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March 24, 2010

Petrobras Needs State Funds

Petrobras requires capital from the Brazilian government to meet its five-year investment plan, a top official from the company said. Last week the state-run oil company said it would increase its five-year 2010-14 investment plan to $220bn from $174bn in the previous 2009-13 plan.

By cms admin

Petrobras requires capital from the Brazilian government to meet its five-year investment plan, a top official from the company said.

Last week the state-run oil company said it would increase its five-year 2010-14 investment plan to $220bn from $174bn in the previous 2009-13 plan.

This boost, however, would depend on the success of the capitalisation plan.

The Brazilian government is trying to introduce a bill that would transfer 5 billion barrels of untapped oil reserves currently in its control to Petrobras in exchange for a greater stake in the company.

This transfer of rights would translate into about $50bn of fresh capital at Petrobras’ disposal.

Petrobras chief executive Jose Sergio Gabrielli said that an additional $15bn to $25bn fresh capital can be acquired from minority shareholders, according to Reuters.

Gabrielli said that if the proposed capitalisation scheme does not take place, the company would then consider other alternatives.

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