Petrobras increases allocation of funds to US$ 174 billion up to 2013
DCI - 01/26/2009
After postponing it for five times, Petrobras has finally disclosed its Business Plan for the 2009-2013 period. The state-owned company revealed that US$ 174.4 billion will be invested, but there is one point the company CEO, José Sérgio Gabrielli, insisted on emphasizing: the company will force those values down. Unlike the other great commodity-selling companies, Petrobras increased its Business Plan by 55.16% at a moment of retraction of investments and reduction of production in the world. The previous plan foresaw investments of US$ 112.4 billion for the five-year period ended in 2012. The plan was approved Friday afternoon by the Administrative Council, which met in Brasilia. The plan was presented to President Luiz Inácio Lula da Silva. Included in the amount announced are the values foreseen for new projects of exploration and production that amount to US$ 47.9 billion until 2013, US$ 28 billion of which for the pre-salt layer. The whole exploration and production plan amounts to US$ 92 billion in the period. For 2009, the investments foreseen amount to US$ 28.6 billion and it will be necessary to raise US$ 18.1 billion. According to Gabrielli, US$ 16.9 billion are already assured: US$ 11.9 billion from the Brazilian Development Bank (BNDES) and another US$ 5 billion from other banks. "We only need US$ 3 billion for 2009. The plan present financial feasibility for the short term, performance capacity for the mid term and it make us become one of the largest companies of the sector in the long run", affirmed Gabrielli. The cost of capital to be borrowed from the BNDES will be equivalent to the market cost. The cost from the private banks, however, will be higher - a fact that has already received criticism from the market. The US$ 5 billion will be received at once, as a bridge-loan, and more expensive than the traditional financings. In order to pay the bridge-loans and have the cash required for the next year, Petrobrás should raise money in the international market. According to the Financial Officer and Investor Relations Officer, Almir Barbassa, the company can raise funds still in the first quarter of the year.