Petrobras’s Foster to Replace Gabrielli as Chief Executive

Maria das Gracas Foster
Maria das Gracas Foster, seen here as director of gas and energy at Petroleo Brasileiro SA. Photographer: Douglas Engle/Bloomberg

Petroleo Brasileiro SA, the world’s fifth-biggest oil producer by market value, plans to replace its chief executive officer with its natural-gas and energy chief, Maria das Gracas Foster, as Jose Sergio Gabrielli pursues a political career.

Foster, 58, plans to replace Gabrielli, 62. Petrobras Chairman and Finance Minister Guido Mantega will present Foster’s name to the board of directors of the state-run company on Feb. 9, according to a regulatory filing today. Gabrielli is departing to run for political office, Energy Minister Edison Lobao told reporters today, without elaborating.

“The parts of the company she has managed have good numbers,” said Lucas Brendler, who helps manage about 7 billion reais ($4 billion) at Banco Geracao Futuro de Investimentos in Porto Alegre, Brazil. “Now they can focus again on delivering targets.”

Petrobras is investing $224.7 billion in the five years through 2015 as it taps the largest discoveries in Brazil’s history in the so-called pre-salt region in deep waters off the coast. Foster was the head of oil and natural gas at Brazil’s energy ministry when President Dilma Rousseff was minister from 2003 to 2005. Rousseff took over as president in January 2011.

The nomination of Foster, who ran Petrobras’s fuel distribution unit before heading the gas and energy division, will benefit the company at a time output growth has missed targets, Bradesco analyst Auro Rozenbaum said in an interview.

‘Presidential Connections’

“She is a politically strong figure, connected to the president,” Rozenbaum said in a telephone interview from Rio de Janeiro. “Without a doubt, because of her technical profile for a company like Petrobras it may end up having some advantages.”

“She’s a good option because she is a career official at Petrobras,” Adriano Pires, the head of the Rio de Janeiro-based Brazilian Center for infrastructure, said in a telephone interview from Rio de Janeiro. “It’s been a long time since Petrobras had a president who came from the company.”

Gabrielli, who began working at Petrobras in 2003 as chief financial officer and was promoted to chief executive officer in 2005, was a “political appointment” and had little experience in the oil industry, Pires said. Foster’s promotion follows Rousseff’s move to replace officials who were appointed by former president Luiz Inacio Lula da Silva, he said.

Management Changes?

“As part of this policy of ministerial changes, changes at Petrobras are being made,” Pires said.

Petrobras didn’t mention any other management changes in the statement.

Bahia state governor Jaques Wagner has invited Gabrielli to join his government, an official at the governor’s press office, who declined to be named because of internal policies, said in a telephone interview. Gabrielli is from Bahia.

Foster has a degree in chemical engineering from the Universidade Federal Fluminense, and advanced degrees in chemical engineering and nuclear engineering from the Universidade Federal do Rio de Janeiro. She also has a master’s of business administration from the Fundacao Getulio Vargas.

Exxon Mobil Corp. and PetroChina Co Ltd. are the world’s first- and second-biggest oil producers by market value. Royal Dutch Shell Plc and Chevron Corp. and the world’s third- and fourth-largest producers.

Petrobras rose 3.8 percent to 25.13 reais in Sao Paulo. The stock has climbed 17 percent this year, more than the 10 percent gain in Brazil’s benchmark Bovespa index.

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