Petrobras Seeing Results in New Offshore Fields: CEO
Petrobras, the Brazilian oil producer that’s rapidly emerging as one of the world’s top companies, is “finding very good results” at its newly discovered off-shore deposits, Chief Executive Jose Sergio Gabrielli de Azevedo told CNBC in an exclusive interview.
"We are in the final stages of appraisal," Gabrielli told "Closing Bell" anchor Maria Bartiromo. The company, founded as a state monopoly in 1953, will start testing production at the find during the first quarter of next year and expects to be pumping 100,000 barrels a day by the end of 2010, Gabrielli said.
Petrobras stunned energy analysts in November when it reported finding up to 8 billion barrels of recoverable oil at the Tupi field, 7 kilometers below the waves. In January, it made a similar discovery at the Jupiter field, and its nearby Carioca location may hold four times more petroleum. (See the whole interview in the video at left.)
Shares of the company, which started trading publicly 11 years ago, are up more than 50 percent since those discoveries. Petrobras now ranks among the world’s largest companies by market capitalization, with a value over $330 billion, surpassing firms such as CNBC parent General Electric and UK-based oil driller BP .
The success may come at a price, however. Now that the company has made significant discoveries, politicians in Brasilia might look for a bigger piece of its surging profits.
“Many governments are trying to get a larger share in the income stream from oil,” Gabrielli said. “Also, we think in Brazil, we are going to face this discussion.”
Gabrielli reiterated plans to increase production to 4.2 million barrels a day in 2015 from 2.3 million barrels now. That total will climb higher when oil from the new fields come on line. Petrobras also plans to add 1 million barrels of daily refining capacity and to increase its use of debt to fund growth, Gabrielli said.