Brazil’s Petrobras plans China subsidiary in push to boost ties, CEO says

Rio De Janeiro — Petrobras plans to create a Chinese subsidiary, Chief Executive Jean Paul Prates told Reuters, as Brazil’s state-run oil firm pushes to strengthen relations with the Asian nation that had “chilled” under former President Jair Bolsonaro.

Prates said Petrobras aims to open the Chinese subsidiary next year, after getting formal approval. He said the move would help efforts to triple its share of China’s oil imports in the next couple decades, while contributing to warmer Brazil-China ties under President Luiz Inacio Lula da Silva.

“It’s important to them,” Prates said in a phone interview during a business trip to China.

“It is an interesting signal, saying that in the same way that we have a Petrobras America, we will have a Petrobras China, because both countries are equally important to us,” he added.

While China and the United States have tussled for influence across the globe, Lula has argued for balanced and friendly relations with both countries. He has visited both the White House and Beijing since taking office in January.

Prates said Petrobras China subsidiary would allow Petrobras to operate and participate in projects as partner even in other countries, including in Africa.

He added that Chinese partnerships under development could also help to accelerate oil refining and fertilizer projects in Brazil, adding that China could help to revive the Brazilian naval industry.

Petrobras wants to increase its share of China’s oil imports to 15% from the current 5% in the next 10 to 20 years, Prates said.

Earlier this week, Petrobras tapped Chinese companies such as CNOOC and Sinopec for energy partnerships, while also agreeing to discuss joint projects with CITIC Construction and lenders China Development Bank and Bank of China.

“The relationship with these Chinese companies cooled down during the previous government, which didn’t give them much priority,” Prates said, referring to the Bolsonaro administration.