Petrobras proposes new fuel supply contract
By Nathan Walters / Argus Media
Petroleumworld 09 13 2021
Brazil's state-run oil company Petrobras has approved new fuel supply contract terms in a bid to remain competitive with the sale of its refineries.
The contracts for diesel - road and marine - and unblended gasoline "will give more flexibility, making it possible to adjust commercial conditions according to the market, representing an important step for the positioning of Petrobras in the new competitive environment," the company said in a statement.
The new contract models, which are subject to regulatory approval, are designed to help Petrobras compete with importers and the companies it expects to buy 1 million b/d of its refining capacity. The specifics of the new contracts were not disclosed.
Petrobras stressed that the new contracts, drafted based on industry feedback, are not a departure from its market-based fuel pricing policy. The company's commitment to import price parity has been questioned in recent days in response to President Jair Bolsonaro's rhetoric.
So far, Petrobras has only signed two refinery sale agreements, a $1.65 billion one with Abu Dhabi state investment fund Mubadala for the 333,000 b/d Landulpho Alves refinery (Rlam) and a $189.5 million one with Brazilian fuel distributor Atem for the 46,000 b/d Isaac Sabba refinery (Reman). The company canceled the sales processes for two other refineries - Presidente Getulio Vargas (Repar), of 208,000 b/d, and Abreu e Lima(RNest), of 130,000 b/d - after failing to attract satisfactory offers.
The sales should be closed by the end of the year, according to the antitrust agreement signed with the Administrative Council for Economic Defense (Cade). Sale agreements for four other refineries are to be signed by October 30, and two more by December 31.