July 30 (Bloomberg) -- Petroleo Brasileiro SA said it may more than double its borrowings from the U.S. Export-Import Bank to as much as $5 billion, following a $10 billion loan from China.

Petrobras, as the state-controlled oil company is known, may increase the loans from $2 billion now, Chief Financial Officer Almir Barbassa said today at a press conference in Rio de Janeiro. The initial loan made in April was an “opening amount,” Fred Hochberg, president of the U.S. bank, said earlier today in an interview in Rio.

“The Export-Import Bank met yesterday with Petrobras, and it offered more resources to the company,” Brazilian Energy Minister Edison Lobao said at the press conference.

Investment in Brazil’s oil industry is expected to surge to more than $200 billion over the next five years, buoyed by spending on the Americas’ largest oil find since 1976. Petrobras in February secured $10 billion in financing from the China Development Bank Corp.

China replaced the U.S. as Brazil’s biggest trading partner this year, after the global recession choked sales to the U.S. The Chinese bank, which plans to open an office in Rio de Janeiro next year, has also agreed to lend $800 million to Brazil’s state development bank, known as BNDES.

The U.S. and Chinese loans will help Petrobras pay for part of its $174 billion, five-year investment plan to expand output.

High Priority

Hochberg, in his first trip abroad since being named to the post by President Barack Obama in April, said the administration places a high priority on its relationship with Latin America’s largest economy. The Export-Import Bank has helped finance Brazil’s development since 1940, when it made a loan for $25 million to help build the country’s first steel mill at Volta Redonda.

Prior to the Petrobras loan, Brazil had $2.3 billion in outstanding loans from the bank. Lending to Petrobras may surpass the almost $5 billion in financing to Mexico’s state- owned Petroleos Mexicanos, Hochberg said.

Opportunity

“I think the opportunity here is even greater,” he said.

During his three-day visit to Brazil, Hochberg said he met with officials from Petrobras; Vale SA, the world’s biggest iron-ore producer; and the nuclear power unit of state- controlled Centrais Eletricas Brasileiras SA.

Energy cooperation with Brazil will be a “centerpiece” of future bilateral ties, Assistant Secretary of State Thomas Shannon, the top U.S. diplomat for Latin America and Obama’s choice to be the next ambassador to Brazil, said in written testimony to the Senate Foreign Relations Committee this month.

Total new loans by the U.S. Export-Import Bank will likely top $20 billion for the first time in the fiscal year through Sept. 30, Hochberg said, adding that he expects another record next year.

“We’re not seeing demand fall,” Hochberg said. “Two or three months ago, we had a lower forecast for loans this year and we are each month increasing that expectation.”

The Export-Import Bank, the World Bank, China’s export lender and other government-supported agencies are ramping up their financing for exporters, as the World Trade Organization estimates a 9 percent drop in trade this year.

Petrobras also said today it signed a 25 billion-real ($13.3 billion) loan with BNDES that will be repaid in 19 years and 8 months. The first payment is scheduled for September 2016.

Petrobras CFO Barbassa said today that the company’s cash- generation will be greater than forecast with oil prices at current levels.

To contact the reporter on this story: Helder Marinho in Rio de Janeiro hmarinho@bloomberg.net; Joshua Goodman in Rio de Janeiro jgoodman19@bloomberg.net

Last Updated: July 30, 2009 19:19 EDT