US$ 860 Million Loan by Brazil’s Petrobras Is No Ominous Sign, Says Minister

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Petrobras offshore platform in Brazil Brazil's minister of Mines and Energy, Edison Lobão, confirmed a 2 billion Brazilian reais (US$ 861 million) loan made by Brazilian state-controlled oil multinational Petrobras from the Federal Savings Bank (Caixa Econômica Federal) to cover operating costs. According to him, it is just a "regular loan."

"This is not a problem for any company. It has already been done many times. Petrobras has already made loans abroad at other moments, and in Brazil too. Petrobras is just repeating something that it has always done," stated the minister while addressing the Senate regarding infrastructure.

Earlier this week, Brazilian senator Tasso Jereissati spoke about the loan in a plenary session. According to him, the company has "serious cash flow problems." The organization's monthly report to the Securities and Exchange Commission (SEC) shows that the loan was made on October 31 and the objective is to "strengthen the working capital."

According to Jereissati, the conditions negotiated by Petrobras with the CEF were as follows: grace period of 180 days for payment of the loan and single amortization at the end of the event; interest rate of 104% of the CDI Over; incidence of the financial transactions tax (IOF) and amortization and full payment of the loan made.

Jereissati wants Petrobras president José Sergio Gabrielli and the president of CEF, Maria Fernanda Ramos Coelho, to clarify the matter at the Senate's Commission of Economic Affairs.

ABr

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