The Brazilian oil and gas state-held company Petroleo Brasileiro SA (Petrobras) has reached a strategic cooperation agreement with the China Development Bank (CDB).
This cooperation agreement will allow Petrobras to seek new financing options in China and make use of the second half of a US$10bn credit line opened in 2016 by the CDB and guaranteed by the Brazilian oil exports. The first half (US$5bn) was borrowed in December 2016 under the framework of a 10-year loan which can be repaid either in cash or in oil, at CDB request. The deal will encompass the financing and leasing of equipment required for exploration and production operations such as oil platforms.
Petrobras is heavily indebted and has been forced to divest assets and in late June 2017 its total debt stood at US$113.8bn (net debt of US$89.3bn), down from US$123.9bn in late June 2016 (US$103.6bn of net debt).