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‘We want a Petrobras that is proud of being big’, says new head of the state-owned company


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In his first communication with employees after assuming the presidency of Petrobras, Jean Paul Prates reinforced the idea that PT management will be more focused on the company’s role as a driver of development than on remuneration to shareholders.

“The oil industry is capital-intensive and job-generating, and should be a locomotive for Brazil’s development,” he said. “We want a Petrobras that is proud of being big and of boosting all the regions and businesses where it operates.”

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The speech follows a very different line from that adopted by the presidents of the company during the Jair Bolsonaro government: “The important thing is to be strong and not be giant”, said the first of the four nominees by Bolsonaro to the company, Roberto Castello Branco.

The third Lula government had already been indicating since the campaign that it would make changes in the company’s strategy, resuming investments in areas abandoned by previous administrations and paying less attention to shareholder remuneration.

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Since the election, this speech has had an impact on the appetite of investors for the state-owned company, which has brought down the company’s market value. This Thursday, after confirmation of Prates by the board of directors, Petrobras shares fell another 2.7%.

In a report in which it explains why it started to prefer the private oil company PRo to Petrobras, Ativa Corretora mentions a “new and less robust dividend policy”. “With the formation of a new board, we expect the company to review its policy on earnings in 2023”, he says.

“There is no value generation without taking care of people and without thinking about our impact on the world”, defended Prates, in a video distributed to the company’s employees. He did not specifically mention changes in dividends or talk about pricing, another concern of analysts.

But he reinforced that the company should expand investments outside the pre-salt layer, which has been the main focus in recent years, and that it will return to the energy generation segment, with a vision focused on energy transition.

“Mitigating climate change is a necessary and urgent global demand,” he said. “Petrobras’ size and trajectory make it naturally play a role as a major driver of Brazil’s energy transition.”

Among the investment focuses, he cited renewable energy, more sustainable fuels and oil exploration on the Brazilian equatorial margin, one of the main bets in the sector, which today still faces strong environmental restrictions.

He also cited the Urucu gas field, in the Amazon, which had been put up for sale during the Bolsonaro government. The deal was agreed with Eneva, but it was not concluded.

In the speech, Prates made a point of mentioning all Brazilian regions as investment targets, reversing a strategy of concentrating the company’s operations in the Southeast and Midwest, initiated in the Castello Branco administration.

“We want Petrobras to grow and the country to grow with it, because we all know that this company has a multiplier effect on the Brazilian economy”, stated the new president of the state-owned company.

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