Business Opportunities in O&G Sector in Brazil. Joint Ventures Between Brazilian and Japanese Companies.

Transcription

1 Business Opportunities in O&G Sector in Brazil. Joint Ventures Between Brazilian and Japanese Companies. 1

2 Forward Looking Statements Disclaimer The presentation may contain forecasts about future events. Such forecasts merely reflect the expectations of the Company's management. Such terms as "anticipate", "believe", "expect", "forecast", "intend", "plan", "project", "seek", "should", along with similar or analogous expressions, are used to identify such forecasts. These predictions evidently involve risks and uncertainties, whether foreseen or not by the Company. Therefore, the future results of operations may differ from current expectations, and readers must not base their expectations exclusively on the information presented herein. The Company is not obliged to update the presentation/such forecasts in light of new information or future developments. Cautionary Statement for US investors The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this presentation, such as oil and gas resources, that the SEC s guidelines strictly prohibit us from including in filings with the SEC. 2

3 Petrobras Overview 3

4 Petrobras: An Investment Grade, Publicly Traded, Major International Oil Company Incorporated in 1953 as government monopoly for all hydrocarbon activities in Brazil Originally established as a refinery of imported crude oil Became net exporter in % of total equity capital (common and preferred) is now publicly traded Government maintains controlling interest with 55% of voting shares Market cap of approximately $260 billion, NYSE Listed, quarterly disclosure in US GAAP Foreign currency ratings from Moody s of Baa1, Standard & Poors (BBB), and Fitch (BBB) (3, 1, and 1 notch above sovereign, respectively) Brazilian Constitution Amended Nov 1995 First Public Auction of Oil Exploration Areas June 1999 Petrobras NYSE Listing August 2000 Full Deregulation January 2002 Upgraded to Investment Grade Issuer October 2005 Crossed the $100 billion dollar Market Cap mark 2006 Brazil Self- Sufficient in Oil April MM bpd, $200MM market cap, Discovery of new oil frontier

5 Corporate Organization and Key Operating Results Exploration and Production Downstream Distribution Gas and Energy Petrochemicals Biofuels Summary Financials (US$ bln) Income from Operations (2) For Year Ended Net Revenues EBITDA Capex Total Debt (1) Cash & Cash Equivalents Net Debt Total Equity Total Assets Distribution 3% Domestic E&P 81% Downstream 16% Notes: 1 Includes capital leases 2 For the year ended December 31, Excludes losses in gas and energy, corporate results and eliminations 5

6 Improving Metrics and Proven Track Record Production and Reserves (SEC) Average Realization Price Reserves MM BOE Production M BOE/d $ s/bbl 58,58 70,92 79, ,72 36,13 40, Market Value (as of May 26, 2008) Imports vs. Exports (US$mm) ,772 Exports Imports (M BBL/d) (424) (559) (446) (488) (538) 0 Jan- 02 Aug- 02 Mar- 03 Oct- 03 May- 04 Dec- 04 Jul- 05 Mar- 06 Oct- 06 May- 07 Dec- 07 May Fonte: Evaluate Energy and Company Reports 2007 (*) Eni Refining Throughputs 6

7 World Class Integrated Public Energy Company 2006 Proven Reserves (SEC) 2007 Oil & Gas Production (Bln boe) ( 000s boepd) 25,0 22,1 20,0 15,0 10,0 5,0 0,0 Exxon Mobil 17,4 BP 13,7 11,6 11,5 Chevron 11,2 (1) Conoco Phillips 10,7 6,3 Eni 3,2 Shell Petrobras Total Repsol Exxon Mobil BP Shell Chevron Conoco Total Petrobras Eni Repsol Source: Company Filings, Company Website Source: Company Filings Market Value as of March 14, 2008 (US$Bln) ( 000s boepd) 2006 Refining Capacity Exxon Mobil Petrobras Shell Total Eni Repsol BP Source: Company Filings, FactSet Chevron Conoco Exxon BP Petrobras Chevron Eni Mobil Shell Total ConocoPhillips Repsol Source: Company Filings, Company Website (1) 7

8 Upstream Overview 8

9 Thousand boed E&P - rapidly growing production profile 8,3% p.y ,7% p.y. 8,7% p.y * * Oil and NGL - Brazil Natural Gas - Brazil Oil and NGL - International * Includes non consolidated production Natural Gas - International 2012 Target 2015 Forecast 9

10 Main Projects in Brazil Rio de de Janeiro Espadarte Mód II II bpd 6/jan/07 Piranema bpd 10/oct/07 Cidade de de Vitória Golfinho Mód bpd November 2007 Roncador P bpd November Roncador P bpd November 2007 Cidade Niterói Jabuti (FPSO) bpd 2008 Marlim Sul Módulo 2 P bpd * Marlim Leste P bpd 2008 Tupi EWT Up to to bpd 2009 Frade bpd Parque das Conchas bpd 2009 Tupi Pilot System Up to to bpd Cachalote & Baleia Franca FPSO Capixaba 100,000 bpd 2010 Marlim Sul Módulo 3 P bpd Jubarte P bpd 2012 Espadarte Módulo bpd Roncador Module 4 P bpd Obs.: This curve does not include Tupi s Pilot System Production * Target may vary +/- 2.5% 10

11 Exploration Perspectives 11

12 Exploratory Perspectives in Brazilian Southeastern Margin Espírito Santo Golfinho/Canapú/ Peroá/Cangoá Parque das Baleias Roncador Light Oil Mexilhão Campos Merluza/ Lagosta Papa- Terra BS-500 Santos Pre-salt Cluster Blocks 12

13 Pre Salt Santos Basin BM-S-52 (Corcovado) BM-S-42 BM-S-50 BM-S-10 (Parati) (Yara) BM-S-11 (Tupi) BM-S-24 (Jupiter) BM-S-8 (Bem-te-Vi) BM-S-9 (Carioca) (Guará) BM-S-17 BM-S-21 (Caramba) BM-S-22 Wells Being Drilled Wells Drilled 13

14 E&P: UPCOMING UNITS Units Field Capacity Status Start-up Shipyard FPSO Cidade de Niterói* Jabuti Oil: bpd Gas: 3,5 MM m 3 /dia Under construction 2S08 Modec Sipem - Dubai P-51 Marlim Sul Oil: bpd Gas: 6MM m 3 /dia Under construction 2S08 Nuclep/Brasfels Angra/RJ P-53 Marlim Leste Oil: bpd Gas: 6MM m 3 /dia Under construction 2S08 Quip Rio Grande/RS Cidade São Mateus* Camarupim Oil: bpd Gas: 10 MM m 3 /dia Under construction 2S08 Prosafe Keppels - Cingapura PMXL-1 Mexilhão Gas: 15MM m 3 /dia Under construction 2009 Mauá-Jurong Niterói/RJ P-56 Marlim Sul Oil: bpd Gas: 6MM m 3 /dia Under construction (P-51 Clone) 2011 Brasfels -FSTP Keppel & Technip Angra/RJ P-57 Jubarte Oil: bpd Gas: 2MM m 3 /dia Contracted 2011 SBM Shipyard N/A P-62 Roncador Oil: bpd Gas: 6MM m 3 /dia Contracted 2012 Mauá-Jurong Niterói/RJ P-55 Roncador Oil: bpd Gas: 6MM m 3 /dia Hull contracted. Basic project under revision Atlântico Sul Suape/PE Rio Grande/RS * Leased 14

15 E&P: Rigs Water Depth Start Up 2009 Start Up 2010 Start Up 2011 Start Up 2012 From 2013 to m Petrobras XIV m Olinda Star Ocean Worker 2000m Lone Star Schahin III Petrorig II Gold Star Schahin I Norbe VI Delba IV Sevan Brasil Delba V Delba VI Scorpion + 28 New Units to be leased Sevan Driller W. Taurus Delba III SSV Victoria Delba VII Delba VIII W.Eminence Dave Beard W. Orion Norbe IX Schahin 1 Schahin 2 Norbe VIII Petroserv Etesco 8 Total Rigs contracted plus 28 to be leased up to 2017 making a total of 57 new drilling rigs. Stena Drillmax e Dep Water Millennium are not being considered since they are being negotiated in the Spot Market 15

16 New Vessels to be Contracted Large Vessels 26 Supply Vessels 24 FPSO/SS 6 Others (jack-ups, TLWP) 3 Total 59 Leased/ Being Leased To be Leased Navio-sonda Barco de Apoio Navio de grande porte (VLCC) Plataforma de Produção (FPSO) (FPSO)

17 Downstream Overview 17

18 Total Downstream Spending of $29.6 Billion 21% 28% Fuel Quality 8,619 Conversion 3,938 Maintaining Balanced integration between Refining and Production 8% Expansion HSE 5,353 1,083 1,792 2,167 8% 4% 18% 13% Transportation 2,270 Pipelines 2,264 Others 6,112 2,412 Year 2012 Total Refining Capacity ( 000s. bpd) Domestic Oil Production ( 000s. boed) 2011: New Refinery in Brazil to add s. Bpd cap. New Refinery in Texas expanded & upgraded 18

19 Downstream Business Strategy Complexo Petroquímico do Rio de Janeiro - COMPERJ Total Investment: US$ 8.4 billion (Petrobras Investment US$4.6 billion); Throughput capacity: 150 thousand heavy oil barrels (Marlim oil from Campos Basin); Start Up: 2012 Refining and Petrochemical Integrated Complex that through the use of new technologies process heavy oil to obtain oil products and first and second generation petrochemical products. New Refinery in Pernambuco Total Investment: US$ 4.1 billion (Petrobras Investment US$2.4 billion); Throughput capacity: 200 thousand heavy oil barrels (60% Petrobras oil / 40% PDVSA oil); Focusing diesel and LPG production maximization, the new refinery will aim the growth of oil products demand in the Northeast. The Northeast Region, which responds for 19% of oil products demand and holds only one refinery in Bahia, will no longer be a fuel importer (either from refineries in Brazil or abroad); Costs reduction: oil products transportation are more expensive than for crude oil; Start Up:

20 Downstream Business Strategy Northeast Region Refinery in Rio Grande do Norte Premium Refinery in Ceará Petrobras will deploy its 12th refinery in the state of Rio Grande do Norte. New plant to produce gasoline and improve the quality of other oil products (Jet fuel, Diesel and LPG) produced in existing facilities in Guamaré. Capacity: 80,000 bpd. Start-up scheduled for Petrobras will study, together with Ceará State, the possibility of installing a Premium refinery; Capacity: 300,000 bpd; Premium Refinery in Maranhão The refinery s first operation phase is scheduled to start in Petrobras will study, together with Maranhão State, the possibility of installing a Premium refinery; Capacity: 600,000 bpd; The refinery s first operation phase is scheduled to start in

21 International Overview 21

22 International - Overview United Kingdom. Mexico USA Colombia Ecuador Peru Houston New York Venezuela BRAZIL Portugal Turkey Jordan Libya Iran Pakistan Senegal Nigeria India Tanzania Singapore Angola Mozambique Beijing Tokyo Okinawa HEAD OFFICE REPRESENTATIVE OFFICE Bolivia REFINING TRADING EXPLORATION AND PRODUCTION Paragay Rio de Janeiro Uruguay Argentina Core Areas: Refining Add value to Brazilian heavy oil exports E&P: West Africa & Gulf of Mexico: Apply deep water and deep well drilling technology. Latin America: Leadership as an integrated energy company 22

23 Gas and Energy Overview 23

24 Domestic Natural Gas Market* Million m3/day ,1 27, ,9 42,1 48,0 31,1 30,0 72,9 LNG Bolívia E&P** Supply 2012 Thermoelectric Industry Other (*) considering maximum dispatch of every thermoelectric power plant Other: vehicular, residential / commercial, refineries and fertilizer units. (**) Adjusted to STD Heat Value (9,400 Kcal/kg) 24

25 Plangás: Increasing Natural Gas Supply in the Southeast Region From the current 15.8 million cubic meters per day to 40 million in 2008 and 55 million in Main Projects: Marlim and Roncador field in the Campos Basin, Merluza in Santos Basin and Peroá in Espírito Santo Basin. Total Southeast in 2008: 40 MM m3/d Additional: + 24,5 MM m3/d Total Southeast in 2010: 55 MM m3/d Additional: + 39,2 MM m3/d UTGC Extension to 20MM m3/d Peroá Extension to 10MM m3/d Cabiúnas/Reduc Extension to 23MM m3/d UTGCA Extension to 15MM m3/d UPGN Cubatão Adaptation to 15MM m3/d 25

26 Pipelines Network Belém Coari-Manaus Manaus Natal Recife Catu Carmópolis Pilar Gasbel II Paulinia - Jacutinga Brasília Salvador Cacimbas Catu Vitória -Cacimbas GASENE Cabiúnas Vitória Existing Pipelines New Pipelines Expansão Gasbol Sul Rio de Janeiro São Paulo Campinas Rio Caraguatatuba Taubaté Gaspal II / Gasan II Porto Alegre Gasduc III e Japeri-Reduc 26

27 Renewables 27

28 Renewable Energy and Biofuels ( ) Investments Biodiesel Plants H-Bio (Bio-Refining) 2012 Target Availability of 938 Thousand m3/year Vegetable oil Processing 1.6 million m³/year 21% US$ 1.5 billion Investments 4% 29% Ethanol pipelines Ethanol Project Vessel Export of 4.7 billion m³/year of Ethanol Aeolic Energy Solar Energy Other Sources of Renewable Energy Installed Capacity of Generation of Electric Power from 365 MW Renewable Sources Biofuels 46% Pipelines and Ethanol Pipelines Total avoided GHG emissions: 3.93 MM tons CO2 equivalent Others H-Bio 28

29 Petrobras Investments to Export Ethanol New Ethanol Pipeline (1.150 Km) Ethanol collection, storage and distribution centers are spread out through producing and consuming regions Large scale marine terminals improve efficiency New Pipeline (1412 km) New Water Way for Ethanol Replan Ilha Dágua Pipeline (Current flow) Tietê-Paraná Water way Senador Canedo São Sebastião Pipeline Replan Brasília Pipeline (OSBRA) Replan Guararema Pipeline Existing Pipeline New Ethanol Pipeline (919Km) Large storage capacity necessary to regulate supply Pipelines reduce transport costs; improve energy efficiency São Paulo Marine Terminal Rio de Janeiro Marine Terminal Future Pipeline Existing Terminal Future Terminal Exportation Target: Export 4.75 MM cu.m/year in

30 Financial Considerations 30

31 PETROBRAS BUSINESS PLAN Indexes FX rate (R$/US$) Brent for Funding (US$/bbl) Projected Net Cash Flow (Including Dividends) Projected Investments for Plan Plan Net Debt/ Net Debt + Shareholders Equity (Leverage) (%) Return on Capital Employed (ROCE) (%) (*) PPP purchase power parity 31

32 Investment Plan by Business Segment 58% Period US$ billion 13% % 2% % 2% 4% 6% E&P RTC G&E Petrochemical Distribution Corporate Biofuel Brasil 97.4 Internacional 87% US$ 65.1 billion directed to E&P: Exploration: US$ 13.8 billion Production: US$ 51.3 billion Note: Includes International 32

33 Strong returns have enable company to grow without increasing debt 25,0% Historical ROCE U.S. GAAP Consolidated Cash Flows 74.3 BN ,0% 15,0% Inc. Debt Dividends 10,0% 5,0% 0,0% CFFO (including W.C.) Capex Operating Income and Assets by Segment (US GAAP US$ Millions) E&P (Brazil) Downstrea m (Brazil) Gas & Energy Distribution Int l Sources Uses Net Op. Inc. 14,072 2,785 (834) 446 (815) PP&E (inc. Dep.) 48,529 14,480 10,615 1,838 7,596 O/w Construction in Progress 13,558 9,371 6, ,144 Source: Petrobras and Bloomberg 33

34 Capital Structure and Credit Metrics (US$ MM) Cash and Cash Equivalents 9,871 12,688 6,987 Total Debt 21,177 21,338 21,895 Net Debt 11,306 8,650 14,908 Shareholders Equity 32,917 44,299 65,179 Net Income 10,344 12,826 13,138 EBITDA 17,638 22,923 25,333 Net Debt / Book Capital 26% 16% 18% Net Debt/ Market Capital 15% 8% 6% Net Debt / Boe Production (X) Net Debt / Proved Reserves (X) Reserves/Production (Years, SPE Criteria)

35 Brazilian Oil Indutry Main Chalengies Infrastructure Enhancement Critical Items Supply (imports) Drilling Equipments Dynamic Positioning and Propeller Systems Steel Manufacturing Process and Supply Brasfels Shipyard at Angra dos Reis. P-51 and P-56 construction sites. Skilled Work Force for Construction and Operation Financiability Rio Grande Shipyard under construction. Designed for platforms construction. 35

36 Final Remarks Results Expected Fulifl PETROBRAS Demand for Equipments ; Brazil O&G Industry Development into a Competitive Global Player. PETROBRAS is committed to achieve its business interests with social and economic development responsibilities. It should assure an efficient supply chain of critical resources to its projects and perform its mission to enhance the sustainable development of Brazil and of the other countries where it is established. 36

37 Petrobras at a Glance - Results and Perspectives Thank You For more information, visit our website: 37