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Petrobras Speeds Sales of Assets and Seeks Partners to Reduce Debts

09/19/2016 - 17h58

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NICOLA PAMPLONA
FROM RIO

Aiming to accelerate the process to reduce its debts, Petrobras, Brazil's state-owned oil giant, is likely to increase its efforts to sell assets and cut costs in the next five years.

The proposals are at the base of the company's new business plan, which will be evaluated by the board of directors on Monday, September 19.

It is the first management plan of the company's new president Pedro Parente, who was appointed to the position by President Michel Temer - the plan focuses on reducing the company's debts.

Petrobras did not disclose details, but the market expects a cut in the investment budget of some US$ 15 billion per year - a 20% reduction in comparison with the current plan's average, launched in 2015 and revised in January.

Petrobras's new plan will focus mainly on partnerships with other partners, creating possibilities to sell its participation in businesses in which it currently occupies the controlling position, such as refining and transportation of oil and its by-products.

The idea is concentrate expenditure in operations connected to petroleum production, which have a higher potential to generate revenues.

All other operations, such as gas, energy, biofuel and the petrochemistry area, may be sold, if the market shows interest.

The list of closed sales includes businesses in Argentina and Chile, 49% of its participation subsidiary in distributors of piped natural gas and the area of Carcará, in the pre-salt region.

Petrobras is likely to announce soon the sale of its gas pipeline in the Southeast region of Brazil for US$ 5.2 billion.

The negotiations with a consortium led by Canada's Brookfield have been closed and only depend on the approval of the board of directors.

Translated by THOMAS MUELLO

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