MercoPress. South Atlantic News Agency

China interest in extending more loans to Petrobras but in Renmimbi

China Development Bank may offer more financing to Brazil’s government managed oil and gas corporation Petrobras adding to the 10 billion US dollars extended this week, said Petrobras CEO Jose Sergio Gabrielli on Thursday in New York.

“We have discussed with the bank the possibility of another loan, which could be large, but denominated in the Chinese currency, Renminbi,” Gabrielli told a press conference in New York who also revealed that the Brazilian oil giant has managed 30 billion US dollars in funds for the development of its five year investment program.

On Tuesday, China signed a 10 billion deal with Brazil under which Petrobras will supply 200,000 barrels of oil a day (bpd) to China's state oil company Sinopec for the next 10 years. Petrobras is already providing Sinopec with around 160,000 bpd, and will boost shipments to 200,000 bpd next year.

Petrobras Chief Financial Officer Almir Barbassa told reporters the company won't need new financing until 2011. “We are fully funded, but we're always looking at our options,” Barbassa said.

In spite of the global financial crisis, Petrobras was able to raise 30 billion US dollars to fund its investments, the largest fundraising initiative in its history. According to CEO Gabrielli this includes the 10 billion from the China Development Bank (CDB). Previously, it had already secured credit lines worth 2 billion from the US Ex-Im Bank, 12.5 billion from the National Development Bank (BNDES), and 6.5 billion from a group of international banks.

Petrobras Business Plan calls for investments in the order of 174.4 billion, from 2009 to 2013, both in Brazil and abroad including investments for the pre-salt area, new refineries, bio-fuel, petrochemicals, and fertilizer plants, and expansions in the natural gas and oil derivatives supply infrastructure.

By 2013, Petrobras intends to have invested 15.9 billion in its international businesses. The United States will receive most of the resources: 4.45 billion, i.e. 28% of the total invested outside of Brazil.

Gabrielli also said world oil prices of 45 USD a barrel would make it commercially viable for Petrobras to produce oil from Brazil's pre-salt fields, located under several kilometres of sand, rock and salt.

Petrobras is currently able to drill a pre-salt well in the offshore Santos Basin at a cost of 60 million US dollars, with completion costs - to enable the well to produce oil and gas - of around 100 million, Gabrielli said.

CEO Gabrielli arrived in New York on Thursday for the 2009 Person of the Year Award ceremony whish is awarded by the Brazilian-American Chamber of Commerce.

Delivered annually, the award honours two personalities (a Brazilian and a US citizen), who have helped draw Brazil and the United States closer in their diplomatic, corporate, and financial relations. In addition to Gabrielli, this year the ambassador of the United States to Brazil, Clifford Sobel, will also be honoured.

The Brazilian-American Chamber of Commerce has been the main private thrust for bilateral trade relations between Brazil and the United States in the past 40 years. In the afternoon Petrobras’ CEO visited the New York Stock Exchange (NYSE), where he took part in the Closing Bell ceremony, which marks the closing of trading at the exchange.