August 6, 2019 / 4:09 PM / 4 months ago

Brazil's Petrobras studies sale of power plants, CEO tells brokerage

SAO PAULO, Aug 6 (Reuters) - Brazil's state-controlled oil company Petroleo Brasileiro SA is studying the creation of a subsidiary comprised of around 15 power plants, which could then be sold through an initial public offering, analysts at XP Investimentos said in a report sent to clients on Tuesday.

Analysts at the Sao Paulo brokerage led by Gabriel Fonseca wrote the report to clients after a breakfast with Chief Executive Officer Roberto Castello Branco.

The analysts also said in the report that Petrobras, as the firm is known, is considering partnering with oil firms present in Brazil's so-called pre-salt offshore oil region to create a company composed of gas pipelines coming from the off-shore exploration areas. Petrobras could then exit the venture via a share offering, the report said.

Petrobras operates 20 power plants with 6,000 megawatts in total capacity. Its divestment program has largely spared such assets so far, with the only divestiture being the sale of a 50% stake in the TermoBahia plant to France's Total SA in 2017.

Petrobras did not immediately reply to a request for comment about the CEO statements to XP.

Petrobras has given a mandate to Credit Suisse to sell three gas pipelines in the pre-salt area. In April, sources told Reuters that Petrobras needed to secure an agreement with partners in the pre-salt region to go ahead with the sale.

In addition to Petrobras, various international oil companies such as Royal Dutch Shell PLC, Total, and BP PLC are present in the pre-salt region.

The report underscores the focus of Petrobras' current administration, led by Castello Branco, on selling off assets to reduce debt and focus on oil exploration and production.

Earlier in July, Petrobras signed an agreement with Brazil's antitrust authority Cade to sell all its natural gas exploration and transportation assets.

In a separate report published on Tuesday, analysts at Goldman Sachs cited Petrobras executives as saying that lifting costs at a platform in the pre-salt region had recently dipped to $4 a barrel, significantly lower than the $6 per barrel that the firm averaged in the pre-salt region in the second quarter.

Brazil-listed preferred shares in Petrobras were up 1.9% in midday trade. The nation's Bovespa benchmark equities index was up 1.4% as stocks recovered from a global rout on Monday. (Additional reporting by Marta Nogueira in Rio de Janeiro; Writing by Tatiana Bautzer Editing by Marguerita Choy)

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