Petrobras seeks pre-salt allies after US$2bn graft write-off
Brazil's federal energy major Petrobras said Thursday it is considering joint ventures in existing pre-salt projects in an effort to reduce capital expenditure and fast-track production.
However the company stopped short of including pre-salt assets in its US$13.7bn two-year divestment program.
The comments came as Petrobras reported a loss of 21.6bn reais (US$7.3bn) for 2014 compared to a 23.6bn-real profit in 2013.
The figure took into account 6.2bn reais in costs related to corruption and impairment charges of 14.8bn reais reflecting the lower value of its assets.
Speaking during an investor conference call, Petrobras exploration and production director Solange Guedes said the company was seeking partnerships with other experienced offshore operators.
"We are considering some assets - and it doesn't matter if they are pre-salt or post-salt - where we can share risk," Guedes said.
"There are different companies that want to partner with Petrobras and we have identified [areas] that the market has evaluated as good opportunities. We're talking with companies and looking to work with them to reduce our capex burden."
The director added that pre-salt fields were "especially relevant" for companies with similar projects.
This is the first time that Petrobras has admitted to seeking partnerships for existing projects in the vaunted pre-salt layer, said to hold 35Bboe of hydrocarbons deep below the Atlantic.
In its 2014 financial statement released late on Wednesday, Petrobras said it would invest US$29bn in 2015, down from US$35bn last year. In 2016 the figure will fall to US$25bn.
The company also hopes to raise a further US$13bn in fresh capital this year to end 2015 with a net cash position of US$20bn.
CAR WASH
Petrobras had delayed the announcement of last year's third and fourth quarter results after auditors PriceWwaterhouseCoopers refused to certify its accounts due to the unknown impact of corruption.
Federal police have arrested dozens of top politicians and construction firm executives accused of siphoning money from inflated contracts.
Three former Petrobras directors have also been detained.
On Thursday a judge convicted Paulo Roberto Costa, who was head of refining and supply, to seven and a half years in prison. However, he will serve just one year under house arrest after a plea bargain deal with prosecutors.
The scandal has led to mass anti-government demonstrations across Brazil.
Hundreds of thousands of people marched through the country's major cities earlier this month after a nationwide rally in March drew more than 1.5mn protesters.
The allegations reached the inner circle of President Dilma Rousseff last week following the arrest of her party's treasurer João Vaccari for allegedly accepting kickbacks.
'PLANE CRASH'
In a press conference in Rio de Janeiro on Wednesday night, Petrobras CEO Aldemir Bendine, moved to assure investors that the company was on the road to recovery.
"We are taking a fundamental step towards regaining Petrobras' credibility," Bendine said.
"Petrobras won't stop or go into reverse. We see this as being like a plane crash. Through this we can perfect security measures. We've gone through a big disaster. It will help us to invest more in good governance.
"We are convinced the company will recover its capacity to generate value. Our biggest asset is the staff. We have people who are committed."
Bendine added that the company's new business plan would be revealed next month.
PRODUCTION RISE
Despite the spending cuts, Petrobras expects its global production to rise to 2.796Mboe/d this year from 2.669Mb/d in 2014. The tally is expected to hit 2.886Mboe/d in 2016.
Petrobras said there would be "inertia" related to reduced investments.
"We can't just walk away from commitments that we have already made," Guedes said. "There are projects that cannot be discontinued because it would lead to lawsuits and non-compliance claims.
"The new [business] plan will integrate all these premises towards deleveraging and giving priority to projects with high profitability," she added.
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