With Aiming To Cut 2 Billion Dollars In Operational Costs, Petrobras Seeks Temporary Suspension Of Contracts With Suppliers

Petrobras Forecasts Total Investment of US$ 8.5 Billion (Approximately R$ 41.71 Billion) in 2020, Compared to the Investment Projection of US$ 12 Billion Announced at the Beginning of the Year.

Petrobras aims to cut US$ 2 billion in operational costs as part of its pandemic response plan; initially, the proposals included postponing parts of the charter fees for platforms and support vessels to 2021 and delaying the enforcement of new contracts while expediting the end of others in offshore support. Petrobras Advances in the Process of Selling Its Shares of Wind Farms in Rio Grande do Norte.

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This is the second time the company attempts to renegotiate some points with its suppliers. In the previous attempt, Petrobras aimed to postpone payments and expedite the end of contracts nearing expiration.

Petrobras has stated from the outset that these negotiations are being conducted only with large companies that have a greater capacity to bear the weight of the crisis. According to sources quoted by Valor newspaper, smaller suppliers are also suffering from the measures imposed by the state oil company.

Petrobras stated that it is solely seeking solutions to overcome this crisis alongside its major suppliers. The company also informed that each contract for goods and services is being analyzed individually in the renegotiation processes. The oil company said it is “always prioritizing the pursuit of a negotiated solution.”

Sustainability Report Announced by Petrobras Last Week

Petrobras reported last Wednesday (10), in its Sustainability Report, detailed the impacts of the new coronavirus pandemic on its operations and the measures taken to combat the crisis.

One highlight of the report was the US$ 2 billion (approximately R$ 9.82 billion) cut in operational expenses.

The oil company achieved this result through the reduction and postponement of human resources expenses, optimization of working capital, as well as the reduction of the investment plan for this year.

The state company forecasts a total investment of US$ 8.5 billion (approximately R$ 41.71 billion) in 2020, compared to the investment projection of US$ 12 billion announced at the beginning of the year.

During the pandemic caused by the coronavirus, Petrobras aimed to prioritize cash preservation and optimization of oil production.