April 16, 2014
Simon Romero & Landon Thomas Jr – The New York Times, 4/15/2014
No company has embodied Brazil’s rise like the oil giant Petrobras.
Bolstered by some of this century’s largest oil discoveries, Petrobras soared into the top ranks of global energy producers. Executives at the state-controlled company boasted that it could even outstrip Apple as the world’s most valuable publicly traded company. Political leaders here said Brazil was on the cusp of energy independence.
Now Petrobras is coming to symbolize something else entirely: the disarray afflicting Brazil’s sluggish economy and the reassessment of growth prospects in emerging markets around the world.
April 8, 2014
Lucy Jordan – Global Post, 4/7/2014
It might not look like much, but this little green bean is both villain and hero in Brazil’s Cinderella story.
Soybeans helped turn this South American nation from a country of peasants into the world’s seventh-largest economy. They’re also blamed for the destruction of vast swathes of rain forest, causing habitat loss and bloody land conflicts.
Brazil predicted this year it was going to out-bean world soy leader the United States. A nasty drought may have put the kibosh on that, but this country’s output is still expected to reach some 94 million tons, coming up close behind the US’s 99 million tons.
April 4, 2014
The Economist, 4/5/2014
“UNIQUE.” That is how Credit Suisse, a bank, sums up Petrobras. It has a point. Most companies’ stocks would sag on the sort of news Brazil’s oil giant has faced in the past three weeks. A federal investigation was opened, into alleged backhanders paid to its employees by a Dutch company in exchange for oil-platform and drilling contracts. (Both companies deny the allegations.) A parliamentary inquiry is imminent, into the purchase in 2006 of a refinery in Texas which cost $1.2 billion but is now worth no more than $180m. A former director has been arrested in a money-laundering probe. If that were not enough, on March 24th Standard & Poor’s, a ratings agency, downgraded its corporate debt. Yet Petrobras’s shares have risen by 30%.
The reason for this seemingly irrational exuberance is that investors consider Petrobras’s prospects to be inversely linked to those of Brazil’s government, led by the president, Dilma Rousseff. The rally began with rumours (later proved premature) that Ms Rousseff’s poll lead over her likeliest challengers in a presidential election this October was dwindling. The government owns a majority stake in the company and makes most of the strategic decisions over the head of Maria das Graças Foster, the chief executive.
March 31, 2014
The Chico Vive conference is bringing together grassroots activists, NGO’s, students, engaged scholars, applied scientists, policymakers, journalists and others to discuss the development of the global grassroots environmental movement in the 25 years since environmental martyr Chico Mendes’ death. Participants will plan strategies for coordinated international actions, networks, coalitions and initiatives to advance sustainability, defend the environment from depredation and climate change, and protect the rights of its traditional inhabitants.
When: April 4-6 2014
Where: American University School of International Service
Keynote: MARINA SILVA
More information here.
March 25, 2014
Christiana Sciaudone – Bloomberg Business Week, 3/25/2014
Rio Bravo Investimentos SA, the asset manager founded by former central bank president Gustavo Franco, is looking for new financial partners to help it become one of Brazil’s biggest wind power companies.
Rio Bravo plans to bring its first 503.5 megawatts of wind energy on line by the end of this year and will at least double that by 2017, said Paulo Bilyk, its chief investment officer. The Sao Paulo-based company needs 1.5 gigawatts to 2 gigawatts as it plans to go public within five to six years, he said.
“We’d like to build one of the biggest renewable energy companies,” Bilyk said in a March 6 interview in Sao Paulo. “Brazil needs energy. Even if Brazil’s economy grows at just 1 percent to 3 percent a year for the next five or six years, we won’t have enough energy.”
March 25, 2014
Jeb Blount – Reuters, 3/24/2014
Brazil is fighting against time to avoid crippling power blackouts and electricity rationing as a drought prevents the world’s most water-rich nation from recharging its hydroelectric dams.
A decade of growth has diversified the electricity system away from hydropower, but policymakers, industrial companies and investors in the world’s seventh-largest economymay find little cause to relax.
Rio de Janeiro-based energy consultancy PSR puts the odds of rationing at nearly 1 in 4.
March 24, 2014
Kenneth Rapoza – Forbes, 3/23/2014
Petrobras’ PBR +0.78% problems are becoming Dilma’s problems.
Brazil’s oil and gas major, Petrobras, can do no right. And now President Dilma Rousseff is being blamed for the problems. Of course, she is being blamed by politicians who don’t want to see her re-elected in October. They probably won’t succeed at dethroning her, but one thing is certain: the deterioration of the shining star of Brazil’s state owned enterprises happened on her watch. This election season, Dilma isn’t the only one in the cross hairs. Petrobras is now her problem, too.
Not long ago, as in 2007, Petrobras was heralded as the Latin America Aramco, finding oil deep under the ocean floor far off the coast of Rio and São Paulo states. Goldman Sachs once put a $60 price target on the stock in early summer 2008. Today, Petrobras shares trade under $12, and its market cap is smaller than Colombia’s EcoPetrol EC +0.99%.