National Congress Tries to Prevent Sale of Petrobras Refineries

In The Request, The Legislative Chambers Argued That The Possible Sale Of Petrobras’ Units Would Go Against A Previous Decision By The Court In 2019

Congress Asked Yesterday (02/07) The Federal Supreme Court (STF) For An Injunction To Prevent Petrobras From Selling Its Refineries, With The Petition Citing The Refining Units In Bahia (RLAM) And Paraná (Repar). São Mateus Port Construction Authorized With 750 Job Openings Initially Scheduled To Start In 2020

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In The Request, The Legislative Chambers Argued That The Possible Sale Of Petrobras’ Units Would Go Against A Previous Decision By The Court In 2019, In Which Congressional Approval Is Necessary For The Sale Of Assets Of A State-Owned Company.

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This Week, Petrobras Received Binding Offers For RLAM. The Asset Received Proposals From At Least Abu Dhabi’s Fund, Mubadala Investment Company, And The Indian Conglomerate Essar Group, Sources Told Reuters.

Last Wednesday, Petrobras President Roberto Castello Branco Reported That Repar Will Be The Next State-Owned Refinery To Receive Bids.

According To The Executive, Petrobras Aims To Receive Binding Offers For All Its Refineries For Sale “In The Coming Months.” The Company Plans To Sell Eight Refineries, Or About Its Refining Capacity Target.

The Congress Chambers Also Claimed That To Sell The Refineries, Petrobras Would Be Splitting Strategic Assets Into Subsidiaries, Whose Privatization Does Not Depend On A Decision From Lawmakers, Aiming To “Circumvent” The Supreme Court’s Decision.

“In Such A Scenario, The Decision Made By The Supreme Court Will Essentially Be Fraudulent, As This Purposeful Deviation Will Prevent Popular Sovereignty From Influencing The Terms Of The Substantial Sale Of Shares In The Parent Company,” Says The Petition. The Legislature Noted In The Manifestation That The Sale Of The Landulpho Alves Refinery (RLAM) Should Be Completed By The End Of The Year, While The Delivery Of Binding Proposals For Repar Is Scheduled For The 13th.

The Request Was Distributed For A Decision By The President Of The STF, Dias Toffoli, Due To The Start Of The Judiciary’s Recess.

Petrobras Stated That It Would Not Comment On The Matter. However, A Source From The State-Owned Company Told Reuters That It Is Confident The Court Will Not Grant The Legislative Chambers’ Request. “This Is A Process That Has Been Politicized From The Beginning And We Believe It Will (Continue This Way) Until The End,” The Source Stated When Asked.

“We Have To Deal With This And Work For What Is Best For The Company,” Added The Person, Who Preferred To Remain Anonymous. In The Source’s Assessment, “This Type Of Move Makes No Sense And The Company Believes The STF Will “Reinforce This.” “We Are Complying With The Previous Decision Of The STF And Therefore It Does Not Make Sense. We Are Confident The STF Will Not Grant The Injunction.”

The Brazilian Institute Of Oil, Gas And Biofuels (IBP) – An Association That Represents Companies In The Sector, Stated In A Note That It Is Surprised By The Injunction Request. IBP Advocates For The Opening Of The Refining Market And Cites The STF’s Position That Allows The Sale Of Subsidiaries.

“The Sale Of Petrobras Refineries Is Supported By Legislation And Based On The Decision Of The Highest Court Of Justice In The Country,” Said The Institute. “IBP Believes That The Concentration Of Refining Capacity In The Country In Just One Company Does Not Meet The Greater Interests Of Brazilian Society And Should Be Corrected,” It Stated, Adding That Attracting New Investments Requires Legal Predictability And Clear Rules.