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UPDATE 3-Brazil audit court clears Petrobras to restart asset sales
March 15, 2017 / 9:10 PM / 7 months ago

UPDATE 3-Brazil audit court clears Petrobras to restart asset sales

(Adds Petrobras statement)

By Leonardo Goy

BRASILIA, March 15 (Reuters) - Brazil’s federal audit court TCU on Wednesday allowed state-run oil company Petroleo Brasileiro SA to proceed with its divestment program, but required the company to restart the process except for two projects.

The decision means that moves by Petrobras, as the company is known, to sell off a controlling stake in its fuels distribution unit BR Distribuidora will start from scratch.

Petrobras had been prevented from signing any new asset sales while TCU reviewed its procedures and the court overturned an injunction that suspended sales in December.

The two assets that Petrobras will be able to sell without restarting the process are the rights to operate the Baúna and Tartaruga Verde offshore oil fields, and a share of Petrobras’ deepwater rights in the U.S. Gulf of Mexico.

Other assets will have to be sold under new rules that were not immediately made public. Sale decisions will remain the responsibility of the board of directors, through direct negotiations with buyers instead of a bidding process.

Petrobras said in a statement it would follow recommendations by the TCU to improve the divestment process and make it more competitive.

“This decision is fundamental for the company to press ahead with its plan for partnerships and divestments, one of the pillars for reaching its target of reducing leverage,” the statement said.

Saulo Puttini, the TCU’s infrastructure coordinator, told reporters the new rules will increase transparency and oversight in future asset sales.

Petrobras has sold about 30 assets since 2012 when the divestment program began, Puttini said, noting that another 40 remain to be sold.

The divestment plan has also been held up by an injunction obtained by the Alagoas oil workers union in Sergipe state, Sindipetro-AL/SE. The injunction has blocked the sale of the Baúna and Tartaruga Verde oil fields, the Baúna and Tartaruga Verde oil fields, as well as the inland fields in the states of Ceará, Rio Grande do Norte, Sergipe, Bahia and Espírito Santo.

Petrobras’s statement did not mention the oil worker’s injunction.

The union’s lawyer, Raquel Sousa, said in an interview that the oil workers would not accept the sale of Petrobras assets without a bidding process as provided for by Brazilian law to protect the country’s capital.

The injunction in November forced Petrobras to suspend talks with Karoon Gas Australia Ltd on the sale of a 100 percent stake in the 45,000 barrels-per-day Bauna field, in the Santos Basin, and a 50 percent interest in Tartaruga Verde, still in development, in the Campos Basin. (Reporting by Leonardo Goy; Writing by Anthony Boadle and Ana Mano; Editing by Richard Chang and Lisa Shumaker)

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