Q2 2026 Transportadora de Gas del Sur SA Earnings Call

August 4, 2026

Speaker #1: You have joined the meeting as an attendee and will be muted throughout the meeting.

Speaker #3: 21, and Carlos Almagro, Head of Investor Relations. I would like to welcome everyone to the TGS Q2 2026 earnings video conference. TGS issued its earnings release yesterday.

Carlos Almagro: Everyone. I'm Carlos Almagro, Head of Investor Relations. I would like to welcome everyone to TGS Q2 2026 Earnings Video Conference. TGS issued its earnings release yesterday. If you didn't receive a copy of the release, please contact us at inversores@tgs.com.ar. Before we begin the call, I would like to inform you that this event is being recorded, and all participants are in listen-only mode. Following the company remarks, we will host a Q&A session. All questions will need to be submitted in writing through the Q&A chat box. I would also like to remind you that forward-looking statements made during today's video conference do not account for future economic circumstances, industry conditions, or company performance and financial results. These statements are subject to a number of risks and uncertainties.

Speaker #3: If you didn't receive a copy of the release, please contact us at investores@tcscom.ar. Before we begin the call, I would like to inform you that this event is being recorded and all participants are in listen-only mode.

Carlos Almagro: Following the company remarks, we will host a Q&A session. All questions will need to be submitted in writing through the Q&A chat box. I would also like to remind you that forward-looking statements made during today's video conference do not account for future economic circumstances, industry conditions, or company performance and financial results. These statements are subject to a number of risks and uncertainties.

Speaker #3: Following the company's remarks, we will host a Q&A session; all questions will need to be submitted in writing through the Q&A chat box. I would also like to remind you that forward-looking statements made during today's video conference do not account for future economic circumstances.

Speaker #3: Industry conditions or company performance. And financial results. This statements are subject to a number of risks and uncertainties. All figures included herein were prepared in accordance with international accounting reporting standards.

Carlos Almagro: All figures included herein were prepared in accordance with International Financial Reporting Standards, IFRS, and are stated in constant Argentine pesos as of 30 June 2026 unless otherwise noted. Joining us today from TGS in Buenos Aires is Alejandro Basso, Chief Financial Officer. I will now turn the video conference over to Mr. Basso. Alejandro, please begin.

Speaker #3: IFRS. And are stated in constant Argentine pesos as of June the 30th, 2026, unless otherwise noted. Joining us today from TCS in Buenos Aires is Alejandro Baso, Chief Financial Officer.

Speaker #3: I will now turn the video conference over to Mr. Baso. Alejandro. Please begin.

Speaker #4: Thank you, Carlos. Good morning, everyone, and thank you for joining us today to discuss TCS's 2026 Q2 earnings and highlights. To begin the call today, I'd like to share some of the most recent corporate developments.

Alejandro Basso: Thank you, Carlos. Good morning, everyone, and thank you for joining us today to discuss TGS's Q2 2026 earnings and highlights. First of all, the most relevant news is the FID for the NGL project, announced a few weeks ago, with key commercial agreements representing more than 90% of the project's total capacity already executed as of today. This is an ARS 3 billion CapEx project, and the construction is expected to take about 45-month period, with the COD expected in March 2030. In addition, we have also requested that this project be approved under the regime. The project consists of a new gathering pipeline in Vaca Muerta, a processing plant to be built in Tratayén, and a 475-kilometer poliducto, a fractionating plant in Cerri, and storage facilities in Puerto Galván.

Speaker #4: First of all, the most relevant news is the FID for the NGL project, announced a few weeks ago. With key commercial agreements representing more than 90% of the project's total capacity already executed as of today.

Speaker #4: This is a 3 billion dollar capex project, and the construction is expected to take about 45 months period, with the COD expected in March 2030.

Alejandro Basso: This is an ARS 3 billion CapEx project, and the construction is expected to take about 45-month period, with the COD expected in March 2030. In addition, we have also requested that this project be approved under the regime. The project consists of a new gathering pipeline in Vaca Muerta, a processing plant to be built in Tratayén, and a 475-kilometer poliducto, a fractionating plant in Cerri, and storage facilities in Puerto Galván.

Speaker #4: In addition, we have also requested that this project be approved under the REI, the project consists of a new gathering pipeline in Vacamuerta, a processing plant to be built in Trata Gem, and a 475 km polyglot, a fractioning plant in Surrey, and storage facilities in Porto Galván.

Speaker #4: In terms of the natural gas transportation expansion, which is currently under construction and following the open season launch last February, after the allocation of 5 million cubic meters per day under a fully prepaid basis in a first round, last June we received bids for over 100 million cubic meters per day of capacity in order to allocate the remaining capacity of 9 million cubic meters per day.

Alejandro Basso: In terms of the natural gas transportation expansion, which is currently under construction, following the open season launch last February, and after the allocation of 5 million cubic meters per day under a fully prepaid basis in the first round, last June, we bid for over 100 million cubic meters per day capacity in order to allocate the remaining capacity of 9 million cubic meters per day. We submitted our capacity allocation to our regulators some weeks ago and are waiting for its approval. It is important to highlight that last May, the Perito Moreno pipeline expansion was approved by the Ministry of Economy to be included in the regime, which will result in tax benefits for the project. Finally, in June, S&P upgraded the long-term local and foreign currency debt ratings from B- to B, following the revision for Argentina's transfer and convertibility risk assessment.

Speaker #4: We submitted our capacity allocation to our regulators some weeks ago, and are waiting for its approval. It is important to highlight the last May, the Perito Moreno pipeline expansion was approved by the Ministry of Economy to be included in the REI, which will result in tax benefits for the project.

Alejandro Basso: It is important to highlight that last May, the Perito Moreno pipeline expansion was approved by the Ministry of Economy to be included in the regime, which will result in tax benefits for the project. Finally, in June, S&P upgraded the long-term local and foreign currency debt ratings from B- to B, following the revision for Argentina's transfer and convertibility risk assessment.

Speaker #4: Finally, in June, S&P upgraded the long-term local and foreign currency debt ratings from B- to B, following the revision of Argentina's transfer and convertibility risk assessment.

Speaker #4: Similarly, in July, Moody's upgraded the rating of our notes from B2 to B1, as a consequence of the Argentina's sovereign rating upgrade. Moving to slide 4, I will briefly highlight the key financial results for the Q2 of 2026.

Alejandro Basso: Similarly, in July, Moody's upgraded the rating of our notes from B2 to B1 as a consequence of Argentina's sovereign rating upgrade. Moving to slide four, I will briefly highlight the key financial results for Q2 2026. Please keep in mind that all figures presented for this quarter and comparisons made with the previous quarter are expressed in constant Argentine pesos as of 30 June 2026, following the provisions established by IFRS for the financial reporting in hyperinflationary economies. As seen in the slide, we reported a total net income of ARS 133 billion during Q2 2026, compared to ARS 53.8 billion reported in the same quarter of 2025.

Speaker #4: Please keep in mind that all figures presented for this quarter, and comparisons made with the previous quarter, are expressed in constant Argentine pesos as of June 30, 2026, following the provisions established by the FRS for financial reporting in hyperinflationary economies.

Alejandro Basso: Please keep in mind that all figures presented for this quarter and comparisons made with the previous quarter are expressed in constant Argentine pesos as of 30 June 2026, following the provisions established by IFRS for the financial reporting in hyperinflationary economies. As seen in the slide, we reported a total net income of ARS 133 billion during Q2 2026, compared to ARS 53.8 billion reported in the same quarter of 2025.

Speaker #4: As seen in the slide, we reported a total net income of 133 billion during the Q2 of 2026, compared to 53.8 billion reported in the same quarter of '25.

Alejandro Basso: This relevant net income increase is mainly explained by the ARS +50.2 billion variation in our financial results, as well as the important liquids EBITDA growth of ARS 48.4 billion, and to a lesser extent, the ARS 12.3 billion increase related to the natural gas transportation EBITDA. Moving on to slide five, EBITDA for natural gas transmission business in Q2 2026 totaled ARS 132 billion, which is above the almost ARS 120 billion recorded in Q2 2025. It is worth noting that tariff increases generating higher revenues by ARS 50.2 billion, which was more than the ARS -48.6 billion effect of inflation. In addition, two negative events in Q2 2025 also explain partially the higher EBITDA in Q2 2026 of ARS 19.2 billion.

Speaker #4: This relevant net income increase is mainly explained by the $60.2 billion positive variation in our financial results, as well as the important liquid EBITDA growth of $48.4 billion, and to a lesser extent, the $12.3 billion increase in EBIT related to the natural gas transportation EBITDA.

Speaker #4: Moving on to slide 5, EBITDA for natural gas transportation business in Q2 of '26, total 132 billion, which is above the almost 120 billion recorded in the Q2 of '25.

Alejandro Basso: It is worth noting that tariff increases generating higher revenues by ARS 50.2 billion, which was more than the ARS -48.6 billion effect of inflation. In addition, two negative events in Q2 2025 also explain partially the higher EBITDA in Q2 2026 of ARS 19.2 billion.

Speaker #4: It is worth noting that tariff increases generating higher revenues by 50.2 billion, which was more than the 48.6 billion negative effect of inflation. In addition, two negative events in the Q2 of '25 also explained partially the higher EBITDA in the Q2 of '26, of 19.2 billion.

Speaker #4: The first event was related to a trade receivable write-off of $11.2 billion, and the second one was the climate event that occurred in March '25, which damaged some natural gas transportation assets and generated a positive EBITDA valuation of $8 billion.

Alejandro Basso: The first event was related to a trade receivable write-off of ARS 11.2 billion, and the second one was the climate event occurred in March 2025, which damaged some natural gas transportation assets and generated an ARS +8 billion revaluation. Finally, the revenues generated by firm transportation contracts decreased by ARS 9.3 billion following the natural gas transportation system reconfiguration, which became effective starting as of May 2026, whose initial negative effect will be partially offset by future small monthly tariff adjustments. On slide six, you can see how EBITDA for the liquids segment increased to ARS 82.3 billion during Q2 2026, compared to a low ARS 33.9 billion reported in Q2 2025.

Speaker #4: Finally, the revenues generated by field transportation contracts decreased by $9.3 billion, following the natural gas transportation system reconfiguration, which became effective starting as of May '26.

Alejandro Basso: Finally, the revenues generated by firm transportation contracts decreased by ARS 9.3 billion following the natural gas transportation system reconfiguration, which became effective starting as of May 2026, whose initial negative effect will be partially offset by future small monthly tariff adjustments. On slide six, you can see how EBITDA for the liquids segment increased to ARS 82.3 billion during Q2 2026, compared to a low ARS 33.9 billion reported in Q2 2025.

Speaker #4: Whose initial negative effect will be partially observed through future small monthly tariff adjustments. On slide 6, you can see how EBITDA for the Liquids segment increased to $82.3 billion during Q2 of '26, compared to the low $33.9 billion reported in the same quarter of '25.

Speaker #4: The increase in EBITDA was mainly attributed to higher volume sales, which rose from 211,000 metric tons to 330,000 metric tons, and was mainly explained by the low volume sales in the '25 quarter due to the processing plant shutdown caused by the flooding suffered on March 7, 2025.

Alejandro Basso: The increase in EBITDA was mainly attributed to higher volume sales, which rose from 211,000 metric tons to 330,000 metric tons, and was mainly explained by the low volume sales in the Q2 2025 due to the processing plant shutdown caused by the flooding suffered on 7 March 2025. The plant started to operate by mid-April with low level of production and increased its production to reach normal levels in the beginning of May. The higher volume sales generated a higher EBITDA of ARS 46.7 billion. Moreover, high international reference prices as a consequence of the geopolitical conflict in the Middle East raised EBITDA by ARS 23.2 billion. These positive effects were partially offset by the Ethane take-or-pay annual compensation collected in the Q2 2025 of ARS 8.5 billion, together with the ARS -7.4 billion monetary effect.

Speaker #4: The plant started to operate but mid-April, with low level of production and increased production to reach normal levels in the beginning of May. The higher volume sales generated a higher EBITDA of 46.7 billion.

Alejandro Basso: The higher volume sales generated a higher EBITDA of ARS 46.7 billion. Moreover, high international reference prices as a consequence of the geopolitical conflict in the Middle East raised EBITDA by ARS 23.2 billion. These positive effects were partially offset by the Ethane take-or-pay annual compensation collected in the Q2 2025 of ARS 8.5 billion, together with the ARS -7.4 billion monetary effect.

Speaker #4: Moreover, higher international reference prices as a consequence of the geopolitical conflict in the Middle East raised EBITDA by 23.2 billion. These positive effects were partially observed by the e-same take or pay annual compensation collected in the Q2 of 2025, of 8.5 billion, together with the negative monetary effect of 7.4 billion, the lower e-same price, which generated lower revenues of 5.8 billion and a higher average natural gas price, which increased to 3.4 dollars per million of BTU from 3.3, and generated higher costs by 2.5 billion.

Alejandro Basso: The lower Ethane price, which generated lower revenues of ARS 5.8 billion, and a higher average natural gas price, which increased to $3.4 per million BTU from $3.3 and generated higher costs by ARS 2.5 billion. Turning to slide seven, EBITDA from midstream and other services decreased slightly to ARS 64.1 billion, compared to ARS 69.3 billion in the Q2 2025. Revenues generated by the administrative services rendered in Vaca Muerta increased by ARS 13.2 billion. Transported natural gas billed volume rose from an average of 30 million cubic meters per day in the Q2 2025 to 35 million cubic meters per day during this quarter. The natural gas conditioning volume also increased from an average of 27 to 30 million cubic meters per day.

Speaker #4: Turning to slide 7, EBITDA from midstream and other services decreased slightly to 64.1 billion, compared to 69.3 billion in the Q2 of 2025, revenues generated by midstream services rendered in Vaca Muerta increased by 13.2 billion, transported natural gas billed volume rose from an average of 30 million cubic meters per day in the Q2 of '25 to 35 million cubic meters per day during this quarter.

Alejandro Basso: Revenues generated by the administrative services rendered in Vaca Muerta increased by ARS 13.2 billion. Transported natural gas billed volume rose from an average of 30 million cubic meters per day in the Q2 2025 to 35 million cubic meters per day during this quarter. The natural gas conditioning volume also increased from an average of 27 to 30 million cubic meters per day.

Speaker #4: The natural gas condition in volume also increased from an average of 27 to 30 million cubic meters per day. However, this higher revenue was more than observed by the negative monetary effect of 10.5 billion, as inflation was higher than the foreign exchange rate increase, along with higher operating expenses of 5.6 billion.

Alejandro Basso: This higher revenue was more than offset by the ARS -10.5 billion monetary effect, as inflation was higher than the foreign exchange rate increase, along with higher operating expenses of ARS 5.6 billion. As seen on slide eight, we recorded an ARS +60.2 billion positive variation in the financial results. This was mainly due to an ARS 130.1 billion increase in income from financial assets, given the higher yields recorded for the domestic financial investment, and to a lesser extent, to a higher level of financial investments. This positive effect was partially offset by an ARS 46.7 billion higher foreign exchange loss, ARS 15.2 billion in higher interest expenses, most of which are mainly attributed to the $500 million bond issued in November 2025, as well as the ARS 7.6 billion higher inflation exposure loss.

Speaker #4: As seen on slide 8, we recorded a positive variation in the financial results amounting to 60.2 billion. This was mainly due to 130.1 billion increase in income from financial assets, given the higher yields recorded for the domestic financial investment, and to a lesser extent to a higher level of financial investments.

Alejandro Basso: This positive effect was partially offset by an ARS 46.7 billion higher foreign exchange loss, ARS 15.2 billion in higher interest expenses, most of which are mainly attributed to the $500 million bond issued in November 2025, as well as the ARS 7.6 billion higher inflation exposure loss.

Speaker #4: This positive effect was partially observed by a 46.7 billion higher foreign exchange loss, 15.2 billion in higher interest expenses both of which are mainly attributed to the 500 million dollars bond issued in November of '25, as well as the 7.6 billion higher inflation exposure loss.

Speaker #4: Finally, turning to the cash flow on slide 9, our cash position increased by $274 billion in real terms during Q2 of '26, to $2,206 billion, equivalent to approximately $1.5 billion at the official exchange rate.

Alejandro Basso: Turning to the cash flow on slide nine, our cash position increased by ARS 274 billion in real terms during the Q2 2026 to ARS 2,206 billion, equivalent to approximately $1.5 billion at the official exchange rate. The EBITDA generation in the Q2 was ARS 278.4 billion, of which 53% was generated by non-regulated businesses, even after considering the full normalization of the natural gas transportation segment. These results highlight the increased relevance of the non-regulated activities within the company's overall business. CapEx amounted to ARS 165 billion, largely driven by investments in the pipeline expansion project. Working capital decreased by ARS 186 billion, primarily due to the collection of the first prepayment installment of approximately ARS 140 billion from customers that contracted 5 million cubic meters per day of incremental firm transportation capacity.

Speaker #4: EBITDA generation in Q2 was 278.4 billion, of which 53% was generated by non-regulated businesses, even after considering the full normalization of the natural gas transportation segment.

Speaker #4: This result highlights the increased relevance of the non-regulated activities within the company's overall business. CAPEX amounted to 165 billion, largely driven by investments in the pipeline expansion project, working capital decreased by 186 billion.

Alejandro Basso: CapEx amounted to ARS 165 billion, largely driven by investments in the pipeline expansion project. Working capital decreased by ARS 186 billion, primarily due to the collection of the first prepayment installment of approximately ARS 140 billion from customers that contracted 5 million cubic meters per day of incremental firm transportation capacity.

Speaker #4: Primarily due to the collection of the first prepayment installment of approximately 140 billion from customers, that contracted 5 million cubic meters per day of incremental foreign transportation capacity.

Speaker #4: We also paid $31.3 billion in income taxes and $30.8 billion in interest, and we incurred new debt amounting to $20.8 billion. This concludes our presentation, and we will now turn it over to Carlos, who will open the floor for questions.

Alejandro Basso: We also paid ARS 31.3 billion in income taxes and ARS 30.8 billion in interest. We incurred new debt amounting to ARS 20.8 billion. This concludes our presentation. I will now turn it over to Carlos, who will open the floor for questions. Thank you.

Speaker #4: Thank you.

Speaker #1: Thank you, Ali. The floor is now open for questions. If you have questions, please send them through our Zoom chat. We will read and answer the questions.

Carlos Almagro: Thank you, Ale. The floor is now open for questions. If you have questions, please send them through our Zoom chat. We will read and answer the questions in the order in which they are received. Please make sure to state your name and company so we can introduce you to the audience. Should any participant need assistance, please send us a message in the chat box. Please hold while we poll for questions. Thank you. Well, the first question is from Bruno Montanari from Morgan Stanley. Hello. How are you, Bruno? The first question is regarding the GPM expansion. How much capital is still left to execute in the coming quarters?

Speaker #1: In the order in which they are received. Please make sure to state your name and company so we can introduce you to the audience.

Speaker #1: Should any participant need assistance, please send us a message in the chat box. Please call while we poll for questions. Thank you. Well, the first question is from Bruno Montanari from Morgan Stanley.

Speaker #1: Hello, how are you, Bruno? The first question is regarding the GPA expansion. How much CAPEX is still left to execute in the coming quarters?

Alejandro Basso: Hi, Bruno. Well, as of 30 June 2026, we have already invested around $180 million. We have $600 million left for the remainder of quarters until 1 May or until May 2027.

Speaker #4: Hi, Bruno. Well, as of June 30, '26, we have already invested around $180 million, so we have $600 million left for the remainder of the quarters.

Speaker #4: Until May 1st, so until May next year.

Carlos Almagro: The second question is regarding the new liquids project. How should we think about the capital distributions over the years?

Speaker #1: The second question is regarding the new liquidity project. How should we think about the CAPEX distributions over the years?

Speaker #4: Well, we have for this year around 500 million dollars, 800 million dollars for '27, 1 billion in '28, and 600 million in '29. Approximately.

Alejandro Basso: Well, we have for this year approximately $500 million, $800 million for 2027, $1 billion in 2028, and $600 million in 2029, approximately.

Carlos Almagro: Yes.

Speaker #1: Yes.

Alejandro Basso: The remainder in Q1 2030.

Speaker #4: And the remainder in the first quarter of '23.

Alejandro Basso: The remainder in Q1 2030.

Speaker #1: 2030.

Carlos Almagro: 2030.

Speaker #4: Yeah.

Alejandro Basso: Yeah.

Carlos Almagro: His third question is regarding the financing of the project, if he has already secured all the funding requirements.

Speaker #1: The third question is regarding the financing of the project. If TGS already secured all the funding requirements.

Speaker #4: We have signed agreements with banks for the import financing, for approximately $300 million for the first year. We are also working with a group of banks for the financing of the remainder of the MGS in the second BPU, with a total investment of $2 billion.

Alejandro Basso: We have signed agreements with banks for the import financing for approximately $300 million for the first year. We are working with a group of banks for the financing of the remainder of the MGS finance. MGS is the second BPU with a total investment of $2 billion. We are working with this group of banks to finance 60% of the total investment of this $2 billion. The tenure of the import finance facilities is three years. The cost is approximately 8.5% all in.

Speaker #4: And we are working with this group of banks to finance 60% of the total investment of these $2 billion. The tenure of the import facilities finance facilities is three years.

Speaker #4: The scope is approximately an 8.5% holding.

Speaker #1: Now we have a question from Matthew Stoss. Hi, Matthew. His question is regarding the transportation segment. The revenues of EBITDA of this second quarter why it was weaker in dollars terms compared to the first Q?

Carlos Almagro: Now we have a question from Matthew Stough. Hi, Matthew. His question is regarding the transportation segment, the revenues of EBITDA, how the EBITDA this Q2, why it was weaker in dollar terms compared to the Q1, even as we have a real gain in tariffs.

Speaker #1: Even we have a real gain in tariffs.

Alejandro Basso: Hi, Matthew. As you may know, we have a reconfiguration, a new regulation of the capacity in the whole transportation systems in Argentina, as the natural gas currently is coming from the west, from Vaca Muerta, from Neuquén, replacing the gas that used to come from the north, from the Bolivian basin and from the northern basin, and also from the south. Some contracts were transferred from one system to the other. TGS has an impact there because of the important position that we have in the southern contracts, the transportation contracts coming from Tierra del Fuego. You are going to see this loss of volumes or lower volumes in the future. Also, this reconfiguration has made more efficient the system, so lower IT services, interruptible services, are rendered by TGS and TGN.

Speaker #4: Hi, Matthew. As you may know, we have a reconfiguration regulation, a new regulation of the capacity in the whole transportation system in Argentina. The natural gas currently is coming from the West, from Vaca Muerta, from Neuquén, replacing the gas that used to come from the North—from the Bolivian basin and from the Northern basin—and also from the South.

Speaker #4: So some contracts were transferred from one system to the other, so TGS has an impact there, because of the important position that we have in the South on contracts, the transportation contracts coming from Tierra del Fuego.

Alejandro Basso: TGS has an impact there because of the important position that we have in the southern contracts, the transportation contracts coming from Tierra del Fuego. You are going to see this loss of volumes or lower volumes in the future. Also, this reconfiguration has made more efficient the system, so lower IT services, interruptible services, are rendered by TGS and TGN.

Speaker #4: So you are going to see this loss of volumes or lower volumes in the future. Also, this reconfiguration has made more efficient the system, so lower IT services, interruptible services are rendered by TGS and TGN.

Alejandro Basso: At the same time, we have a compensation tariff, but the compensation tariff is calculated in the future. You may see a small compensation for this weakness in the transportation revenues, but it's not significant.

Speaker #4: At the same time, we have a compensation tariff, but the compensation tariff is calculated in the future, so you may see a small compensation for this weakness in the transportation revenues, but it's not significant.

Carlos Almagro: The second question is regarding the liquids business, which are the drivers of higher costs versus the Q1 that explain why margin and EBITDA were weaker despite good energy prices.

Speaker #1: The second question is regarding the liquid business. Which are the drivers of higher cost versus the first Q? Just explain why margin and EBITDA were weaker despite good energy prices.

Speaker #4: Well, in that has to do with the cost of natural gas, in the winter season, that starts on May every year, you may see higher natural gas prices than the obviously in the summer season, the first Q.

Alejandro Basso: Well, that has to do with the cost of natural gas. In the winter season that starts on May every year, you may see higher natural gas prices than obviously in the summer season, the Q1. At the same time, cost of gas is higher than the previous year, especially in the spot market. That's compared with the same quarter of last year, 2025.

Speaker #4: At the same time, the cost of gas is higher than the previous year in the especially in the spot market. That's compared with the same quarter of last year.

Speaker #4: '25.

Carlos Almagro: We have a question from Charles Raftopol from Latin Securities. A question that was answered in the first-

Speaker #1: Now we have a question from Shore Gas Stores from Latin Securities, a question that was answered in the first, in the previous one.

Carlos Almagro: We have a question from Charles Raftopol from Latin Securities. A question that was answered in the first

Alejandro Basso: In the previous one.

Carlos Almagro: In the previous one, regarding the transportation revenues compared with the Q1 2026. His second question is also one that was explained regarding the financing of the NGL project, Alejandro explained specifically. Well, we have a question from Juan Ignacio Lopez. Hi, Juan. His first question is regarding the high CapEx deployment for the H2 2026, regarding the GPM, the Perito Moreno pipeline, and the NGL project.

Speaker #1: Regarding the transportation revenues compared with the first Q '26. His second question is also when it was explained regarding the financing of the initial project.

Speaker #1: Alejandro explains specifically. Then we have Well, now we have a question from Juan Ignacio Lopez. Hi, Juan. His first question is regarding the CAPEX deployment in the for the second half of 2026.

Speaker #1: Regarding the GPM, the perito marino pipeline, and the initial project.

Alejandro Basso: Okay. Regarding the Perito Moreno expansion, we are estimating for the remainder of this year around $400 million and a similar amount, or a bit higher than that, for the NGL project for this year.

Speaker #4: Okay. Regarding the perito marino expansion, we are estimating for the remainder of this year around 400 million dollars. And a similar amount of. And higher than that, a bit higher than that for the initial project, for this year.

Carlos Almagro: His second question is regarding the strong cash flow being supported by a positive working capital. Well, his question is regarding what is the reason of this strong cash flow?

Speaker #1: His second question is regarding the strong cash flow print supported by the positive working capital. His question is regarding what is the reason of this strong cash flow.

Speaker #4: Okay. Juan Ignacio, as I said in the call, we have 5 million out of 14 square meters per day, or out of 12 square meters per day.

Alejandro Basso: Okay. Juan Ignacio, as I said in the call, 5 million out of 14 cubic meters per day or out of 12 cubic meters per day from the Perito Moreno expansion or for the transportation, TGS transportation system expansion, were collected as prepaid. They were prepaid by the clients. It's an option that we have, and the clients also have in the open season. 40% of the total capacity may be offered and sold at TGS under prepaid scheme. They prepay the capacity for the 15-year contract. That's the $100 million almost that we collected in Q2, which is the important impact, favorable impact in our working capital.

Speaker #4: For the Perito Moreno expansion, or for the transportation, TGS transportation system expansion, were collected as prepaid. They were prepaid by the clients. It's an option that we have and the clients also have in the open season.

Speaker #4: Forty percent of the total capacity may be offered and sold at the TGS under the prepaid scheme. So they prepay the capacity for the 15 years—15-year contracts—and so that's $100 million, almost, that we collected in the second quarter, which is an important federal impact on our working capital.

Carlos Almagro: We have a question from Andrés Ciguiñuela from Balanz. Well, the same question that was answered before regarding the deployment of the $3 billion in which years. Another question is from Jorge Castro, regarding the Pampa project, the urea project, which will require an additional 3.5 million cubic meters per day of transportation capacity out of Vaca Muerta. If we expect to exercise the Perito Moreno 6 million cubic meters per day additional expansion option to meet this demand.

Speaker #1: Now we have a question from Andrés Cimillaro from Balance. The same question that was answered before, regarding deployment of the $3 billion. In which years?

Speaker #1: Now, another question from Shore Gas Store regarding the pump project, the Urea project. Which will require an additional 3.5 million cubic meters per day of transportation capacity out of Agua Muerta.

Speaker #1: If we expect to exercise the Perito Moreno 6 million cubic meters per day additional expansion option to meet this demand.

Alejandro Basso: Yes, Jorge, we are analyzing that business opportunity to further expand the Perito Moreno up to 6 million cubic meters per day. It may be less than that, but it could happen.

Speaker #4: Yes, George. We are analyzing the business opportunity to further expand the Perito Moreno up to 6 million cubic meters per day. It may be less than that, but it could happen.

Speaker #1: Now we have a question from Melina Einar from PPI. The question is regarding the 3 billion CAPEX. At what level do we expect that the net debt to EBITDA ratio to peak during the investment phase?

Carlos Almagro: We have a question from Melina Eynard from PPI. The question is regarding the ARS 3 billion CapEx. At what level do we expect the net debt-to-EBITDA ratio to peak during the investment phase? In which moment we think this will occur?

Speaker #1: In which moment we think this will occur? Well, overlooking.

Alejandro Basso: Well, obviously, Melina, we expect to increase our net debt-to-EBITDA ratio, maybe in the year 2029 or 2028.

Speaker #4: Okay. We obviously Melina, we expect to increase our net debt to EBITDA ratio maybe in the year '29 or '28. We could be around three times.

Carlos Almagro: It could be 3x.

Alejandro Basso: We could be around 3x.

Carlos Almagro: Below 3x.

Speaker #1: Below three times.

Alejandro Basso: Below 3x. Obviously, much below the maximum ratio governed under our-

Speaker #4: Or below three times, obviously much below the maximum ratio that we have under our bond contracts.

Alejandro Basso: Below 3x. Obviously, much below the maximum ratio governed under our-

Carlos Almagro: 3.5

Alejandro Basso: bond conference.

Carlos Almagro: That is 3.5.

Speaker #1: That is 3.5.

Speaker #4: 3.5.

Alejandro Basso: 3.5.

Carlos Almagro: Now we have a question from Alvaro Leiva from BTG Pactual. Hi, Alvaro. Well, your question was answered regarding the financing of the NGL project.

Speaker #1: Now we have a question from Álvaro Leiva. From BTC. Actual. Hi, Álvaro. Well, your question was answered regarding the financing of the initial project.

Speaker #4: And the leverage also.

Alejandro Basso: The leverage also.

Carlos Almagro: Also the leverage. Yes. A question from Santiago Herrera from Allaria regarding NGL project. What is the new maintenance CapEx once the project is finished? I think that is around the total project, $10 million per year, in addition to what we currently have. That is $90 million, plus another 10 that would be added.

Speaker #1: And also the leverage, yes. A question from Santiago Herrera from Alaria regarding the initial project: What is the new maintenance CAPEX once the project is finished?

Speaker #1: I think that is around the total project 10 million dollars per year. In addition to what we have, what we currently have. That is 90 million dollars plus another 10 that could be added.

Alejandro Basso: At the project.

Speaker #4: A new project.

Carlos Almagro: Yes. Now we have a question from Ramiro Marra. Hi, Ramiro from Bull Market. His question regarding the integrated NGL project, what portion of the $3 billion investment do we expect to finance through project finance at the SPV level? And what portion will require contribution from TGS?

Speaker #1: Yes. Now we have a question from Ramiro Guerrero. Hi, Ramiro, from Bull Market. His question is regarding the integrated initial project: What portion of the $3 billion investment do we expect to finance through project finance at the SPV level?

Speaker #1: And what portion will require contribution from TGS?

Alejandro Basso: Hi, Ramiro. I would say that half of the total investment, because we are going to finance with a 60% of leverage, the second BPU, which is a $2 billion investment, and at least $300 million of import finance in the first BPU, which is $1 billion. A total of $1.5 billion out of $3 billion. That's our expectation. We are working on that.

Speaker #4: Hi, Ramiro. I would say that half of the total investment, because we are going to finance with 60% of leverage the second BPU, which is a 2 billion dollar investment.

Speaker #4: And at least $300 million of import finance in the first BPU, which is a $1 billion. So a total of $1.5 billion out of $3 billion.

Speaker #4: That's our expectation. We are working on that.

Carlos Almagro: We have another question from Ignacio Valdés, another one regarding the NGL project, if we consider adding a partner to participate in the project.

Speaker #1: We have another question from Ignacio Gálvez, regarding the initial project. If we consider adding a partner to participate in the project.

Alejandro Basso: Hi, Ignacio. Well, we may consider adding a partner. It will depend on new business opportunities and the context, obviously.

Speaker #4: Hi, Ignacio. Well, we may consider adding a partner. It will depend on new opportunities, business opportunities, and the context of this.

Speaker #1: Now we have a question from Agustín Pacheco from Grupo Mariva. Hi, Agustín. Well, his first question was answered regarding the first year. How much do we expect to invest?

Carlos Almagro: We have a question from Agustín Pacheco from Grupo Mariva. Hi, Agustín. Well, his first question was answered regarding in the first year of how much we expect to invest. His second question, is RIGI approval a prerequisite for starting construction and committing the main expenditure, or could some early-stage investment begin before approval?

Speaker #1: And his second question is re-approval a priority seat for starting construction and committing the main expenditures? Or could some early stage investment begin before approval?

Alejandro Basso: Hi, Agustín. In fact, we have already started investing in the project, so the RIGI approval is not a prerequisite. Nevertheless, we are quite confident that the RIGI is going to be approved soon. We already filed the RIGI 5 June, so we are expecting to have the approval in a few months, I would say. That's all.

Speaker #4: Hi, Agustín. In fact, we have already started investing in the project. So the re-approval is not a priority seat. Nevertheless, we are quite confident that the really is going to be approved soon.

Speaker #4: We already filed the re in June the 5th. So we are expecting to have the approval in a few months, I would say. And that's all.

Speaker #1: Another question from Federico Favelli that we answered previously. Another question from Alan Feldman from Criteria. Hi, Alan. Your question was answered regarding the big variation in working capital.

Carlos Almagro: Another question from Federico Favelli that were answered previously. Another question from Alan Feldman from Criteria. Alan, your question was answered regarding the working capital big variation. As Alejandro explained, that we expect for the following quarter to receive another ARS 300 million, ARS 200 in 2026 and ARS 100 more in Q1 2027, or before, in April 2026. Another question from Alan Feldman regarding the working capital. What underlying free cash flow would use as a run rate, and how should the market think about the sustainable conversion of EBITDA into cash, considering this dependent?

Speaker #1: Alejandro explained that we expect for the following quarter to receive another 300 million dollars. 200 remain in 2026 and 100 more in the first quarter of 2027.

Speaker #1: Or before, in April, or 2027. Another question, from Alan Feldman regarding the working capital: What underlying free cash flow would you use as a run rate, and how should the market think about the sustainable conversion of EBITDA into cash?

Speaker #1: Considering this.

Speaker #4: Okay. Hi, Alan. As we already or as we are being prepared 40% of the new volumes of the expansion volumes of the GPM expansion and the transportation TGS transportation system expansion.

Alejandro Basso: Okay. Hi, Alan. As we are being prepaid 40% of the new expansion volumes, the GPM expansion and the TGS transportation system expansion. We are not going to have those revenues, those 40% of the revenues collected after the project COD next May. Approximately, I would say ARS 40 million of EBITDA of the revenues per year are not going to be collected because at project time, we will have already collected them.

Speaker #4: So we are not going to have those revenues after those 40% of the revenues collected. After the project COD. Next May. So approximately I would say 40 million dollars of EBITDA of the revenues per year are not going to be collected because we have already for that time we will have already collected them.

Carlos Almagro: We have another question regarding financing the project, so it was answered. Another question from Jorge Mauro. Hi, Jorge. Your question was answered regarding the fixed leverage in the next 3 years. Jorge Castro, a question regarding the Pampa project, that it was answered. Well, I think that's all. Well, this concludes the questions and answers section. Now we will turn to Alejandro for final remarks.

Speaker #1: Then we have another question regarding financing the project. So it was answered. Another question from Jorge Mauro—hi, Jorge—your question was answered regarding the peak leverage.

Speaker #1: In the next three years, George Castro, a question regarding the Pampa project—it was answered. Well, we think that that's all. Well, this concludes the questions and answer section.

Speaker #1: Now, we will turn to Alejandro for final remarks.

Speaker #4: Thank you all for participating in this year's second quarter 2026 conference call. We look forward to speaking with you again when we release our 2026 third quarter results.

Alejandro Basso: Thank you all for participating in this year's Q2 2026 conference call. We look forward to speaking with you again when we release our 2026 Q3 results. If you have any questions in the meantime, please do not hesitate to contact our investor relations department. Have a good day.

Speaker #4: If you have any questions in the meantime, please do not hesitate to contact our investor relations department. Have a good day.

Operator 2: Goodbye

Operator: Goodbye.

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