Petrobras Debt Crunch Buoys Exxon’s Prospects in Brazil: Energy

Petroleo Brasileiro SA’s worst debt position in a decade is boosting chances the Brazilian oil company will step aside and let Exxon Mobil Corp. and Royal Dutch Shell Plc buy offshore exploration licenses in Latin America’s biggest auction this year.

Exxon has been the most active in requesting data about the acreage Brazil is offering next month to take advantage of government-run Petrobras holding back its full participation, a state official with knowledge of the sale said. As Petrobras boosted investment in deepwater finds in past years, it became the world’s most indebted publicly-traded oil company, with $96 billion borrowed, or quadruple the level of 2008 compared with earnings before interest, tax, depreciation and amortization.