of 50, new with it could eat in our inventory and back to.

To my country wide input.

In 2022, we delivered solid operational performance.

<unk> for the year was $48 6000 beauty per day, a 25% increase year over year.

Well about our 40 <unk> per day guidance.

332% year over year, driven by higher recruiting where she was.

We have 40% to 44% of our oil volumes, which generate 52% of total sales driven by higher realization prices in export market.

Who would have used lifting cost from seven six to seven five dollar or euro.

Year over year, reflecting our export to conserve costs in a challenging FX environment and delivering on our better.

During 2022, we also made good progress in our sustainability program, we continued to invest in the kind of announcing our operation.

This has led to a 2% drop in absolute emissions in the year meeting, which production increased 25%, therefore, reducing emissions intensity from 24 to 18 <unk> in February .

Concurrently we have initiated the first four projects that I know what nature based solution portfolio I will deep dive into this matter later in the presentation.

Regarding shareholder because we've got quite a year.

Yes.

EBITDA of $765 million.

Exceeding our guidance.

Return on capital.

Employing came very strong at 40% for the year and so with our bottom line.

Yet.

For $2 per share and free cash flow one country it might be $7 million.

We have applied part of discussed through the debt by $84 million.

We have also repurchased three 2 million shares for a total of $29 million.

Driven by execution of our strategic plan.

In fact, the context for international I'm going to cry.

Our check right.

During 2022.

Briefly itself increased 39% vis vis 2021 for a total of 251 medium estimated at year end 2022.

This implies a total makes sense if your payment ratio or poor countries 90 type of scan <unk> floor.

It seemed like increased to $14 two years.

This growth reflects the quality of our quarterback commodity acreage and now what are we did it to generate organic unprofitable.

Net additions were $87 8 million.

Driven by activity in our paradigm, where we added 40, new with location.

That valuation, where we added 32, new well locations.

We added four.

Well locations.

This resulted.

In a total of 210 book.

Well locations in our Q1 results.

The 75% by year, a 10% discount rate of $3 two beep into the improved reset of $3 2 billion dollar using the price assumption of $72 per watt.

And triple net.

You forgot.

To SCC guidelines.

During 2022, we made significant achievements on the operational trauma.

Execution.

Program to date guidance of 28, new shallow way during the year.

By the way.

Production increase from 40 to 68 with <unk>.

And.

25%.

I'm, 49% and sugar production you had already good.

20 of the new with wedding because by the way.

In addition, we die even seek with El Al Qaeda.

We incorporated into our quarterly regimen 90 of Iconix team.

Sure.

Got it.

We also initiated a pilot in the current valuation.

Where are we in the first two waves in Q1, 2022 showing robust productivity results.

If you like we started operating our own sand mine and sang washing plant improving signs of she can't cost.

Land is already supplying beta was and is designed to so 100% of our sand needs.

At full capacity, which is forecasted to be reached by midyear.

We have also made good progress in expanding our treatment capacity.

Finally, I went up there.

Right.

The old treatment plant, where we flow with it because partly reflected production increasing its capacity to 57 and tell somebody let's start there.

We are actively working on another upgrade.

Which will further increase the capacity on the plant to 69000 barrels per day by the third quarter of this year.

Finally, we achieved two major milestones related to <unk> question on production.

In all of the environment.

I'm thinking back on more of a two part to Australia.

I mean, a 131 5000 barrels oil per day capacity in that function person. In addition to $42 7000, we already Scott index 50 by that.

We were also awarded 37 4000 barrels of oil per day.

Throughput capacity at the port expansion in political hole sizes.

Capacity in these two drillship, we bought some could each axis supporting through Atlanta.

We have possibility to prepay, 100% of our capacity not that about 50% of our capacity.

Which means an estimated investment in there for prepayments to suppliers of $77 million in 2023, and $60 million in 2024 and $11 million.

Right.

The agreements we have signed for these two purchase constitute a major milestone for our overall plan with.

With combined secured term potential capacity, including our current capacity.

We leased 74 3000 barrels of oil per day.

Which is more than is needed to deliver our 2020 production target.

As part of our upside due to other ongoing questions.

We are currently working with other upstream player to develop an additional pipeline capacity from the core area of <unk>, where we can link to our facilities to the north of the basin connecting with a 50 not that San OTC pilots to achieve it we.

We have seen is switching at eight and evacuation routes for exports to the Pacific.

During 2022, we have made solid progress on all fronts.

Fronts.

As discussed earlier execution of our decarbonization pro shaping grow and reduction if I were to kind of intensity from 24 to 18 kilos of CRT would keep it in February .

Year over year.

Crucially during Q4 of 2022.

Quality and.

I mean intensity of 14 kilos as the impact of the project implemented during the year materializing food, leaving us at a very solid starting point for 2023.

We also signed a long term power purchase agreement with a leading provider of electricity from renewable sources.

We plan to cover approximately 20% of our.

Our need for new logos in 2023 and get out of.

This year in the coming years.

This will contribute significantly to reducing our scope two emissions.

During 2022, we made headway in the development of our nature based solution portfolio we.

We said that Kip <unk> subsidiary to design manage and execute our Taiwan upset brushes.

I can start with leading local effect I'm focused on the development of a mixed foresee.

For consideration and solid capture through sustainable agricultural and livestock practices in Argentina.

Unit.

Year of operation I kept purchased land in the pro forma liquidity, where we planted 1080 <unk> signed.

<unk> Advisory Committee members.

Purchased by Succinic says for the Forest Conservation project in the province South of that.

Unsigned sustainable farming, our livestock agreement covering a total of 3800 <unk> the protein called Bella some tepid vinyl sided and reasoning.

Considering our solid throat if needed carbonization MBS projects, we are well on track to fulfill our scope one and two zero ambition by 2026.

On the social front, we are keep solid safety resources accordingly.

Our incident rate below one for the third again in the world.

Hey, good progress in our synergy initiatives.

Thailand, and developing teammate talent issues.

Issuing <unk> and running bush up between recent growing employee awareness.

We also setup associated management system.

Anywhere to support and develop social projects with our local communities.

Kevin reality I'm following IFC standards.

Finally, we have continued to strengthen our governments issuing new policies related to business.

And implementing its probably even mechanism on our website.

I believe this is like conveyed how our stronger performance good way above total shareholder return in 2022.

Our strong profit oil production grows little cash generation led to positive free cash flow, reaching almost $200 million in 2022.

These costs enable us to further delever, our company, reducing gross debt by 84 million.

This reflected in a very solid net leverage ratio of Cedar 0.4 times EBITDA at year end 2022.

And demonstrate quality of our resource return on average capital employed very quickly reached 40% in <unk>.

EPS increased by four times he had already yet we.

We have also allocated 50 million the other two the first U S based use of our share buyback program.

These significant achievements were positively as reflected by our share price per forma.

Tripled in 2022.

Moving to slide 15.

We announced a transaction that will allow us to become fully focused on back of motorbike shouldn't really minimum.

The transaction structure, assuming nobody has to face amendment, we'd really like Coca Cola.

Cause the convention and conversation shows you gave on the map.

As of March 1st 2023, a Coca Cola would become the operator pay 70% of the Opex capex royalties and taxes.

Such assets.

We remain transitions like this until final closing date, we shouldnt be no later on February 28 2027.

At this time funded 100% ownership will be done for a couple of them kawa subsys to provision up to do it.

Mr would receive a consideration composed of three items first a payment of $26 $5 million in Keystone and <unk>.

40% of oil and master used by the outlook for the next four years.

70% of the LPG and condensate clear.

That Android.

The consideration payable in O&M volume has the minimum one keyboard for medium burgers with Boyd and three medium cubic meters of gas.

Sure the right to purchase a home got what 60% share of gas production at one dollar per million Btu.

For such a got we will be making a margin of around $3 $5 per million with you our current pricing.

Importantly, the old treatment plant, but Africa located in Arizona with a capacity of 57000 barrels of oil per day is not included in this transaction.

So mid <unk>, the right to develop the back home onto play in all the concessions.

According to our estimates it really.

Prices of $65 per Nevada of oil and $4 $5 per million Btu.

The total value of two week, though there's an obsession with reach and nobody had.

Approximately $400 million.

This is a low beta to fully focus on the development of Vaca Martha.

In line in our portfolio and boosting our financial and operating metrics.

It's an infection, we have immediate benefit on our metrics.

In 2020, three we forecast a reduction in lifting cost per <unk> 25 per cent.

The increase in adjusted EBITDA margin by five percentage points to 71%.

The fact that we will be consolidated 60% of all the production from these conventional assets.

He made it at 5000 Boe's per day debit impact is neutralized by the food company already operates.

<unk> expenses Android.

When taking into consideration the capex calorie and their working capital effect. These transactions generate $30 million in incremental free cash flow for <unk>, which will be embedded in banking crude oil transport infrastructure to increase exports.

He also improve our ability to deliver on.

Our 'twenty 'twenty target through additional pre cash flow.

We forecast an additional net cash generated of approximately $100 million between 'twenty, three and 'twenty 'twenty seek a separate sort of the transaction our portfolio will be stronger.

With investment did X to hire I got out of childhood Pershing, leading to higher corporate return on capital employee and adjusted EBITDA margins.

I will now, but it's in our 2023, guys I'm, reflecting double digit growth in production and adjusted EBITDA.

This plan, coupled with our robust delivery during 'twenty 'twenty to leave us well on track to deliver on our 2026 targets.

Our development strategy is to really focus on developing our core areas and finally like the pilot.

By the way to be reached such books during 2023, we plan to retain 20 neighborhoods.

16th in because by the way state aid.

<unk> a phase three.

Three and because by the way.

And two more.

These times are forecasted to deliver 55000 boe's per day, a 17% increase year over year.

The rate is forecast at around 60000 barrels per day.

This is planted to corn, even with the consolidated 60% of the production of our conventional assets as of March 1st which will remove approximately 5000 boe's per day on our production base.

Lifting cost is forecasted to dropped 27% year over year to $5 $5 a barrel.

Mainly driven by the deconsolidation of the conventional assets.

Adjusted EBITDA is estimated in the 852 900 medium range based on our reputation price between $65 or whatever it is.

Implied and instead annualized growth of 11% to 18%.

Our planned capex exceed country mediums.

Driven by slightly higher drilling and completion activity.

On investment and treatment facilities.

Awesome.

The part a little bit.

In southwest emission intensity is forecasted to be used on 18 to listen thank you Liz obscure tricky viewing.

These reductions captures the full year impact of the project executed in 2022 as well as a partial impact of the 2023 portions.

We are very confident that that is one factor that neither on the long term target percentage of that working better day in December 2021.

Moreover, we see potential for over there either.

In our production efficiency metrics and free cash flow targets.

Yeah.

We will now go through the key takeaways of today's presentation.

2022 which is a year of robust operational and financial performance.

We have delivered our positively revised 2022 guidance and made good progress toward our 2022 Academy.

We also delivered on our superior total shareholder return proposition.

Where do you usually doesn't debt repurchased three 2 million shares.

Through the warrant exchange last October .

This led to a peer leading a stock performance during 2022.

We sign and ignore the ATB that we come from big things with fully focused back on more of a competitive with improved operational and financial metrics.

Finally, we have issued guidance for 2023 today and double digit growth in production and adjusted EBITDA, which higher margins.

Before we move to Q&A I would like to send our investors for their continued support.

And all the team for their commitment and hard work.

A key insinuating this understanding with salt.

Operator, please open the line for Q&A.

As a reminder to ask a question. Please press star one one on your telephone.

And wait for your name to be announced to withdraw your question. Please press star one one again.

Please standby, while we compile the Q&A roster.

Our first question comes from the line of Alejandro than my Sheila from.

And I use securities.

Yes, good morning, gentlemen, congratulations on the deal.

Let me give a quick question you mentioned that you see potential to over deliver on the 2026 targets. So could you kind of walk us how youre seeing those those targets now because you're lowering your.

The cash cost you are reducing your emissions significantly through the sale.

Having more money in the bank you are having a question on capacity.

How much more can you over the liberal can you bring those those targets forward rapidly.

Hi, Alejandro Thank you very much for your question.

Yes, I mean, we.

If you remember for 2026.

We basically guys that we were going to be around 80000 barrels per day on one to one.

$1 1 billion of EBITDA, and we are well on track and as I said in the presentation. We believe that we will surpass.

The objective that we put our sense.

When you look at 2020 guidance already in terms of EBITDA between 859 countries millions so.

With that I think we would be well ahead.

The other thing to consider on the plan that we presented a December 20.

2021.

What commodity price at that time was 60.

Today, we are running with higher commodity price. So that also we've got it.

But he got activity.

Of course, I mean this year our plan is to fully utilize the capacity that we have we'll be running with one rig and a half.

With a capex of around 600 million part of that Capex are important part of that companies are going to be dedicated to facilities.

In 'twenty 'twenty four.

Of course also we can shift some of that capex to having additional activity in terms of motivating.

Move from one Rick.

Rick to 200, and then Rick you see that in the context of the one that we have today that we believe that could be the case so.

But in the long story short I think we are well ahead to deliver what we said for 2026.

You should expect that we would sort of bucket of production and also David that target that we put them in the investor call.

That's great. Thank you.

My follow up how are you thinking about those cash returns that that tumor.

And sent to shareholders with a new setup.

No. The cash return that is in place is something that.

We keep in mind this year would be a particular year, because when you're investing a lot in facilities for the future growth.

Now 2020, Florida from the cash point of view it would be I mean.

<unk> plan and look to be a very good year on that.

Returning cash to shareholder return to shareholders is something that we keep in mind remember we have a buyback program.

We are executing that was approved last December .

We have $20 million to execute.

That buyback program.

It's one of the way alright, definitely returning to shareholders that continue in place and we will continue executing that.

Okay. That's clear thank you.

Thank you.

One moment for our next question.

Our next question comes from the line of Regis Cardoso from Credit Suisse.

Good morning, Jeff and let me go to Andrew Congratulations on the deals.

Very strong results.

My question really is a discussion on connects very well with the previous question.

No no no.

The good results, you've had but still with the cross trained.

Capital flow restrictions in Argentina, I wanted to get a sense of what you think.

As necessary or what would be a good arrangement that Argentina could implement.

Foster the investments and to allow the oil companies to remunerate their shareholders I mean in the past we've talked about.

Retaining some of the dollar from from exports for example.

So I'm asking because now let me go basically because you have no again divested of NASA looks at very attractive valuation.

But it looks like you are generating a lot of liquidity in the company right.

So the question really is you know what can be done with.

That liquidity thank you.

Hi, Thank you very much for your question question, Yes.

Yes, you are.

Complete horizon, we have the same target.

Let me search first I mean, one of them seem though we haven't any time today is that the QD.

207, seven I think our main objective is this decree that was put in place.

Fully regulated by the government. So it doesn't mean that they have we've seen it all.

The process that they have to there. We're there we've got to put in place in order for the any could each be operational.

<unk> is already for free from the government side, you social point field for on our site. We have presented every team on them basically today, we have first claim of $36 million.

That.

<unk> is in place and we are waiting for the minister of energy.

Basically two released their certificate of that claim that we have done okay. So.

That is what we have to keep pushing on it.

The decrease was put in place.

It's good for the industry and I think good for the country.

All of that.

Money today is a result of the investment I mean, the first thing we need to focus on a second I would like to come in in terms of Capex.

The 'twenty two 'twenty three is a year, where most of the capex.

Most of the cash that we shouldnt at eight it would be tempting to cut back because we need to invest in facility because at the moment we have to.

Upgrade our capacity and in order to fulfill the plan that we got to 2026 2024, you said he outerwear.

We have a strong cash generation.

Not that not that investment in facilities.

And therefore for that to have that degree and probably other things that could come why is big wave will come from.

From a new economic regime due to the election that we have.

The fear I think would be in place between most of the part and some politicians today.

Besides I mean encompass and competition, we have probably four or five years ago, but come out of that is the key for the country to access to golar and to exit the.

We need to continue investing and we need to continue growing their production in order to create more export volume.

This is very clear across the board so.

I'm positive.

That award I would happen after the election.

That will be part of something that.

That would be very high and agenda in a new vitamin okay.

Well I don't I don't think I can tell you more than that concrete decreased to 77.

And then of course, we are hopefully that.

We can do even better than that.

Very clear and we go thank you for the comprehensive answer.

Yeah.

Thank you one moment for our next question.

Our next question comes from the line of Andreas Cardona from Citi.

Hi, good morning, everyone.

Congratulations on the very strong results in 2000, and I'm 20 tuned on only on the financial front, but also on the reserves.

And even on the looking value strategies.

Let me start from does that last.

You have been very active on the money front.

Do you see more room to do something else in 2023, maybe farmout some working interest.

But could I could ask two accelerates development or something else and the second question is with such a low lately I was kind of strong cash flow what is holding you back to accelerate the development.

Oh, okay.

Projects, you said something about I don't know if facilities.

It's sad.

Company policy to work on a new take cash flow basis. So just wanted to understand what is holding you back from accelerating from the production front.

<unk>.

Thank you Andre for your question.

I will just start from the second question.

As you know.

To date in 2023.

We have a plan that basically is same to foreign fees.

The only capacity that we have.

And that all capacity.

Going to fulfill it because we are going to be exiting 2023.

With 60000 Boe's.

Okay.

<unk> will allow us to use every single piece of capacity that we have in our facilities and also in the main fine line that clinic.

With the airport.

Airport Fortinet.

In Bahia Blanca.

Going forward as I mentioned before I mean, what we see is that 40% of the capacity.

Everybody is going to create this country. They live in in 2024, and the rest 60% of that.

The.

Additional capacity is going to be released in 2025 that the way that will allow us to grow as part of it.

And so we're a little further I mean in 2024, where today. We can think of is to probably add Rick so toward two or four.

Great program that would take us around 30 wells brought her into 40 wet.

But keeping in mind that.

We all with caffeine.

In our in our program.

The cash flow generation. This is something that we are always looking at.

We basically are aiming to generate cash and to return.

Part of that to our shareholders.

Shareholders.

Again, I mean, when we don't cover attrition of capacity and the dynamics that we are presenting underwood investor in <unk>.

Are they you we'd be related to how much cash we shouldn't today, how much we want to bump.

Into additional activity.

We want to return to our shareholders.

And of course.

You see because you run the numbers.

Cash generation is going to be so reach that will be also.

Uh huh.

The freedom to continue looking on M&A.

Transactions.

So part of what we have done have been very focused on.

On increasing not pushing back on what we have done very well with the acquisition of <unk>.

Not only from the economical point of view because we when we bought core acreage are they.

They're very good rate.

But also the business development team execute.

This quarter on it.

Transaction that kill us to be a pure play in and become more of that with a very focused organization.

Using our lifting cost and increasing our margins. Okay. So again nothing that you should expect from the M&A point of view, but we always we did so far.

Looking to how we can improve.

Sure.

Our numbers.

And our returns on our margin.

Yeah.

Okay.

Thank you one moment for our next question.

Yeah.

Our next question comes from the line of Walter <unk> from Santander.

Yeah.

Hello, Good morning, and congratulation for the results.

Thank you for taking my question.

I would like to ask you if you.

And more specific breakdown.

Opex, specifically the six condominium capex.

Especially between.

What is facilities this year.

What is that.

Investment in production.

I treated.

Patients in the field.

That's my first question.

So.

Sure.

To make it clear.

You are investing in the older but it probably has shown that your own kind of let's say one five <unk> per day.

I mean, we didn't newest Spanish.

But you mentioned in the presentation you have it.

A paucity of $34 three barrels per day.

The difference we've seen that at 1734.

Samsung is already.

Okay.

And that you have secured already.

It's something that.

He's done year over year.

Sorry my questions. Thank you.

Sure.

Thank you Walter for the question.

So let me give you first the breakdown of the Capex.

Hum.

Hopefully that they became more clear to you.

Just to give you the breakdown first of 2022 us a baseline two compared with $20 into city.

We basically are in 2022 with Ben <unk>.

$360 million in brick and mortar with around $100 million in facilities are there was around $60 million in other sound familiar in Mexico.

It's been around 504 countries is $540 million in total capex.

This capex is.

We seem to see kind of $3 million in 2018, mainly due to facilities. So when you look at the Capex in 2023 is going to be three XD in.

In brick and mortar Wes.

The 20, new was that we put in our plan now facility something around 100 million till $140 million.

That basically include.

And upgrades of the three main facilities gathering facilities compression facilities, so everything that we need.

Chris.

Capacity.

To basically everything that went into delivery plan that we put together for 2026. So our capacity in <unk>. For example is going to go all the way up to 80000 barrels of oil per day and so.

So that this is a big update.

The address on it's still the same I know when you will see we're also we see because we will have increased activity in Mexico in Mexico.

$5 million. This year, we drilled a few words, so that go to $18 million, but main increase in capex is related to facilities.

And in order to be ready to to be prepared for the 80000 Boe.

But we I mean investor in Investor Day.

The other question was related to the advisor.

So.

All of these well project.

It's a project that will add capacity to the industry.

350000 barrel per day of evacuation capacity on the top of that we have today.

It is a project that would require a capex of $1 1 billion.

<unk> was awarded a 10% of that capacity okay.

That project for us in term of Capex.

Capex.

They require an investment of $180 million.

That is going to pay in three installments of 54 in 2000 $23 million in them in 2024.

54 million in 2024, and 10 million in 2025 and a half.

I know unnamed that is 0.6 dollars per barrel.

So what you should expect in terms of capacity additional capacity for us.

71000.

Baron a foot per day.

Yeah.

Alright, but the total contracted capacity.

34.

Okay is that correct today at 42, and we will add 31 point.

Okay.

Understood. So we did that we wouldn't be.

We have enough capacity to.

Execute our plan basically.

Perfect and a follow up question.

How do we should see you you mentioned that you've got the scoop.

We will reduce in 2024, because you had not invested much in facilities.

Uh huh.

What would be the number that we should call it.

No one likes that.

When you cut off could you repeat the question.

I mean, you you mentioned that 2023 is going to be like how your capex here six 7 million, but eventually for.

Capex, especially facilities should be lower.

So how much would be the capex for 2024.

Assuming that Q3.

Excuse me.

West.

I mean, it should be lower.

If it was you I would play so clearly facility is going to go down from today's country 4800 $50 million to more close to <unk>.

$100 million.

2024, and thought of it alone in 2025, we said $50 million $60 million.

Now then you got to play with.

The fact that our what we're doing demo acceleration of drilling activity. It is possible that we accelerated as I said before to move from one five rig to two rigs and that he will who will bring a bit of extra capex to.

Two the development to the development side of the Capex. So.

For example, it is not unthinkable that in 2024, even though we've been $40 million to $50 million less on facilities, we transfer that capex into west because we want to accelerate our program.

The commodity prices. These are the way that it is today.

Yeah.

With the performance that we're having with the portfolio that we have on the development costs and lifting costs that we have.

It could be reasonable that we want to accelerate.

Perfect. Thank you very much for the answer.

Youre welcome.

Thank you one moment for our next question.

Our next question comes from the line of Rodrigo <unk> from <unk> Securities.

Hi, Neil.

Congratulations on the strong associates quota.

I'm curious about the potential impact of the upcoming election here in domestic pricing on how big that belongs to navigate any potential fluctuations.

And then additionally, annuities that there've been some recent discount next for Brexit.

And wondering if you could provide some insight into what is driving this trend and what can we expect.

Going forward in terms of.

Pricing for foreign exports. Thank you.

Thank you Rodrigo for another question.

Hi.

Well look I think first of all I'll say an.

As a general comment I would say for us the best way of mitigating them.

Local pricing dynamic.

<unk> is to export more.

And that is what we plan to do I mean, we have reached today 55 of our volumes.

Our imported and that.

They represent 65% of our revenue.

And we plan to continue growing in that export volumes and also therefore revenue.

And you see already today and the mitigation of any fluctuation with the couple of the import parity.

They definitely have the impact that used to have for us in our balance sheet. I think this is the way to continue to meet the 18th.

The local market dynamic related to what we.

We have been this year.

For anybody that's helpful. Barry in Argentina, clearly that this will be a difficult year in term of dynamic of local prices.

What you mentioned is an election year.

Nevertheless.

The dynamic Oh, we show that.

Basically pricing.

Prices of gasoline in pesos is not a good deal for the country.

Today, it's clear that.

We need to continue being capital what the international market.

Any big decoupling with international market ended up not being good for the country not being good for the probably provinces that are happily from royalties of the oilfield and neither for us that Oh for the industry that ended up cutting investment.

That is what is noteworthy are shrinking in Argentina needs today.

So we've.

We are being conservative we said in our plan in term of local pricing local pricing probably more conservative that we should be.

So that is factoring in our plan, but yet they need that mix is going to be tough this year.

Related to discount of commercial economy on export.

As we mentioned I mean, we were at eight.

The last quarter.

For us if it's a high discount and we see that discount coming down to more six and seven for the Q1 and our.

Our commercial team is that that is gone is going to continue going down during the year. So we are back to be much lower than a for the year. The reason of that as far as I know, but you know we use categories of a.

Half a million barrels.

Those category has been in high demand due to Russia, and Russia cutoff of production.

We believe that that that dividend, even though Russia is still complicated.

It will not be that much in place and we seem to see that in Q1. So.

I would say you should consider that probably that there was a high number on where we should be more more close to 645 for this year.

Thank you Elsa.

It really clear.

Then a quick.

Follow up on the Capex for <unk>.

For next year.

What are the key factors that I would consider to exit.

Accelerate its investment than semi of.

Of pricing, it's a matter of a capital restriction speaking how.

How would you think.

How.

Or what's your thinking process didn't skype or not to ramp up.

<unk>.

Yes.

For us I mean again as I mentioned before for 2023.

The main thing is a year, where we are going to.

We feel the full capacity that week off and they needed to have.

Leaving leaving the year with very high murder of 60000 barrels per day and.

And that is as much so that we can do then 'twenty 'twenty four is different because with all the laws delivering 40% of the capacity that is.

But they are executing today.

It will be more of a.

Playing how much cash we're launching that aten come much capex of that cash we want to bump into in traditional activity as I said before.

Is not unthinkable that we increase activity.

Two two rigs.

And that is going from 31 to 40 with and then we will have less capital to invest in facility facilities. So if you want to model. It you can continue modeling and then and then medium case that we were having a capex of around $600 million, but with more activity of.

Of course, we can go.

We can go farther than that.

Is not in the plan today is not something that today, we can say that we would do.

Okay. Thank you very much.

Thank you I would now like to turn the conference back to Miguel Lucia for closing remarks.

Yeah.

Luca Thank you very much for your participation.

We are closed in a very good 2022, and a study in 2021 would be great.

M&A transaction.

Put this guy in a better place in terms of being a fully.

Conventional play it.

With better numbers than we'd been lifting costs with better margins.

We are looking forward to execute and deliver on our promise also in this 2020 through 2023. So thank you very much for participating and looking forward to see you again next quarter.

This concludes today's conference call. Thank you for participating you may now disconnect.

Yeah.

The conference will begin shortly to raise and lower Johan during Q&A, you can dial star one one.

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The conference will begin shortly to raise and lower Johan during Q&A, you can dial star one one.

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The conference will begin shortly to raise and lower Johan during Q&A, you can dial star one one.

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[music].

Good day and thank you for standing by welcome to the Vista <unk> fourth quarter 2022 earnings and full year webcast conference call at this time.

Time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session.

Ask a question during this session you will need to press star one one on your telephone you will then hear an automated message advising your hand has been raised.

Sure. Your question. Please press Star one one again please be advised that today's conference is being recorded I would now like to hand, the conference over to your speaker today Alejandro <unk> Nicole. Please go ahead.

Thanks. Good morning, everyone. We are happy to welcome you to <unk> fourth quarter and full year 2002 results conference call I'm here with me getting a little vista's, chairman and CEO , probably would have been postponed for one year.

Before we begin I would like to draw your attention towards cautionary statements on slide two.

Please be advised that our remarks today, including the answers to your questions may include forward looking statements.

These forward looking statements are subject to risks and uncertainties that could cause actual results to be materially different from expectations contemplated by these remarks.

Our financial figures are stated in U S dollars and in accordance with international financial reporting standards.

However, during this conference call, we may discuss certain non <unk> financial measures such as adjusted EBITDA and adjusted net income.

Conciliation of these measures to appeal for Cfos measure can be found in Los Angeles.

That was issued yesterday.

Please check our website for further information on our company beta sensitive annually, our subsidiary capital area organized under the laws of Mexico, which is <unk> and there was some kind of a lora and the New York stock.

Yeah to clarify common stock.

Beta in there was somebody who kind of irrelevant.

<unk> in the New York.

And particularly if I weren't btw AP.

<unk>.

I will now turn the call over to Leo.

Thanks, Tom Good morning, everyone today, I will share with you the fourth quarter and full year results of 2022.

We have continued to deliver strong operational and financial performance.

First I will present, the fourth quarter results and then we'll move on to full year results and 2023 guidance.

We also comment on the transaction, we closed and announced yesterday.

During Q4 of 2022 total production out of that 57000 <unk> per day.

At 33% increase year over year OIBDA.

Oil production was up 41% year over year, driven by the timing of long haul wave pattern behind by the way and another in our wealth.

Total revenues were three coming to a million dollars for the quarter and in the annual increase of 57%.

Driven by higher production on a stronger realized oil pricing.

Lifting cost per <unk> was $72 for the quarter.

Our success and continued cost pressure from a number of efficiency measures.

After the dilution the feed cost through incremental production volumes.

Capital expenditure was $145 million.

Including the drilling of a.

With the completion of certain work during the quarter.

Adjusted EBITDA during Q4 2022 was $202 million.

73% increase year over year, driven by higher production and realization prices and lower lease vehicles per year.

During Q4, 2022 will report positive free cash flow of $57 million.

Driven by robust adjusted EBITDA generation.

<unk> ratio at quarter end was 0.4 times adjusted EBITDA.

Adjusted net income was a solid one coming to $71 million.

Including and not recurring positive acceptance of $98 million.

<unk>.

Implying a quarterly adjusted EPS of $2 per share.

We will now deep dive into our main operational and financial metrics for the quarter.

Total production during Q4 2022 was $54 7000 Boe's per day.

33% inter annually and 8% sequentially.

Oil production was up 41% year over year, mainly driven by the timing, but bajada del Palo Este $14 an hour.

Yeah.

Total shale production, which also includes.

<unk>.

$236 2000 barrels of oil per day, representing 79% of oil production.

Moving to slide five I will share some details on our projects back Armada.

In Bajada del Palo Este, we continue to report robust television.

<unk> 60 with today.

Which 40 have exceeded three can be 60 days of production and are producing on evidenced 3% of our bajada del Palo Este.

During Q4, we completed but the <unk> 15, which was timing in late in the year.

This but that's by way of which three were landed in Lego Sina to inorganic growth.

We are seeing very good through DVD readings, and this was which are performing above our type curve. After 40 days on production.

Also we recently started to drill four well pads.

<unk> 16, which we planned to dine during Q2.

<unk> production increased to $5 8000, Boe's per day during Q4 2022.

The block contributed 14% of our total production.

Bypass I'll update.

On to Nols it actually.

We have recently finished drilling four wells.

Great I'll call, London, too with the legacy one waiting the organic growth and one way you can kind of run rate, which we have not tested in our I'll say that so far.

We plan to complete in saying this but by the end of Q1.

During Q4 2022, we made good progress in our pilot.

Okay.

We drill complete and tie in one way in Bajada del Palo Este Lauder.

And lack of Sina and eastern part of the block we're currently really fast.

Because by the way too which contains two west Vela casino.

We plan to retain these with you in April after which we will be hosting our investment commitment.

In Angola Mora, we completed our first two well pad in Shanghai, we landed one William Nicosia, and one way immediate kind of run rate.

We are currently working on the temporary production facility for the block, which is scheduled for completion in April .

Our plan is to dilute there was other than total revenues in Q4 of 2022 were $38 1 million.

<unk>, 57% increase year over year, driven by production growth and don't move reservation pricing during the quarter, we normalized our inventory with the build up 238000 barrels.

Satellite will price for the quarter averaged $68 $9 per bottle and can get online increase of 14%.

Debit analyze domestic price it was $67 <unk> per Barbara.

This figure does not include trucking transportation cost from sales point to refinery.

<unk> such caused the domestic realized oil prices were $3 per market.

The average realized price of the export market was $74 $1 per barrel, reflecting a soft opening and higher shipping costs.

For the second and third quarter more than 50% of our total revenue came from the export market.

As to international market accounted for 52% of our volume 56% of revenues, we had $34 five cargoes during the quarter for $2 2 million butter 40 in total.

Expect to maintain this level during the coming quarters.

<unk> prices were $4 5 million of it.

<unk>.

An increase of 65% year over year.

Mainly boosted by sales to our industrial customers $3 per million btu applicable to 44% of our tables.

Pretty chilly at $8 8 million.

Btu applicable to 26% of our assessed borders.

Total lifting cost for the quarter was $36 1 million.

We have successfully implemented cost savings initiatives, mainly with highlights from our trade up to the highest risk.

Which will reduce transportation costs.

Additionally, the boost in production volume continues to dilute fixed.

<unk> costs, leading to an 11% reduction in lifting cost per unit year over year.

Adjusted EBITDA in Q4, 2022 was $201 7 million.

Implied at 73% growth year over year.

This reflects strong revenue growth and a reduction in lifting costs I mentioned.

Adjusted EBITDA margin was 55% during the quarter and in the annual improvement of six percentage points.

Netback was $41 per Boe.

A 30% increase year over year, driven by higher oil prices and lower cost per unit.

During Q4 2022, we continue to generate positive free cash flow for a total of $57 2 million.

Cash from operation activities during the quarter increased 55% internationally.

$15 4 million.

Cash flow used in investment activities was $158 2 million.

Capital expenditure was $145 2 million.

On an accrual basis of which 98 were invested in U S. In our commercial approach at getting 1 million facility and $60 million in another minus bushnell.

Cash flow generated by financing activities at $8 $8 million during the quarter.

We successfully refinanced $108 5 million of 2023 maturity.

$45 million are now viewing 2025 and $63 five in 2026.

We also refinanced $45 million for 2024 maturities, which you 2025.

This extended the average life of our debt from $2 40 years to two eight year.

To reduce the.

Cost from 6% to 4%.

Gross debt stood at $549 $3 million at the end of Q4 2022.

The slight increase compared with Q3 2022 with driven by debt issuance to repay $22 $5 million of our term loan in Shanghai.

After this payment dropped that to $526 8 million.

After this debt repayment and due to our successful refinancing efforts at the end of the last year, we only have $45 million debt maturities remaining in 2023.

Net leverage ratio stood at a very healthy Cedar 0.4 times adjusted EBITDA at quarter end.

I will now move to our full year result.

During 2022, we have continued to deliver on our superior shareholder return proposition.

Also achieved robust performance vis vis our 2022 guidance.

We further expanded our reach that might be per base.

<unk> increased to 251 six medium E R M.

In line with our replacement ratio of 495%.

<unk> mission of country for standing up our I'll say that I'm not.

Net to the addition of <unk> to our inventory.

Also our successful result.

In the first two words.

Okay.

Net to an addition of 50 you would it increase in our inventory and back to.

Two nine countrywide input.

In 2022, we delivered solid operational performance.

For the year was 48 6000 barrels per day at 25% increase year over year, and well above our <unk> 40, <unk> per day guidance.

332% year over year, driven by higher oil content, where she was.

We exported 44% of our oil volumes, which generate 52% of total sales driven by higher realization prices in export market.

Who would have used lifting cost from seven six to seven by Golar.

Year over year, reflecting our effort to control costs in a challenging FX environment and delivering on our value.

During 2022, we also made good progress in our sustainability program, we continue to invest in the kind of announcing our operation.

This led to a 2% drop in absolute emissions in the year meeting, which production increased 25%, therefore, reducing emissions intensity from 24 to 18 kilos of <unk> in February .

Concurrently we have initiated the first four projects on our nature based solution portfolio I will deep dive into this matter later during the presentation.

Regarding shareholder returns.

Quite a year.

Yes.

EBITDA at $765 million.

Exceeding our guidance.

Return on capital.

Employing came very strong at 40% for the year and so with our bottom line rebounded yet.

$4 $3 per share and free cash flow one country it might be $7 million.

We have applied barrel discussed.

By $84 million during the year.

We have also repurchased three 3 million shares for a total of.

$29 million.

Driven by execution of our strategic plan.

The context for international ankle once the crisis, our tier three during 2022.

Proved reserves increased 39% <unk> 2021 for a total of $261 six medium <unk> estimated at year end 2022.

This implies a total knee replacement ratio of 490 <unk> and.

<unk> 15 floor proved reserve life increased to $14 two years.

This growth reflects the quality of our core of our commercial acreage and our ability to generate organic and profitable growth.

Net additions were 80 symphony medium.

Driven by activity in our paid out while we added 40, new with location.

By the way, where we added 32, new well locations and by the way.

We added four.

Well locations.

This resulted.

In a total of 210 book.

Well locations in our Q1 results.

The 75% value at 10% discount rate attributable to beat instead, it improved reset of $3 2 billion using a price assumption of $72 per borrower fraud.

And triple net dollars per million Btu forgot a carnival to SCC guidelines.

During 2022, we made significant achievements on the operational front.

The execution, but what I want more rolling back to the guidance of 28, new CLO during the year.

We had a poor total work on production an increase from 42 <unk>.

<unk> increased 25%.

Action and 49% and sugar production you had already good.

20 of the new with we're in Bajada Palo.

In addition, we seek with in our theater, which we incorporated into our core development area of Iconix team.

Hello.

Hello.

We also initiated a pilot in Bahar evaluating where we tie in the first two waves in Q1 between the two showing robust productivity results.

If you like we started operating our own 2009 and sang washing plant improving signs of ship chicken cost.

Plan is already supplying beta was and is designed to sort of 100% of our some meat at full capacity, which is forecasted to be reached by midyear.

We have also made good progress in expanding our streaming capacity.

Finalize our update of.

The only treatment plan, where we slowed the bajada Palo reflected production increasing its capacity to 57000 barrels per day.

We are actively working on another upgrade.

Which will further increase the capacity of the plant to 69000 barrels per day by the third quarter of this year.

Finally, we achieved two major milestones related to <unk> question on production.

In OLED it by line linking back on more of the two parts of Australia.

<unk> been awarded 31, 5000 barrel oil per day capacity in that expansion person. In addition to $42 seven it's Hudson, we already Scott in the system by net.

We were also awarded 77.

<unk> thousand barrels of oil per day throughput capacity in both the port expansion in political status.

Capacity in the two Drillships will give us increased access to 14 with Atlantic.

We have agreed to prepay 100% of overcapacity.

50% of our capacity.

Which means an estimated investment in the form of prepayment to suppliers of $77 million in 2000.

Three and $60 million in 2024 and $11 million.

Okay.

The agreements we have signed for these two process constitute a major milestone for our growth plan.

We combined secured term potential capacity, including our current capacity.

We leased 74 3000 barrels of oil per day, which is more than is needed to deliver our 2020 production target.

As part of our upside due to other ongoing pluses.

We are currently working with other upstream player to develop an additional pipeline capacity from the core area, who bought her more.

Where we can lean into our facilities to the north of the basin connecting with existing notes outstanding OTC pilots to achieve it.

We have seen is also generate an evacuation goods for export to the Pacific.

During 2022, we have made solid progress on all fronts.

Plants.

Scott earlier execution of our decarbonization projected growth and reduction of our covered intensity from 24 to 18 kilos of <unk> year over year.

Crucially during Q4 2022, we have recorded.

Density of 14 kilos.

The impact of the project implemented during the year materialized in food, leaving us at a very solid starting point for 2023.

We also signed a long term power purchase agreement with a leading provider of electricity from renewable sources.

We plan to cover approximately 20% of our.

Our need for renewables in 2023 and gradually increase this year in coming years.

Will contribute significantly to reducing our scope two emissions.

During 2022, we make headway in the development of our nature based solution portfolio.

We said that it <unk> subsidiary to the Si Mamas and execute our Taiwan upset brushes.

Is that leading local.

Focus on the development of the mix 40.

For a consideration and source capture for sustainable agriculture, and livestock practices in Argentina.

Unit.

First year of operation.

Purchased land in the protocol.

Where we planted 1080 <unk>.

<unk> advisory and commitments to purchase by <unk> for the fourth conservation project in the province.

On Simon's sustainable farming and livestock agreement covering a total of 3800 <unk>.

Cordova, some tepid vinyl sided on revenue.

Considering our solid progress in the carbonization and Mds projects, we are well on track.

Our scope, one and two zero ambition by 2026.

On the social front, we are keep solid safety resources accordingly.

Furthermore, incident rate below one for the very young in the road, we have made good progress in our synergy initiatives.

And developing teammate talent.

Issuing <unk> and running workshops <unk> recent growing employee awards.

We also see tablet social management system.

The framework to support and develop social project with our local communities at several.

Generally aldi and following IFC standards.

Finally, we have continued to strengthen our governments issuing new policies related to business.

And implementing a public you'd even mechanism on our website.

I believe this design conveyed.

Our strong outperformance give way to a robust total shareholder return in 2022.

Our strong profitable production growth drove cash generation led to positive free cash flow, reaching almost $200 million in 2022.

Discuss enable us to further delever, our company, reducing gross debt by 84 million.

This reflected in a very solid net leverage ratio of <unk> four times EBITDA at year end 2022.

In Denmark, the quality of our resource return on average capital employed very quickly reached 40% and adjusted EPS increased by four times year over year.

We have also allocated $50 million to the first two stages of our share buyback program.

These significant achievements were positively reflected by our share price performance, we tripled in 2022.

Moving to slide 15 yesterday, we announced a transaction that will allow us to become fully focused on back of multiple should we leave it there.

The transaction structure as an innovative toothpaste amendment with visibility that can power.

Covers the convention and conservation shown in gray on the map.

As of March 1st 2023, a conqueror will become the operator on page, 70% of the Opex capex royalties and taxes.

Such as it did.

<unk> will remain transitions like this quarter until final closing date, we shouldnt be no later on February 28, 2000 ambition.

This time funded 100% ownership will be done for a couple of empower subsys to provincial approval.

Mr will receive a consideration composed of three items first a payment of $26 5 million.

And then second 40% of oil and gas produced by the outlook for the next four years.

100% of the LPG and condensate clear upward growth path.

Android.

The consideration payable in oil and gas volume has a minimum one P volume 4 million barrels of oil and 3 million cubic meters of gas.

Sir.

The right to purchase a comb cowboy, 60% share of gas production at one dollar per million Btu.

For such a gap, we will making a margin of around $3 $5 per million with you our current pricing.

Importantly, the oil treatment plants geographically located in Arizona with a capacity of 57000 barrels of oil per day is not included in this transaction.

Also this <unk> the right to develop the back home onto play in the concessions.

According to our estimates it really.

Realized prices of $65 per barrel of oil $4.

Dollar per million Btu.

The total value of two week, though the transaction will reach a nominal value of approximately $400 million.

This does allow visa to fully focus on the development of Vaca <unk>.

In aligning our portfolio and boosting our financial and operating metrics.

This is an inflection with immediate benefit on our metrics.

2023, we forecast a reduction in cost per view a.

25% as well as an increase in adjusted EBITDA margin by five percentage points to 71%.

Despite the fact that we will be consolidated 60% or the production from these conventional assets.

Estimated at 5000 <unk> per day debit impact is neutralized by the food company over operating expenses and royalty.

When taking into consideration the topics covered in their working capital effect. These transactions generate $30 million in incremental free cash flow for Vista, which will be invest in bonding crude oil transport infrastructure to increase exports.

It will also improve our ability to deliver on our.

Our 2020 target through additional free cash flow, we forecast an additional net cash generated of approximately $100 million between 'twenty, three and 'twenty 'twenty seek a semi solar transaction our portfolio will be stronger.

With investments directed to higher average brushy.

Brushy, leading to higher corporate return on capital employee and adjusted EBITDA margins.

I will now briefly on our 2023 guidance, reflecting double digit growth in production and adjusted EBITDA.

This plan coupled with our robust delivery during 2020 to leave us well on track to deliver on our 2026 targets.

Our development strategy is to fully focus on developing our core area and finalize the pilot.

By the way to the research books during 2023, we plan to tie in 'twenty neighborhoods.

<unk> by the way.

Eight.

Three in because by the way.

And two in Angola Morgan.

These times are forecasted to deliver 55000 boe's per day, a 13% increase year over year exceeded.

Forecast at around 60000 barrels per day.

This is planned to occur even with the consolidated 60% of the production of our conventional asset as of March 1st with will remove approximately 5000 boe's per day on our production base.

Lifting cost, we forecasted two dropped 27% year over year to <unk> $5.

Mainly driven by the deconsolidation of the conventional assets.

EBITDA is estimated in the 852 900 medium range based on our reputation price between $65 $68 per Barbara This implies an annual growth of 11% to 18%.

Our planned Capex is 600 million.

Given by slightly higher drilling and completion activity on our planned investment in treatment facility.

<unk> for the part a little bit.

Greenhouse gas emission intensity is forecasted to reduce 18 to less than <unk> <unk> per year.

Okay.

This reduction captures the full year impact of the project executed in 2022 as well as a partial impact of the 2023 portions.

Overall, we are very confident that it will impact on the long term target percentage at that works better than in December 2021.

Moreover, we see potential for over that neither.

In our production efficiency metrics and free cash flow targets.

Yeah.

We will now go through the key takeaways of today's presentation.

2022 was the year of robust operational and financial performance, we have delivered our positively revised 2022 guidance and made good growth.

Our 'twenty two targets.

We also delivered on our superior products share core local position.

We reuse of debt repurchased three 2 million shares and approve the warrants exchange last October .

This led to a peer leading the stock performing during 2022.

We signed an innovative.

We transformed <unk> fully focused back on more of a competitive with improved operational and financial metrics.

Finally, we have issued guidance for 2023, both today and double digit growth in production and adjusted EBITDA with higher margins.

Four we move to Q&A I would like to thank our investors for their continued support.

And all the team for their commitment and hard work, which were a key insinuate in this on the Standalone results.

Operator, please open the line for Q&A.

Okay.

As a reminder to ask a question. Please press star one one on your telephone.

And wait for your name to be announced to withdraw your question. Please press star one one again.

Please standby, while we compile the Q&A roster.

Our first question comes from the line of Alejandro Derma Sheila from.

<unk> Securities.

Yes, good morning, gentlemen, congratulations on the deal.

Quick question, you mentioned that you see potential to over deliver on the 2026 target.

Could you kind of walk us how youre seeing those those targets now because you're lowering your.

Cash cost youre, reducing your emissions significantly through the sale.

Youre, having more money in the bank you are having a real question on capacity.

How much more can you over the liver can you bring those those targets forward rapidly.

Hi, Alejandro Thank you very much for your question.

Yes, I mean, we.

If you remember for 2026.

Basically.

We were going to be around 80000 barrels per day on one to one.

$1 1 billion of EBITDA.

We are well on track and as I said in the presentation. We believe that we will surpass that objective that we put our says.

When you look at 2020 guidance already in terms of EBITDA is between 850 and $900 million. So.

With that I think we would be well ahead.

Other thing to consider on the plan that we presented.

December 20.

2021.

Our commodity price at that time was 62.

Today, we are running with higher commodity prices. So that also will help.

But he got activity.

Of course, I mean this year.

Our plan is to fully utilize the capacity that we have we will be running with one rig and a half.

With a capex of around $600 million part of that Capex are important part of that capex is going to be dedicated to facilities.

In 'twenty 'twenty four.

Of course also we can shift some of that capex to having additional activity in term of more drilling.

If we move from one on that Rick.

Rick to 200, and Rick you see that the context is there one that we have today that we believe that could be the case so.

Cutting the long story short I think we are well ahead to deliver what we set for 2026 and you should expect that we would sort of better production and also David that target that we put out.

In the Investor call.

That's great. Thank you.

Small follow up how are you thinking about those cash returns that you mentioned to shareholder would then you setup.

So the cash return that's still in place is something that.

We keep in mind this year would be a particular year because when you invest in a loading facilities for future growth.

Now 2024 from the cash point of view.

I mean by plan and look to be a very good year.

Sure.

Returning cash to shareholder a return to shareholders is something that we keep in mind remember we have a buyback program.

We are executing there was approved last December .

We have $20 million.

To execute off of.

That buyback program set for US is one of the way of return or returning to shareholders that continue in place and we will continue executing that.

Okay.

Thank you.

Thank you.

One moment for our next question.

Our next question comes from the line of Regis Cardoso from Credit Suisse.

Good morning, Jeff and let me go to Andrew Congratulations on the deals.

Very strong results.

My question really is a discussion on connects very well with the previous question.

No no no.

The good results, you've had but still with the cross trained.

Capital flow restrictions in Argentina, I wanted to get a sense of what you think is.

As necessary.

Would be a good arrangement that Argentina could implement to foster the investments and to allow the oil companies to remunerate their shareholders I mean in the past we've talked about retaining some of the dollar from from exports. For example, so I'm asking because now let me go.

Basically because you have no again divested and assets it looks at very attractive valuation.

But it looks like you are generating a lot of liquidity in the company right.

So the question really is you know.

What can be done.

With that liquidity. Thank you.

Hi, Rajeev. Thank you very much for your question question.

Yes, you're completely right.

On the same target.

Let me set first I mean, one of them seem that we have any time today's did decrease $2 77.

Our main objective is this decree that was put in place.

It was fully regulated by the government so that mean that they have been.

The process that they have to.

We have to put in place in order for the industry to be operational.

Is already for free from the government side is social <unk> thrilled for on our site. We have presented everything on basically today, we have first claim of $36 million.

Debt.

That is in place.

We are waiting for the minister of energy basic.

Basically to relieve the certificate of that claim that we have done okay. So I.

I would say that is what we have to keep pushing on.

And if a decree that was put in place.

Basically it's good for the industry and I think good for the country seeing all of that.

Money today is the result of an investment and it's the first thing we need to focus on a.

Second I would like to come in in terms of Capex.

The 'twenty two 'twenty three is a year, where most of the capex.

The cash that we shouldnt at eight it will be tough to capex, because we need to best in facility because at the moment we have to.

Upgrade our capacity.

In order to fulfill the plan that we got to 2000 22024, if any are aware way.

We have a strong cash generation.

And not that not.

That investment in facilities.

Therefore.

For that to have that degree and probably other things that could come why is <unk> come from.

<unk>.

From a new economic regime due to the election that we will have this year I think will be in place between most of the part of some politicians today.

Besides I mean encompass and competition, what we have probably four or five years ago become what of that is the key for the country to access and.

And to access.

U S dollar we need to continue investing and we need to continue growing their production in order to create more export volume.

I think this is very clear across the board.

Uh huh.

I'm positive.

That award I would happen after the election.

That will be part of something.

That will be very high in the agenda in the new government okay.

So I don't I don't think I can tell you more than that concrete decreased to 77, and then of course, we are hopefully that.

We can do even better than that.

Very clear and we go thank you for the comprehensive answer.

Okay.

Thank you one moment for our next question.

Our next question comes from the line of Andreas Cardona from Citi.

Hi, good morning, everyone.

Congratulations on the very strong results in 2022, not only on the financial front, but also on the reserves.

Even on the looking value strategies.

Start from thus not less.

I have been very active on the money front.

Do you see more room to something else in 2023, maybe farmout some working interest.

But could I could ask two accelerates development or something else and the second question is with such a low level.

Cash flow what is holding you back to accelerate the development of the of the projects you said something about I don't know if facilities.

It's that comp.

Company policy to work on new tight cash flow basis. So just wanted to understand what is holding you back from accelerate on the production front. Thank.

Thank you.

Okay.

Thank you Andre for your question.

We just got a photo from the second question.

As you know.

To date in 2023, we have a plan that basically is same to foreign fees.

The old capacity that we have and that full capacity.

If we feel it because we are going to be exiting 2023.

With 60000 Boe's.

Okay.

Will allow us to use every single piece of capacity that we have in our facilities and also in the main fine line that clinic.

With the airport.

<unk>.

In Bahia Blanca.

Going forward as I mentioned before I mean, what we see is that 40% of the capacity.

But he is going to creative control, we delivered in 2024, and the rest 60% of that gap.

Additional capacity is going to be released in 2025 that way that will allow us to grow as part of it.

And to grow further in 2024, where today, we can think of is to probably add Rick So tivo to four <unk>.

The program that would take us around 30 wells brought into 40 west.

But keeping in mind that the.

We all with caffeine.

In our program.

The cash flow generation. This is something that we are always looking at.

We basically are aiming to generate cash and to return.

Part of that two hour.

Shareholders.

Again, I mean, when we don't have a restriction of capacity and the dynamics as we presenting underwriting better.

Better are they would be.

Related to how much cash we generate how much we want to pump.

Into additional activity on how much we want to return to our shareholders.

And of course.

As you see because you run the numbers.

Cash generation is going to be so reach that will be also.

Yes.

Have the freedom to continue looking on M&A.

Transaction.

So part of what we have done have been very focused on.

On increasing that pitching Banco Martha will have done very well with the.

Acquisition.

No normally from the economical point of view, because we when we bought core acreage.

They're very good rate.

But also as the business development team execute.

This quarter any transaction that kill us to be a pure play in and become more of that with a very focused organization.

Using our lifting cost and increasing our margins.

So again nothing that you should expect from the M&A point of view, but we always we did so far looking to how we can improve.

Sure.

Our numbers.

And our returns on our margins.

Okay.

Thank you one moment for our next question.

Yeah.

Our next question comes from the line of Walter <unk> from Santander.

Hello, Good morning, and congratulation for the results. Thank.

Thank you for taking my questions.

I would like to ask you a little bit.

I'll have more specific breakdown on the Capex, specifically, the 600 million capex, especially between.

What is facilities this year.

Investment in production.

Our trading.

Patient.

Milt.

That is my first question.

So.

So to make it clear.

You are investing in the older about expansions at your own kind of let's say, one 5000 barrels per day.

With this new expansion, but you mentioned in the presentation.

Got it.

A paucity of $34 three barrels per day.

The difference between that 31730 4000 is already.

So I think that you have secured or something.

Something that.

That is down year by year.

Thank you.

Sure.

Thank you for your question.

So let me give you first the breakdown of the Capex.

<unk>.

<unk>.

And hopefully that they became more clear to you. So just to give you. The breakdown first of 2022 of the baseline to compare with <unk>.

We basically.

In 2022, with Ben <unk> $360 million in bulk commodity with around $100 million in facilities, there was around $60 million in others and $5 million in Mexico.

It's been around 500, 400 $540 million in total Capex.

This capex is.

Precinct to $600 million in 2018, mainly due to facilities. So when you look at the Capex in 2023 is going to be three XD in.

In brick and mortar Wes.

The 20, new wells that we put in our plan now facility sharper in around 100 million to a $140 million.

That basically include.

And upgrade of the three main facilities gathering facilities compression facilities, so everything that we need.

To increase our capacity.

To basically everything that we need to deliver a plan that we put together for 2026. So our capacity in <unk>. For example is going to go all the way up to 80000 barrels of oil per day.

So that this is a big update.

The race on it's still the same where you will see we also we see because we will have increased activity in Mexico in Mexico last year, we invested $5 million. This.

Yes.

Few words, so that go to $80 million, but main increase in capex is related to facilities.

In order to be ready to to be prepared for the 80000 Boe.

But we I mean investor in Investor Day.

The other question was related to a level.

So.

All the while project.

<unk> is a project that we did add capacity to the industry.

<unk> 350000 barrel per day of evacuation capacity on the top of that we have today.

Is the project that it would require a capex of $1 1 billion.

Beef was awarded.

10% of the capacity okay.

That project for us in term of Capex.

Capex.

They require an investment of $180 million.

That is going to pay in three installments of 54 in 2023 $10 million in.

In 2024.

No 54 million in 2024, and 10 million in 2025.

I know unnamed Paris.

<unk> $6 per barrel.

So what you should expect in terms of capacity additional capacity for us.

71000.

Baron a foot per day.

Yeah.

Alright, but the total contracted capacity.

34 <unk> okay.

Okay is that correct today at 42, and we will add 31.

Okay.

Alright understood.

We did that we would be well.

No capacity too.

Execute our plan basically.

Perfect and a follow up question.

How do we should see you you mentioned that the Capex.

We reduce in 'twenty 'twenty four because you had not invested much in facilities.

What would be the number that we should call it.

Our models.

If.

When you cut off could you repeat the question.

I mean, yeah.

You mentioned that 2023 is going to be like high capex year $600 million, but sequentially for GAAP.

Capex, especially facility should be lower.

So how much would be the capex for 2024.

Assuming that Q3.

Similar.

Yeah.

I mean, it should be lower.

Yes, it was.

We play so clearly facility is going to go down from today's 140, <unk> hundred $50 million to more close to $600 million.

<unk> 24, and part of it alone in 2025, we said $50 million $60 million.

Now then you have to play with the fact that we're doing the modulation of drilling activity.

It is possible that we accelerated as I said before to move from one five rig to two rigs.

And that he will who will bring a bit of it.

Capex too.

Two the development to the development side of the Capex. So.

For example is not unthinkable that in 2024, even though we've been 40 or $50 million less on facilities, we transfer that capex in.

Two Wes because we want to accelerate our program.

The commodity prices the way that it is today.

With the performance that we're having.

With a portfolio that we have and we do.

The development cost of lifting cost that we have.

Could be reasonable that we want to accelerate.

Perfect. Thank you very much for the answer.

Youre welcome.

Yeah.

Thank you one moment for our next question.

Our next question comes from the line of Rodrigo <unk> from <unk> Securities.

Hi, <unk>.

Congratulations on the strong associates quota.

I'm curious about the potential impact of the upcoming election hearing on domestic pricing.

<unk> plans to navigate any potential.

Sure.

And then additionally, annuities there've been some recent discounts.

Excellent.

And wondering if you could provide some insight into what is driving this trend and what can we expect.

Going forward in terms of.

Pricing for exports. Thank you.

Thank you radio part of question.

When I look at I think first of all I'll say as.

As a general comment I would say for us the best way of mitigating.

Local pricing dynamic.

Is to export model.

And that is what we plan to do I mean, we have reached today 55 of our volumes.

Our export it and that.

They represent 65% of our revenue.

And we plan to continue growing.

That export volumes and also therefore revenue.

And you see already today.

The mitigation of any fluctuation with the couple of the export parity, but today doesn't have the impact that used to have for us in our balance sheet and I think this is the way to continue mitigating.

The local market dynamic related to work.

<unk> happen this year.

For anybody that's helpful. Barry in Argentina is clearly that this will be a difficult year in terms of.

Dynamics of local prices because what you mentioned is an election year.

Nevertheless.

The dynamic always show that.

Basically pricing.

Ics our gasoline in pesos is not a good deal for the country.

Today, it's clear that.

We need to continue being capital what the international market.

Any big decoupling with international market ended up not being good for the country not being good for the probably provinces that are sharply from royalties of the oilfield and neither for us that are for the industry that ended up cutting investment that is what.

Is noteworthy are shrinking in Argentina need today.

So we've.

We are being conservative we said in our plan in term of local pricing local pricing probably more conservative that we should be.

So that is factoring in our plan, but yes, the dynamic is going to be tough this year.

Related to discount commercial economy on exports.

As we mentioned I mean, we were at eight.

The last quarter.

For us it is a high discount and we see that discount coming down to more six and seven for the Q1 and our.

Our commercial team is that that is gone is going to continue going down during the year. So we are back to be much lower than a for the year.

The reason of that as far as we know about <unk>.

We use categories of.

Coffee a million barrels.

Those category has been in high demand due to Russia, Russia cutoff of production.

But we believe that that.

That dividend, even though Russia is complicated.

Not be that much in place and we seem to see that in Q1. So.

I would say you should consider that probably that there was a high number on where we should be more more close to 645 for this year.

Thank you Elsa.

Really clear.

Then a quick one.

Follow up on the Capex for <unk>.

For next year.

What are the key factors that I would consider to accelerate its investment than semi.

Of pricing, it's a matter of capital restriction seeking.

How would you think.

How is your thinking process to decide or not to ramp up our investments.

For us I mean again as I mentioned before for 2023.

The main thing is a year, where we're going to fulfill their full capacity that we have and they needed to have leaving leaving the year with very high amount of 60000 barrels per day.

And that is as much so that we can do then 'twenty 'twenty four is different because with all the while delivering 40% of the capacity that is.

But they are executing today.

It will be more of.

Playing how much cash we won't generate income much capex of that cash we want to bump into in traditional activity as I said before.

He is not unthinkable that we increase activity.

To two rigs.

That is going from <unk> to 40 with and then we will have less capex to invest in facility facilities. So if you want to model. It you can continue modeling and then.

Medium case that we were having a capex of around $600 million.

But with more activity.

Of course, we can go.

We can go farther than that.

<unk> is not in the plan today is not something that today, we can say that we would do.

Okay. Thank you very much.

Yes.

Thank you I would now like to turn the conference back to Miguel dilute Shaw for closing remarks.

Luca Thank you very much for your participation.

We are closing a very good 2022 on a study in 2021 would be great.

M&A transaction.

Put this.

In a better place Intel being.

Fully.

Unconventional play it.

With better numbers than we've been in lifting costs with better margins.

We are looking forward to execute and deliver on our promise also in this 2020 through 2023. So thank you very much for participating and looking forward to see you again next quarter.

This concludes today's conference call. Thank you for participating you may now disconnect.