Key Updates From Petroleo Brasileiro SA Petrobras (ADR)(NYSE:PBR)


Petroleo Brasileiro SA Petrobras (ADR)(NYSE:PBR) reported that following its liability management plan, has executed the debt pre-payment with JPMorgan Chase Bank, N.A. of US$ 1.13 billion, payable between June 2019 and March 2020. The company executed simultaneously with this entity a new funding of US$ 847.5 million that matures in 2022.

It will continue to evaluate new funding prospects according to its liability management plan, which intends to enhance the debt repayment profile, considering the deleveraging target established in its Business and Management Plan for 2017-2021.

The buzz

In an unrelated news, Petroleo Brasileiro reported that further to the material fact announced on July 23, 2016, it was informed by Fundação Petrobras de Seguridade Social that its Deliberative Board has allowed the Deficit Equating Plan for the Petrobras System Petros Plan. The PED offers for equating the aggregate value of the deficit noted in 2015, explicitly, R$ 22.6 billion. It is projected that this amount, revised to the date set for start of plan implementation in December 2017 will reach nearly R$ 27.7 billion.

PPSP can be defined as a plan of Established Benefits and, as per Petros, the prime reasons for this deficit can be stated as actuarial structural adjustments, such as improvement to the life expectancy of the beneficiaries and participants, and updating family profiles, legal provisions and agreements, plus impact of economic scenario on investment, which led in profitability coming below the actuarial target, as noted with most pension funds.

In other news, Petroleo reported that the company has restarted operations after flooding and weather conditions improved after the devastating passage of Hurricane Harvey. The refinery is increasing production and expects to achieve normal operations in the coming period. As it is known, the plant possesses capacity to process over 100,000 barrels per day. Recently, the company increased gasoline prices by 10% in Brazil in response to the hurricane.

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