Despite Loss in Venezuela, Brazil’s Petrobras Has Record Profit

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Brazilian state-controlled oil company Petrobras ended 2006 with a net profit of 25.9 billion reais (US$ 12.2 billion), the highest in its history. The result was 9% higher than in 2005, which was already an all-time high.

The company's consolidated data, released today, February 13, show that 33.7 billion reais (US$ 15.9) were invested last year, 31% more than in 2005.

Oil production in Brazil increased by 6% and production of oil derivatives grew by 2%. The company's foreign refining capacity increased by 87%, leading to a 23% growth in international production of oil derivatives. The company's physical exports saw a 21% increase.

Petrobras, however, saw its profit fall by 76% in its foreign operations going from 1.45 billion reais (US$ 688 million) in 2005 to 350 million reais (US$ 166 million) in 2006. In Venezuela the company lost 370 million reais (US$ 176 million).

With the changes in the contracts rules Petrobras, which had 100% of the shares in exploratory fields in Venezuela had it reduced to 40%. In Bolivia, taxes increases meant that the Brazilian company had to pay an extra US$ 100 million in tariffs and royalties.

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