A Review of the Nigerian Energy Industry

Petrobras profit, production fall

Maria das Graças Foster, Petrobras CEO

11 May 2014, News Wires – Petrobras reported lower first-quarter profits and output as production disruptions weighed on the balance sheets of the state-led Brazilian giant.

The Rio de Janeiro-based company late on Friday posted net income of 5.39 billion reais ($2.43 billion) in the three months to March, off 30% from the year-ago figure of 7.69 billion reais.

The lower profits were recorded despite 12% jump in revenue to 81.54 reais.

Production was down 1% to 2.53 million barrels of oil equivalent per day due to the demobilisation of the Brasil floating production, storage and offloading unit at the Roncador field.

The P-20 Marlim platform was also offline throughout the quarter due to repairs from a fire in December but since has restarted output on 7 April.

The hit to earnings comes at an already difficult time for Petrobras, which is fighting output declines and pushing a technically challenging ramp-up in its pre-salt province.

Petrobras also faces outside pressure from investigations into bribery allegations in its contracts with Dutch floating production system provider SBM Offshore.

The company has also faced fresh criticism over a Texas refinery purchase in 2006 after former downstream director Paulo Roberto Costa was arrested in March on charges of involvement in a money-laundering scheme spanning $10 billion reais.

Chief executive Maria das Gracas Foster, however, expressed optimism that the company could still pull off its promised production turnaround in 2014 on the strength of new pre-salt output, which in a bit of good news hit record monthly production of 395,000 barrels per day in March.

“We are confident that we will reach our goal of growing production by 7.5% in 2014,” she said in a statement.

The third quarter is expected to bring the start-up of the P-61 platform and its associated tender-assisted drilling unit at the Papa Terra field as well as the Cidade de Ilhabela FPSO in the Sapinhoa Norte field.

In the fourth quarter the Cidade de Mangaratiba is due online at the Iracema Norte field.


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