Petrobras is expected to reduce planned investments by US$21 billion next year, three sources close to the discussions told Reuters, despite government requests for the company to accelerate its projects.
This reduction would mark the third year, at least, in which an annual projection by the state-owned company would not be achieved, after the oil company invested less than expected in 2023 and reduced the forecast made for 2024.
The reduction in the projection for 2025 is being evaluated within the preparation of the new strategic plan for the period from 2025 to 2029, scheduled to be released in November.
The current plan, for the period from 2024 to 2028, foresees contributions of US$21 billion for 2025.
“This will not be achieved. The company will seek to calibrate and balance this value better”, said one of the sources, on condition of confidentiality.
The new projection is still being calculated. One of the people said initial estimates for 2025 are around $17 billion, which would be a 19% cut.
The review, according to sources, occurs for several reasons, such as an increase in the global prices of inputs and equipment, which end up leading the company to reevaluate the projects, in addition to limitations in financing and timing of works execution, among others.
More realistic review
Last year, the company still had plans to accelerate investments in the Equatorial Margin, notably in Foz do Amazonas, which is still awaiting authorization from Ibama for exploration. This year a strike by the environmental agency delayed a series of projects. But the sources did not comment on these topics.
When contacted, Petrobras did not immediately respond to a request for comment.
The company expected to invest US$18.5 billion in 2024, but recently adjusted the estimate to between US$13.5 billion and US$14.5 billion.
“There is no way to go from US$14 billion in one year to US$21 billion in the next. A 50% increase will not and cannot happen”, said the source on condition of anonymity.
“What we want is a more realistic and less futuristic value and plan. It was something very far from reality”, added a second source.
In its current strategic plan, Petrobras plans to invest US$102 billion between 2024 and 2028, which represented an increase of 31% in relation to what was foreseen in the previous five-year plan, amid pressure from the federal government to expand investments, contributing to the generation of jobs and income in the country.
But 2025 will be the third year in a row, at least, in which Petrobras will not be able to reach its investment targets.
In 2023, Petrobras invested US$12.7 billion. However, the amount was 21% below planned, due to postponements of well activities due to lower availability of probes and materials, project replanning and delays in exploratory wells due to lack of environmental licensing, the company previously reported.
“What is planned is to better calibrate these investment projections… The more rigorous metrics that are adopted for production must also be replicated in investments”, declared a third source.
One of the sources highlighted that Petrobras still has speed barriers to make its projects viable and that it needs to have a faster supply and financing network.
Low investment projects
The new plan should also bring as a novelty a prioritization of projects with lower investment, with higher and faster returns, according to the sources, which could serve the government. More oil and gas wells are also planned.
“The delay in investing investments was the main reason for the change in command at Petrobras. Investments in Petrobras have an impact on the economy, generating jobs and income. The new management is more down to earth and butt in the chair and less media. The company is going through a management shock,” said a source.
“The order is to choose projects with low investment and quick implementation. Well placement and anticipation. These are quick projects that help the country and increase the company’s results. The concern is clear: increasing oil and gas production”, added the source.
Asked whether the new plan value could be lower than the US$ 102 billion in current planning, the three sources said that the effort is to do what is best for the company, shareholders and society “in general”.
(By Rodrigo Viga Gaier)
