(Bloomberg) — The new CEO of Brazil’s Petrobras sought to allay investor concerns about ramping up investment in her first public comments at the helm of Latin America’s largest oil producer.
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Magda Chambriard was formally appointed to the position last week at a time of growing investor concern over government intervention in Petroleo Brasileiro SA. Her predecessor was fired over a dispute over the amount of dividends the company paid instead of using the money for investments.
“Petrobras is perfectly capable of guaranteeing returns for its shareholders, both private and public,” Chambriard said Monday in her first public comments as CEO. “I understand that we have to make a profit.”
President Luiz Inacio Lula da Silva has made it clear he would like state-controlled Petrobras to spend more money on expansion in sectors such as refining and job creation. The government controls the oil producer’s board through a majority of voting shares.
Under Lula, Petrobras has already shifted from the previous government’s focus on streamlining operations to reduce costs. The company has halted a program to sell a group of refineries and could even buy back some of the facilities sold under previous management.
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Chambriard – a former head of Brazil’s oil regulator – said the company needed to accelerate exploration offshore Brazil, including the Pelotas basin and a region known as the equatorial margin near the border with French Guiana.
She has criticized the delays in granting permits for drilling in an environmentally sensitive location on the equatorial margin, saying they leave the country without a source of growth after its main oil-producing basin, the Pre-Salt, has declined .
“We have to be very careful about replenishing reserves unless we want to accept the fact that we could become importers again,” she said.
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Regarding domestic fuel costs, Chambriard said Petrobras will remain committed to protecting consumers from short-term declines and fluctuations in oil prices. After Lula came to power in 2023, Petrobras changed its pricing policy to focus more on production costs rather than the international price level.
–With help from Beatriz Amat.
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