A board member of Brazil's state-run Petrobras lashed out at the government on Thursday and said he may ask the country's securities regulator to sanction the oil company for failing to inform him and other board members of a 15 billion real ($6.8 billion) oil-rights purchase plan.
Board members Silvio Sinedino and Mauro Cunha told Reuters on Thursday that they knew nothing of a government plan to sell as much as 15.2 billion barrels of offshore oil rights to Petroleo Brasileiro SA, as Petrobras is formally known, until it was announced in a securities filing on Tuesday.
Sinedino said he is considering a complaint to securities regulator CVM because of the government's heavy hand in the company's affairs under President Dilma Rousseff. On her watch, Petrobras has become the world's most indebted and least-profitable major oil company.
"I'm not against buying the oil, I'm just not sure the terms are a good deal," Sinedino said. "The government has been doing everything it can to suck money out of Petrobras to balance its own books."
A senior government official, speaking on condition of anonymity, told Reuters that government officials who drafted the plan felt they had no need to inform the Petrobras board.
Petrobras shares have slipped 5.4 percent since the decision. A Petrobras spokeswoman declined a request for comment.
While the government owns a majority of voting shares, non-government investors own most of the company's capital, but most of that is made up of non-voting preferred shares.
"If the government finds the minority shareholders or employee representatives or the by-laws to be a nuisance they have a remedy: they can fully nationalize the company, buy up the minority shares," said Sinedino, who represents Petrobras' union employees on the board.
"But as long as they have minority shareholders, they have to obey the rules," he added.
In addition to paying the government about 15 billion reais by 2018, the plan increases annual Petrobras spending by about 3 percent and requires the purchase of billions of dollars worth of oil production vessels and equipment.
On Tuesday, Petrobras Chief Executive Officer said that the plan had been under discussion for two years. It was approved by the country's National Energy Council earlier on Tuesday.
This latest move comes as the government's refusal to let Petrobras raise domestic fuel prices in line with world prices has led to large losses on fuel imports. This has caused the company's debt to soar beyond its own internal limits as it seeks cash to pay for a $221 billion five-year expansion plan.
Cunha, who represents minority shareholders on the board and is also a member of the company's fiscal committee, voted against approval of the company's 2013 results earlier this year after complaining that the company did not give him or his colleagues sufficient time to review them.
Source: Reuters
Board members Silvio Sinedino and Mauro Cunha told Reuters on Thursday that they knew nothing of a government plan to sell as much as 15.2 billion barrels of offshore oil rights to Petroleo Brasileiro SA
Sinedino said he is considering a complaint to securities regulator CVM because of the government's heavy hand in the company's affairs under President Dilma Rousseff. On her watch, Petrobras has become the world's most indebted and least-profitable major oil company.
"I'm not against buying the oil, I'm just not sure the terms are a good deal," Sinedino said. "The government has been doing everything it can to suck money out of Petrobras to balance its own books."
A senior government official, speaking on condition of anonymity, told Reuters that government officials who drafted the plan felt they had no need to inform the Petrobras board.
Petrobras shares have slipped 5.4 percent since the decision. A Petrobras spokeswoman declined a request for comment.
While the government owns a majority of voting shares, non-government investors own most of the company's capital, but most of that is made up of non-voting preferred shares.
"If the government finds the minority shareholders or employee representatives or the by-laws to be a nuisance they have a remedy: they can fully nationalize the company, buy up the minority shares," said Sinedino, who represents Petrobras' union employees on the board.
"But as long as they have minority shareholders, they have to obey the rules," he added.
In addition to paying the government about 15 billion reais by 2018, the plan increases annual Petrobras spending by about 3 percent and requires the purchase of billions of dollars worth of oil production vessels and equipment.
On Tuesday, Petrobras Chief Executive Officer said that the plan had been under discussion for two years. It was approved by the country's National Energy Council earlier on Tuesday.
This latest move comes as the government's refusal to let Petrobras raise domestic fuel prices in line with world prices has led to large losses on fuel imports. This has caused the company's debt to soar beyond its own internal limits as it seeks cash to pay for a $221 billion five-year expansion plan.
Cunha, who represents minority shareholders on the board and is also a member of the company's fiscal committee, voted against approval of the company's 2013 results earlier this year after complaining that the company did not give him or his colleagues sufficient time to review them.
