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Petrobras: Standoff with Sete Brasil threatens billionaire compensation in the oil market

Written by Ruth Rodrigues
Published 28/08/2023 às 13:41
If there is no indemnity agreement, Petrobras may be subject to even greater charges. The impasse with Sete Brasil has become a central topic of discussion in the oil and gas market.
Photo: Sete Brasil

If there is no indemnity agreement, Petrobras may be subject to even greater charges. The impasse with Sete Brasil has become a central topic of discussion in the oil and gas market.

A long stalemate in the Board of Directors of Petrobras related to Sete Brasil, a company linked to pre-salt exploration, puts the state-owned company in front of a potential billionaire loss this Monday, (28/08). The uncertainty revolves around the decision to offer or not an indemnity agreement to Sete Brasil, whose disputed amount is R$ 1 billion. The absence of an agreement could trigger more harmful lawsuits for Petrobras in the energy sector. oil, while an understanding can protect the company from potential financial and legal impacts.

Petrobras board of directors enters deadlock over Sete Brasil

A dilemma that has dragged on for five years at Petrobras' Board of Directors is in the spotlight, bringing the possibility of significant damage to the state-owned company.

The impasse with Sete Brasil, the company responsible for pre-salt oil exploration rigs, has caused postponements and disagreements between the directors, leading Petrobras to assess whether or not to present a proposal for an agreement to indemnify Sete Brasil.

Sete Brasil's trajectory dates back to 2010, when it was established by Petrobras itself as part of a plan to strengthen the Brazilian naval industry focused on pre-salt oil exploration.

Originally responsible for building drillships, the project foundered due to corruption allegations under investigation in Operation Lava Jato, resulting in the non-delivery of the planned 28 rigs.

In the internal scenario of Petrobras, the impasse surrounding the compensation to Sete Brasil is aggravated by the division in the council.

According to reports, this division reflects two opposing perspectives: members aligned with the government and the top of the state-owned company support the payment, while minority shareholders are opposed to this measure. 

The figure under discussion revolves around R$ 1 billion. However, the lack of an agreement may open the door to lawsuits demanding even greater amounts against Petrobras.

If the situation evolves into a judicial conflict, the state-owned company could be confronted not only with financial issues, but also with responsibilities for crimes linked to the oil scandal, where the company is considered a victim in the criminal sphere.

State may face heavy fines in cases involving Sete Brasil

While in criminal cases related to Lava Jato, Petrobras appears as a victim and seeks compensation for corruption schemes, the business scenario paints a different picture.

That's because the company could face hefty fines if there is evidence of corruption among its top brass in the oil market.

Foreign shareholders are already seeking compensation in arbitrations due to Lava Jato.

Sete Brasil's own request for judicial recovery underscores its close relationship with Petrobras.

This could allow creditors to trigger arbitration and the Judiciary, claiming that the state-owned company is responsible for Sete Brasil's damages and debts.

The possibility of indemnification by Petrobras to the supplier then appears as a possible solution.

The agreement under discussion would contain a clause that would prevent Sete Brasil's creditors from filing lawsuits against Petrobras in exchange for compensation.

The outcome of this impasse will have significant implications for Petrobras and for the country's business scenario. The search for an amicable solution is a delicate challenge, but it can avoid even more serious consequences for the state-owned company and for the oil sector as a whole.

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Ruth Rodrigues

Graduated in Biological Sciences from the State University of Rio Grande do Norte (UERN), she works as a writer and scientific disseminator.

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