Edition 31 - Sharing in Petrobras - number 2/2009
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Petrobras produces its first oil from Tupi O n May 1 st , Petrobras began its first production of oil in the Santos Basin’s Pre-Salt cluster. The first sample of oil from the Tupi field was produced by the platform FPSO BW Cidade de São Vicente, which has the capacity to process 30,000 barrels of oil per day and is anchored in ultra-deep waters (2,140 meters). This fact marked the beginning of the development of the largest oil deposit ever discovered by Petrobras in Brazil and the start up of the extended well test (EWT) at Tupi, which will last 15 months, and will collect technical information for the development of the reservoirs that the company discovered in the Santos Basin. The information gathered will be important not only to define the development model for the Tupi area, but also in relation to the other pre-salt accumulations in that sedimentary basin, which constitute one of the largest discoveries ever made in the oil industry. With the expectations confirmed, Tupi has a recoverable volume of oil equivalent (oil and gas) estimated to be between 5 and 8 billion barrels. With the beginning of the Tupi EWT, Petrobras has initiated the development of a new exploratory frontier, consisting of oil reservoirs in carbonate rocks of the microbial type, located at a depth of 5,000 meters from the seabed, under a water depth of more than 2,000 meters. The exploration of the pre-salt region is an unprecedented technological challenge, since it requires the construction of wells that go through a great depth to reach reservoirs formed by rocks that are still relatively unfamiliar to the oil industry. In addition, it will require a new, complex logistics model to transport people and equipment, as well as with respect to aspects of storage and production outflow. HIGHLIGHTS New gas unit in the state of Espírito Santo ■ The second phase of the Cacimbas Gas Treatment Unit (UTGC) in the municipality of Linhares (ES) has started its operation. The Cacimbas Pole, composed of the UTGC and the Lagoa Parda Processing Station, will process 11 million m³ of gas and 15,000 barrels of oil concentrate per day. The Pole will process gas both from the onshore fields in the north of the state and from the offshore fields such as Peroá, Cangoá, Golfinho, Canapu, and Camarupim. Payment of IOC ■ Holders of Petrobras ordinary and preferential shares in December 26 th , 2008, received two installments of the Interest on Own Capital (IOC) payment in the amount of R$ 0.3800 per share each each one. The payment dates were April 29, 2009 and June, 2009. The total amount received by the shareholders was calculated considering a discount of the Income tax of 15% and an addition corresponding to the restatement at the Selic rate from December 31, 2008 to the payment dates. Gas and oil production increased 9.5% in Brazil ■ In March, the average Petrobras production of oil and gas reached 2,315,276 barrels of oil equivalent per day (boed), reflecting an increase of 9.5% over the volume produced in March last year and of 3% in relation to the production in the previous month. The production of oil in the domestic fields, of 1,991,934 barrels/day, surpassed the same month last year by 10.6% and was 2.7% higher than the volume of 1,940,412 barrels/day extracted in February 2009. Both the total production (oil and gas) and the production of oil alone were monthly records. The positive difference of 52,000 barrels/day of oil occurred in the Campos Basin with the beginning of production from platform wells and with the increase of production from the platforms P-53 and FPSO Cidade de Niterói in Marlim Leste and P-54 in Roncador. On March 19, the daily record of oil production was broken, with the volume of 2,042,559 barrels. Petrobras and UFRJ University inaugurate laboratory for the pre-salt layer ■ Petrobras, in partnership with the Federal University of Rio de Janeiro (UFRJ), inaugurated the Corrosion and Non-Destructive Testing Laboratory. The company has already invested US$ 13 million of the total expect amount to the project of US$ 15 million. The laboratory is one of the most advanced in the world for corrosion testing and for the inspection of materials and welding, of considerable importance to the needs for pre-salt production, which requires testing in unique conditions, similar to those found in the recently discovered fields. The laboratory was designed to make viable testing at high pressures and temperatures and with the presence of corrosive fluids. Supercomputer evaluates pre-salt reservoirs PAGE 3 The 4 th most respected company in the world PAGE 4 “Person of the Year” Award PAGE 4 Ocean Salt Pre-salt Post-salt 1.000 4.000 6.000 2.000 3.000 5.000 0 Investor Relations • Year VIII • # 31 Sharing Petrobras news Ac?o?es ING Fotolito VALENDO.qxp:BR Ações nº 2 2005 PORT 9/8/09 9:47 AM Page 1
Transcript of Edition 31 - Sharing in Petrobras - number 2/2009
Petrobras produces itsfirst oil from Tupi
On May 1st, Petrobras began its first production of oil in the Santos Basin’s Pre-Salt cluster. The first sample ofoil from the Tupi field was produced by the platform FPSO BW Cidade
de São Vicente, which has the capacity to process 30,000 barrelsof oil per day and is anchored in ultra-deep waters (2,140 meters).
This fact marked the beginning of the development of thelargest oil deposit ever discovered by Petrobras in Brazil and the start up of the extended well test (EWT) at Tupi, which will last 15months, and will collect technicalinformation for the development ofthe reservoirs that the companydiscovered in the Santos Basin. Theinformation gathered will beimportant not only to define thedevelopment model for the Tupiarea, but also in relation to theother pre-salt accumulations in thatsedimentary basin, which constituteone of the largest discoveries evermade in the oil industry. With the expectations confirmed, Tupihas a recoverable volume of oilequivalent (oil and gas) estimatedto be between 5 and 8 billionbarrels.
With the beginning of the Tupi EWT, Petrobras has initiated thedevelopment of a new exploratory frontier, consisting of oilreservoirs in carbonate rocks of the microbial type, located at a depth of 5,000meters from the seabed, under a water depth of more than 2,000 meters.
The exploration of the pre-salt region is an unprecedented technologicalchallenge, since it requires the construction of wells that go through a greatdepth to reach reservoirs formed by rocks that are still relatively unfamiliar tothe oil industry. In addition, it will require a new, complex logistics model totransport people and equipment, as well as with respect to aspects of storageand production outflow.
HIGHLIGHTS
New gas unit in the state of Espírito Santo ■ The second phase of the Cacimbas GasTreatment Unit (UTGC) in the municipality ofLinhares (ES) has started its operation. TheCacimbas Pole, composed of the UTGC and the Lagoa Parda Processing Station, will process 11 million m³ of gas and 15,000 barrels of oilconcentrate per day. The Pole will process gasboth from the onshore fields in the north of thestate and from the offshore fields such as Peroá,Cangoá, Golfinho, Canapu, and Camarupim.
Payment of IOC ■ Holders of Petrobras ordinary and preferentialshares in December 26th, 2008, received two installments of the Interest on Own Capital (IOC)payment in the amount of R$ 0.3800 per shareeach each one. The payment dates were April29, 2009 and June, 2009. The total amount received by the shareholders was calculatedconsidering a discount of the Income tax of 15% and an addition corresponding to therestatement at the Selic rate from December 31,2008 to the payment dates.
Gas and oil productionincreased 9.5% in Brazil ■ In March, the average Petrobras productionof oil and gas reached 2,315,276 barrels of oilequivalent per day (boed), reflecting an increaseof 9.5% over the volume produced in March lastyear and of 3% in relation to the production in the previous month. The production of oil in the domestic fields, of 1,991,934 barrels/day,surpassed the same month last year by 10.6%and was 2.7% higher than the volume of1,940,412 barrels/day extracted in February2009. Both the total production (oil and gas)and the production of oil alone were monthlyrecords.The positive difference of 52,000 barrels/day ofoil occurred in the Campos Basin with thebeginning of production from platform wells andwith the increase of production from theplatforms P-53 and FPSO Cidade de Niterói inMarlim Leste and P-54 in Roncador. On March19, the daily record of oil production wasbroken, with the volume of 2,042,559 barrels.
Petrobras and UFRJ Universityinaugurate laboratory for the pre-salt layer■ Petrobras, in partnership with the Federal University of Rio de Janeiro (UFRJ), inauguratedthe Corrosion and Non-Destructive Testing Laboratory. The company has already investedUS$ 13 million of the total expect amount to theproject of US$ 15 million. The laboratory is oneof the most advanced in the world for corrosiontesting and for the inspection of materials andwelding, of considerable importance to theneeds for pre-salt production, which requirestesting in unique conditions, similar to thosefound in the recently discovered fields. Thelaboratory was designed to make viable testingat high pressures and temperatures and with thepresence of corrosive fluids.
Supercomputerevaluates pre-salt
reservoirs
PAGE 3
The 4th mostrespected company
in the world
PAGE 4
“Person of the Year”
Award
PAGE 4
Ocean
Salt
Pre-salt
Post-salt1.000
4.000
6.000
2.000
3.000
5.000
0
Investor Relations • Year VIII • # 31
Sharing Petrobras news
Ac?o?es ING Fotolito VALENDO.qxp:BR Ações nº 2 2005 PORT 9/8/09 9:47 AM Page 1
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Petrobras' ADR's Return
Economic and Financial Figures
In US$ million 1T09 4T08 Variation(%)
Sales of products and services 22,899 28,039 (18.33)
Net operating revenues 18,212 22,337 (18.47)
Net income 2,636 2,166 21.70
Operating Income 4,256 2,318 83.61
Earnings per share 0.30 0.51 (41.18)
Earnings per ADS 0.60 1.02 (41.18)
Quarter
Petrobras’ net income in the 1st
quarter of 2009 (1Q09) was US$ 2.64 billion. This result
represents an increase of 21.7% inrelation to the 4th quarter of2008 (4Q08) and was generated bythe increase of the Consolidatedoperating income in the 1Q09 (83.6%compared to the fourth quarter of2008) due to the capital disciplineimposed by the Company and bydecreased losses from impairmentcharges and inventory devaluation.These effects offset the decline in net
operating income caused by lowerdomestic and international demand,the sale of inventories acquired at ahigher average unit cost and the non-recurrence of a tax benefit related to interest on shareholders’ equity in the 4Q08.
The cash flow generation measured by the EBITDA reached US$ 5.521 billion, 40% more thanthat in the last 4Q08. The strongcash generation enabled the Companyto finance investments in the order of US$ 6.3 billion in the 1Q09, in line withthe investment goal of approximatelyUS$ 28.6 billion for 2009. Of the total invested, 51% was to theExploration & Production segment,25% to Downstream, 15% to Gas &Energy, and 9% to the other segments.
Despite its capacity to finance the investment program with the cash flowfrom operating activities, the companycontinued its funding program, to finan ce its Business Plan 2009-2013. In this context, it must be highlighted the bank loans hired recently and the issuance of US$ 1.5 billion GlobalNotes due February. In this way,
Petrobras’ cash increased 28% inthe quarter, totaling US$ 8.2 billion.The Net Debt/Net Capitalization rateremained stable in relation to theprevious quarter, at 26%, considerablybelow the 35% maximum limitconsidered optimum by the Company.
On the operational side, Petrobrasbroke its record of daily production.Petrobras’ total production of oil andnatural gas, including Brazil and abroad,increased 2.2% in relation to the4Q08, reaching 2,482,000 barrels. Theproduction of oil and natural gas inBrazil reached 2,261,000 barrels of oilequivalent per day (boed) in the 1Q09.The start up of the platforms P-53 (Marlim Leste), P-51 (Marlim Sul), andFPSO Cidade de Niterói (Marlim Leste),in the 4Q08 and the 1Q09, and the risein production from the units P-52 andP-54 (Roncador) contributed to this increase, surpassing the natural declinein the mature fields.
In spite of the increase in production,the volume of sales in the domesticmarket fell 9.5% in relation to the 4Q08,influencing the result of the period, ashas been explained.
In thousand barrels of oil equivalent per day 2009 2008 Variation(%)
Total crude oil, NGLs and natural gas production 2,261 2,120 6.65Total oil products production 1,991 1,892 5.23Net exports of crude oil and oil products 100 (7) (107) Refining and marketing operations – Brazil – Utilization 1,942 1,986 (2.22)– International – Utilization 281 181 55.25Domestic crude oil of total feedstock processed 78% 78% –
Dow Jones PBRA PBR
8 years (23.0%) 351.1% 412.9%
5 years (26.5%) 231.8% 264.0%
3M09 (13.3%) 20.0% 24.4%
In US$ million 1T09 4T08 Variation(%)
Net cash provided by operating activities 8,190 5,902 38.77
Capital Expenditures 6,330 9,817 (35.52)
Net debt 21,833 20,852 4.70
Total liabilities/shareholder equity(%) 50% 50% 0.00
Market Value 122.909 96.8 26.97
EBITDA 5,521 3,960 39.42
ADR´s, Dow Jones, Amex Oil and Brent
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124,42 120,04
86,87 86,70
Operating Performance
2009 first quarter results
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Morediscoveries
in the SantosBasin Petrobras has installed a
latest generation computerto simulate the production
development in oil reservoirs in pre-saltlayer accumulations in the SantosBasin. The company became aware ofthe urgent need to modernize thesimulation technology of the availablereservoirs in view of the new demandsbrought by the pre-salt discoveries.
This supercomputer has a great capacity to process data, weighs about three tons, and simulates thebest drainage strategy in a field.Among other data, it takes into accountthe number of producing and injectingwells which should be drilled, providingtheir field position and geometry, that is, vertical, horizontal, or directional. Another main technological advantageis the increase of the speedin processing the informationgenerated in the productiveprocess. With this, it will help to reducethe evaluation time of field productionscenarios and will increase project efficiency, in addition to improving theuse of the reserves. Only equipment of this magnitude would be able toprocess, for example, the 2,000 Km2
of area of the Tupi mega-accumulation,whose first simulation model will haveabout 10 million cells.
This new equipment will represent aleap in quality in reservoir simulation
processes, since giant fields, such asthe Marlim, which covers an area of160 Km2 in the Campos Basin, requirea simulation model which has hundredsof thousands of cells, much beyond the Tupi demand. This comparisongives an idea of the importance of this new technological resource andof the complexity of the developmentof the pre-salt province of the SantosBasin.
Supercomputer evaluatespre-salt reservoirs
The Akpo field, located in block OML130, in deep water Nigeria, startedup the production in March.
Petrobras has a 16% workinginterest in the block, operated in partnership with the French companyTotal (operator) the Nigerian companiesNNPC (Nigerian National PetroleumCorporation) and Sapetro (South Atlantic Petroleum) and the CNOOC(Chinese national oil company).
Discovered in 2000, the field is located 200 kilometers from the Nigeriancoast, at a water depth that varies between 1,200 and 1,400 meters.
The estimated reserves are on the order of 620 million barrels of oil condensate (above 50° API) and are located in deep water. TheAkpo project meets the Nigerian government’s regulation of “flare out,”which establishes that the gas mustnot be burned in the productionprocess.
The FPSO (floating production,storage, and offloading) installed inthe block has the capacity to produce185,000 barrels of condensate per dayand to store up to 2 million barrels. Itis estimated that the production
peak, of 175,000 barrelsper day, will be reachedin the third quarter of2009.
To develop Akpo, 44wells will be necessary (22 producers, 20 water injectors, and 2 gas injectors), of which 22have already been drilled. The oil fromthe well is sent to the ship through 110kilometers of pipelines. The producedoil is transported by tankers, connectedto a floating terminal anchored at adistance of two kilometers.
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P etrobras announced threenew discoveries in the Santos Basin in April. A con-
sortium formed by Petrobras (63%)and Repsol (37%) sent the NationalOil, Natural Gas, and Biofuels Agency(ANP) a declaration of commerciabilityon the discovery of light oil and gas, above the pre-salt layer, in blockBM-S-7. In the new field, namedPiracucá, the estimated volume of thedeposit is 88.5 million cubic meters.
The BG Group (40%), in consortiumwith Petrobras (60%), announced the existence of indications of hydrocarbonates in the Corcovado-1well, in deep water of the pre-salt layer,off the coast of São Paulo. Assessments will now be carried out to determinethe commerciabilty of the block.
A consortium formed by Petrobras(45%), BG Group (30%), and Repsol(25%) to explore block BM-S-9 in ultra-deep water in the Santos Basinconfirmed the existence of one moredeposit of light oil in the pre-salt reservoirs. The block consists of two areas of evaluation – Guará and Carioca – where the well discovered,named Iguaçu, is located. Now, theevaluation work will be continued.
Field in Nigeria begins to produce
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Newssheet edited by Petrobras' Investor Relations Department • Executive Manager: Theodore Helms • Editor: Cláudio Paula MTb-22069/RJ • Colaboration: Bianca Nasser, ClaraRodrigues, Fernanda Bianchini, Luciana Guilliod and Orlando Gonçalves, • Contact: Petrobras' Shareholders Department • Phones: (55-21) 3224-1540/4914 • Fax: (55-21) 2262-3678• Address: Av. República do Chile, 65 / 2202-B • Centro – Rio de Janeiro – RJ – Brazil – 20031-912 • E-mail: [email protected] • Design: Estúdio Matiz • Depositary Bank: JPMorganChase Bank • JPMorgan Depositary Receipts • 4 New York Plaza, 13th Fl. • New York, NY 10004 • +1 (866) JPM-ADRS (576-2377)
Visit our website at www.petrobras.com.br/ir/english
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P etrobras jumped from thetwentieth to the fourth placeamong the most respected
companies in the world, according to the Reputation Institute (RI), anAmerican consulting and researchcompany. The ranking, which lists 200
of the world’s big companies, is doneannually and measures the level ofesteem, trust, respect, and good feelingthrough research with customers in thecompanies’ countries of origin.
Petrobras received 82.37 points(18 points above the worldwide
average) and belongs to the group of 17companies with an excellent reputation,the highest classification. It surpassedGoogle, Microsoft, 3M, Honda, andPhillips and earned the top positionamong the energy companies and alsoamong all other Brazilian companies.
Petrobras is the fourth most respected company in the world
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D Social Report is considered notable
by the UN againFor the third consecutive year,
Petrobras’ Social and EnvironmentalReport was considered notable and anexample to be followed, according to
the criteria established by the UNGlobal Compact. The Compact is aninternational initiative which aims at
encouraging intersectorial cooperationfor the undertaking of actions relatingto ten human rights principles. Since
2003, Petrobras has participated in theinitiative and is committed to basingits social and environmental activities
on the Compact’s principles.
The Gender Pro-EquitySeal is granted again
For the second year in a row,Petrobras has received the Gender Pro-Equity
Seal granted by the Special Secretariat forPolicies for Women, from the Brazilian
government, with the support of the UnitedNations Development Fund for Women(UNIFEM) and the International Labor
Organization (ILO). Since 2003, the femalelabor force at the company has grown 84.1%.In 2009, a total of 8,113 women employees
are spread throughout almost all thecompany’s sectors.
Petrobras' CEO José Sergio Gabrielli deAzevedo, received the award Person of the
Year 2009, granted by the Brazilian-AmericanChamber of Commerce in New York in May.The award pays tribute to two personalities peryear (one Brazilian and one American) who havecontributed to strengthening the ties betweenthe two countries in the diplomatic, business,and financial areas. In addition to Gabrielli, theAmerican ambassador to Brazil also receivedthe award.
On the same date, the president ofPetrobras visited the New York Stock Exchange(NYSE), where he rang the bell that marks theclosing of the trading session, a ceremonyknown as The Closing Bell. Since 1870, bellshave been used to signal the beginning and theend of the trading sessions on the New Yorkstock market.
Petrobras' CEO: Person of the year
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Best Investor Relations Program Award Investor Relations Magazine has grantedPetrobras the Best Investor Relations Programfor Individual Shareholders award.A partnership with Revista RI, the award is also sponsored bythe Brazilian Investor RelationsInstitute (IBRI). The Companyalso received the honorable
mention in three categories: Best IRWebsite, Best Annual Report, and Best Corporate
Brand/Branding. This award is acknowledgedworldwide as the most accurate and prestigiousassessment of the best performances in the InvestorRelations Area among publicly-traded corporations.
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