Webcast 2Q13

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Webcast about 2nd Quarter 2013 Results.

Webcast about 2nd Quarter 2013 Results.

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Webcast 2Q13 Webcast 2Q13 Presentation Transcript

  • Operational and Financial Results 2nd Quarter of 2013 Conference Call / Webcast August 12th, 2013
  • 2 FORWARD-LOOKING STATEMENTS: DISCLAIMER The presentation may contain forward-looking statements about future events within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are not based on historical facts and are not assurances of future results. Such forward-looking statements merely reflect the Company’s current views and estimates of future economic circumstances, industry conditions, company performance and financial results. Such terms as "anticipate", "believe", "expect", "forecast", "intend", "plan", "project", "seek", "should", along with similar or analogous expressions, are used to identify such forward-looking statements. Readers are cautioned that these statements are only projections and may differ materially from actual future results or events. Readers are referred to the documents filed by the Company with the SEC, specifically the Company’s most recent Annual Report on Form 20-F, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements, including, among other things, risks relating to general economic and business conditions, including crude oil and other commodity prices, refining margins and prevailing exchange rates, uncertainties inherent in making estimates of our oil and gas reserves including recently discovered oil and gas reserves, international and Brazilian political, economic and social developments, receipt of governmental approvals and licenses and our ability to obtain financing. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events or for any other reason. Figures for 2013 on are estimates or targets. All forward-looking statements are expressly qualified in their entirety by this cautionary statement, and you should not place reliance on any forward-looking statement contained in this presentation. NON-SEC COMPLIANT OIL AND GAS RESERVES: CAUTIONARY STATEMENT FOR US INVESTORS We present certain data in this presentation, such as oil and gas resources, that we are not permitted to present in documents filed with the United States Securities and Exchange Commission (SEC) under new Subpart 1200 to Regulation S-K because such terms do not qualify as proved, probable or possible reserves under Rule 4-10(a) of Regulation S-X. DISCLAIMER
  • 3 1.957 1.764 1.792 1.677 1.6911.855 240233188140115109 +1% 1.9311.9101.9802.066 1.9041.970 Oil and NGL Production (kbpd) » Oil and NGL Production 1.1% higher than 1Q13 (+21 kbpd): • Scheduled Stoppages and operating problems: +18 kbpd. • New wells and abandoned wells impact offset by natural decline: 3 kbpd. » NG Production of 61.8 thousand m³/day or 389 kboed (-3% vs. 1Q13). » Expected production for the 3Q13 in line with 2Q13. Pre-Salt Production (kbpd) » 9 production units operating in the Pre-Salt, 4 of which started up after the 2Q12: Cidade de Anchieta (Baleia Azul, Sep/12), Cidade de São Paulo (Sapinhoá, Jan/13), Cidade de São Vicente (TLD Sapinhoá Norte, Feb/13) and Cidade de Paraty (Lula NE, Jun/13). Production Units Start Up (Brazil) Since the 2Q12, 4 new definitive systems started up, with total capacity of 420 kbpd, of which 312 kbpd of Petrobras Capacity 120 kbpd 45% Petrobras Capacity 80 kbpd 100% Petrobras Capacity 120 kbpd 65% Petrobras Pre-Salt Record (Petrobras+Partners): 326 kbpd in 06/22/13 Other FieldsPre-Salt 2012 = 1 2013 = 4 until June Connected Wells 9 7 5 9 34 7 4 8 4 Old SystemsNew Systems » 15 wells connected in the 1H13. » 36 wells planned to be connected in the 2H13, adding approximately 440 kbpd of potential production. Capacity 140 kbpd 62,5% Petrobras * 291 1Q13 277 4Q12 218 3Q12 176 2Q12 146 1Q12 135 2X 2Q13 Pre-Salt Production (Petrobras+Partners)Records * P-63 left Quip/Honório Bicalho Shipyard on June 18 and will be taken to its definitive location on August 23rd. Record 326 kbpd Oil and NGL Production in Brazil Production in the Quarter as expected. New Pre-Salt Record: 326 kbpd. FPSO Cid. São Paulo (Sapinhoá) Jan/13 FPSO Cid. Anchieta (Baleia Azul) Sep/12 FPSO Cid. Itajaí (Baúna) Feb/13 FPSO Cid. Paraty (Piloto de Lula NE) Jun/13 P-63* (Papa-Terra) Jun/13 – Leave Shipyard Capacity 100 kbpd 100% Petrobras » 4 new systems will initiate production by the end of the year: P-63, P-58, P-55 and P-61/TAD. * New Systems: FPSOs Cid. São Paulo, Cid. São Vicente, Cid. Itajaí and Cid. Paraty. 1Q134Q123Q122Q121Q12 2Q13 1Q134Q123Q122Q121Q12 2Q13
  • 4 Operating Performance in Brazil – E&P PROEF 2Q13: contribution to production of 62 kbpd, 15 kbpd in UO-BC and 47 kbpd in UO-RIO Drilling Expenses (R$ million) 1.1461.2371.728 1.116 3.294 921 -63% Exploratory Policy (2H12) » Drilling rigs migrating from exploration to production development. » Selection of exploration wells with lower risk. » 2Q13: 13 wells write offs, none in Pre-Salt (41 in the 2Q12, 2 in the Pre-Salt) Discoveries 3 4 3 4 121 7 4 5 1 8 5 4 4 4 Post-Salt Pre-Salt/Transfer of Rights » 1H13: Exploratory success ratio of 70% (64% in 2012) and 100% only in the Pre- Salt (82% in 2012). » Discovery of good quality oil in Iara Surrounding (Transfer of Rights), announced on May 7th. » Graph above shows the 30 most relevant discoveries announced to the market, all offshore, except for Igarapé Chibata (Amazonas). 55 discoveries in the last 18 months, 16 in Pre-Salt. Operating Efficiency (%) Oil + NGL Production (kbpd) +47 kbpd 887840 +2.4 p.p. 92.890.4 389374 +15 kbpd 66.1 74.3 +8.2 p.p. PROEF UO-BC: 2Q13 PROEF UO-RIO: 2Q13 » Additional production of 15 kbpd. » Focus on wells recuperation and subsea systems. » NPV of US$ 626 million. » Total expenses of US$ 1.2 billion until May/13. 1Q134Q123Q122Q121Q12 2Q13 1Q134Q123Q122Q121Q12 2Q13 Without PROEF With PROEF Without PROEF With PROEF Operating Efficiency (%) Oil + NGL Production (kbpd) » Additional production of 47 kbpd. » Focus on management, integrity improvement and optimization of the use of resources. » NPV of US$ 596 million. » Total expenses of US$ 3.2 million until Jun/13.
  • 5 26.39 61.60 22.57 67.08 67.88 31.2528.3330.79 64.87 67.8769.47 29.49 3Q13 4Q13 Lifting Cost New units still ramping up in 2Q13: 138 kbpd x 312 kbdp capacityLiftingCost R$/Barrel » Full impact of new units costs, without production counterpart (gradual ramp up). » Impact of personnel costs due to actuarial revision of pension and health plans. » 3% FX devaluation (2Q13 vs. 1Q13) impacted costs in Reais. » Key levers from PROCOP that contributed to the lifting costs optimization: onshore intervention costs, chemicals consumption during the production process and optimization of the use of maintenance resources. » Reduction in government take due to lower average reference price, linked to international prices. Brent, in Reais, 6% lower than in 1Q13. » E&P Net Income: R$ 8.9 billion on 2Q13 x R$ 10.0 billion on 1Q13. Cid. Itajaí Feb/13 Cid. São Paulo Jan/13 Lifting Cost, Oil Production and New Production Units Start-up Capacity¹: 54 kbpd 2Q13: 11 kbpd Capacity¹: 80 kbpd 2Q13: 31 kbpd Capacity¹: 78 kbpd 2Q13: 3 kbpd Cid. Paraty Jun/13 3Q122Q121Q12 2Q131Q134Q12 Lifting Cost Oil and LNG ProductionGovernment Take ¹ Production capacity related to Petrobras working interest. Cid. Anchieta Sep/12 Capacity:¹ 100 kbpd 2Q13: 93 kbpd OilandNGLProduction kbpd
  • 6 26.39 61.60 22.57 67.08 67.88 31.2528.3330.79 64.87 67.8769.47 29.49 3Q13 4Q13 LiftingCost R$/Barrel Cid. Itajaí Feb/13 Cid. São Paulo Jan/13 Lifting Cost, Oil Production and New Production Units Start-up Capacity¹: 54 kbpd 2Q13: 11 kbpd Capacity¹: 80 kbpd 2Q13: 31 kbpd Capacity¹: 78 kbpd 2Q13: 3 kbpd Cid. Paraty June/13 3Q122Q121Q12 2Q131Q134Q12 Lifting Cost Oil and LNG ProductionGovernment Take ¹ Production capacity related to Petrobras working interest. Cid. Anchieta Sep/12 Capacity:¹ 100 kbpd 2Q13: 93 kbpd P-63 P-55 P-58 P-61 TAD Capacity¹: 448 mbpd » Sustained production growth in 2nd semester: • Ramp up of production units that began operating in the 1st semester. • Start up of production units P-55, P-58, P-63, P-61/TAD (Tender Assisted Drilling) in 4Q13. • Throughout the 2nd semester, connection of 36 offshore wells with production potential of approximately 440 kbpd. 2013 Production Stronger Growth in 4Q13 due to the start up of 4 news production systems Example
  • 7 Operation Performance in Brazil – Downstream Refining throughput, product output and sales, and costs Oil Products Sale in Brazil (kbpd) Oil Products Production in Brazil (kbpd) » Focus on increasing production of oil products that generate higher value, especially gasoline (+48 kbpd) and diesel (+16 kbpd), while reducing low margin products such as naphtha (-25 kbpd) and fuel oil (-43 kbpd). » Oil products production 196 kbpd higher than 1Q12, comparable to the capacity of COMPERJ’s 1st train (165 kbpd) » Diesel production maximization planned for 2H13. 802 785 839 855 754 782 785 785757 784 782835 +6% +1% 2Q13 2,138 501 1Q13 2,127 453 4Q12 2,010 441 3Q12 2,026 439 2Q12 2,008 441 1Q12 1,942 431 Diesel Gasoline Others Throughput (kbpd) and Utilization (%) Refining Cost (R$/bbl) 1,884 1,974 1,970 1,534 1,589 1,633 2,102 1,666 2,083 1,722 1,936 1,585 Domestic Oil + NGLImported OilUtilization » Oil processing record: 2,200 kbpd (June 29th and 30th) » Utilization of 99% in 2Q13: ongoing efforts to maximize refineries’ utilization contributed to higher throughput. 984864 986 978921914 797759 795 +6% +3% 2,372 583 811 2,313 580 812 2,237 557 766 569 2,3502,168 545 610 2,391 Gasoline Diesel Others » Domestic market sales increased by 3%, led by diesel (+6% vs 1Q13). » Diesel: +57 kbpd comparing to 1Q13 due to higher seasonal activities of industry and agriculture. » Gasoline: +3 kbpd compared to 1Q13 related to light vehicles fleet increase in Brazil. +2%+2% » 2Q13 x 1Q13: higher refining cost due to actuarial revision of pension and health plans, partially offset by higher throughput (+1%) and PROCOP results. » Key levers of PROCOP that contributed to optimization of Refining Costs: standardization of scope on refining maintenance and increase of energy efficiency. +11% +2% +6% 2Q131Q134Q123Q122Q121Q12 2Q131Q134Q123Q122Q121Q12 2Q131Q134Q123Q122Q121Q12 +196 mbpd
  • 8 Domestic and International Price Comparison In 2Q13, the lowest differential to international prices since Jan/12 Average Brazil Price* x Average USGC Price** The differential decreased in 2Q13 due to price adjustments of diesel (Jan 30th, Mar 6th) and gasoline (Jan 30th) as well as decrease of international prices. Devaluation of Real in the second half of the quarter reversed the convergence to international prices. Diesel ImportsGasoline Imports Prices(R$/bbl) * Considers Diesel, Gasoline, LPG, Jet Fuel and Fuel Oil. ** USGC price with domestic market prices. ImportedVolumes(Thousandbbl/d) 0 100 200 300 400 500 600 700 800 900 100 120 140 160 180 200 220 240 260 Jun/12 Jan/12 Oct/12 Aug/12 May/12 Jul/12 Sep/12 Apr/12 Mar/12 Feb/12 Jun/13 May/13 Apr/13 Mar/13 Feb/13 Jan/13 Dec/12 Nov/12 Average Sales Price Brazil Jun 25th Adjustments Jul 16th 20132012 Adjustments Jan 30th +5.4% diesel +6.6% gasoline Mar 6th +5% diesel 2Q13 x 2Q12 Gasoline: -31 kbpd Diesel: -127 kbpd • Sales Price Increase • International Prices Decrease • Lower Imports Average Sales Price USGC Losses
  • 9 Trade Balance of Oil and Oil Products Domestic production increase improves the result of 2Q13 compared with 1Q13 Lower net imports in 2Q13 due to lower oil products imports (-115 kbpd) as a consequence of higher Gasoline (+48 kbpd) and Diesel (+16 kbpd) production. » Reduction of 31% of oil products imports (2Q13 vs. 1Q13), despite higher sales (+3%), led by diesel and gasoline imports decrease (- 66%): » Lower Gasoline imports (-75%) due to higher domestic production and increase of ethanol in gasoline blend. » Lower Diesel imports (-64%) due to higher domestic production along with decrease of inventory built in 1Q13. » Decrease of heavy crude oil exports to build inventories of domestic oil. » Lower light oil imports due to utilization of inventories built during the previous period. » Increased imports of diesel and gasoline imports expected in the second half of the year due to seasonal demand and lower domestic output as a result of scheduled stoppages. » Downstream Net Income: -R$ 2.5 billion in 2Q13 x –R$ 4.2 billion in 1Q13 Balance Exports Imports kbpd 68 188195 13 5244 383731 341 359 215 554 172 159 162 406 155 -12% -18% 708 180 447 860 136 484 724 144 351 DieselGasolineOthers Oil ProductsFuel OilOil -35% -2% +105% -185 -180 -64 10 2Q13 -349 -285 1Q13 -454 -269 2Q12 -170 -23% Diesel and Gasoline Imports 195 188 68 13 -66% 81 240 52 -66% 239 44 2Q131Q132Q12 2Q131Q132Q12 2Q131Q132Q12
  • 10 Operational Performance in Brazil – Gas and Energy Natural Gas supply and demand balance, fertilizers and power generation Power Generation (GWavg)Fertilizers Production (thous. ton) » Utilization factor of 82%, highest average level since 1Q12. » Acquisition of fertilizer plant in Paraná (FAFEN-PR) on June 1st,13 with production capacity of Ammonia (1,303 tons / day) and Urea (1,975 tons / day). » 2Q13 production does not consider FAFEN-PR. +43% 405 221 184 417 225 192 293 156 137 455 252 203 +38% 419 231 188 304 166 138 FUT (%) 87% 57% 80% 78% 60% 82% 8.2 4.2 2.1 0.3 1.6 9.3 4.6 2.3 0.6 1.9 8.8 4.9 1.8 1.7 3.4 2.0 1.1 4.1 2.6 1.31.9 0.9 0.8 0.4 Atend. ONS (%) 98% 99% 99%99% 98% 99% » Supply of natural gas and oil for power generation of 8.2 GW avg, representing14% of Integrated National System (SIN). » Decrease of 12% of power generation compared with 1Q13 due to higher level of hydropower reservoirs. » Petrobras´ power generation reached 4.5 GW avg. FUT = Utilization Factor Ammonia Urea 18.316.0 14.17.39.50.9 +21% +2% 88.1 30.4 90.1 24.6 43.3 37.0 43.563.5 71.5 25.5 39.6 74.5 27.2 37.8 41.4 90.3 30.730.8 12.110.812.412.211.712.1 89.3 38.3 11.7 39.3 63.1 18.6 40.3 71.0 38.6 37.0 1QT12 39.5 3Q12 74.2 23.0 2Q12 4Q12 39.3 +2% 87.7 39.9 1Q13 89.4 38.0 2Q13 +20% Natural Gas Supply (million m³/day)Natural Gas Demand (million m³/day) LNG Bolivia Domestic Thermoelectric Downstream E&P/Fertilizers Non-thermoelectric +6% » Non-thermoelectric demand increased 6% in 2Q13 due to higher industrial consumption. » Decrease of 5% in thermoelectric demand compared with 1Q13 due to lower level of power generation by NG (-7%). » Total supply of Natural Gas reached 90 milllion m³/day » Lower domestic NG supply (2Q13 x 1Q13) due to scheduled stoppages for maintenance in Manati, Mexilhão, Uruguá and Lula fields led to higher LNG imports. 1QT12 3Q122Q12 4Q12 1Q13 2Q13 1QT12 3Q122Q12 4Q12 1Q13 2Q13 1QT12 3Q122Q12 4Q12 1Q13 2Q13 Petrobras Gas Plant Third-Parties Gas Plant Petrobras Oil Plant Third-Parties Oil Plant » Gas and Energy Net Income: R$ 0.6 billion in 2Q13 x R$ 0.9 billion in 1Q13
  • 11 PROCOP: Monitoring of Outcomes – Jun/13 Accomplishment of R$ 2.9 billion, 78% of annual target of operating cost optimization Planned Accomplished as planned or higher 2013 Target: R$ 3.8 billion Exploration & Production Downstream Engineering, Technology & Materials Corporate & Services Transpetro Gas & Energy Onshore Production Administration and Support Building Mngt, Travels and Lodging Offshore Production Support Services Wells Intervention Refining Oil and Oil Products Logistics Commercialization Supplies and Stocks ITC HSE MngtNG Logistics Fertilizers Incorporation of additional targets, including subsidiaries Liquigas, BR and PBIO, will bring additional savings of R$ 151 million in 2013 and R$ 1.9 billion by 2016. High risk of not achieving the annual target Attention points that can put the achievement of the annual target at risk 70% 30% 90% 110% 40% 20% 100% 10% 50% 130% 150% 160% 140% 120% 80% 60% 100% OperationalExecution(%) Jan-Jun/13 Cost Savings Expected : R$ 1.6 billion (43%) Cost Savings Accomplished: R$ 2.9 billion (78%)
  • 12 Financial Highlights of 2nd Quarter »Higher Operating Profit with significant increase in Cash Generation. »PRODESIN: Sale of 50% of assets in Africa, generating a gain of R$ 1.9 billion, with a cash increase of R$ 3.4 billion. »As of June 30th, divestments during the year total US$ 1.8 billion. »International Net Income: R$ 2.0 billion in 2Q13 x R$ 0.7 billion in 1Q13. »Net borrowings of $ 15.1 billion, including the issuance of US$ 11 billion in global notes (May/13). »Extension of hedge accounting to protect future exports: »FX losses of R$ 8.0 billion, related to approximately 70% of total net debt exposed to FX variations (end of 2Q13), were recorded in Shareholders’ Equity account. »Transfer to Income Statement as exports occur over a 7 year period. -1.346 7.693 6.201 2Q12 1Q13 2Q13 Net Income 5.282 9.849 11.107 2Q12 1Q13 2Q13 Operating Income 10.599 16.231 18.091 2Q12 1Q13 2Q13 EBITDA -19% +561% +13% +110% +11% +71% R$million R$million R$million
  • 13 Operating Income – 1Q13 vs 2Q13 Increase in oil product prices and domestic demand R$million 9,849 1,092 (1,240) (377) 1,783 11,107 1Q13 Operating Income Sales Revenue COGS SG&A Other Expenses 2Q13 Operating Income » Higher Sales Revenue due to the full effect of diesel and gasoline prices adjustments in 1Q13 and increased demand in the domestic market. » Increase in COGs driven by higher sales volume in the domestic market, higher processing of imported oil and higher LNG imports. » Improvement in Other Expenses mainly due to the sale of assets in Africa.
  • 14 Net Income – 1Q13 vs 2Q13 Lower than previous quarter due to financial results R$million 7,693 1,258 (4,941) 234 1,293 664 6,201 1Q13 Net Income Operational Income Financial Result Earnings of equity investments Taxes Minority Interest 2Q13 Net income » Lower net income as a result of the FX depreciation effect over net debt, partially offset by higher operational income » Financial results already factor in the smaller FX exposure due to the extension of hedge accounting to future exports. » Lower taxes as a result of lower quarterly income.
  • 15 Investments: Physical progress in line with financial progress Tracking physical and financial progress – S-Curves Tracking of physical and financial progress of 155 individual projects (S-curves): Average physical progress: 98.4%. Average financial progress: 97.7%. R$Billion Investments: 1H12 x 1H13 R$ 44.1 billion in investments during the 1H13, 14% up on 1H12. When calculated in dollars, investments grew 5% 44.1 38.7 +14% 1H131H12 1H13 investments by business segment 54% R$ 10,7 bi35% R$ 6,9 bi 1% 1% 0% 5% 6% G&P International Distribution Biofuel Corporate Downstream E&P
  • 16 1) Net debt / (adjusted EBITDA 1S13 x 2) 2) Net debt / (net debt + shareholders equity) 3) Adjusted EBITDA (EBITDA excluding earnings of equity-accounted investments and impairments) 4) Includes tradable securities maturing in more than 90 days Capital Structure Borrowings at competitive costs to fund 2013-2017 BMP R$ Billion 06/31/13 03/31/13 Short-term Debt 18.2 14.6 Long-term Debt 230.8 182.4 Total Debt 249.0 196.9 (-) Cash and Cash Equivalents 3 72.8 46.3 = Net Debt 176.3 150.7 US$ Billion Net Debt 79.6 74.8 1.61 2.46 2.42 2.77 2.32 2.57 24% 28% 28% 31% 31% 34% -20% -10% 0% 10% 20% 30% 40% 0,0 1,0 2,0 3,0 4,0 5,0 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 Net Debt/EBITDA Net debt / Net Capitalization2 3 3 » US$ 15.1 billion in net borrowings during 2Q13. » Cash and Cash equivalents of R$ 72.8 billion (US$ 32.8 billion) as of 2Q13. 3 1
  • Operational and Financial Results Information: Investor Relations +55 21 3224-1510 investors@petrobras.com