New Petrobras CEO to Execute Investment Plan Without Surprises

© Caio / Adobe Stock
© Caio / Adobe Stock

The incoming chief executive of Petrobras will execute its investment plan with no "surprise" for investors, Brazil Mines and Energy Minister Alexandre Silveira said on Tuesday, in his first comments since the state-run oil firm announced a CEO swap.

The minister downplayed concerns of a government intervention at Petrobras, which dismissed former CEO Jean Paul Prates and named Magda Chambriard in his place last week. Still, Silveira said the company should be a driving force for "national development."

"Comrade Magda arrives with a lot of gas, a lot of energy, and with the strength of the Brazilian woman to make Brazil grow," Silveira told reporters in Rio de Janeiro.

Chambriard, a former head of oil and gas regulator ANP, was appointed with a mandate to speed up the firm's investment plan of $102 billion for the 2024-2028 period. Former CEO Prates drew fire from Silveira for not investing enough and keeping fuel prices too high.

Chambriard's appointment to CEO is set to be approved on Friday by the Petrobras board, sources close to the matter told Reuters.

Prates' ouster marked a victory for Silveira, who had a series of public spats with the former CEO before Brazilian President Luiz Inacio Lula da Silva finally decided to remove him from the state-run firm.

The change took investors by surprise, sending Petrobras shares plunging as much as 8% as markets opened last Wednesday.

Shares were up 0.5% in midday Tuesday trading, but are still down nearly 10% since the management shakeup was announced.

Silveira said Chambriard shares his views on the need to explore the potential of the Foz do Amazonas basin, an offshore area near the mouth of the Amazon River, considered Brazil's most promising frontier for oil exploration.

The decision on whether to produce oil in the environmentally sensitive area should be made after Brazil knows the potential of the region, Silveira added.

The minister also said Brazil needs to expand its supply of natural gas, so it can lower prices for consumers.


(Reuters - Reporting by Rodrigo Viga Gaier and Fabio Teixeira; Editing by Brad Haynes, Gabriel Araujo and Bill Berkrot)

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