BNDES Cuts Brazil Oil-sector Investment Outlook

Posted by Joseph R. Fonseca March 28, 2015

Brazil's state development bank BNDES said on Friday it cut its outlook for 2015-2018 oil and natural-gas sector investment by nearly 30 percent to 360 billion reais ($111 billion) from 509 billion in its previous estimate.

The decline is expected to be led by lower spending by state-run Petroleo Brasileiro SA which is grappling with a huge corruption scandal.

While requests for oil and natural-gas project finance shrank in the first months of 2015, the bank expects to lend 8.4 billion reais to the sector this year, an amount similar to 2014, BNDES's manager for the bank's gas, petroleum and supply chain department Pompeo Mendes told Reuters.

(Reporting by Marta Nogueira, writing by Jeb Blount)