Category: Brazil

Petroleo Brasileiro SA, Brazil’s state-controlled oil company, sat out an oil licensing round in Brazil for the first time on Wednesday as it struggles to reduce the oil industry’s biggest debt load. Brazil’s National Petroluem Agency sold only 37 of the 266 onshore and offshore blocks it offered in the worst turnout at a Brazil auction in years. International majors who operate in Brazil, including Statoil ASA, Royal Dutch Shell Plc., and Total SA, didn’t submit any bids. Winning bidders include QGEP Participacoes SA and Parnaiba Gas Natural, both based in Rio de Janeiro. The auction took place amid a slump in crude prices, a national political crisis and with Petrobras, the country’s dominant producer, suffering cash constraints. While small and mid-sized producers prefer to join Petrobras as minority partners to limit risk, the company is balking at new financial commitments, according to Jotavio Gomes, an oil consultant and […]

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A worker fills a car with gasoline at a Brazilian Oil Company Petrobras gas station in Rio de Janeiro, Brazil, September 30, 2015. As Brazil prepares for its first sale of oil exploration rights in nearly two years on Wednesday, the auction is shaping up to be a mini-referendum on the willingness of investors to bet on the future of an industry under pressure and a Brazilian economy in turmoil. Not only has the price of oil fallen more than 50 percent since the last auction, slashing sector revenue and potential profit, Brazil’s principal oil company, state-run Petroleo Brasileiro SA, is mired in a giant price-fixing, bribery and political kickback scandal. And with $130 billion in debt and a backlog of existing projects, Petrobras, as the company is known, has not said if it will bid. In all previous auctions Petrobras, alone or as a member of a group, […]

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SÃO PAULO—Brazil’s state run oil company Petróleo Brasileiro SA, PBR 5.52 % or Petrobras, cut its investments and expenses outlook through 2016 following a drop in oil prices and sharp depreciation of the Brazilian real. The company said it now expects to invest $25 billion in its operations this year, down from its previous view of $28 billion, and $19 billion in 2016 instead of its previous view of $27 billion. Petrobras said it expects manageable operating expenses of $29 billion this year, down from $30 billion, and $21 billion in 2016, compared with its previous view of $27 billion. The company it expects the cuts “to preserve its fundamental goals of deleveraging the company and creating value for shareholders.” In June, when Petrobras announced its business and management plan for the 2015-2019 period, it was based on a crude oil Brent price average of $60 per barrel this […]

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Brazil pledged on Sunday to slash greenhouse gas emissions by 43 percent by 2030 as its contribution to a United Nations climate agreement, but said it will include reductions from past efforts against deforestation to help it reach the target. President Dilma Rousseff presented the country’s pledges during a speech at the U.N. General Assembly in New York, noting the targets are more ambitious than those of most developed countries and that Brazil will not need external support to achieve them. Brazil already curbed emissions by 41 percent between 2005 and 2012, largely through fighting deforestation. Rousseff reaffirmed the country’s commitment to ending that illegal practice in the Amazon , as stated during a joint announcement with U.S. President Barack Obama in June, but fell short of declaring a freeze on deforestation in general as many environmental groups had sought. Emissions from deforestation worldwide account for 15 percent of […]

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Transocean Ltd., the world’s largest offshore rig contractor, is being linked for the first time to the corruption probe of Petroleo Brasileiro SA, the state-owned energy giant at the center of Brazil’s biggest corporate scandal. A former executive at Brazil’s state-run oil company has testified to receiving what he says were payments made by someone claiming to be a Transocean agent in exchange for a rig-operation contract from Petrobras. “Transocean has a long-standing commitment to and upholds the highest standards for corporate ethics and compliance,” the company said in an e-mailed response. “Our employees — and everyone conducting business on our behalf — are required to adhere to our high standards for integrity, honesty, financial discipline and legal and regulatory compliance.” As a result of the probe into the alleged pay-to-play scheme, known as Carwash, Petrobras has temporarily blocked more than 20 suppliers from future work with the oil […]

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It’s unlikely that oil prices will ever return to $100 a barrel and Petroleo Brasileiro SA needs to work with suppliers to manage the price rout, an executive at the state-run oil producer said Tuesday. “We were all surfing the great wave of $100 a barrel,” Cristina Pinto, the company’s executive manager for exploration and production said at an event in Rio de Janeiro. “It won’t get to $100 again. If it gets to $70, we’ll be happy.” Shares tumble 60% in a year as Brent sinks to less than $50 a barrel The world’s largest producer in ultra-deep waters is working to optimize technology to cut costs and save in everything from buoys to riser pipes used at its offshore platforms, Pinho said. Chief Executive Officer Aldemir Bendine said Monday that the company seeks to reduce costs to withstand a combination of lower oil prices and a weaker […]

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Photo Applicants at a government-run job center in São Paulo on Thursday. Brazil’s unemployment rate reached a five-year high, 7.5 percent, in July. Credit Andre Penner/Associated Press BRASÍLIA — The president of Brazil should have been ecstatic. She had just won re-election after an intense campaign in which she fiercely defended her role in making Brazil , for a few fleeting years, a rising star on the global stage. But in the days after her victory last October, President Dilma Rousseff was worried, confronted in private deliberations with her closest advisers by signs that Brazil’s triumphs were at risk of coming undone. “We went too far,” Aloízio Mercadante, Ms. Rousseff’s chief of staff, acknowledged publicly this month, describing the sense of alarm as the dust settled after the election and Ms. Rousseff and her aides grappled with the weaknesses in Brazil’s economy. It was not just the drop in […]

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SÃO PAULO—Not long ago, Brazil stood as the leading example of how a developing nation could rise toward global prominence on the force of a China-driven commodity boom. As its economy surged, Brazil stormed the world stage—hosting a World Cup, demanding more say at the United Nations and blocking a U.S. free-trade plan for the Americas. Now Brazil is looking like a symbol of something else: resource-rich nations’ habit of ending their booms with spectacular busts. Brazil’s stock market is down 22% in the past year. Its currency has lost a third of its value against the dollar. And on Friday, Brazil is expected to report that in the second quarter, its economy shrank at a pace of about 1.7%. Economists are voicing fears of prolonged stagnation. China has caused turmoil in many places, but none more so than in this prime supplier of commodities to a country whose […]

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A fuel storage tank is seen at the company Petroleo Brasileiro SA, or Petrobras, in Sao Caetano do Sul, near Sao Paulo July 24, 2015. Brazil’s Petrobras may need to pay record penalties of $1.6 billion or more to settle U.S. criminal and civil probes into its role in a corruption scandal, a person recently briefed by the company’s legal advisors told Reuters. State-run Petroleo Brasileiro SA, as the company is formally known, expects to face the largest penalties ever levied by U.S. authorities in a corporate corruption investigation, according to the person, who has direct knowledge of the company’s thinking. The settlement process could take two-to-three years, this person said. To date, the largest settlement of corporate corruption charges with the U.S. Department of Justice and the U.S. Securities and Exchange Commission was a 2008 agreement with Siemens AG, the German industrial giant. It agreed to pay the […]

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RIO DE JANEIRO — Tens of thousands of protesters returned to the streets of cities across Brazil on Sunday to express their ire against President Dilma Rousseff , reflecting a low ebb for her as she grapples with a colossal bribery scandal and a declining economy. Still, the protests in some cities seemed to lack some of the urgency of huge demonstrations this year calling for the ouster of Ms. Rousseff, a leftist who won re-election just 10 months ago, suggesting tension may be easing somewhat on the president as congressional and business leaders try to prevent a political crisis from intensifying. The protest in Rio de Janeiro had something of a Carnivalesque feel to it; some demonstrators wore bathing suits as they marched through the Copacabana district as trucks blared samba. But vitriol also marked the event, with some urging the president to kill herself or calling on […]

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