Good morning, ladies and gentlemen. Welcome to Petrobras' call with analysts and investors to present the second quarter 2012 results. We would like to inform you that this call would be recorded and everybody would be in listen mode only and will be broadcast by simultaneous interpretation. And then we will start our Q&A session in English and in Portuguese when instructions have been given at that time. [Operator Instructions] Present today are Ms. Graças Foster, President and CEO of Petrobras; Mr. Almir Guilherme Barbassa, Petrobras' CFO and Investors Relation Officer; Mr. José Miranda Formigli, Chief Upstream Officer; Mr. Jose Carlos Cosenza, Chief Downstream Officer; Mr. Jose Alcides Santoro, Chief Gas and Power Officer; and their staff. Before we start, Mr. Lucas Mello, Investor Relations Manager of Petrobras has some additional comments. You may proceed, Mr. Mello.

Good morning, everybody. I would like to apologize for the delay. We had some technical problems, but we hope that this has now been fixed. So we would like to start with our call, Petrobras, and the results for the second quarter. This is broadcast live on the Internet and you know our site, www.petrobras.com.br/ri/english. You may follow this call in English. So www.petrobras.com.br/ri/english. And before proceeding, we may make forward-looking statements based on beliefs and assumption of Petrobras' management. The results will be both in reais and dollars in accordance with the IFRS. However, this conference call discuss Petrobras' results in reais only. I would like to give the floor to Ms. Foster now, and she will talk about the results of Petrobras, and then we will reply to the questions. Maria Das Graças Silva Foster: Ladies and gentlemen, analysts, investors, good morning. We would like to start our presentation bringing some focus to the results of the second quarter. The highlights was the approval of the Business and Management Plan of $236.5 billion, related to projects under implementation and $27.8 billion projects under evaluation, subjected to adequate return and financeability. In June and in July, on the 23rd of June, we had a new price increase of diesel and gasoline, 10% for diesel and 8% on increase of gasoline. Also very important was in June, we booked -- domestic refining throughput record was 2.01 million barrels per day. Advances in contracting and the development of the local industry. And we had many technological problems and a new technical partner defined for Atlantico Sul shipyard and contracts for construction of 12 drilling rigs by Sete Brasil, 6 at the BrasFELS and 6 at Jurong Aracruz shipyards. And we had also the construction and integration of the first topsides of…

Good morning to all. We have here on Slide 18 our operating income comparing the second quarter of 2012 with the first quarter of 2012. We see a substantial reduction in our operating income. We see an increase in sales revenues due to a higher domestic demand, 4% up. We also had a foreign exchange depreciation effect, we had to use our formal inventories, particularly at the end of the first quarter at higher cost than those used in the first quarter of the year. In addition, operating costs, when we pay for feedstock abroad, services equipment, all necessary to our operation, the costs were higher given the dollar appreciation. That cost increased significantly. And with that, we had a negative impact in our operating income. Something else that was quite analyzed was the effect of the dry hole in commercial wells that were written-off. Related to our operating income from BRL 11.771 billion to BRL 5.282 billion, and there was also the increase of COGS due to higher sales volume on domestic market, sales from inventories required higher costs and the foreign exchange effect. Net income, as you can see on the following slide, was also impacted. The effect was really due to the exchange variation and the dollar appreciation, since we have quite an exposure to this currency. However, in the long term, we have a hedge operation. We had then a reduction of our operating income, and our financial expenses of BRL 6.4 billion due to the foreign exchange depreciation on our debt. As you can see, taxes also impacted our results. We had to include in our financial result are part that is in the hands of the minority shareholders, not that surprised. In that, all of that together, the operating income, financial results, the equity…

[Operator Instructions] Our first question comes from Marcus Sequeira from Deutsche Bank.

I have 2 questions. The first is related to the diesel price. With the last price increase of diesel, or is this positive, you had announced another price increase a little bit before. I would like to understand how is that decision made? Well, normally, you're committed to quality, and you also have a business plan focusing on quality, but we also understand that there is a political element there. So the last diesel price increase was due to what? Did the government finally understand they need to adjust the prices? Or was it due to a lower inflation rate that gives you more space to increase the price? And can we expect -- are there price increases until the end of the year, given the differences in parity with the domestic prices?

Well, this result includes price, but largely what we have done is systematically talk with and show our stakeholders the reality of passing on the price increases to consumers. This has been done systematically over the past few years. This is the true demonstration of a need that we'll have to pass on our cost increases. Our board members recommended that we follow some guidelines, and that is what we did. In the last board meeting just last week, we presented the outlook for 2012. And again, we thought that there is a mismatch between international prices and domestic prices and once again we talked about the effect on the cash of the company. But definitely, the price increase was led by Petrobras. I don't know what the government was thinking about it, it was a decision made by Petrobras.

My second question has to do with your debt level, how much do you intend to fund during the year? The operating profit marks an inflection point, but I would like to know if that will impact the company's will to have more funding activities?

Marcus, So intend to fund around $3 billion a year. Most of it has been raised this year. But it won't happen necessarily every year. We are working with a considerable cash of surplus. We have to adapt to market movements. I don't think that any of these elements will impact our ability to raise funds. The results of this quarter will not impact our fund-raising ability more than what happened in the first quarter. Our plan shows that the company will be producing a part of this cash flow, already considering the investments until 2016. We are working currently with funds already raised. The company's very healthy financially, and there's a very strong and positive outlook in the expectation of a growing production and exploration. So I do not think that our fundraising capability will be impacted just because of the results of this quarter.

Our next question comes from Caio Carvalhal from JPMorgan. Caio M. Carvalhal - JP Morgan Chase & Co, Research Division: My first question has to do with the write-off with the dry wells. I would like to know why did the company decide to do this? Have you got any plan regarding return that this should be done in 2009, 2012? So what was the reason for your decision to write-off so many in this quarter instead of doing it more gradually? And also there is a trend to focus more in the first quarter, so my question is, to whether in the first quarter of 2012, there might be an increase of this number? Or do you think that this was the heaviest portion or the largest portion, or do you think now it's removed off. And then also my other question regarding your debt, the 2 indicators on Slide 23, debt/equity, and net debt over EBITDA, what about the second half of the strategic plan, the current one. So between '14, '15 or up to 2016, what is going to happen?

Well, first of all, what about our flexibility regarding writing-off dry wells in 2012, this has to do with the evaluation plan. If you have a well, which drives up. And then, you have plans for drilling new ones, it you don't write-off the dry one immediately, they are written-off according to the possibilities of economic activity or not. Some can be recovered, some not. On the second quarter of 2012, there was a politically atypical focus of wells that were left over from the past and had dried out, and Petrobras has a greater number of drilling rigs on new frontiers according to what has been published. And although the new wells have more expensive logistic costs. So in the beginning, these costs are higher. Your second question has to do with the production from the end of this year. Although we have not given you detail of our throughput, the results of the second quarter have been atypical. We do not consider that this means in the fourth quarter of 2012, we will have a higher number. Well in the question of sensitivity, we are very sensitive to flexibility and 41 wells have been already written-off. They had to be written-off and were as if not. And this is important for our accounting reasons, and we have fulfilled our obligation. Well, in view of the devaluation of the real, this is available which accompanies the economy from a structural point of view and a more depreciated real creates a buffer for the future, for leverage. But besides that in the next 2 years, we have a scheduled investment for the company. So this must be done. Growth will ensue and finally, last but least, the question of transparency is important. So these elements will be realized within the proposed leverage.

Our next question comes from Paula Kovarsky, Itaú BBA. Paula Kovarsky - Itaú Corretora de Valores S.A., Research Division: I have 2 questions, perhaps a follow up of the previous questions. First of all, the dry wells, I understand that there has been a concentration of projects, which were considered noneconomic, and this means obviously that there was -- some blocks were given back to the regulator. I would like to understand whether it is reasonable to think whether the number of blocks to be given back should have a higher average from now on. Since we have 4 years with no auction, and so we just have some concessions coming into the end of the exploration phase or new phase of evaluation and that says there's new coming along. So it might be reasonable to admit that the level of dry wells should increase. It is clear that BRL 2.7 billion will not recur, let's say, in this quarter. But I'd like to understand what is the reasonable level of dry wells that we could think of from now on. Therefore, consider the average of previous years might be a little bit conservative assumption because due to the lack of auctions. The second regarding the question of debt. You all said in the previous call, in the presentation of the results, that there would be series of initiatives to try and release cash because of some of the things that you were going to try and do, to try and support or to finance an investment plan. I'd like to understand whether in this quarter, if there is some benefit from these initiatives and if you manage to -- will you manage to do something by the end of the year, so if to release this indebtedness load because you're very close to investment grade. So what are you thinking about, will you be able to reduce the CapEx during the year? So what are you thinking about in terms of indebtedness until the end of 2012?

Well, with regard to your questions, first of all, the dry wells. In fact, the write-off of the wells was with the conclusion of the drilling of some new wells. This we are planning to do with the fact that we are not having new auctions. This was work which was completely within our plan and in our exploratory portfolio and opportunities within the best techniques were mapped out, according to the exploratory success which we have had before outside of the total results, well above the average of the industry. The barrel will probably reach, I think you said $2, but we have a volume of wells and we have control with it economically, it does not support a good throughput plan. So a resolution were to be given back. Very high number of rigs purpose and some of the basics offsets our growth and one of them are [indiscernible] where we have a mechanical problem, which led to the abandonment of this well. This is why they had a concentration in the second quarter. And give exemptions from the level that we should have ahead of us. We will have the same level as the one we had in June 2011, no more at the level of the second quarter. Let me say, if I can invert the question a little bit, so it is a reason not to think that this return of dry wells is not going to involve more capital. So following everything which is being said that's regarding the new investment plan and clearly, a greater degree of objectivity and exploratory continue with much greater success. So it would be reasonable to think that this is a reflection of a greater objectivity of the company, of focusing on the areas where we can have a greater probability of growing short term and perhaps changing the former position that we had was -- which is abandon the well at the last minute. And well, is it reasonable to think like that? Does that make sense to you? Well, first of all, we will follow right enough [ph] the wells according to our accounting standards. The possibility of developing production, the greater production, short and medium term, it's possible to deliver focus on the increase at a sustainable rate. It will allow us to have a greater possibility of success with wells. We will do this.

Well, we always have arrived on success, but also the impact this will have on our results and the same priority. So the company that will invest as we are investing and which is recovering confidence in production maintenance to be able to take a leap forward as from the end of next year. We have to maintain this production in a certain way and managing the drive well for both parts of this strategy. And finally, first of the new frontiers, this number would not -- is in our accounting standards and has a very important effect on the net results of the company and in our success plans, so we will step up our actions.

Thank you, Paulo. Well, regarding the debt, Paulo, the investments -- the divestments that we made and we hope to be successful by the end of the year. And start of the question with divestments, there's also the optimization of our invested capital and I have here 2 cases of our working capital. We have 2 examples here and the projects and we deposited in collaterals. Today, we are giving a guarantee and in August more than [ph] BRL 5 billion, which will have a positive effect on the. and besides these cases we have here, which gets Petrobras system of subsidiary of about -- which exceeds BRL 2 billion. We are trying hard to sell this case, and as from the 1st of September, we will be getting guarantees through another banks, so we can allow this volume of working capital and close will be well done.

And anything about the total expected investments for this year? Or has this not been answered?

Our expectation is the same.

Next question comes from Auro Rozenbaum from Bradesco. Auro Rozenbaum - Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division: I would like to go back again to the point of commercial work that is now. You gave some explanations, in which you said that the work is being done according to the regular policies of the company, et cetera. So what we observed, it's a clear fact, it's a potential increase of the write-off of dry wells and the subcommercial wells in the second quarter?

When we look at the CapEx of the company year-to-date, the results have been to include this increase in that element. This is quite justified by the amount of new discoveries. So everything seems to be according to the routine of the company. And considering the information that we have and the explanations that we received, it seems fair to assume that we are now going to follow to another one of our [indiscernible] to follow the increase of the capacity [ph]. And more than that, we should be expect an increase in the cost of the exploratory activities given the new frontiers, and also the best and complexity, challenges that were brought to Petrobras by the [indiscernible]. Auro Rozenbaum - Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division: There was one point that is still not clear to me, whether we reached a new level of well write-offs, do you think that is in the first statement that we reached a new level of write-off of wells?

Well, Auro, it is not true that we reached a level that will be perpetuated and or that will be repeated after the second quarter of 2012. For sure, we can manage the portfolio that we have ahead of us in such a way that we don't have, as highlighted by Senor Gracas in his previous answer, a higher risk associated with the wells that have been drilled, that is to minimize the amount of wells that have been written off in this past quarter. Now, hence, will wells drove in previous quarters. As it was said, this quarter had a concentration of dry wells and subcommercial wells, but this is never expected to be repeated in the coming quarters. So we are in a good position to manage our write-offs. So that we won't have an accumulation in one given quarter as it happened in the second quarter. Auro Rozenbaum - Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division: Is there any way, have you considered any way of helping analysts to analyze the portfolio of the company and help analysts have the ability to predict this kind of event?

Well, Auro, I do not know any company that will give the analysts detailed notes about their portfolio of wells that have been drilled and that are being drilled and that will be drilled. We already gave more details than the rest of the industry. We're in the case of we need to work the wells that were written off, that was the case this quarter. Now you can do your research and you can read everything that is public information in our results. Historically, our yield is high, it will remain high. So when you have them to manage what's coming ahead, so as to avoid and we don't expect that you have such a concentration of write-offs as well than the coming quarters. Auro Rozenbaum - Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division: And my last quarter -- actually, my last question?

Well, we'll have the scheduled evaluation plan that you can read. Auro Rozenbaum - Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division: My second question is, actually, I would like to ask you if you could give us more comments on third quarter and details on this phenomenon that happened in the second quarter in the area of gas and energy. It is divided in 2 parts, higher needs, to import gas and the increase in prices, kind of that part of the energy was bought. And I'd like you to elaborate on that. What can we expect for the next quarter?

In the second quarter of 2012, we had an increase in the spot prices compared to the previous quarter and year-on-year. What's higher -- we have to buy LNG as spot prices can supply 2 or 3 more electric at power plants and the price of LNG decreased a lot because of the need of Japan to buy a lot of LNG. If you compare the price of the past quarter and of the same quarter of last year, you see that the price increases were a typical. And the because of that part, we import more -- we have to import a lot more LNG and that was due -- it's to spend more than BRL 600 million additional to what we have spent in the same quarter of last year. But now, prices are stabilizing. LNG is being sold at I think $13. And the energy prices are varying too. And we will have to consider the new market conditions. We are now selling at [ph] more than 916 [ph] megawatts. All of the effects that we suffered in the second half of the year are attenuated in the -- for the coming quarters. For the third quarter and the fourth quarter of 2012, we're expecting much of our energy generation. The fact is, what can we do to reduce our exposure to the energy market? We have what's stronger [ph] with the electricity industry after the generators to give us a net that we can expect, how much energy we can expect but certainly, they used to be for -- so we are working with the regulatory agency as well and the goal is to have lower exposure. We have a commitment of energy generation but we need more [indiscernible] stability by the energy. This process is done with the national electricity operator and with the contact of the monitoring of the electrical systems.

Next question comes from Mr. Gustavo from BTG.

My first question is I'd like to understand what will lead to the increase in the depreciation of barrels overproduced domestically? We had an increase of BRL 3 per barrel to BRL 16, around BRL 16 per barrel. What's leading to this? My second question has to do with the balance sheet. A lot of people have asked about it, many answers have been given. But unfortunately, we feel a little bit uncomfortable because in the past, we used to hear, production is going to grow, but in fact, it doesn't. And we would like to understand that whether production is going to be weaker or stronger in the future. We don't really know what's going to happen. What can the management of the company do to give us a little phase margin in the balance sheet? And if tell us what exactly we can expect.

Gustavo, before I give the floor to Barbassa, I would like to make a comment. I'd like to talk again about the drying wells and the export policy -- sorry, policy of the company. In the foreseeable future, for the [indiscernible] this contain, that is underway and that is quite of hard to explain. We have a very strict follow up right now. We are following the movement of each drilling rig. Our oil production will accelerate as such in line with our business plan. So just to mention a plan B, because that's plan A. But we have -- we -- you are in an exploratory campaign, you have to deal with the dry holes, so it's part of our business. There are moments where we have a dry well. The moment we calculate that their well is dry, we have to manage that in the way we are managing these dry holes and subcommercial. Since December of last year and January of this year, we're seeing a higher number of dry holes. We've got indication that we have to work in a more focused area in managing these dry wells. For the write-offs, they are just -- we are going to have it in the next quarter, especially already defined, but from then on, in the first quarter of this year and for next year, we have to be managing these dry holes and subcommercial wells so that the impact will be lower. We also have the per well operating efficiency improvement program, but the last is going to be launched in September, I believe in the first week of September. Then it is a clear indication that we will make this kind of [indiscernible] to follow-up a lot more detail. We will be informing you step by step. We want to get many wonderful and further in the results of the company. Our management wants to have more visibility [ph] and we have to figure out how many dry wells can we support in our business and management's plan. And again I mentioned the operating efficiency improvement program that will increase the profitability of the company and which is our operating expenses.

And then I just have a follow-up question. How are you accounting for the dry wells, the dry holes? In my view, the cash flow has been used, the investments have been made. A dry hole is just an indication that something that has that already been done that's in our account. I see this as a sad business, but also it's good business. It just have a few risks to find wells [ph], that in the long run, that will increase, the market profit of the company. So I have a management question. Some things are under control by you. Some things however seems to be under control and sometimes are not. Where is this operating efficiency improvement program indicate the management actions?

Absolutely. It is a program that will indicate clearly where we're looking for higher efficiency. Not just the programs, but other efficiency programs as well. But we will indicate how we can optimize costs and how we can look -- a step [ph] we have energy and gas and downstream distribution company. There are number of segments where we can work better, where you can use new interfaces to develop the business with these segments. But the efficiency program is quite interesting. We are working on it to make very clear in the call, where we want to get and how to get there over the years, because it's not something that is done overnight. And this is management. Clearly and simply, it is management, Gustavo.

Just to clarify about a possible venture at the [indiscernible] given the yields, as for the dry holes and subcommercial wells.

It's not that we have a dry well and we're going to neglect it in a given quarter. No, if we find a dry well in a certain quarter, we will take it to the management, but rid of those prices that will decide whether I'm going to write that well off now or later. Those are the kinds of management decisions. So I though that this has been clear, that this have been made clear, but if not, thank you also for the clarification. I might be starting to trail the well next month, and I'll know by the end of the year that it is dry. We have to be managing the new wells that we have in our exploratory campaign. Our policies are being strictly followed by our company.

Our next question comes from Pedro Medeiros from Citigroup.

In fact, I have 2 questions. The first would be, your first slide, you showed complete process operation. So tell us about the guidance for October 2013. There's a clear chance that this unit should be installed. Will it be finished before hand? This has not happened, so do you think you this will advance in time? The second question, they have some confirmations here. One of them is still regarding the write-off of projects in the dry wells and the projects that have been canceled with the request over with the investment plan and the -- all the assets on -- what is going to be invested in Brazil and also the investment plans, recent visit of the President of Venezuela to Brazil. So it was something talked about and that project. I was wondering and would like to know how this plan is developing. And in this quarter, we can see the negative results. We have had nothing dense. Is it the right forecast? Is it the dividend payout -- would be handed out? Or will we have a rule regarding the payouts and so the payouts and dividends will be much less in months, years? Maria Das Graças Silva Foster: Well, first of all, the deck mating of the P-55 was in fact included from the Rio Grande. We think that the deck mating -- so we thought several loading of modules, which are being prepared and on schedule, so according to schedule. So that forecast of the first well for next year, September 2013, continues to hold but will not be put forward. That is the reality. Regarding the write-off of the wells, there is no relationship between investment and the write-off. There is no tie. There's no correlation, okay? Well, I was in Baleia at the meeting of Atlantico Sul and I was able to talk to the person there and they maintain the position of an interested shareholder stake to have a stake in the refinery, and they have until November this year to define what their share would be, and they have to make feasible their guarantees of these divineza [ph]. And there is nothing to do here. It is their issue. So the right plan, they will solve this issue and decide the amount, and then will present us what has to be done to complete the project. So they will participate in the stake of refinery. Regarding the dividend policy of this company, it has not been altered set and will not have any alterations. We will continue to pay out at least 20% of the adjusted net income and -- anyway, there's been no -- and the percentage of the market cap. The board has approved this criteria at the moment, 3% of the market cap and 10% of the adjusted net income.

Lilyanna Yang for UBS.

My first question was the PROEF program in Campos. Could you elaborate on that? You mentioned $12 billion in costs, $1 billion as they will begin scheduled and the net present value of 1.6, and then more than $3 billion. So could you tell us what is expenditure and how is this measured? And another thing I'd like to ask is about the due diligence process that you carried out to be comfortable with the signature of the drilling rigs. So the AISC [ph], EAS and the Jurong. And the refinement, my third question, or the refining in Slide 6, what is the deal price which would be too reasonable for gathering and the timing? Could you say what should include this because of the increase of domestic prices?

Well, first of all, the PROEF program has already started. We have expenditures programmed to USD 5.6 billion, $1 billion of our operating costs, 1.6. And we've announced of this month over $1,200 million were already planned for and visibility in the planned CapEx. So what we are doing now is to work on the optimization of the cost through the program of cost optimization. So this cost projection will be -- has to be done. We have to improve them to bring them -- to come back to the historic level. This growth and efficiency can be seen in the growth of output, the production of oil and included in our business plan for the next few years, up to 2016, and included in the -- using the potential of the assets that will be used in this program. The greatest part of these costs are associated with marine installations and levers, and 26% are specific to [indiscernible] and safety. So as for next year, the effect of the cost of these also will be in test. You asked how you estimate the expenditures. Well, we consider the same form of the investment of Petrobras in terms of minimum rates of BPL. And remember, 1.6 is associated to the fact that even if nothing were done in terms of PROEF, which is improbable, then we consider that this number should drop even more and essentially have a number of $3.3 million of net present value.

You talked about the checklist. So what agreed with the probability of our projects?

We have already tried to anticipate possible problems. This is the correct measure and some actions have been taken. So steps have been taken to act in the yards, shipyards, and positive actions and improve our proposals and anticipate problems. So when you have technological partners, who are they? You have kind of objective criteria, doesn't matter if they'd have to be the Korean. You have to have completely objective criteria context to find binding programs regarding the technological partnership. There must be a demonstration and there must be direct ties with the Bauna and the secretary of the environment itself, show you else what they have done also outside of Brazil. So what is important that all this begun because otherwise, we are the ones who will not be delivering and so on and so forth. It is a step-by-step process of objective demonstrations. It's not just to say that we've done this or done that, but to demonstrate that this has already been contracted, that this has already been approved. So to minimize risks, when potential risks are manageable, then we will have an action plan to mitigate the risks so as to have a better outcome. Your other question, well, it depends on many of the functions with the inclusive fuel prices. Well, with diesel being imported and after, well, it depends, and Petrobras will not withstand the quality, which is a target of us. Even so, when I -- it is necessary to reduce. We couldn't wait to see -- inventory is necessary, which is the percentage amount that we still have to reach to head back in cloud 6.

You don't even have the cost of imports, so what would we be? First thing, we are into per barrel.And one last question, I just like to have your opinion. Is it worthwhile having a partnership of investment for refining and out with another carrier, perhaps?

Well, the question that we are having, well, with partners, it's that we add value within our model and we do. They have to put in some kind of an advantage. We have participated in dozens and thousands of building ourselves and expansion of refineries, starting from zero. So any partner who brings to us an advantage vis-à-vis better than our original and more knowledge is welcome. But there must be -- have been some differential, so that we can do better jobs.

Our next question comes from Mr. Christian Audi from Santander.

How do you see the inputs of gasoline and diesel in the third quarter? In June, is it an oscillation or deflation of the economy or not? And the inputs I have negatively impacted the result for Petrobras. So is there any -- a 10-year waiting action in the short term other than looking for parity, given that the new capacity will only -- or refining capacities will only come into play in 2014?

We have been importing a lot. What are we doing to offset or retract? Well, our CEO mentioned in the beginning of the presentation that we are trying to improve the quality of our refinement in addition to profits. We have been reaching record levels of quality in our refineries. We have production unit, but are now allowing this to significantly increase our domestic production so as to offset the imports. These are some of the quality initiatives that we're working on, renewing fineries. We will be concentrating on the refining of diesel to give you a -- to offset the inputs. Do we see a lot of room to improve productivity or not, which is just a marginal increase? We see opportunities in the new units with additional, substantial volumes. The idea is to produce the quality products to offset the imports.

The next question comes from Mr. Oswaldo Telles from Espirito Santo Corretora. Oswaldo Alcântara Telles Filho - Espirito Santo Investment Bank, Research Division: I would like to go back to the balance sheet. Two things that I would like you to explain more in-depth. You talked a lot about exploration expenses, they grew a lot, but other expenses also increased. For example, SG&A increased by 13% on an already broad base. Legal expenses also increased by 34% compared to the previous quarter, and this is not a small number. So there was an increase in exploration expenses, but other expenses also increased in the balance sheet. I would like to understand. Just like you've just asked for other expenses, were these -- or one of these expenses increased exceptionally or should this level be expected to be maintained in the next quarters? Remember, question has to do with the international results. It's negative, but it is not -- was negative than I expected. And you mentioned that 7.8% exchange variation while the total exchange variation in the quarter was 10.9%. I would like to understand the methodology that you used?

I will ask how this from our accounting department to give you some detail about the SG&A expenses. Since revenue illustrated expenses, they were related particularly to personnel. We hired new staff compared to the first quarter and also in services to third parties, particularly information technology. Oswaldo Alcântara Telles Filho - Espirito Santo Investment Bank, Research Division: So I understand that this level will be maintained, looking forward to this assessment?

Yes. And last week, we've just seen the effects, the positive effects of our operating efficiency improvement program, which has not been included in the plan yet. I would like to make a comment, Oswaldo, with regards to the administrative and managerial costs. This is a program that's for our operating costs, we also considered IT, not personnel. So for now, it's not in this cost of the program, at least not in the corporate place program, but all the information technology side of the company will be optimized, okay? Oswaldo Alcântara Telles Filho - Espirito Santo Investment Bank, Research Division: I asked also about the exchange rate variation?

Oswaldo, could you repeat your question about the exchange variation? Oswaldo Alcântara Telles Filho - Espirito Santo Investment Bank, Research Division: Well, I expected an even or worse financial result because I was considering the 10.9% exchange variation, which is the official number, but you considered 7.8% exchange variation. And I would like to understand what kind of methodology you used.

Okay. Here's what happened. You're getting your math based on the figure that we showed you in the end of the first quarter, about BRL 76 billion. This BRL 76 billion became BRL 84 billion in this quarter. Therefore, the value grew over which we apply the exchange variation. Not all of these sums are in dollars. A smaller part of it is the local currency in Brazilian real. And this accounts also for decks in other currencies, not just dollar. And we found decks who will -- could reduce the exchange rate of valuation effect.

We are now closing the Q&A session. I will now give the floor to Ms. Maria Das Graças Silva Foster for the final comment. Please proceed, ma'am. Maria Das Graças Silva Foster: So I would like to thank you a lot for your attention, ladies and gentlemen and our investors and analysts, to those of you who've stayed with us during this webcast. I did stress my conviction and the conviction of our top management in the company. We are convinced that we've got the right actions in place for the short, medium and long run. Our results are real. New discoveries have been a constant. So I'm convinced that we are able to reverse this negative impact of the quarter and turn it into a positive result so that we can bring to our shareholders all the value generations that you are expecting the moment you invested in Petrobras. Again, thank you very much.

Thank you, ladies and gentlemen. This program is -- we will be making the audio of this teleconference for recreated in 1 hour and connect us the audio stream on the following website, to www.petrobras.com.br/ri or using from +55-1-1312-741-99 and the codes -- +55-1-1312-749-99 code 6127 and 2593 for the english webcast. And with this, we conclude the Petrobras' conference call for today. Thank you very much for your participation. You may now disconnect and have a good day.