markets

Petrobras's Turnaround CEO Open to Staying Beyond Election

Updated on
  • Parente would demand managerial independence to remain in job
  • Now not the time to discuss a Petrobras privatization, he says
Petrobras CEO Pedro Parente speaks with Bloomberg’s Erik Schatzker at the World Economic Forum in Davos.

The man responsible for Petrobras’s recovery from scandal and rout could consider staying in the job after the presidential election, as long as the state-controlled producer keeps its independence under the next government.

Pedro Parente has won praise for trimming the biggest debt load in the oil industry even amid a price rout, settling a class action case with U.S. investors, and expanding Petroleo Brasileiro SA’s deep-water production fleet during a period of spending cuts. The election, set for October, is shortening Parente’s timetable to reduce leverage through asset sales and form partnerships with foreign oil majors.

“If I have the same conditions I have now, I may consider” remaining in the job, Parente said during an interview with Bloomberg TV in Davos. “What concerns me is that there is no political interference.”

Although Parente’s mandate lasts until March, 2019, Brazil’s next administration could use its majority of Petrobras voting shares to appoint a new chief executive at the start of 2019.

Polling shows that most Brazilians aren’t in favor of privatizing Petrobras even though the topic has come up in the presidential campaign, Parente said. Henrique Meirelles, Brazil’s finance minister and a potential presidential candidate who is also in Davos this week, said he favors a gradual Petrobras privatization.

“This is not the right time to discuss this,” Parente said. “It’s time to focus on the business.”

Debt Burden

Petrobras most leveraged major producer

Source: Bloomberg

In the past couple of months, Parente has made headway at asset sales with the $1.5 billion initial public offering of the producer’s fuel subsidiary, and a $2.9 billion sale of a legacy field stake. Parente said the company will meet its $21 billion target even though it has more than $16 billion to divest in the remainder of the year.

— With assistance by Erik Schatzker

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