Cribbing for the exam?

A veritable bombshell exploded on 4 August, when it was made clear in a video that the Senate Parliamentary Committee of Inquiry (CPI) had supplied Petrobras staff with questions in advance of a hearing into improprieties in the purchase of a refinery in Pasadena, Texas.

President Dilma Rousseff immediately rejected the charge and said that Congress should decide whether the questioning was rehearsed.

Payback time?

The Federal Court of Accounts (TCU) on 2 July proposed the return of US$873 million from the Pasadena refinery accounts to the federal Treasury. This would be collected from the Petrobras directors involved in the unlawful acquisition of the refinery.

The former directors of the Pasadena company – identified by TCU as possibly responsible for the damage to Petrobras in the acquisition of the refinery – affirmed on 24 July that responsibility for the transaction had been assumed by the board of the company, which in 2006 was chaired by President Rousseff. The TCU itself approved a report that exempts Rousseff from responsibility.

The challenge of production

Petrobras received President Rousseff on 1 July to announce the production of 1,975 million b/d of oil in May, 4.4 percent more than in the same period in 2013. In total, pre-salt has produced more than 500,000 barrels.

The company is under pressure to raise production by 7.5 percent this year, but facing high indebtedness and no authority to increase fuel prices, it is unlikely to meet the challenge. In the first five months of the year, production rose just 0.1 percent. At that rate, Petrobras will not reach the target until 2019. Currently, production from pre-salt reserves accounts for just 22 percent of the company’s total oil production, but it plans to increase that to 53 percent by 2020.

No tenders for pre-salt?

The National Council on Energy Policy (CNPE) has approved the direct contracting of Petrobras, without tender, to exploit 9.8–15.2 billion excess barrels of oil from the pre-salt fields.

Under this new contract, Petrobras will pay a signature bonus of R$2 billion and will pay another R$13 billion from 2015 to 2018. Actual oil extraction will start only in 2021, meaning that Petrobras will be financing the Treasury until then. Both Petrobras and the National Petroleum, Natural Gas, and Biofuels Agency (ANP) received the decision favorably.

Petrobras, which is burdened with heavy indebtedness, will try to secure financing from Chinese banks and companies. The company earlier offered a guarantee that it would not resort to another IPO to meet new expenditures.