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Webcast about the 1st Quarter Results 2011 - IFRS

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Webcast about 1st quarter results 2011 - IFRS

Webcast about 1st quarter results 2011 - IFRS

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  • 1. Results Announcement 1st Quarter 2011  (IFRS)Conference Call/WebcastAlmir Guilherme Barbassa CFO and Investor Relations OfficerMay 17th, 2011 1
  • 2. DISCLAIMERFORWARD-LOOKING STATEMENTS:DISCLAIMERThe presentation may contain forward-looking statements We undertake no obligation to publicly update orabout future events within the meaning of Section 27A of revise any forward-looking statements, whether asthe Securities Act of 1933, as amended, and Section 21E a result of new information or future events or forof the Securities Exchange Act of 1934, as amended, that any other reason. Figures for 2011 on areare not based on historical facts and are not assurances of estimates or targets.future results. Such forward-looking statements merelyreflect the Company’s current views and estimates offuture economic circumstances, industry conditions, All forward-looking statements are expresslycompany performance and financial results. Such terms qualified in their entirety by this cautionaryas "anticipate", "believe", "expect", "forecast", "intend", statement, and you should not place reliance on"plan", "project", "seek", "should", along with similar or any forward-looking statement contained in thisanalogous expressions, are used to identify such forward- presentation.looking statements. Readers are cautioned that thesestatements are only projections and may differ materiallyfrom actual future results or events. Readers are referred NON-SEC COMPLIANT OIL AND GAS RESERVES:to the documents filed by the Company with the SEC,specifically the Company’s most recent Annual Report on CAUTIONARY STATEMENT FOR US INVESTORSForm 20-F, which identify important risk factors that could We present certain data in this presentation, suchcause actual results to differ from those contained in the as oil and gas resources, that we are not permittedforward-looking statements, including, among other to present in documents filed with the Unitedthings, risks relating to general economic and business States Securities and Exchange Commission (SEC)conditions, including crude oil and other commodity under new Subpart 1200 to Regulation S-K becauseprices, refining margins and prevailing exchange rates, such terms do not qualify as proved, probable oruncertainties inherent in making estimates of our oil and possible reserves under Rule 4-10(a) of Regulationgas reserves including recently discovered oil and gas S-X.reserves, international and Brazilian political, economicand social developments, receipt of governmentalapprovals and licenses and our ability to obtain financing. 2
  • 3. HIGHLIGHTS OF THE QUARTERo Record net income;o Start‐up  of  pre‐salt  EWT  in  Campos  and  Santos  Basins:    Brava,  Tracajá and Lula Northeast;o New  oil  discoveries  in  Santos  Basin  pre‐salt  area,  such  as  Carioca Northeast and Macunaíma;o Start‐up of gas pipelines linking Lula Pilot and Mexilhão platform  and connecting Caraguatatuba and Taubaté (Gastau);o New  diesel  and  naphtha  HDT  units  in  RPBC,  REGAP  and  REVAP  refineries;o US$ 6 billion Bond issuance of 5, 10 and 30 year. 3
  • 4. MAIN INDICATORS ∆%  1Q11 4Q10 1Q10 1Q11 X 4Q10 EBITDA (R$/million) 16,093 14,584 10% 15,076 OPERATING INCOME¹ (R$/million) 12,536 10,773 16% 11,617 NET INCOME² (R$/million) 10,985 10,602 4% 7,726 AVERAGE REALIZATION PRICES – ARP (R$/bbl) 163.58 158.89 3% 157.39 AVERAGE REALIZATION PRICES – ARP (U$/bbl) 98.15 93.66 5% 87.29 Brent (US$/bbl) 104.97 86.48 21% 76.24 Average sales dollar (R$) 1.67 1.70 ‐2% 1.80 Production (thousand bbl/day) 2,627 2,628 ‐ 2.547 ¹ Income before financial results, profit sharing and taxes ² Net income attributable to Petrobras shareholders 4
  • 5. OIL AND GAS PRODUCTION – 1Q11 VS 1Q10 Total Production (daily average)  Brazilian Production (daily average)  +3% 2,385 2,547 2,627 2,302 +4% ‐1% 341 Natural   245 242 International 317 8% Gas(thous bpd) 4% 3% Oil and  2,385 2,044 NGL 2,302 Brazil 1,985 1Q10 1Q11 1Q10 1Q11 o Increase  in  production  due  to  ramp‐up  of  installed  units  in  2010  in  Campos  Basin,  Lula  Pilot,  and  EWTs of  Tiro, Sidon and Guará; o Start‐up of new wells in Akpo and Agbami (Nigeria) partially offset by decline of mature fields in Argentina  and Colombia; o Investments  in  infrastructure  and  new  NG  production  units  contributed  to  a  supply  growth  of  8%  when  compared 1Q11 VS 1Q10. 5
  • 6. SANTOS BASIN PRE‐SALT UPDATE o Approval of chartering of 2 new  FPSOs for the  Guará‐Norte and Cernambi projects; o New  discovery  of  good  quality  oil  in  the  pre‐ salt  reservoirs  of  block  BM‐S‐9,  informally  known as Carioca Nordeste;  o Discovery  of  a  new  accumulation  of  good  quality  oil  in  Parati (BM‐S‐10),  named  ‘ Macunaíma; o 8  new  drilled  wells  in  2011,  taking  Santos  Basin Pre‐Salt total to 28 wells drilled; o PLANSAL Revision; o Start up of Lula Nordeste EWT; o Restart of Guará EWT; o The  current  fleet  of  drilling  rigs  (6)  will  increase to 11 by the and of the year. 6
  • 7. CONTINUOUS PROJECTS OPTIMIZATION SINCE THE FIRST PLANSALPLANSAL IN 2008 Capex Transfer of Rights Areas Under ConcessionNet Present Value Areas Under Concession 7
  • 8. EXTENDED WELL TESTS IN PRE‐SALT EWT Results: o Steady  Production  without  decline  during the test; o Good behavior of the reservoirs; o Excellent lateral communication; o No flow assurance issues; o Restriction due to gas flaring limits. 6 EWT completed and 4 still underway 8
  • 9. DRILLING OPTIMIZATION IN THE SANTOS PRE‐SALT o Since the beginning of the activities in the Santos pre‐salt, the drilling time has decreased, reducing Capex. * Wells ordered by drilling duration. 9
  • 10. AVERAGE REALIZATION PRICEUS$/bbl R$/bbl 120 1Q11 AVERAGE 220 105 ARP Petrobras: 163.58 100 ARP USA: 180.54           86 170 78 94 80 75 76 77 68 80 59 70 73 74 72 120 60 64 44 2010 AVERAGE ARP Petrobras: 158.26 70 40 49 ARP USA: 150.67          32 20 20 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 ARP USA ARP Petrobras Petrobras Oil Price (Average) Brent (US$/bbl) o Oil price volatility in the quarter (Brent went from US$ 86,48 in the 4Q10 to US$ 104,97 in the 1Q11) due to  geopolitical issues in North Africa, especially in Libya.    10
  • 11. LIFTING COST IN BRAZIL 175.30 R$/barrel US$/barrel 104.97 147.02 86.48 140.16 137.23 134.51 78.30 76.24 76.86 50.66 30.48 24.50 24.67 25.58 43.82 43.91 42.72 43.47 23.73 19.10 31.66 14.33 14.71 14.07 15.29 26.87 26.37 24.26 26.13 16.95 17.54 18.46 17.34 19.00 9.40 9.79 10.60 10.29 11.38 1Q10 2Q10 3Q10 4Q10 1Q11 1Q10 2Q10 3Q10 4Q10 1Q11 Brent Government Take Lifting Costo 1Q11 vs. 4Q10 Comparison: o Lifting cost increased due to higher expenses with well intervention and scheduled stoppages; o Higher government take due to higher reference oil price. 11
  • 12. OIL PRODUCTS AND NATURAL GAS SALES IN  DOMESTIC MARKET OIL PRODUCTS NATURAL GAS 2.052 1.968 363 1.851 578 OTHERS 125 291 525 505 257Thous. bpd 46 Thermal 219 30 208 LPG 203 414 439 GASOLINE 410 227 238 245 Non thermal 733 841 796 DIESEL 1Q10 4Q10 1Q11 1Q10 4Q10 1Q11 o Domestic oil products sales increased 6% in the 1Q11 vs 1Q10 comparison, due to the Brazilian economy growth; o Jet Fuel sales increased 18% in the 1Q11 vs. 1Q10; o Natural Gas sales increased 13% (1Q11 vs 1Q10), due to industrial and power generation demand. 12
  • 13. OPERATING RESULTS – BRAZILIAN REFINING Crude Oil Processed Oil Products Production Utilization Factor andThous. Barrels/day Thous. Barrels/day % Brazilian Oil Throughput2.000 2.100 100 1,852 6.4% 1,738 1,8771.800 1,765 1.800 95 3321.600 341 424 89.8 1.500 418 901.400 86.2 244 851.200 239 82.1 1.200 80.41.000 80 390 900 353 800 1,520 92 75 1,397 73 600 600 70 400 6.5% 682 727 300 200 65 - 0 60 1Q10 1Q11 1Q10 1Q11 1Q10 1Q11 Imported Oil Processed Diesel Jet Fuel Gasoline Utilization Factor - Brazil (*) Brazilian Oil Processed Brazilian Oil Throughput Fuel Oil Others o Increase in crude oil processed in the 1Q11 due to revamps and refining expansions during 2010. Schedule stoppages  in the 1Q10 also contributed to the increase.(*) Utilization Factor reached 92.1% in March/2011 13
  • 14. OPERATING INCOME 1Q11 vs 4Q10 (CONSOLIDATED) (R$ Million) 1,016 627 (188) 12,536 10,773 308 4Q10 Sales  COGS Expenses Other  1Q11 Operating  Revenues Expenses  Operating  Income Income o Positive effect on COGS due to inventories built at lower prices in the 4Q10 (R$ 1.2 billion); o Decrease in Expenses due to lower exploratory costs (R$ 425 million) and  SG&A expenses (R$ 210 million). 14
  • 15. NET INCOME 1Q11 vs 4Q10 (CONSOLIDATED)  (R$ Million) 1,763 96 (112) (1,189) 10,602 (175) 10,985 4Q10       Operating  Financial  Interest in  Taxes Minority  1Q11 Net Income Income Results Investments Interest Net Income o Higher income taxes due to lower tax benefit from Interest on Capital in the 1Q11 (R$ 754 million). 15
  • 16. EXPLORATION AND PRODUCTIONOperating Income 1Q11 vs 4Q10(R$ Million) 3,983 (815) (786) 388 (507) 14,142 11,879 4Q10 Price Effect Volume Effect Cost Effect Volume Effect Operat. 1Q11 Operat. on Revenues on Revenues on COGS on COGS Expenses Operat. Income Income o Negative volume effect due to lower sales/oil transfers to Downstream; o Increase in COGS due to higher lifting costs and government take. o Higher lifting costs partially offset by lower DD&A ( ‐ R$ 1,01 per barrel); 16
  • 17. DOWNSTREAMOperating Income 1Q11 vs 4Q10(R$ Million) 2,676 (1,497) (4,690) 1,508 1,466 43 (494) 4Q10 Price Effect Volume Effect Cost Effect Volume Effect Operat. 1Q11 Operat. on Revenues on Revenues on COGS on COGS Expenses Operat. Income Income o Positive price effect due to higher oil and oil products prices, especially reflected on exports; o Sales of oil and oil products inventories built at lower prices in the 4Q10 avoided higher increase in COGS. 17
  • 18. GAS & POWER, INTERNATIONAL andDISTRIBUTION (1Q11 vs 4Q10) (R$ Million) 1Q11 VS. 4Q10 Gas & Power Operat. Income: R$ 745 R$ 529 41% o Higher average market prices of natural gas and reduction of acquisition/transfer costs of domestic gas; o Lower LNG imports and consumption volume; o Commercialization margins gains on power energy, due to average cost reduction at the spot market. International 1Q11 VS. 4Q10 Operat. Income: R$ 903 R$ 272 232% o Earnings increased due to higher commodities prices; FPSO Campo de Akpo o Lower exploratory expenses and dry wells write-offs also contributed to a better result. Distribution 1Q11 VS. 4Q10 Operat. Income: R$ 559 R$ 443 26% o 6% increase in commercialization margins offset by 7% reduction in sales volume; o This increase was compensated by the 7% reduction in sales volumes. 18
  • 19. INVESTMENTS 1Q2011 vs 1Q2010 1Q2011 1Q2010  R$ 15.9 billion R$ 17.8 billion(R$ billion) (R$ billion) Others  Others*  0.8 0.6 Inter  ‐ 0.9 Inter  ‐ 1.5 G&P*  ‐ 1.0 E&P* G&P*  ‐ 2.4 E&P* 7.2 7.9 RTM* 6.0 RTM* 5.4 o E&P: Decreased investments as a result of reduced exploration expending for the quarter; o RTM: Expansion (33%), quality (37%) and others (30%);  o G&P: Complementary phase of investments, after massive infrastructure built. *Includes projects developed  by SPEs 19
  • 20. LEVERAGE Net Debt/Net Cap. Net Debt/Ebitda 6 40% 5 34% 30% 4 32% 16% 17% 17% 3 20% 1.52 2 1.35 1.03 0.94 1.03 10% 1 0 0% 1Q10 2Q10 3Q10 4Q10 1Q11 R$ Billion 03/31/11 12/31/10 Short Term Debt 16.6 15.7 o Petrobras`  Leverage  level  kept  stable  Long Term Debt 112.4 102.2 when compared 1Q11 VS 4Q10; Total Debt 129.0 117.9 Cash and Cash Equivalents 43.3 30.3 o QoQ higher  long  term  debt    is  Tradeable Securities 19.6 25.5 explained  by  bonds  issuance  (  US$  6  Adjusted Cash and Cash Equivalents 62.9 55.8 billion), last January. Net Debt 66.1 62.1 Net Debt/Ebitda 1.03X 1.03X US$ Billion 03/31/11 12/31/10 Net Debt 40.6 37.3 20
  • 21. Information:Investor Relations+55 21 3224-1510petroinvest@petrobras.com.br 21 21

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