Ángel Bautista - Miguel Martínez San Martín - Chief Financial Officer

Haythem Rashed - Morgan Stanley, Research Division Filipe Rosa - Espirito Santo Investment Bank, Research Division Flora Mericia Trindade - Banco Português de Investimento, S.A., Research Division Thomas Yoichi Adolff - Crédit Suisse AG, Research Division Oswald Clint - Sanford C. Bernstein & Co., LLC., Research Division Anish Kapadia - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division Irene Himona - Societe Generale Cross Asset Research Hamish Clegg - BofA Merrill Lynch, Research Division Alastair Roderick Syme - Citigroup Inc, Research Division Jon Rigby - UBS Investment Bank, Research Division Joshua Stone - Barclays Capital, Research Division

Hello, and welcome to the Repsol Third Quarter 2014 Preliminary Results Conference Call. Today's conference will be conducted by Mr. Miguel Martinez, CFO. A brief introduction will be given by Mr. Angel Bautista, Head of Investor Relations. I would like now to turn the call over to Mr. Bautista. Sir, you may begin. Ángel Bautista: Thank you. Good afternoon, ladies and gentlemen, and welcome to Repsol Third Quarter Results Conference Call. I am Angel Bautista, Director of Investor Relations. This presentation will be conducted by Mr. Miguel Martinez, CFO. Other members of the Executive Committee are joining us as well. Before we start, I invite you to read our disclaimer notes. We may make forward-looking statements which are identified by the use of words such as will, expect and similar phrases. Actual results may differ materially depending on the number of factors as indicated on the slide. I now hand the conference over to Mr. Martinez. Miguel Martínez San Martín: Thank you, Angel, and good afternoon, ladies and gentlemen. Today, I would like to discuss something which I think is very material, if somewhat unusual. The material event was the death of Christophe de Margerie in Moscow. It was a great loss for Total, the energy industry and those people everywhere trying to find solutions in a complicated world. Christophe was not just the CEO of a major oil company, he was more than an executive. He was a leader. He challenged the industry with an enormous personality, a sense of humor and a genuine desire to work together in goodwill to improve things. For those of you who met Christophe, you will appreciate my feelings of affection and admiration. To my colleagues at Total, I express a deep sense of loss. But I'm also grateful that people of Christophe de Margerie's enthusiasm, gift for life and common sense do rise to the top of this industry. I repeat, his loss was a material event for all of us. And now let's start with Repsol's third quarter results conference call. Today, we will cover two topics. First, the market environment for the quarter, together with the operational activity and the main highlights. And second, the quarterly results. Starting with the macroeconomic environment. During the third quarter of the year, we started to receive news that has impacted the commodity and financial markets, and that is still having a strong influence on them. China and the eurozone demand shows some signals of weakness and therefore, have reduced the market forecast of future crude and oil products demand. Volatility in the financial markets has increased. Oil supply has increased more than expected due to the fast growth in the U.S. and increased production in Libya. As a consequence, during the quarter, we saw declining crude prices, but the quarter finished with a much stronger dollar. Being a euro-denominated company, these effects hedge each other. With regard to the refining environment, we saw a recovery of the refining margin indicators throughout Europe. Thanks to the weaker oil prices and a strong maintenance season in the U.S., from which we benefit. In the last few weeks, the downward trend in Brent crude prices has continued, reaching the lowest level since November 2010. Sustained improved refining margins are protecting us in the short term from this situation. All Repsol's actual production is profitable at current price. Moreover, the current environment does not affect our strategic projects and neither our development CapEx program. Every strategic projects still to come on stream has a breakeven price below $80. Repsol faces the current environment from a very solid and low gear financial position. Let's move now to the operational activity. Starting with the Upstream business in exploration, since the publication of the second quarter results, 8 wells have been concluded, 5 wells with a positive result in USA and Russia, of which 3 were appraisals and 3 wells with a negative outcome in Libya and Liberia. Two additional wells are pending evaluation, Colombia and Angola. In the Gulf of Mexico, we have good news from 2 wells. Leon, our operated ultra-deepwater well, where we have found good quality oil sands with a net pay above 150 meters. We are currently evaluating the discovery. Additionally, we have also completed appraisal work of the Buckskin and expect to move into front-end engineering and design in 2015. In Brazil, in Campos 33, step 2 is programmed to run a test following the drilling of Pão de Açucar, which we are respudding now, after encountering a healthy oil color. A test was performed in the Sagitario well in Block 50 of Santos, confirming that this future is a significant discovery. In Colombia, the offshore well Orca 1, located in the Tayrona Block in the Caribbean Sea, is currently preparing to run a test in the target formation. In Angola, we cannot disclose information for the time being from our first operated well in the pre-salt segment of the Kwanza Basin, named Locosso 1. The results of the well are under evaluation. In Russia, we have 3 positive wells, 31-P and 32-P in the Karabahsky second block, and K3 well in Karabahsky's third block in West Siberia. We carry out production tests this year that confirmed last year's positive results. In Alaska, we are finalizing the definition of 2 to 3 pads for the first development. We'll have additional definition and potential confirmed from next winter drilling campaign. Currently, we continue to carry out drilling activity in the following areas. In Brazil, Piracuca well is being drilled targeting the pre-salt of the Albacora Leste producing block. Facilities are already there. Therefore, a discovery would be very easy to monetize. In the U.S., 2 non-operated wells are active; Buckskin North and the Marathon-operated well in the Key Largo prospect. Our activities continues in Romania and in Norway. And before the year-end, we expect to spud additional wells in Spain, Norway, Angola, Algeria, Canada and Peru. Finally, during the quarter, we obtained 1 new block in Algeria and dilute our stake in the Tayrona and Guajira offshore blocks in Colombia. Turning to production activity. During the quarter, we reached an average of 366,000 barrels of oil equivalent per day. The production was 6% higher year-on-year and 8%, if Libya is stripped out from both years. In Libya, we resumed production on the 7th of July, and we're able to produce at 50% of our full capacity during the remaining part of the quarter. In Brazil, we have reached production of 100,000 barrels per day in gross terms with the first FPSO, and we're expecting to have first oil from the second half FPSO this month. The second FPSO is already on location. Sapinhoá field will reach plateau for both FPSOs in the second half of 2015. Moving to the downstream division. Starting with refining, our margin indicator was $3.9 per barrel during the quarter, higher than the $2.6 per barrel reached during the third quarter of 2015. The increase was due to the good behavior of the spread between products, except the middle-distillates and Brent, that offset the weaker behavior of the spread between light and heavy crude oil. Distillation utilization rate was 84.8% during the quarter, and the conversion capacity reached 106% of utilization. In petrochemicals, the improvement of the market environment as well as the adjustments undertaken by the business during 2013 allowed us to maintain the positive results achieved in previous quarters. Volumes in the market and business remain stable year-on-year. Finally, I would like to briefly explain the recent acquisition of the Chilean company, Compañía General de Electricidad, CGE, by Gas Natural Fenosa. This acquisition reinforces the leadership of Gas Natural Fenosa in gas distribution in Latin America, with the entrance in a stable and growing economy where Gas Natural Fenosa did not have a presence, providing a platform for the consolidation for power distribution in LatAm, and further growth in the power generation in Chile. This transaction is consistent with Gas Natural Fenosa strategic priorities, which aim to increase its international diversification. From a financial point of view, it does not change the solid financial position of Gas Natural, having a low impact on the gearing ratio of the company. Gas Natural Fenosa has reaffirmed its intention to maintain the actual payout policy and therefore, considering the accretive nature of this acquisition, even increased the level of dividends paid to shareholders. I will now explain our third quarter earnings performance. Adjusted net income stood at EUR 450 million, 41% higher than in the third quarter of 2013. The accumulated adjusted net income for the first 9 months of the year is EUR 1.3 billion, 10% higher than in 2013. On a business-by-business basis, starting from the Upstream business, adjusted net income was EUR 185 million, in line with the third quarter of 2013. The basic differences are mainly due to increased production year-on-year in Brazil, the U.S., Peru, Bolivia and Russia, which resulted in a positive impact on operating income of EUR 63 million. Lower crude and gas realization prices, which had a negative impact on operating income of EUR 56 million. Higher depreciation charges due to higher production had a negative impact on operating income of EUR 42 million. Lower exploration costs lead to an increase in operating income of EUR 38 million, mainly due to lower amortization of bonds and wells. In 3Q '14, we accounted for 5 exploration wells with a negative outcome, Iroko-1 and Timbo-1 in Liberia and Agrub in Libya. Additionally, 2 wells have been reclassified as negative, Jupiter-1 in Sierra Leone and Magadi 1 in Brazil, previously under evaluation. Higher taxes had a negative impact of EUR 17 million. Other items such as the minority interests and equity affiliates and other costs explained the remaining differences. Turning to our Downstream division. Adjusted net income was EUR 190 million, 77% higher than in the third quarter of 2013. In refining. The margin improvement had a positive impact at the operating level of EUR 137 million. In the petrochemical business. Better margins and volumes allow us to improve the operating income by EUR 38 million. The commercial business had results in line with the same year ago period. The gas and power business. Operating income was EUR 47 million lower year-on-year. The results of the North American operations weren't affected by the warm season and the negative results from the hedging positions. In 2013, our results in North America were positively impacted by compensation received from suppliers for the deviation of cargoes to other destinations. Results and trading and other activities explain the remaining difference. In Gas Natural Fenosa. The EUR 92 million adjusted net income in the third quarter was -- of 2014 was 13% lower year-on-year. These lower results are mainly explained by the lower results in the gas commercialization business due to the new regulations approved this year in Spain and the sale of the telecom business carryout during the second quarter of 2014. Turning now to our financial situation. The group net debt -- net financial debt at the end of the third quarter amounted EUR 2 billion, approximately EUR 3.4 billion lower than at the end of 2013. Net debt over capital employee ratio stands at only 6.6%. Our liquidity position, cash and outstanding credit lines is EUR 10.5 billion, sufficient to cover short-term maturities 3.6 times. In conclusion, operationally speaking, we continue to deliver the production growth target established in our strategic plan. During the quarter, we received some good news from our exploratory activity, which will create further opportunities to our future growth. In Downstream, we were able to capture the improved market momentum. Additionally, I'd like to take this opportunity to underline the resilience of our earnings to this weaker crude oil price environment. Since Repsol production is still 60% gassy, the quality and relative size of our downstream assets protect us, along with the better performance of the spread of those products not indexed to crude oil prices. The negative correlation between oil prices and the dollar-euro exchange rate also provides a hedge, and the solid and stable results from Gas Natural Fenosa are not affected by Brent price. Finally, we'll continue analyzing the market in order to pursue a possible inorganic transaction. And probably, as a result of the new macroeconomic scenario, better opportunities could arise. And now we will be pleased to answer any questions you may have. Thank you very much for your attention. Ángel Bautista: Thank you very much, and now we'll move into the Q&A session. We've also enabled chat in the webcast in order to post questions. Please use it only in the event there are connection problems on the call. You can identify it by a tab called "Ask a Question". We will address, if any, these questions at the end.

[Operator Instructions] Ángel Bautista: Well, let's move in to the q&a session. We'll start with Haythem Rashed from Morgan Stanley. Haythem Rashed - Morgan Stanley, Research Division: And I actually would love to pick up on the last point that you made around the inorganic sort of opportunities you're pursuing, and just with regards to this sort of the current environment. Clearly, as you say, lower price may allow you to acquire something at a more attractive price. However, I just wanted to understand how you're finding the evolution of bid/ask spreads effectively with sellers? Are you finding that sellers are willing to discuss valuations at lower oil prices? Or is that actually, potentially providing some challenge with regards to executing on it on a transaction? My second question just relates to Libya and with -- really with regards to sort of the more sort of medium-term ability to carry out maintenance. Clearly, production has been sort of better than in previous months, but one of the issues remains obviously, access into and out of the country. And perhaps, if you could say something about your ability to actually maintain production and carry out necessary work over activity, et cetera, on the fields there and whether that might pose a challenge for you. That would be helpful. Miguel Martínez San Martín: I think that your point is right. I mean, in the short term, sellers and buyers expectations are somehow far apart. So I think that at least 2 or 3 months with these level of prices will probably close this gap into a more feasible way to close a transaction, but I agree with you. I mean, if you look at many of the companies have fallen between 20% and 50% of their market cap. So spot price and expectations are far apart today. Having said so, if prices remain at this level, I think that better opportunities would arise, especially if we compare with the situation we had 3 months ago. In relation with Libya, there's no issue with maintenance, I mean, no major problems there. And the incident we had yesterday was based in -- less than 20 people robbing some cars. There were some shooting, so by safety reasons we decided to take our people out. So I expect it to be a minor incident and that we can recover production in short term. Did I answer you, Haythem? Haythem Rashed - Morgan Stanley, Research Division: Yes. That's very helpful. Ángel Bautista: Now let's move to Filipe Rosa from Banco Espirito Santo Investimento. Filipe Rosa - Espirito Santo Investment Bank, Research Division: Just 2 questions for me. The first one relates to your exploration and production campaign in the Gulf of Mexico. So you have this discovery to Leon and you did positive results from the Buckskin. Could you just give us a little bit more information on what could be the potential of, firstly, the Leon discovery? And in the case of Buckskin, what do you mean by positive? Do you think that it allowed you to support your expectation in terms of resources? Did it imply an upward revision of the resources that you estimate for this area? And my second question relates to what is your outlook in terms of oil prices? What is your perception? Is that affecting the way you are looking at your CapEx plan? You probably need to revise it soon. Do you see any potential investments at risk with the new backdrop of oil prices? And coming back to the -- your intention to make an acquisition, are you revising downwards or your long-term assumption for oil prices? Or do you think that you now will be able to make an acquisition at the previous valuations you were expecting, because the sellers will adjust their prices to your new level or to your valuation? Miguel Martínez San Martín: Felipe, well, I don't know if I can put more light in the Gulf of Mexico results. I mean, basically, in Buckskin we found a net pay of more than 150 meters, but it's way too early to make -- sorry, in Leon, to make any assessment about the potential of the discovery. We will run an appraisal well once we have rig availability and then probably we will have more light. In relation with Buckskin, as mentioned, we keep drilling now in the north part to really establish the preceding engineering plan and the design of the future development. I think that also the distance between Leon and Buckskin is lower than 30 miles. So we have to think about it, and all this area is going to have development closer. So it's time to think. I cannot give you more light on that. In relation with the outlook for oil prices, I'm sure that they will fluctuate, as a first comment. In relation with the CapEx, I would say, I will not touch and we will not modify our plan for exploration. I mean, if we start exploring today, probably first oil would arrive in 8 years. So we have to look more on exploration as buying an option. And buying an option is something that has proved quite -- we have achieved good results through our model, which basically implies putting at risk and penalizing short-term our P&L of $7 per barrel produced, and we will keep attached to that. And in relation to the development and the CapEx of the developments, I would say that for sure, for future developments, we are taking into account the assets scenarios. But at today, all the projects that are ongoing do not present any problems. And for the future, we'll have to see. And finally, in the acquisition, for sure we are revisiting long-term oil prices and really having a wide band, I would say, between $70 and $100 to analyze any possible acquisition. Did I answer you, Filipe? Flora Mericia Trindade - Banco Português de Investimento, S.A., Research Division: Yes, yes. Ángel Bautista: Now we're moving to Credit Suisse, Thomas Adolff. Thomas Yoichi Adolff - Crédit Suisse AG, Research Division: Miguel, you sounded quite excited about the acquisition of CGE. You even gave it a slide in the presentation. I just wanted to come back to the point you just made on exploration that you said, you don't plan to modify it. But if we think about lease expiries aside, perhaps it is actually better and cheaper to buy undeveloped resources than your finding cost per barrel if anything. And we're not talking about big corporate deals or big asset deals that the others are referring to, but simplistically an opportunistic approach to buy undeveloped resources versus exploration. That's kind of one question, if you can talk around that. And staying with exploration perhaps, can you quantify the resource addition so far in 2014 from the exploration campaign? And the final question I had is on Buckskin again, you did sound quite excited about the appraisal results. But I wondered whether your base case, which I think is a stand-alone joint development, I think with Moccasin or another field, whether that's still the base case or whether we should actually be thinking about some of the industry press talked about, a tieback instead? Miguel Martínez San Martín: In relation with the acquisition, or the M&A activity, I think that is not only the M&A of the corporation, the one that is working in the process. Also the business is totally involved in it, and we are analyzing also undeveloped resources. But in my perception, they are still not cheap. So in that sense, I would say, let's see how they evolve. But normally, I mean, within 2 months, people don't change their mind. And I think their mindset -- and sellers are still thinking oil of $110. So not much possibilities there, okay? In resources addition in 2014, we do not disclose that, though I'm sure that we are doing okay. Thomas Yoichi Adolff - Crédit Suisse AG, Research Division: Are you on track to deliver on your annual targets so far, the run rate? Miguel Martínez San Martín: Yes, yes. Even if nothing happen from now till the year-end, we are okay. We are okay. And in relation with Buckskin, really I cannot put more light than the one I gave you. I mean, there are several possibilities there. The one that you mentioned is Moccasin, but there are also -- there are developments nearby. And we'll have to see, I mean, let's have the people do his job. Let's take the results from the North flank in Buckskin and then we'll be able to provide you more light. But it's way too early. Sorry about that. Ángel Bautista: And now moving to Sanford Berstein, Oswald Clint. Oswald Clint - Sanford C. Bernstein & Co., LLC., Research Division: Maybe I think that you made a comment that all of your production was economic at these prices. Could you talk about your Mid-Continent volumes. Is that also true for that portion of the Upstream in the third quarter? And what happens here at these oil prices going forward? And how should we think about that growth, volume growth, into 2015? And then, just a smaller question, just want to make sure the Russian discoveries you have are kind of normal developments that are outside the scope of any of the sanctions. Miguel Martínez San Martín: Sorry. Did you hear me because I had the microphone off. Oswald Clint - Sanford C. Bernstein & Co., LLC., Research Division: No, I didn't actually. Sorry. Miguel Martínez San Martín: Sorry about that. My microphone was off. In Mid-Continent, I was telling that we'd reach 11,000 barrels per day last month, which is a little above our target. And the production there is profitable at $80. Thing also, that we have finished the carry of our partner, SandRidge, this October. Growth for the future, I would say that I would expect to reach 15,000 barrels, no more than that in Mid-Continent for next year. And in relation with the Russian discoveries, I would say, first, we are not affected by sanctions. I mean, we are out of the -- 3 reasons why and you have to move out there, we are not in any of these circumstances. And the development is just still way too early to make any comment. We still have to work on the appraisal phase for a while. And sorry about the microphone issue also. Did I answer you? Oswald Clint - Sanford C. Bernstein & Co., LLC., Research Division: Yes, absolutely. Ángel Bautista: Now we're moving to Anish Kapadia from Tudor, Pickering, Holt. Anish Kapadia - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: I have 3 questions actually. Firstly, it seems like the gas spreads are quite wide at the moment, as you mentioned. There's a number of companies that when you look at their share prices, they're looking distressed and like you said, may not accept the offers that you're thinking. Would you look to potentially go hostile for any corporates? And are you looking more kind of asset deals or corporate deals? And the second question is relating to Angola. We've seen just generally in the industry quite a few unsuccessful wells in the pre-salt in Angola. It seems like on your 2 wells in Angola, the commerciality is highly questionable. I'm just wondering how you think about your Angola pre-salt exploration strategy going forward. And then just the last one, going back to Sandridge. You mentioned that it's profitable at $80. If you look at realization in the U.S., they seem like they're significantly below that at the moment. What makes you kind of cut back on your investment in Sandridge or change anything over there? Miguel Martínez San Martín: Anish, in relation with the first question, we are looking at both, assets and corporates. So we're trying to look at anything that moves. And for sure, it would be friendly. We don't believe in hostile activity. The possibility of failure there is enormous. So if it's a friendly transaction would be there, if not, we'll have to go away and look for other possibility. In relation with Angola, I could agree with your comments. But I think that we have just drilled 2 wells there. So it's way too early. Remember that in Brazil, same situation happened and at the end it appears. So it's a matter of keep playing and we will see, and we will see. And finally, in relation with Mid-Continent, we will keep our 30 rigs there working. If you ask me where would be the moment or the limit in which we'll have to stop production, I don't have the figure in my mind, but for sure it's lower than the prices we are seeing today. So basically, I would say, not hostile. We are looking asset and corporates. Angola needs more time. I mean, we have only just drilled 2 wells, so we'll have to keep trying. And finally, in Mid-Continent, we will not cut back as of today's prices. Okay, Anish. Ángel Bautista: And now let's move to Flora Trindade from BPI. Flora Mericia Trindade - Banco Português de Investimento, S.A., Research Division: Three questions, if I may. The first one a bit more generic. Considering the current prices, it seems increasingly likely that Sacyr will have to sell a part of the stake. So just wondering if you are working together with them on this? The timeline for the refinancing is January, so it is approaching. So just wanted to see if you have any specific view here? And more specifically, you mentioned in the press release a new plant in Cartagena with SK. Can you give us just a sense of how could -- how much could be the contribution to the EBIT of this plant? And then more specific on the net debt evolution table you provide in your release in Page 13. You have an income tax of EUR 287 million in the quarter alone. Does this increase if you compare with the rest of the quarter, excluding the adjustments, does this increase is basically related with just the real that you mentioned in the previous quarter? Because it seems a pretty wide change considering the FX change of the real. So just wondering if this has to do also with Libya or with other issues. If you could explain the drivers please. Miguel Martínez San Martín: Flora, in relation with the first one, we're not working with them. We know that the loan matures in January 2015, but I think that the main differences we have today with what we had 3 years ago. was the situation has changed in many senses. First one, we are not talking about the 20% of the company, but about the 9%. Second, the relationship with Sacyr is totally different from the one we had in the past. Third, also the financial situation is different. So the banks will probably react somehow differently. I cannot provide you more color than that. We are not working with them, and they have showed several times in public their interest on keeping their stake here. So let's see how it evolves. In relation with Cartagena, it's difficult to analyze the EBIT by refinery because we work with the whole refineries as a whole. So it's difficult to really assess the EBIT of a single refinery. If you ask for SK and the SK EBIT, we expect it to be in an annual basis, around EUR 22 million, which implies an internal rate of return of above 30%. And finally, in income tax, you are right. I mean, in Brazil and due do the devaluation, we have 2 accountable -- fiscal loss due to the deferred taxes, and also the impact of Libya coming into production make the fiscal terms tougher this quarter, reaching the 48% you have seen. For the whole year, I expect it to end up at 44%. Did I answer you, Flora? Flora Mericia Trindade - Banco Português de Investimento, S.A., Research Division: Yes, perfect. Ángel Bautista: Now let's move to Irene Himona from Societe Generale. Irene Himona - Societe Generale Cross Asset Research: I have 2 questions, please. First on the cash flow, as you mentioned in Q3, your cash flow did cover CapEx and dividends. I'm wondering if you can clarify the picture for the fourth quarter. I understand there's been a recent change to dividend tax for retail Spanish investors and some companies are paying the dividend early as a result. Are you likely to pay the dividend in December rather than in 2015 to help them with that? So in other words, are we looking at 3 different dividend payments this year and 1 next year? And my second question on the Downstream, obviously, a key strength this quarter. Can you talk a little bit about the trends you've seen in Spanish and European oil products demand? Are things getting a little bit better? Miguel Martínez San Martín: Irene, For sure the dividend policy is a board decision. So my opinion is that we are not going to modify the schedule we have had in the past. So I expect dividends to be paid in January 2015, okay? In relation with the fiscal terms about the dividend, they basically favor solutions like the script. But answering to your question, I don't expect changes, and I don't expect the board to modify the regular payment of dividends in January. And related to products, I agree with you. I mean, we have seen a better demand in Spain, though quite tiny but better. And in relation with Europe, despite the good results of all the companies this quarter and the margins we have seen in October, which are even better than what we have seen in the third quarter, I'm very conservative with my approach to the refining industry in Europe because we are still, I mean, we are still long in distillation capacity. So we will see better margins, though I'm prudent in my estimates for the fourth quarter. Taking it back -- taking this into account, what do I expect for the fourth quarter? I would say that depending on Libya, with Libya in a like-for-like basis, I think we should do a little better than we have done in this quarter. Refining margins are a little better. Cold weather helps. I mean, gas oils will have to increase margins. We have -- we'll have the fuller speed Sapinhoá. So my estimate is that Gas & Power would do better in the U.S. So if -- I'm a little optimistic in comparison with the third quarter. Okay, Irene? Ángel Bautista: Now we move to Hamish Clegg from Bank of America Merrill Lynch. Hamish Clegg - BofA Merrill Lynch, Research Division: Must be good to be Repsol, one of the only companies to benefit from -- or at least have been less impacted by lower oil prices given your mix. But one of the questions asked in some of the other calls has been, what's the rough rule of thumb leverage to oil prices for you, which is something that the oil companies have been answering us. Second question is just on your drilling and M&A, one of the things you mentioned is the lead time on drilling, having a successful drilling campaign, finding oil and coming into portfolio. How much would you consider using your successful drilling operations? Does that mean you're generating cash flow? It might not be organic but by selling steaks in some of your discoveries, that could definitely help bolster your cash position in terms of cash coming into the business. And you also said, if I remember rightly, earlier in the year, you didn't do a deal by year-end, you would look to be returning the excess capital on your balance sheet to shareholders. In the current environment, is this something you would stick to? Miguel Martínez San Martín: Hamish, in relation with oil price sensitivity, I'll give you something more than the oil price sensitivity. Basically after tax, a dollar fall affects us approximately in EUR 18 million -- I mean, after-tax result. A 10% increase in the dollar, increases our EPS by 12%, and normally oil price and dollar moves in the opposite directions. So we have a -- somehow a coverage there. So this is the sensitivity we have, it's not much. If you think that roughly, if you want to make the account by yourself, we can do it mentally. From the 58 million barrels we may produce in oil, take out 8 million barrels to make the calculations easier, taking into account that we have fixed price in Ecuador and some PSCs. So $50 million impact at EBIT level, once you discount taxes and royalties there, which is 60%, you will reach the EUR 18 million that I mentioned, okay? And in relation to return cash to shareholders, I asked for a period of 18, up to 20 -- up to 2 years, last quarter. So only -- and we have covered only 5 months by the year-end. So I still have some room, from my shareholders, allowed, okay? And I think that we have a good time until now, not moving quickly. And in relation with selling assets, I mean, we have done some farm-outs like in Colombia, but it's not the goal today. The farm-outs we did in Colombia were based on our portfolio management issues, especially because it was exploration there. But we have plenty of cash. This is also one of our advantages today. I mean -- and one of our problems, because financially talking is not very efficient to have EUR 7 billion in cash as we have today. So I would say no, it's not in our idea to keep selling assets or to sell assets or part of it, not at this moment. Okay? Hamish Clegg - BofA Merrill Lynch, Research Division: And you said you never considered a hostile M&A. Can you maybe elaborate a little bit more on why you wouldn't, given that you can -- it could get the support of shareholders? Miguel Martínez San Martín: If you analyze the percentages of failure in hostile transaction, you would realize that it's quite big. So -- and also, it's not in our genes. I mean, we are Pacific people and we do prefer go hand by hand with the management and with the board of the company. And if we can really reach an agreement, we will go for it. If not, there are so many companies out there that if it doesn't fit, we'll look for another one. The risk of failure, it's enormous in a hostile situation. Ángel Bautista: Now I'll say hello to Alastair Syme from Citibank. Alastair Roderick Syme - Citigroup Inc, Research Division: On your funding network, do you see much change in crude feedstock, given the sort of all the changing differentials going on in global crude markets? And do you have much flexibility to take advantage? Can I also ask what projects you're looking to FID as we head into 2015, over the first half of '15? And finally, I'd love to know how much the Leone will cost? If you'd prefer to share that. Miguel Martínez San Martín: In relation with the flexibility, no major changes. And we're always active managing oil supply basket, so the flexibility, I would say, is more on our refining system. And we take the advantage of that, and we permanently look at every type of crudes that are available. In relation with your second question, projects that would have FID in the first half of 2015, let me think, but I think that Alaska would be basically the main one that really is important. But we have to take into account also the campaign of this winter, next winter. But Alaska would have a FID next year, and probably also the third stage in Margarita. I would say those are the 2 main. And in relation with Leone, the whole cost, 100% of the well was $280 million. 2, 8, 0. It's okay, Alastair? Alastair Roderick Syme - Citigroup Inc, Research Division: Yes, on the crude feedstock question, I guess, my point was, you're seeing an increasing availability of lighter crudes as things get backed out of the U.S. market. Can you take advantage of that thing in the system? Miguel Martínez San Martín: I would say that an increase in light crudes will not help us much as a basic rule. I mean, part of our advantage is derived between the spread of heavy and light. So if there's more light crude in the market, the spread between heavy and light would be lower. I mean, we can -- we are handling today -- our diet [ph] include 40% -- 45% of heavy stuff. So basically, I would like to have a wider spread. So if the increase of light crude comes in, logically, it will not help us. It's okay, Alastair? Alastair Roderick Syme - Citigroup Inc, Research Division: Absolutely. Perfect. Ángel Bautista: And now let's move to Jon Rigby from UBS. Jon Rigby - UBS Investment Bank, Research Division: I just have 2 questions on cash and then, just one on the Downstream. So on cash, as you're running at the moment, you're running a cash deficits for the first 9 months of the year if you ex out the working capital. So I was thinking, are you conscious of the sort of wasting asset in terms of your strength, your balance sheet strength? I.e. is there sort of backstop date by which you consider you need to have done a deal as opposed to when you'd want to? Just related to that, on Brazil, which is now sort of held off balance sheet to some degree, I noticed that the CapEx continues to be quite heavy, obviously, because you got a lot of work to do. Will that require more funding at any stage, or will that effectively pay out or be able to complete the CapEx spending from its own internal funding and the Chinese funding that went in there? And then just on the Downstream, I noticed the 106.6% utilization rate of your conversion units and a relatively high rates of utilization for the integrated system as a whole. Are you -- given the refining margins that existed in the third quarter, is that a good representation of the system that is running pretty much flat out? Miguel Martínez San Martín: First, I'm totally conscious about cash. I mean, being the financial director and the CFO of the company and having 7 billion at hand, let me tell you, everyone pretends to grab it. So yes, I'm conscious. We have a deficit taking out all the noncurrent or extraordinary items of 400 million at the end of September. And we already have paid the whole dividend for the year. So basically, with a better expectation I hope for this quarter, we will end up with a shortage of cash, taking into account that the -- probably around 200 million, in like-for-like basis for the working capital. So it's not that big, okay? So -- but we follow that really cautiously. In relation with cash in Brazil, Brazil is more than funding, it is more than funding. I mean, our data shows that in a regular scenario, $90 will have a permanent cash availability between $4 billion and $5 billion, permanently. So it's fully funded with the capital increase we did with Sinopec. And in the third one, you are right, I mean, I think it's a good rate. It's where we should stand because basically, we module the distillation capacity in order to maximize the conversion, which is where we really make the money. So I would say, yes. Current utilization rates, I think it's a good one. Jon Rigby - UBS Investment Bank, Research Division: So just a follow-up on that Brazil comment you just made. Are there plans at some stage to bring that cash routes and repatriate that cash? Or will it always sit in Brazil for the foreseeable future? Miguel Martínez San Martín: Well, actually, what we have is both partners have the money already in their hands. So.. Jon Rigby - UBS Investment Bank, Research Division: It could allow [indiscernible] prices. Miguel Martínez San Martín: Yes. And we are comfortable at the present time with this situation. Ángel Bautista: And now Joshua Stone from Barclays. Joshua Stone - Barclays Capital, Research Division: Given the fall in the oil price, I just want to just clarify on your acquisition priorities. You've previously talked about the need for liquids and wanting to get more liquid in the portfolio, but also mentioned the advantage of having gas in the falling oil price environment. Are those priorities unchanged? Or are you perhaps willing to maybe settle for a little bit more gas, if the opportunity presents itself? And then in the Gas & Power part of the Downstream division, slightly surprised by the weakness there. Can you talk a little bit about how much do you expect that to be one-off, and perhaps reverse over 4Q? Miguel Martínez San Martín: In relation with the first one, I would say liquids or gas is not precisely the most critical factor in the acquisition. We look more for really in value and the possibilities to generate value. And also in stable scenarios, I mean, meaning that -- by that the portfolio talking, we need to be more in stable countries. If you want my opinion, I think that there's more downside today in liquids than in gas, but it's just an opinion. In relation with the Gas & Power, it is quite difficult to make an assessment. I think that Algonquin [ph] last year, which is the reference price at a given moment, reached 80. So it's very much dependent on how the weather will affect the East Coast during the fourth quarter. So difficult, really difficult to assess how the weather is going to be in the East Coast of the U.S. Sorry about that. Ángel Bautista: Well, thank you very much, Joshua. And now with Joshua, we have finished our Q&A session and this conference call. You know that any further doubts or queries you may have, the IR service or the IR area of Repsol is entirely at your service. And thank you very much.

Thank you. That will conclude today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.