Petrobras May Sell Oil-Stakes to Raise Money

Petrobras needs to arrange about $8.9 billion in financing to meet 2010 spending plans, and banks in Brazil and abroad will likely provide it, Barbassa said. The Rio de Janeiro-based company would only consider selling a stake in an oil field if there is no other funding available, Chief Executive Officer Jose Sergio Gabrielli told journalists in London.

Petrobras said Nov. 23 it plans to spend $174.4 billion through 2013, part of efforts to more than double output to 4.63 million barrels a day by 2015. Suppliers of equipment such as drilling rigs have found it hard to get loans to meet Petrobras contracts. Gabrielli said Jan. 27 that Petrobras had no plans to sell bonds in 2009 because of high borrowing costs.

“We have flexibility to adjust the plan; we have opportunity to adjust if necessary,” Barbassa said today in London. “We have a very liquid asset that is our oil reserves. If we wanted to sell 10 percent of a field, many companies would be interested.”

Petrobras may also consider taking stakes in oil-rig leasing companies if they fail to raise the cash needed to build an additional 28 offshore drilling rigs the company has yet to contract, Gabrielli said. The company already has contracts for 29 rigs.

Scorpion Offshore Ltd. cancelled plans to build a $700 million rig in Singapore because of a lack of financing, Scorpion Chief Executive Officer Jon Cole told Bloomberg Jan. 13. Petrobras had a contract to lease the rig from Scorpion for $485,000 a day.

“Petrobras faces sizable challenges both in arranging financing and relating to geology, technology, access to materials, rigs and services, staging of development, and the political environment,” Moody’s Investors Service analysts Steven Wood and Thomas Coleman wrote in a report yesterday.

Gabrielli said he would only consider rig-company stakes and oil-asset sales if there were no other sources of funds.

“We have large reserves,” Gabrielli said. “But we don’t want to use this wealth.”

Source: Bloomberg

Author: Ksenia Kochneva