Good morning, ladies and gentlemen. Welcome to the Results Presentation of the First Quarter 2012.

The results we have published earlier on this morning before the opening of the stock exchange market, and they are, as usual, available in our website, www.enagas.es. Mr.

Antonio Llardén, Chairman of Enagás, will host the presentation. We expect it to last about half an hour.

Afterwards, there will be a Q&A session, during which we will try to answer any questions as fully as possible. Thank you very much for your attention.

And I will now hand the floor to Mr. Llardén.

Good morning, ladies and gentlemen. And thank you very much for joining us today.

Today, we present our earnings for the first quarter of 2012, having recently published our earnings for 2011 and held a successful general shareholders meeting. Enagás earnings in the first quarter or the details contained in the presentation accompanying this conference call are consistent with both the expected performance for 2012 and our commitments for the year.

EBITDA is up 4% compared to the first quarter of 2011 reaching EUR 214.2 million. This growth was possible essentially -- mainly due to the expansion of the company's asset base last year and the reining in of operating expenses in like-for-like terms, increasing by only 2.3% in the quarter.

The company reported a net profit of EUR 86.7 million, which is 0.8% higher than in the same period of year earlier. Investment in the quarter amounted to EUR 163.3 million, and assets put into operations are EUR 26.7 million.

I would also like to highlight that Enagás income increased by 8% in the first quarter, and this reflects the pace of assets being brought on stream in 2011 and the inclusion in our accounts of the Gaviota underground storage facility.

We haven't included the results of the first quarter of Altamira because we just received them in the very last minute. We didn't have enough time to audit them.

And if we would have included Altamira, we will have an income increased by 9% for example. And from now on, we will include Altamira's results in every single quarter.

Now in terms of the results obtained in this first quarter. Again, they put us on track to meet our commitments for 2012.

Let me remind you of our main commitments. First of all, EBITDA growth of roughly 8%, net profit at a level similar to 2011.

And this is in line with the target set out in the 2010-2014 business plan, a dividend increase of roughly 8%. We will invest EUR 550 million, and we will put into operations assets worth EUR 750 million, in line with the targets contained in our business plan.

As you all know, we have set these targets with a high degree of prudence in lieu of the particularly volatile economic environment. But we are certain that -- after these results presentation, we are certain that we are back on track to meeting them.

Enagás financial position remains one of the strong points of the company, and I would like to focus on certain issues regarding this issue.

Enagás net debt at 31 of March stood at EUR 3.413 billion at the end of the quarter. Enagás liquidity totaled EUR 2.459 billion, which will allow us to maintain elevated solvency ratios and flexibility in our operators in a highly complicated financial environment, not only in Spain but all around Europe.

In this first quarter, we have been very active with a view to bolstering our financial structure and preparing us for any negative developments yet to come in financial markets.

In a sense, we have increased the percentage of fixed rate debt to 80% as against the 70% we had maintained in recent quarters. We have pursued an active policy of renewing our loans and obtaining new financing, which now accounts for 85% of the expected refinancing for the entire year, only during the first quarter.

Of this new refinancing, I would like to mention the signing of the last EUR 175 million tranche of the EUR 1 billion loan of the EIB granted to Enagás in 2008 and which will be used to continue our investment plan. The loan, signed under excellence payment and cost conditions, confirms the European Investment Bank's confidence in our company.

In addition, we expect to refinance the EUR 500 million bond, which matures in July. As we noted in the February conference call, we intend to execute this transaction in May and June.

Refinancing of this bond not only comfortably meets the company funding needs, but also allows us to enhance our financial structure. All of these provides further proof of Enagás' sound financial position, allowing us to continue moving towards our strategic goals.

We have a very good level of financing because we have been highly cautious in this regard. If financial markets become more difficult, Enagás is ready to meet its needs.

I will now talk about the government measures regarding electricity and gas deficits and fiscal measures set by the government. I'm going to address the measures recently announced by the government with regard to these issues.

As far as the measures to reduce the gas tariff deficits generated in 2011, which is temporary, are not structural in nature, is that they are a step in the right direction. They do combine a necessary increase in tolls with certain adjustments, factors the expansion of the depreciation period of the new underground storage asset.

Hence, the steps proposed by the government to end the problem of the gas deficits -- gas tariff deficits and maintain the regulatory stability needed to ensure fair profitability as well as an efficient and quality service for the Spanish energy system.

As far as the fiscal measures introduced by the government, their impact on Enagás is quite limited. For reasons of prudence, the company have not taken into account the tax incentive arising from accelerated depreciation in our estimates of the business plan 2010-2014.

We can have an in-depth view on this issue during the Q&A session.

Thank you.

Now Enagás considers all the adjustments to be rational and acceptable and no adjustments are needed in our estimates for the coming years. This is partly due to the fact that Enagás has prudently acted in advance and adapted its investment plan through the present economic environment.

This is the case with some of the investments that have been temporarily halted by the government in the Royal Decree Law published at the end of March such as the expansion of the Gaviota underground storage facility, which Enagás had recently adjusted in its investment plan. Again, we are prudent and realistic and capable of adapting to changes in the economic and energy environment.

With regard to the temporary freeze of permits for new projects, we will have to wait for the Spanish gas and electricity infrastructure plan 2012-2020 being prepared by the Ministry of Industry, which might be approved in the second half of this year. However, I'd like to emphasize that our prudent policy of exploitation of our know-how and purchase of core business assets allows us to supplement our organic investment, thus reaffirming our investment targets for the 2010-2014 period.

With regard to demand, the total amount of gas transported in the Spanish gas system increased by 1.4% in the quarter, in the first quarter. Year-to-date, this increase has been larger, and this is information not contained in the presentation regarding accumulated aggregated demand as to date.

So until yesterday, these transported gas increase was 4.1%, which is partly explained because of the major activity of tank loading in Spanish terminals reaching nearly 7,000 gigawatts per hour, which is an outstanding figure we never reached before. Thus, our forecast for the year is a 3.6% growth in total transported demand.

Quarter-on-quarter, we will try to give you a better assessment of the total demand.

Again, during the first quarter and despite the adverse economic environment, there was a monthly record in February of conventional domestic demand, commercial domestic demand and cogeneration plus industrial demand. So far, until yesterday, conventional demand has increased by 8.1%, which is not included on the presentation.

8.1% in conventional demand increase result in a total gas demand in Spain aggregated until -- during the first quarter, increased by 1.4% including conventional and electric demand, which continues to go down compared to previous year's figures. These stresses the importance of a correct and adequate system to be able to cater for certain demand peaks.

In short and to conclude, the first quarter earnings we have just presented give Enagás good visibility for 2012, with the data we now have and I can add that we are on the right track to meeting each and every one of our commitments not only for this year, but also for 2013 and '14, as we have been doing for 5 consecutive years now. In fact, so far, there's been 21 quarters since we launched our strategic plan, where we've met our commitments announced at the beginning of the year.

And despite the fact that during this 21 quarters, 18 of them have been during the current economic crisis.

Thank you very much for your attention. If you now have questions, please ask now, and we will endeavor to answer them as best we can.

Thank you very much indeed.

I have 3 very quick questions. First and foremost regarding the net debt.

You explained that the deductions approved in Spain won't have an impact on Enagás. Could you briefly give us a figure the next best figure by the end of the year Enagás is expecting.

Secondly, regarding the latest changes approved by the end of March in terms of tariff and gas at the end of the quarter. Could you briefly explain whether the change in amortization will only affect Yela or will it also affect Gaviota?

Can you briefly talk about its impact in terms of its impact on earnings, on Enagás earnings? And finally, with today's presentation on the investment figures, you have included EUR 80 million in CapEx in this quarter.

Why have you included this in the CapEx line? Is this provision linked with any type of remuneration provided by the regulators to Enagás?

Secondly, does this only affect one plant, or does it have an impact on other -- on each and every plant?

We will reply to this question. The Chief Financial Officer, Diego de Reina, will answer the first and third question.

And then, I will give the floor to the General Planning Director, Juan Pons. He will answer the second one.

So, Diego?

The net debt figures foreseen for the end of this year is about EUR 3.6 billion. The end figure will obviously depend on the purchases or acquisitions that the company might do during the 2012 period, but our provisions are around EUR 3.6 billion.

With regard to the dismantling provision that will affect all the plants, not only those 3 plants, but also the subsidiaries in Altamira and BBG, this is a consequence on, first of all, the need registered on the concession deeds in every plant. And secondly, because of the application of accounting standards, which do require that whenever we need a provision, all the provision is accounted and then by means of depreciation.

And so the question whether this is -- this has been accounted for? Yes, of course.

These dismantled provisions have been accounted for. This will affect Yela and Castor, the underground facilities.

There's a EUR 500 million income, which is about EUR 2 million yearly, which is recurring. This will happen every single year.

The provision will take place every single year. We will write them down year after year, and the total figure is not relevant taken into account that the regulated income is about EUR 1.2 billion, and this is not concerning us.

And regarding the last changes in March, I will now give the floor to Juan Pons.

This will only affect Yela because it's for new storage facilities. In terms of the impact of this measure, I'd like to mention that the increase of the useful life is -- decreases their retribution, but it's partially offset by the decrease of that quantity in terms of amortization costs.

So there won't be a -- there will be a nil total or net impact. These won't have an impact, but if we have the provisional document to proceed, we can collect the transitional amount.

However, this gas tender has been postponed in 2 months, and this will postpone the retribution. But again, minor impact -- minor cost increase due to the fact that we need a backup guarantee for these 10% of the retribution that we will receive until we receive the definitive retribution.

But again, a minor impact. Thank you very much, indeed.

Any further questions, please?

I have 2 questions. First of all, can you briefly talk about your outlook in terms of investment, especially for the 2014-15 period?

I'd like to get to know your investments outlook, and because this will go -- probably go down and your cash generation will be stronger. Will you increase investments in the field of international investments?

Or will you increase your payout ratio? Or what's going to happen with the regulation?

Secondly, what are your expectations in terms of regulatory changes? Are you expecting a net drop of our assets?

Are you expecting to see a very objective figure? What do you think the evolution will be?

And the National Energy Commission has proposed several measures that could have a 20% impact on your EPS. So what is the worst possible scenario if there's a regulatory change?

Can you briefly talk about all these issues, please?

Now let me answer to both of your questions. First, our strategic plan goes through 2014.

With the figures we just shared with you, we still think we can comply by 2014 with our investment figure. I think that the presentation says more or less 10%, and the final number will depend on the investment pays, potential delays or advances and our prudent investment for third -- for our assets.

It could be lower because of these reasons. But right now, I think that we can comply with our strategic plan within that 10% range.

For 2015, we still need to wait on the publication of the energy plan, which we think will be published by the government in the second half the year. 2 years ago, and I'm starting to get boring because I've been saying this for 2 years, the gas investment in the system after 2015 or starting 2015 will be less than we've had up to date.

However, there are certain projects in this company lying ready for that period. For example, the second regasification plant in the Canary Islands, which is not part of the strategic plan and some other subjects linked to international connections.

The point is that average investment in Spain in that period will be lower. Secondly, we are not going to increase or decrease investment in third-party assets.

The investment in core business assets not owned by us is not trying to compensate what we do or do not do in our energy plan and our organic investments. It's just trying to make use of the know-how we have, which we think may add value to shareholders.

But those both silos are not connected. That is why we decided to increase the payout last year, and we are planning to do so this year as well.

We are going up from 65 to 70. And by 2014, as I announced in the P&L Presentation Conference Call, when we have the energy plan by the government approved and we've come to the end of our strategic plan, then we will assess our payout policy.

And I think this information covers your questions. Now regarding the regulatory changes based on the statements by the government and the conversation we've held with the ministry, we know that the main concern of the government right now is to cut the tariff deficit.

The first measures in the right direction have been taken but the government thinks further measures are needed. That's not our business.

So we won't go into that. I'm just repeating what the government said.

Regarding the gas deficit, we do believe the measures taken are correct and, they are in the right direction. If these policies are maintained, if the tolls go up prudently every year, then the gas deficit won't mean a problem whatsoever.

From this point of view, we do not expect significant regulatory changes because we do understand that the retribution systems and the gas system, not only ours but other operators as well, do not impact at all solving the main problem at hand, which is the gas deficit -- the electricity deficit, correction. It's true that that's the main problem, and I don't have to say that, you know that, and it's worth thousands of millions.

The C&E published their report on this and the ministry very briefly declared on it saying that most measures were not appropriate and were not going to be taken into consideration. So from that point of view, we think, and this is our opinion, we think that what's on the table, what's pending action right now is to take on further measures to readdress the energy deficit problem.

And then second to that, putting together a final energy plan for 2012-2020 or even longer, which would be what would set the energy policy in this country. That's why we think that from a strictly gas point of view, we do not think that it should be us, whoever needs to bring on essential changes to solve this problem.

And then finally, what you mentioned about the Robin Hood Taxes and so forth, well, the government has taken initial fiscal and tax measures, but none of the ones you mentioned. And to the best of our knowledge and although I do not have a crystal ball, I do not think we are going to be affected by this.

But at least, as of today, we have no knowledge of that. Thank you, and I hope I have addressed your question.

I have a couple of questions. The first one regarding the nonrecurring OpEx in the first quarter.

Could you please give us a number for that? How much is nonrecurring?

Because I understand that the Gaviota expense is recurrent. And the second question is regarding the gas deficit.

Can you approximately give us the number for the aggregated, accumulated gas deficits this year, bearing in mind that the volume transported is behaving well and probably will be above initial expectations? If I'm not mistaken, I think the government said that it would be close to 300 million.

Are your numbers close to that? Or are they below that because of the gas evolution?

And third, I think I can infer from what you say that you would like to specify on some core assets acquisitions in the middle term if they are in line with your profitability expectations and you can create synergies, specifically natural gas operations. Could that operation be brought into play before or after the investment plan by the government or before any other regulatory announcements?

So let me answer your 3 questions. The first one, the CFO, Diego de Reina, is going to answer it.

Thank you, President. Now regarding the OpEx.

It's true they are nonrecurring expenses, but it's a small amount. When we compare expenses, we are talking in general, and the recurring expenses are expenses that came up -- nonrecurring expenses are expenses that came up this year, but did not exist before.

One of them is a fiscal expense tax related, which is the -- which are the special properties, which is EUR 6 million, and that's tax paid. And we are starting to pay that this year.

We used to pay the IBI tax before. And of course, this has an impact on the expenses comparison, the fact that we are accounting for the OpEx of the underground storage of Gaviota, which in 2011, we started recording in September, but now it's going to go throughout the year.

So these are the most important numbers when we make a homogeneous comparison. Of course, what I explained about the taxes and the OpEx for the underground storage of Gaviota, those are recurring expenses.

The second question, Mr. Juan Pons, the Planning and Regulation Chief Officer, will answer that.

Now regarding the deficit. It's true that the government provisions last year were at around 300 million, but it's too early to make a calculation, although you are in the ballpark.

If the demand grows higher than expected by the end of the year, the deficit would be below the EUR 300 million. In general, the gas deficit and the systemic cost will grow up to 2014.

But starting 2015, these costs will start to go down. So in the short term, this may be solved.

Now the third question, correct, we have included in the forecast for 2012 an approximate number for one or more core asset acquisitions for an amount of EUR 150 million. Of course, you'll understand that right now I may not comment anything particularly about this subject.

Being optimistic, I think that through 2012, we will be able to reach this goal that we set for ourselves.

The first question would be regarding the impact on your accounts starting 2013 put into operation of the Musel plant and then the changes in the depreciation period for Yela. Could that have a significant impact in your numbers next year?

Secondly, could you give us your point of view on the load factor of gas transmission sectors in Spain? The CEN government was very critical on that number.

Could you give us a number on the usage, and why does it need to continue growing? And the next question, could you please update us on the Castor regasification plant and when do you think these assets could be put into operation?

Let me answer now. Now Mr.

Juan Pons will actually answer the first question.

So the impact is 0 because we do not receive the payment for depreciation -- for amortization, but we do not amortize. And we do receive the financial retribution for the CapEx invested and the OpEx for maintenance costs.

Yela, same thing applies. The impact is 0.

It's divided by -- the depreciation is divided by 2 and so is the cost. So the impact in general is 0, null.

Now regarding the CNE, National Energy Commission, reports and the load factors reports. Let's see if I can clarify this issue once and for all.

It's a technical matter and it leads to misunderstandings. Now gas pipelines of high pressure transportation throughout the world, if we take the average volume transported by the end of the year, if we take the percentage, for example, it's normally at around 40%, 60%.

Now that said, because of technical and legal reasons, these type of gas pipe plants are not built for the average load but for the peak usage. So a network of pipelines that needs to transport between 50% and 55% of volume through the year at the peak point is at 90% or 100%.

And that's the sizing they need. So when we speak about averages at this point, it's not that it's not true, it's just that we cannot reach any technical conclusion.

If you know me, you know that I have explained this several times, but we will have to explain this further, once again, not because of the person that asks the question. But I'm saying this because this normally appears in technical reports.

Same applies to regasification plants. The goal is twofold for these plants.

Of course, the first one is to diversify the origin of the supply and facilitate the entry to the country and competition, but then the security of supply is also another objective. The plants work as a star system, and they are sized so that if one of the entry into the plants, and this is a regulatory requirement from the European Union, if one of the entry fails, we can work with the other ones.

So the averages work here. The other ones would need to work.

And then also, they need to work during peak times. And they are useful for the daily back half of the renewable that we have in this country in terms of power.

For example, the biggest plant we have by far is the one in Barcelona. At certain times of the year, it cannot provide all the gas it needs in that area, and we need to get it from elsewhere.

So it's true that in technical reports at times, we talk about the average use of high-pressure gas infrastructures, but we insist the average usage. It's not that it's not important, it's just that the regulatory requirements, the technical requirement, concerns the peaks not the average.

And now regarding your comment about Castor. Of course, it's not a regasification plant.

You mean, Castor is an underground storage. Based on the information that we have, the gas option has been done already to start using the buffer gas.

And we understand that through the year, Castor will carry out the necessary tests. And some time next year, regardless of the specific contents of costs recognized by the regulator, and that's not something where we have a say, we hope that at some point next year, it will be operational in the system.

I have 2 questions. First, what are the minimal OpEx that you will have in 2013 regarding the list of the freezing of the National Energy Commission for the year?

And then the fixed rate that increased, you said it had changed for 2012. Can you further explain that, please?

Now the first question will be answered by Mr. Juan Pons.

Now regarding the sales OpEx, until we do not put it into operation, we are still validating that. But a regular plant could be 70, 80 employees, and we think that 7/10 should be enough to maintain that.

Of course, it won't have energy costs and pump costs, it could be a little bit higher, but it should be at around 10%, 15% of the regular OpEx costs of a fully operational plant. Now the increase in the fixed rate debt, Diego de Reina will answer that, but please let me make an initial remark.

For this first quarter, the 3 messages that I would like to convey very briefly are the following: first, the financial figures, the most important one; second -- in that regard, I would like to say that we are on the right track regardless of the economic situation right now. Secondly, the measures taken by the government to cut the gas deficit are rational.

And of course, they don't have a huge impact on Enagás this year or the following years. And if there is an over cost, of course, we will try to improve our efficiency to solve that, to address that.

And the third remark, which will start to answer your question, this first quarter, given the volatility of the financial situation, the euro, Europe and Spain, because of all this, we've put our efforts into reinforcing our good financial structure, so that if the financial markets take a turn for the worst, we will be in safe harbor. You know that this has been Enagás policy through 4 years of crisis with the improvement in our forecast, and we've tried to get ahead of the curve as much as possible.

And we've tried to increase efficiency, increase our financing strength, getting ahead of possible financial decreases -- investment decreases, to avoid sudden surprises. And we've tried to get up to speed with our P&L accounts, so that we can maintain, in average, our results despite the changing environment.

I think we've done so, and the payouts to shareholders have increased, in fact, through the period. And in this context is where your question should be answered.

And now Diego will give further details.

Now in line with what the President was explaining, specifically why we have increased the fixed-rate debt percentage up to 80%, 2 main reasons: The first, what the President already mentioned, we are being prudent in a scenario of uncertainty. The evolution in financial markets is hard to forecast that's why we have done this.

The second one is the opportunity. As you are very well aware of, when a company decides to cover part of its debt, as part of the mix debt establishes the financing cost, the coverage represents the highest percentage of the cost.

So we wanted to go up from 70% to 80% to make coverage operations that are below our 3.3% goal for the year. So we've done so without penalizing the cost.

And on the contrary, we've helped the cost to be lower than expected for the year. And it's true that we are below the 3.3% expected for the year, but there is -- we're only one quarter through the year.

There is one important operation that will be done between May and June that will be very profitable for the company. But still, we're trying to be prudent, and that's why we are acting like this in a highly volatile scenario.

Most of them have been answered already. The first one I have left is regarding the -- put into operation of the Musel plant.

I heard yesterday that putting it into operation could jeopardize the rest of the plants in the system because it would not reach the minimum level of operation. Could you please give further details on this?

Then I want to know if all the investments necessary have been done? Is there anything missing?

And in that case, how much? And then second question regarding the tariff deficit, regarding the demand and how important this is for the tariff deficits.

The demand was pretty good for the first quarter, and you're expecting 2.5% growth for 2012, which is quite a good number. So do you think this growth could be kept up in the midterm?

And the final question. The number that you have on your net cash flow, I don't know if maybe I oversaw something, but you have EUR 45 million in the first quarter positive for the profit for receivables.

Could you please give me some more information on this? And regarding the tariff deficit, I forgot.

What gas tariff do you have in your balance right now?

There is no risk whatsoever in the Musel plant. The government measure is adequate in view of the flat demand in the last 2 years.

Therefore, we have decided to freeze the entry into operation of these plants until we can experience a justified increase of demand or, unfortunately, the shutting down of any plant, God forbid. So we have finished the plant and we will run maintenance without its definitive entry into force, but it can be opened as soon as possible.

In terms of the tariff deficits, yes, we can maintain these expectations during the first quarter of 2012. If the demand evolution is reasonably as expected as opposed to what we saw a few months ago, therefore, this will all contribute to decreasing [indiscernible] -- gas tariff deficits.

And having said that, if you've seen the core of this gas demand, which is the so-called conventional demand, because that's been the historical market, it's growing at an 8% rate, highly influenced by the average temperatures during this time of the year. If demand continues this trend, we will probably reach the end of the year with a demand increase or a conventional demand increase by 5% or 5.5%, which will be highly positive after these 2 -- over these last years of crisis.

When we talk about conventional gas demand, this is not representative or is not linked to the rest of the economy as opposed to the electric demand. Gas demand is only linked to certain industries.

And also gas customers are not the same customers as with electricity customers. Hopefully, demand will continue to grow beyond 2012.

It is difficult to really envisage what is going to happen in 2013 or 2014 given the current economic situation, but our forecast will be similar or in line with the 2012 year. Regarding the net cash flow, I don't have this figure at the moment, but perhaps Antonio Velasquez will comment on this.

Diego de Reina would like to make a comment, please.

When you asked about the net cash flows, we're talking about EUR 45 million corresponding to accumulation of the corporate income tax of payments done in 2011. It has to do with the amortization system during this fiscal year.

And finally, I forgot to answer to this question of the tariff deficit in the balance. It is about EUR 150 million.

Regarding debt, Diego Reina said earlier on that debt is below 3.3%. As I see it, when you talk about fixed income, that is hedging, and these very good price hedging for the short term and can they have an impact beyond 2012?

You have set a goal of about 4% for the 2012 period, did these have an impact?

Yes. In about 3 to 4 years, of course, they do have an effect, but this effect is positive not only in order to complete our goals set for this period, but also because of the term.

This will also have a positive influence over the next 4 years. Yes, indeed.

I just have 2 questions left. Hopefully, easy ones.

Could you please confirm the contribution you expect to net income from Altamira in 2012? And the second question is, just returning to Castor, I just wanted to confirm when you expect your acquisition of the 1/3 stake in that project to take place?

Is that immediately upon entering operation in 2013 or could that potentially be a bit later?

Well, the first question, Fred, is I think for all the 2012 year, the contribution of Altamira is near EUR 7 million. And in Castor, we are expecting our acquisition with the conditions we have in our contract with Castor is exactly for the year 2013.

It means in the year 2012, we do not have in our budget any contribution or any acquisition in Castor, but we are calculating that it could be possible in the year 2013. [Spanish]

Finish the conference call. Thanks to everyone.

[Spanish]