December 9, 2013
Brazil’s state-run Petroleo Brasileiro SA could raise fuel prices next year using its new pricing formula, Chief Executive Maria das Graças Foster told a local newspaper in an interview published on Sunday.
The Rio de Janeiro-based company, known as Petrobras, late last month raised fuel prices less than expected and announced it was adopting a new policy to adjust prices to be more in line with international ones.
However, the company declined to detail the formula, disappointing investors worried about Petrobras’s financial health after it suffered heavy losses due to a fuel subsidy. Petrobras shares plunged last week to its lowest level in nearly three months.
October 10, 2013
Kenneth Rapoza – Forbes Magazine, 10/09/2013
By some estimates, Brazil is not getting better.
The undersea Saudi Arabia off the coast of Rio and Sao Paulo states, while still impressive, has not lived up to its hype. Brazilian oil giant Petrobras still has to import gasoline.
Brazil’s biggest oilman cheerleader, Eike Batista, lost his FORBES billionaire status last month because his oil firm, OGX Petroleo, is tapping water from a stone. And now the company that was once the hottest initial public offering in Latin America back in the summer of 2008 is about to be become the largest private default in Latin American corporate history.
September 16, 2013
Brazil’s government may allow state-run oil company Petroleo Brasileiro SA to raise fuel prices by Oct. 21, the date of the first auction of exploration rights for the Libra subsalt oil field, newspaper O Estado de S. Paulo said on Monday.
Estado, citing unnamed sources, said a “relevant part of the government’s economic team” wanted gasoline prices to rise about 8 percent by that date.
By authorizing the increase in fuel prices by Oct. 21, the government wants to bolster investor confidence in the country’s oil and fuel model, Estado reported. Petrobras imports gasoline to meet domestic demand, but sells it at a loss due to the government’s insistence to head off inflation, which is currently running close to the official target’s ceiling.
August 15, 2013
Dan Horch – The New York Times, 08/13/2013
The troubled Brazilian businessman Eike Batista has taken further steps toward dismantling his once high-flying empire of energy, logistics and mining companies.
Mr. Batista announced Wednesday night in a filing with the Brazilian securities and exchange commission that he would sell a controlling stake in one of his companies, the LLX logistics firm, for 1.3 billion reais ($560 million). The buyer is EIG Global Energy Partners, an energy investment firm based in Washington that has invested in projects all over the world. Mr. Batista will also give up his management role in the company.
People briefed on the matter confirmed on Wednesday that another of his companies, the petroleum firm OGX, has hired the Blackstone Group as a financial adviser.
July 22, 2013
Kenneth Foo & Kyunghee Park – Bloomberg, 07/22/2013
Keppel Corp. (KEP), the world’s largest oil-rig maker, will focus on building more offshore production and support vessels in Brazil as competition from China cuts prices for its main product.
Brazil’s offshore development boom means Keppel’s yard is now mainly utilized for building rigs for state-owned Petroleo Brasileiro SA. The Singapore-based company is setting up a second yard to meet demand for other vessels and to offer repair and conversion work, Chief Executive Officer Choo Chiau Beng said in an interview on July 19.
“We’re not interested to take a lot more work than the six semis from Petrobras because we do not want to overload our shipyard,” Choo said, referring to an order to build semi-submersible rigs for state-owned Petroleo Brasileiro SA. “We want to leave some capacity for our other customers” who need floating production, storage and offloading platforms, or FPSOs, and for oil-rig repairs, he said.
July 15, 2013
The consortium that is awarded the right to develop the Libra prospect will likely need to drill for about four years after signing its production-sharing agreement, with commercial production likely to begin in the fifth year, ANP Director-General Magda Chambriard told a press conference in Rio de Janeiro.
ANP studies indicate that between 12 and 18 production platforms will be needed to develop Libra, whose recoverable oil is estimated at between 8 billion and 12 billion barrels, nearly equivalent to Brazil’s current proven-reserve base of 14 billion barrels.
Libra, located some 183 km off the coast of Rio de Janeiro state in an area of the Atlantic Ocean where water depths range from between 1,700 meters and 2,400 meters, will be the first pre-salt field to be auctioned off by Brazil.
July 11, 2013
Samantha Pearson – Financial Times, 07/11/2013
Eike Batista’s empire showed further signs of unravelling after four board members left the Brazilian billionaire’s shipbuilder OSX, including his own father and a former mining and energy minister.
Their departure took place as Brazil’s once-richest man faces intensifying scrutiny by the country’s securities watchdog, which is pursuing almost 20 inquiries about his companies – many in response to investors’ complaints.
OSX said in a filing on Thursday that Eliezer Batista da Silva, Mr Batista’s father, Rodolpho Tourinho Neto, a former mining and energy minister, Luiz do Amaral de França Pereira and Samir Zraick are no longer members of its board.