CFO: Petrobras new strategic plan will focus more on oil and natural gas.

Fernando Melgarejo, the Chief Financial Officer of Petrobras, said that the new strategic plan for the Brazilian state-run company will be more focused on upstream operations.

Melgarejo said that the plan for 2025-2029, which is being developed, will not include any mergers or acquisitions of major proportions and it is unlikely to need more debt and cash than the one for 2024-2028.

Melgarejo stated in an interview that "we'll have a vision focused more on upstream," without revealing what was deemphasized. "Each drop of oil matters to the company, if it is economically viable."

He said that the current plan predicted a reduction of Petrobras's oil and gas reserves by 2030. This scenario, he called "uncomfortable."

Melgarejo became CFO as part of the aforementioned restructuring in June.

The shake-up will be broader

Magda Chabriard replaced Jean Paul Prates, the former CEO of Petrobras, as Luiz Inacio Lula da Silva pushed for a faster investment pace.

Melgarejo made his remarks after Petrobras issued $1 billion of dollar-denominated notes. He said that the transaction showed the markets' confidence in Petrobras, under Chambriard.

Petrobras is exploring the Brazil's most promising oil frontier - the environmentally sensitive Equatorial Margin - and also has other projects, such as exploring natural gases in Colombia.

The current management is not happy about this (reduction in reserves) from 2030. Melgarejo stated that the focus was to replenish reserves to the maximum extent possible. "One cannot be more important than the other, without losing sight of energy transition."

Petrobras released a new release last year, Prates.

Strategic Plan 2024-2028

Foresees investments of $102 billion, including acquisitions as well as low-carbon initiatives like biorefining and wind and solar energy.

Melgarejo stated that the new plan would not include any major acquisitions and would also require Petrobras not to incur much debt.

He said: "We'll move there with a normality that is not major or abrupt." (Reporting and writing by Marta Nogueira, Editing by Brendan O'Boyle & Leslie Adler; Writing by Gabriel Araujo)

(source: Reuters)