Hello. Welcome to the Vopak Analyst Call. My name is Laura, and I will be your coordinator for today's event. Please note this call is being recorded, and for the duration of the call, your lines will be on listen-only. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your questions. If you require assistance at any point, please press star zero and you will be connected to an operator. I will now hand you over to your host, Fatjona Topciu, to begin today's conference. Thank you. Good morning, everyone, welcome to our LNG update analyst c all. My name is Fatjona Topciu, Head of IR. Our CFO, Michiel Gilsing, will guide you through our LNG projects update. We will refer to the analyst presentation, which you can follow on screen and download from our website. After the presentation, we will have the opportunity for the Q&A. A replay of the webcast will be made available on our website as well. Before we start, I would like to note that we are currently in a closed period before our first quarter 2023 results. This means that we will not provide any information or guidance on the performance of the company. We would appreciate your patience till 26th of April on any other topic that is not related to the three projects that we are presenting. In addition, I would like to refer you to the disclaimer content of the forward-looking statement which you are familiar with. I would like to remind you that we may make forward-looking statement during the presentation, which involves certain risks and uncertainties. Accordingly, this is applicable to the entire call, including the answer provided during the Q&A. With that, I would like to turn over to Michiel. Thank you, Fatjona, many thanks for joining the call after the long weekend. A very good morning to all of you. Let me start with the presentation. First of all, on delivering our strategic priorities. In line with Vopak's strategy to improve the performance, grow in gas and industrial terminals, and accelerate towards new energies and sustainable feedstocks, we are pleased to update you today on some recent LNG projects. First of all, the expansion at Gate and the potential acquisition of the 50% of the shares of EemsEnergyTerminal are great steps in our strategic pillar of growing our base in industrial and gas. Especially since both terminals have also the potential to accelerate towards new energies in the future. Disciplined capital allocation is one of the levers that we use to improve the performance of our portfolio. Delays in the projects, as well as expected low returns, led us to the decision not to make use of our right to purchase 50% of the FSRU in Hong Kong. The three recent LNG developments that we are pleased to announce today are, first of all, we intend to acquire 50% of the shares of the EemsEnergyTerminal in the north of the Netherlands, which is already operational and fully rented out since September last year. Secondly, we successfully closed the open season for the fourth tank at Gate terminal in Rotterdam, which means we will proceed in the development of the potential expansion of this terminal. Thirdly, we will not make use of the option to buy 49.99% of the shares of the company owning the FSRU in Hong Kong. Vopak is well-positioned to capture the market opportunities as the number one global independent LNG infrastructure provider worldwide. Approximately 80% of the LNG demand growth is expected to occur in the next 15 years as global LNG demand peaks close to 2050. The value chain of LNG offers similarity with hydrogen and make the LNG terminals well-positioned to locate hydrogen import facilities and other new energies infrastructure. LNG offers relatively sustainable, accessible, and affordable energy that supports the drive for increased LNG demand and bridges to a low carbon future. Moving into Vopak's LNG footprint. We have a good presence in the Americas, with the only import facility on the East Coast of Mexico and the only LNG import terminal in Colombia, which provides reliability to the electricity network of the country. In Asia, we have a presence with our LNG terminal in Pakistan, which is in operation since 2015, facilitating LNG imports into the country. Looking at the Netherlands, we are involved by now in both LNG terminals, Gate terminal in Rotterdam and EemsEnergyTerminal in the north of the Netherlands. Especially here, we contribute to the energy security of Northwest Europe, and our infrastructure will play an important role in the energy transition going forward. Today's announcements related to the Gate expansion and the acquisition of 50% share in EemsEnergyTerminal reflect approximately a 40% increase of our LNG capacities worldwide. Our LNG capacity will expand from 32 billion cubic meters per annum to 44 billion cubic meters per annum of gas with these two expansions. To give a bit more color on the potential acquisition of 50% of the shares in EemsEnergyTerminal. The FSRU is already operational with a regas capacity of 8 billion cubic meters of gas per annum. This joint venture further strengthens the partnership we have with Gasunie. Vopak also supported Gasunie in the realization of the terminal during 2022. As the terminal is already operational upon closing, which is expected latest October 2023, it will provide immediate and attractive cash returns to Vopak. The terminal has initial contract durations of five years with a likely possibility to extend one or two years if needed. On top of the 8 billion cubic meters of gas per annum capacity, which is already fully rented, we have the option to grow with at least another 1 billion cubic meters of gas per annum extra. The terminal also provides opportunities to facilitate the import of green hydrogen in the future. Vopak's equity investment on the combination of the Gate expansion and the EemsEnergyTerminal acquisition is expected to be around EUR 100 million in total. Let me move on to the Gate terminal, the fourth tank. The open season for a fourth LNG tank at Gate is successfully closed. This gives the opportunity to grow regas capacity with 25% with accretive returns and with a commercial proposition similar to the existing capacity. The Gate strategic location and LNG capabilities support the new energies development and has potential to accelerate to new energies such as CO2, hydrogen, and ammonia in the future. From a project perspective, we will work towards a final investment decision by September this year with an expected financial contribution by 2026. On the disciplined capital allocation. When we talk about our strategic priority of improving performance of our portfolio, we continuously review our portfolio and projects we are working on. We have been working with MOL for developing and commissioning the Hong Kong FSRU LNG terminal, and Vopak has contributed much to the establishment of a reliable system of the operation and maintenance of this terminal. With the delays of the project, the attractiveness of this project for us has decreased, and as a result, we have decided not to make use of the share purchase right. We will continue to support MOL in completing the project and the operation of the FSRU as required. There is no material financial impact for Vopak as a result of no longer pursuing this project. Delivering on our strategic priorities. In conclusion, I would like to highlight that we are proud to develop and operate reliable and open access LNG infrastructure, which plays an important role today in the energy security and has the potential to play a significant role towards accelerating for new energies. As said by Fatjona in the introduction, we are currently in a closed period ahead of the first quarter 2023 results. This means that we will not provide any information or guidance on the performance of the company, nor on the expected return levels of the today announced projects. We would appreciate your patience till 26th of April on any other topic not related to the three projects that we are presenting today. With that, I would like to invite you and open the line for questions and answers. Thank you very much. Ladies and gentlemen, as a reminder, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We'll take our first question from Thijs Berkelder at ABN AMRO. Your line is open. Please go ahead. Yeah, good morning, Michiel and Fatjona. Congratulations on the transaction. Can you maybe? Good morning, Thijs. Can you maybe update us on Hong Kong LNG? Will you still be operating Hong Kong LNG in the coming years, as a kind of operational contract, or will that end as well? That will end as well, Thijs. Good morning to you as well. The only services we still provide is basically helping them commissioning the terminal. If more services are required, it will probably be done on a case-by-case basis, but we will not be further involved in operating the facility. Okay. A second question is then on Eemshaven. Should I conclude that the expected returns from Eemshaven will be above your, let's say, guided minimum level for the group for 2025? Yes. We expect that this terminal will immediately contribute to positive development of the return. It should be above the long-term guidance. Yeah. Then maybe final question on Gate. Like, Gate is generating a lot of cash. Why is still an equity investment needed in Gate? Well, we are, let's say, in an active process to look at the debt markets, and indeed, Gate is generating healthy cash. We also expect that we are actually quite capable of leveraging to this investment to quite a large percentage. If you look at the underlying investments, much more significant than indeed the equity contribution. We initially financed Gate at 80% debt and 20% equity. Well, you may expect that we are aiming for at least that percentage for this expansion as well. We are exploring the market should, in general, be a positive project to bring to the debt market in my mind. I would expect a minimum percentage for this expansion as well, in line with what we originally put in place for the Gate terminal. Okay, clear. Thanks. Thank you. Once again, ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We'll move on to our next question from Quirijn Mulder at ING. Your line is open. Please go ahead. Good morning, everyone. Thanks for giving me the opportunity to ask you a couple of questions. Morning, Quirijn. Yes, good morning. Good morning. Everything fine, I hope in Rotterdam. That's okay. There is one question I have with regard to the Eemshaven. It looks to me that if you look at plans, there's a five-year contract with Exmar on this, the Exmar barge, as we call it. Let me say, are there opportunities for Eemshaven to build a fixed or, let me say, an onshore gas terminal, as you did with Gate? Is that one of the opportunities which you consider with, together with Gasunie? There is always an opportunity, but the likelihood at this moment is relatively low, Quirijn. I think it's a bit depending on what the developments will be of LNG going forward? It's still to be seen how this market will develop in the longer term, given the gas demand of Europe. It's not in the cards yet. Could it never happen? It could always happen, but the likelihood at this moment in time is relatively low. I think the good news, I think with Gate terminal and Eemshaven, and given, let's say, that Gate is the longer term investment in terms of fixed infrastructure onshore, and Eemshaven is a bit more flexible because it's indeed operated by this by this barge. It gives us also the flexibility to adapt the capacity going forward, depending on the market circumstances. If the market ever goes down, it is an opportunity obviously to reduce capacity if required, which is not the expectation at this moment in time. If it happens, then there is some flexibility. If the market continues to be very strong, yeah, it may always happen that we would build something in Eemshaven. As I said, I find the likelihood at this moment in time very low, to be honest. Okay. There's a bigger chance that there will be a second barge being placed on the other side or whatsoever. Is that? Yes. Yeah. That is more flexibility. Correct. I understand from the press release, there are expansion plans. This is not a stage goal here for. There are expansion plans. In the longer run, this new energy will develop quite likely as well. That's why we are very happy with the Eemshaven position because we think it's an ideal landing point for renewables to develop its hydrogen. It is a very good location to have on top of, let's say, the Gate location we have in Rotterdam. There are indeed expansion opportunities either for LNG or for new energies, which makes this, in our mind, quite an attractive acquisition. It might be that you, let me say, electrolyzer can build on that for, let me say. The ideas, of course, of the North Sea are to build, wind farms. Yeah. to have an electrolyzer somewhere onshore which is being connected to a place, to an industrial area where you can use the hydrogen. That is maybe the longer-term idea, yeah. Yeah, no, definitely. I think a lot will happen in between now and 2030, that's for certain because this development is in line with the reduction of CO2 in the Netherlands and bringing more renewables into the system. Yeah, I think this is a perfect location to bring, let's say, renewables onshore and indeed transform it into hydrogen and then potentially blend it into the gas system of the Netherlands. I think that would be an ideal opportunity. Too early to give any sort of specifics on it, but to be well-positioned for these kind of opportunities for us makes a lot of sense. Okay. This is all part of the growth, yeah, billion? Yeah. capital for growth. Yeah. That is all the three. Yeah. With Yeah. Maybe briefly on the billion, as this effectively means EUR 100 million under the EUR 1 billion. If you look at... That's, well, you know that, is if you then look at the proportional CapEx for us as a company is actually larger than the EUR 100 million, because we will use the leverage of Gate terminal, of course, the leverage opportunity to put more capital at work than only our equity. Yeah. Under EUR 1 billion as communicated, this will be a 10% fulfillment of that EUR 1 billion. Yeah. Okay. Hong Kong, because in my view, it seems to me that the delay, yeah, it is not that much. It is... Let me say the delay is, yeah, it was planned for, let me say, beginning of 2023. Yeah. Yeah. Now planned for the end of the year. What, is the return lower than you expected before? What is, what's behind here? No, yeah. It's a return decision indeed. A year ago, the project was sort of just above the threshold, let's put it that way. Okay. Not overly attractive, we looked at it during last year and said, "Well, how can we improve the return? Is there any upward potential?" We don't see a lot of upward potential given the type of projects. There was still a financing risk in the project. In the meantime, the financing costs have increased, and as a result, the equity return further dropped. We concluded effectively, well, to put our capital at work in Hong Kong would still have been an opportunity, but it's, it wouldn't be accretive to the return. Actually, it would dilute the return of the company. As a result, we said, "Well, we much rather put our capital at work in projects which are at least in line with the return ambitions we have as a company." For us, we decided, given the fact that there was also not a lot of upward potential, we said, "Well, let's not do this one." Let's find other projects which are more attractive for us. Yeah, Eemshaven for us is more attractive than this one. In terms of internationalization of the LNG business. Yeah. I've seen, okay, Brunsbüttel is gone and Hong Kong is gone. South Wales is progressing, but it takes probably a long time. Zhangjiagang is a back burner, and maybe other projects as well. This, if you speak about your LNG expansion, yeah, it looks limited. Yeah, it looks not very. Of course you can discuss about the returns, but the returns in gas, yeah, they are so quite relatively certain, compared to let me say oil or chemicals. Yeah. Yeah, they're you're right. They are indeed relatively certain, but they still have to be attractive for us. Yeah. They can be certain, and that's, we don't mind to have certain returns, of course, but if they're not at an acceptable level and we need to put a lot of effort in, then we think there is better projects for us to execute. Yes, to grow the international network is always a challenge, of course. So far, if you look at the network we have, if we add this one, we have at least, five locations in the world, a few projects still under development. It's always hard work to land these projects. What we will do, I think, on the other hand, the footprint in the Netherlands has been very attractive for us as a company. It is a good way of allocating our capital and also to be positioned for, let's say, new energy developments going forward. Yeah. My final question, is there any exceptional charge to be taken on Hong Kong in the first quarter or? No. No. That's has no financial implications here? Has no financial implications, no. Okay. Thank you. Thank you. We'll move on to our next question from Lampros Smailis at Kempen. The line is open. Please go ahead. Hi. Good morning, Michiel, Fatjona, and congrats on the acquisition and the announcement. I have one question regarding the Eemshaven. Is the volume contracted already? Are you looking, you know, for buyers for the LNG? Is any of the capacity expected to be on the spot market or is 100% will be contracted? Thank you. Morning, Lampros. The terminal has been contracted for five years, so another four and a half years to go. There is still some capacity which we could expand another 1 billion cubic meters of gas. There's still some opportunity, but the 8 BCM is rented out. Longer than expected with some additional cost for, let's say, this delay phase, which hasn't helped the project overall. As I said, the returns were always just good enough, as a result of the financing market, the long time before it takes to get any dividends out of the project, we said, "Well, this is probably not gonna be very exciting for our portfolio." We could still have taken that step. Like Quirijn says, it gives certainty on the returns. As I said, it would have been lower than our ambition without any upward potential. We thought, "Well, this is actually, yeah, not a nice project to have in our portfolio or not a vital project to have in our portfolio." The delay in the commissioning made the project from a investment and financing point of view, less attractive. Understood. Which I would agree. I don't know, am I allowed to ask about specs because of the silent period or not? Not really. Okay. No, understood. No, that's fine. Okay. Thank you very much. Have a good day. Thank you. You too. Thank you. We'll now move on to our next question from Andre Mulder at Kepler Cheuvreux. Your line is open. Please go ahead. Good morning. A question on Victoria. Can you draw any comparison between Hong Kong and Victoria? It seems like those problems that you mentioned could also impact Victoria, so I'd like to hear your comment there. Well, thanks and good morning, Andre. Yeah, I think we will not go into the details of other terminals, so other development projects in general, huh? Any development of an LNG terminal always faces certain challenges, of course. It is, it's always hard to reach the finish line on any of these projects, given the, given the complexity. Yeah, anything can happen with any BD project. It's a very general answer. It's probably not gonna be helpful for you to put that in the perspective of the Victoria project. To reach the finish line for these kind of projects and still to deliver an attractive return, that is always the balancing act, for any of these BD projects. Thank you. You're welcome. Thank you. We have no further questions in queue. Okay. There's one who just came. Again from Thijs Berkelder at ABN AMRO. Your line is open. Please go ahead. Hi, it's me again. I saw in the presentation that you're also looking into developing Gate as a green energy hub. Can you explain maybe where the extra plans come from and where the room is on the site? Yeah. If you- There's a few opportunities. First of all, there is an opportunity to build CO2 infrastructure next to the LNG terminal for capturing CO2 in the port of Rotterdam and then consolidate it at such a CO2 terminal and then transport and inject it in one of the all the oil or gas fields. That is an opportunity which is work in progress. That location could be next to the LNG terminal. On hydrogen, bring effectively renewables onshore, have hydrogen there and blend it into the gas. That's another opportunity that's a bit longer out than the CO2 infrastructure. In the longer run, you could reuse certain of that capacity of Gate for ammonia as well. It will require some adjustments to the infrastructure because definitely a different product than LNG. It's not that this capacity is obsolete once you can't import LNG anymore. There is an opportunity, and that's also the way we look at the fourth tank, for example. There is an opportunity to refurbish this terminal or adjust this terminal for ammonia storage as well in the future. As I said, it comes with investment, it's not free of charge, but it is still a nice location to import ammonia going forward. Okay. Thank you. Thank you. I will now hand it back to Fatjona for closing remarks. Thank you. Thank you all for joining this call. If you have any other follow-up questions, you know where to reach us. Thanks again. Thank you. Ladies and gentlemen, this concludes today's call. Thank you for your participation. Stay safe. You may now disconnect.