Webcast ingles 3 q10 versao_ing_final


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Webcast ingles 3 q10 versao_ing_final

  1. 1. Results Announcement 3nd Quarter 2010 (IFRS) Conference Call / Webcast Almir Guilherme Barbassa CFO and Investor Relations Officer November 16th, 2010 1
  2. 2. DISCLAIMER FORWARD-LOOKING STATEMENTS: DISCLAIMER The presentation may contain forward-looking statements We undertake no obligation to publicly update or about future events within the meaning of Section 27A of revise any forward-looking statements, whether as the Securities Act of 1933, as amended, and Section 21E a result of new information or future events or for of the Securities Exchange Act of 1934, as amended, that any other reason. Figures for 2010 on are are not based on historical facts and are not assurances of estimates or targets. future results. Such forward-looking statements merely reflect the Company’s current views and estimates of future economic circumstances, industry conditions, All forward-looking statements are expressly company performance and financial results. Such terms qualified in their entirety by this cautionary as "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 this analogous expressions, are used to identify such forward- presentation. looking statements. Readers are cautioned that these statements are only projections and may differ materially from 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 INVESTORS Form 20-F, which identify important risk factors that could We present certain data in this presentation, such cause actual results to differ from those contained in the as oil and gas resources, that we are not permitted forward-looking statements, including, among other to present in documents filed with the United things, 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 because prices, refining margins and prevailing exchange rates, such terms do not qualify as proved, probable or uncertainties inherent in making estimates of our oil and possible reserves under Rule 4-10(a) of Regulation gas reserves including recently discovered oil and gas S-X. reserves, international and Brazilian political, economic and social developments, receipt of governmental approvals and licenses and our ability to obtain financing. 2
  3. 3. HIGHLIGHTS o Net income (R$ 24,588 million) increased 10% in 9M10 vs. 9M09. In the 3Q10, net income reached R$ 8,566 million; o Total investments of R$ 56,500 million YTD 2010, 11% higher than 9M09; o Public offering resulted in a capital increase of R$ 120 billion; o Acquired rights to produce 5 billion boe in new pre-salt areas not yet licensed; o Reduced leverage ratios: o Net Leverage decreased from 34% to 16% o Net Debt/EBITDA from 1.52X to 0.94X 3
  4. 4. OPERATING HIGHLIGHTS FPSO Cidade de Angra dos Reis o Start-up of the first commercial FPSO in Tupi: o Estimated 2011 average production: 50 thous. bpd o Peak production forecasted for 2012 o New exploratory frontier in ultra deepwater at Sergipe-Alagoas basin with light oil; o Inauguration of the diesel hydrotreatment and coke units as part of the modernization of Revap , which is responsible for 15% of the feedstock processed in Brazil. o Record thermoelectric generation in September (6,252 MW average) and of natural gas sales in 3Q10 (360 thous. boed). 4
  5. 5. OIL AND NATURAL GAS PRODUCTION 9M10 VS 9M09: Increase in domestic and international markets Total Production (Thous. bpd) National Production 2,513 2,568 234 246 International 2,279 2,322 National 316 327 Natural Gas Oil and LNG 2,279 2,322 1,963 1,995 o Production growth of 2% in the year due to: - Increase in the production of FPSO´s Cidade de Vitória, Cidade de Santos, Espírito Santo and Frade and contribution of extended well tests (Tiro and Tupi); - Higher demand for natural gas in the domestic market. Production achieved record in September; o Comparing 3Q10 vs 2Q10, reduction of 1% due to maintenance stoppages during August of P-33 and P-35. 5
  6. 6. NEW PRODUCTION UNITS: Continued increase in capacity Main units Projects Capacity 2Q10 3Q10 FPSO Cidade de Vitória 100 th. bpd 60.9 th. bpd 51 th. bpd (Golfinho) FPSO Capixaba 58 th. bpd 100 th. bpd 9.7 th. bpd Cachalote e Baleia Franca FPSO Espírito Santo 35 th. bpd 28.2 th. bpd 26 th. bpd Parque das Conchas (1) SS-11 (TLD de Tiro) 30 th. bpd 15 th. bpd 17 th. bpd FPSO Frade (2) 30 th. bpd 17 th. bpd 18 th. bpd FPSO Cidade de Santos 35 th. bpd and UTB: 15 th.bpd (Uruguá-Tambaú) and - 25 million m3/d MXL.: 1Q11 Mexilhão (1) Projects in partnership, capacity and production refers to Petrobras share (35%) (2) Projects in partnership, capacity and production refers to Petrobras share (30%); Total: 185 th. bpd New Units Projetcs Capacity Start-up FPSO Cidade de Angra dos Reis (Tupi) 100 th. bpd Oct/2010 Guará EWT 30 th. bpd Dec/2010 P-56 (Marlim Sul) 100 th. bpd Jul/2011 P-57 (Jubarte) 180 th. bpd Dec/2010 6
  7. 7. PRE-SALT UPDATE Wells**: Santos Basin Petrobras o Acquisition of the rights to produce ANP 5 billion boe in specific areas of the ** Drilling or completion or test. pre-salt that are not under concession; Libra o Start up of FPSO Cidade de Angra dos Reis in Tupi; Under Concession Transfer of Rights o 5 new wells to be concluded in 2010, totaling 16 wells this year; o Two additional rigs still to arrive in Macunaíma 2010, increasing pre-salt operating fleet to ten; Tupi NE o Guará EWT scheduled to start up Carioca Tupi Oeste Piloto de by the end of November (FPSO NE Tupi IG1 already in Brazil); Tupi Tupi Sul Sudoeste o Tupi NE EWT scheduled to start up in 1Q11 (FPSO Cidade de São Vicente). 7
  8. 8. DOWNSTREAM UPDATES Revap – Reduction of future needs for Imports • Investments of US$ 2.5 billion: • Coke Unit (55%): higher added value products • Capacity: 5,000 m³/day (3,000 m³/d additional domestic crude oil processing) • Yield: Diesel (55%), LPG (5%), Naphtha (10%), Coke (20%) and Feed Cracker Unit (10%). • Hydrotreatment of diesel (45%): Diesel S-50 • Increase in production capacity: - LPG - 21 thous. bpd - Nafta - 42 thous. bpd - Diesel - 23 thous. bpd New Refineries - Updates • New buildings in Comperj and Abreu e Lima in progress • Pre-operation of Polyester Yarn Unit (Suape Petrochemic) • Contracting of basic engineering - Premium I (Maranhão) and II (Ceará) Abreu e Lima 8
  9. 9. INVESTING IN TECHNOLOGY LEADERSHIP Expansion of CENPES makes it one of the largest research center in the world Petrobras´s partnerships with 120 universities and research centers has created one of the greatest concentrations of energy research in the world In the Technological Park of the Rio de Janeiro Federal University, four R&D centers for major equipment and services suppliers is currently under construction : Petrobras Investments in HSE, IT and R&D (2010-14) • Schlumberger • FMC Technologies US$ 11.4 Billion • Baker Hughes • Usiminas 29% Others companies are schedule to come to Brazil to develop technological centers: 46% • Cameron 1.9 •TenarisConfab 0.2 • General Electric • Vallourec & Mannesman 0.9 • Halliburton • Weatherford • IBM 25% • Technip • Wellstream HSE IT R&D 9
  10. 10. AVERAGE REALIZATION PRICE: Stable price in the domestic market US$/bbl 115 R$/bbl 120 101 100 220 Avg. Avg. Avg. 3Q09 2Q10 3Q10 170 80 75 76 78 77 152.34 158.60 158.17 59 68 60 55 120 44 64 70 73 74 49 132.87 152.64 144.47 40 72 70 48 20 32 20 4Q07 1Q08 2Q08 3Q08 3Q084Q08 4Q08 1Q09 1Q09 2Q09 3Q09 2Q09 3Q09 4Q09 1Q10 4Q09 1Q10 ARP USA 2Q10 3Q10 2Q10 3Q10 ARP Petrobras Petrobras Oil Price Brent o Average Realization Price remains stable. o In the comparison 3Q10/2Q10, the gap between ARP USA and ARP Petrobras increased, due to lower oil prices, Real strengthening and price stability in Brazil. 10
  11. 11. DOMESTIC LIFTING COST: Increase explained by collective bargain and stoppages for maintenance R$/barrel US$/barrel 76.2 78.3 76.9 74.6 140.2 137.2 134.5 68.3 129.7 127.7 24,74 24,50 24,67 43.04 43.82 43.91 42.72 23,73 41.62 22,86 24.78 26.53 26.87 26.37 24.26 13.84 15.23 14.33 14.71 14.07 16.84 16.51 16.95 17.54 18.46 9.02 9.51 9.40 9.79 10.60 3Q09 4Q09 1Q10 2Q10 3TQ10 3Q09 4Q09 1Q10 2Q10 3Q10 Lifting Cost Gov.Part. Brent (in R$) Lifting Cost Gov.Part. Brent (in US$) Comparing 3Q10/2Q10: o Collective Bargain Agreement (CBA), expenses with materials (equipments for platform maintenance) and 1% decrease in production increased lifting costs; o Lower government take due to decrease in international oil price (4%); 11
  12. 12. DOMESTIC OIL PRODUCTS : Significant sales growth in the domestic market Refinery Output Domestic Sales Thous. bpd -1% +11% 1,867 2,033 1,807 1,844 Others 1,825 1,898 640 LPG 565 637 634 507 501 134 Gasoline 134 128 222 221 230 338 Diesel 334 342 327 374 379 755 702 740 769 802 859 3Q09 3Q09 2Q10 2Q10 3Q10 3Q10 o Oil product sales in the domestic market grew 11% versus year earlier. - Diesel (increase of 12%): growing economic activity and improved grain harvest; - Gasoline (increase of 16%): substitution with ethanol due to higher ethanol prices; - Other: (increase of 9%): largely from jet fuel, asphalt sales, and LPG o Refinery output increased quarter over quarter as a result of restart of Replan 12
  13. 13. GAS & ENERGY Investments consolidation Infrastructure Flexibility Power Generation NG Pipelines Fertilizer Thermo Power Plant LNG Terminals G&E Investments fully responded to higher demand Power Generation in Brazil Natural Gas sales (Th. boed) 7000 +224% (3Q10 vs. 2Q10) +23% (3Q10 vs. 2Q10) Brazil: 6,252 MW 6000 360 Average MW 5000 Gas to Petrobras 292 Gas to others 244 4000 3000 2000 1000 3Q09 2Q10 3Q10 0 13 Oct-09 Dec-09 Feb-10 Apr-10 Jun-10 Aug-10
  14. 14. OPERATING INCOME 3Q10 vs 2Q10 (R$ Million) - CBA 2010/2011: R$ 634 million 1,108 (580) - Barracuda: R$ 486 million (270) - Employees incentives: R$ 92 million (1,888) 12,303 10,673 2Q10 Operat. Inventory Other Operating 3Q10 Operating Net Effect COGS Expenses Operating Income Revenue (COGS) Income o Higher Operating Revenue due to higher product sales volume in Brazilian market, met largely by imports; o Average inventory accounting increased COGS by R$ 580 million versus prior quarter; o Increased operating expenses due primarily to non-recurrent items in 3rd Quarter: Collective Bargaining Agreement (CBA) 2010/2011, terminating Barracuda financial structure, and Incentives Progam for employees to purchase shares in the Public Offering. 14
  15. 15. NET INCOME 3Q10 vs 2Q10 (R$ Million) 460 (634) 2,598 (523) 8,566 8,295 (1,630) 2Q10 Operating Financial Equity Minority 3Q10 Taxes Net Income Income Result Income Interest and Net Income Employees Part. o Higher financial results (R$2,598 million), due to q/q 6% valuation of Real on net debt; o Equity income and Minority Interest also a consequence of Real strengthening; o Increase in tax expenses as a consequence of higher operating income; o Lower operating income offset by financial results, leading to 3% increase in net income. *(1) Operating profit before financial income and participation in investments 15
  16. 16. EXPLORATION & PRODUCTION 3Q10 vs 2Q10 Operating Income (R$ Million) 11,572 1,095 (506) (930) (1,081) 125 10,275 2Q10 Price Effect Cost Effect Volume Effect Volume Effect Operating 3Q10 Operating on Revenues on COGS on Revenue on COGS Expenses Operating Income Income Reduction in operating income due to: o Lower sales prices in the domestic market for oil and natural gas (oil: -2%; NG: -25%, in US$/bbl); o Higher volumes reflect sales from inventory during 3Q. o Higher operating expenses reflect CBA (R$ 225 Million), Barracuda project structure (R$ 486 Million) 16
  17. 17. DOWNSTREAM 3Q10 vs 2Q10 Operating Income 474 (365) (R$ Million) 2, 497 (211) 1, 714 244 (925) 2Q10 Price Effect Cost Effect Volume Effect Volume Effect Operating 3Q10 Operating on Revenues on COGS on Revenue on COGS Expenses Operating Income Income o Higher sales volumes from increasing domestic demand; o Lower cost of goods sold due to lower oil acquisition/transfer prices in the 3Q10 and higher oil product import costs in the 2Q10, explain positive effect on cost; o Positive effect on COGS due to lower acquisition/transfer prices and oil product import costs; o Operating expenses higher because of CBA 2010/11 (R$ 136 Million). 17
  18. 18. GAS & POWER, INTERNATIONAL and DISTRIBUITION (3Q10 vs 2Q10) 3Q10 VS. 2Q10 Operating Results: 49 % Gas & Power R$ 264 million R$ 522 million o Natural Gas: Lower margins due to sales to volumes; o Energy: Lower result in energy commercialization due to increase in META DE ENDIVIDAMENTO: price (PLD) offset by higher thermoeletric generation; spot Oferta Pública de Ações omelhora indicadores da Cia. Non-recurring write-offs reduced operating income: ICMS Tax (-R$90 million); GTL Pilot Plant (-R$ 50 million), CBA 2010/2011 (-R$ 30 million), lower thermoeletric idleness (+R$45 million). Distribution 3Q10 VS. 2QT10 Operating Results: 35 % R$ 526 million R$ 390 million o Increase of 10% on sales volume; o Benefited from non-occurrence of expenses from the settlement of ICMS tax debits, as occurred in the previous quarter. International Operating Results : 3Q10 VS. 2Q10 R$ 600 million 27 % R$ 437 million o Higher exploratory costs; o Higher write-off of dry or economically unviable wells in Angola, Nigeria, the USA and Argentina. FPSO Campo de Akpo 18
  19. 19. INVESTMENTS 9M10 vs 9M09: Investiments 9M10 Investiments 9M09 R$ 56.5 billion R$ 50.7 billion 4.4 6.5 0.5 3.4 E&P 0.4 3.7 0,05 5,6 Downstream 5.5 1,1 24.1 Gas & Power 23.2 1,3 International 3,8 4.5 20.6 6,1 RTC 10,1 24,7 Others 10.6 Investments in Downstream for 9M10: R$ 20,582 million •Quality improvements Quality/Sulfer Content (sulfur removal); Conversion 27% 27% •Maintenance, HSE, New Units operating efficiencies logistics; Fleet Expansion 12% 13% •Expansion of refining Investments in Braskem capacity. 19% Plangas, Maintenance,infrastructure,HSE 2% and others 19
  20. 20. PUBLIC OFFERING RECONCILIATION R$ 120.2 Billion: Public Offering R$ 115.1 billion: 3Q10 R$ 67.8 Billion: LFTs R$ 67.8 B: LFTs R$ 74.8 Billion to acquire rights GreenShoe R$ 47.2 Billion:Cash R$ 7.0 Billion: Cash to 5 billion barrels R$ 29.5 Billion: Cash R$ 45.5 Billion R$ 10.7 Billion: LFTs* Retained as cash and equivalents R$ 5.2 Billion: 4Q10 Cash Before Public Offering After Public Offering R$ Billion 06/30/2010 09/30/2010 Cash and Cash Equivalents(Adjusted by LFT) 24.2 58.0 Net Debt 94.2 57.1 Net Debt / Net Capitalization 34% 16% Net Debt/Ebitda 1.52X 0.94X *Government securities with a maturity greater than 90 days. 20
  21. 21. Information: Investor Relations +55 21 3224-1510 petroinvest@petrobras.com.br 21 21