Petrobras, Brazil’s energy giant has though tough time continues to make progress towards becoming a global major. Now it has beaten second quarter profit estimates thanks to increased production in its pre-salt fields. The company controls significant oil and energy assets in 18 countries located in Africa, North America, South America, Europe and Asia continents.
Earlier economists and columnists had indicated that as the Brazilian economy is not at its best and it may affect Petrobras. The data show that whereas the Brazilian economy grew at 7.5% in 2010, its GDP slowed to 2.7% in 2011 and 0.9% in 2012.
However, the management at the company monitored increased household consumption and heavy demand from power plants. They also noted that Brazil’s ever expanding vehicle fleet has generated huge demand for petroleum products.
To meet the emerging requirements in the country, Petrobras even decided to max out its refining capacities. The company announced that its net income swung from a $600 million loss a year ago to $3.4 billion in the second quarter. Earnings per share came in 6% ahead of estimates at 48 cents in Brazilian Reais.
Petrobras seems banking on its pre-salt fields as it plans to take production to the next level and compete with Exxon Mobil in the next couple of years. Pre-salt fields in Brazil are one of the most encouraging discoveries of recent times as there are 16 billion proven barrels which may even increase to 100%.
The company even saw increase in sales revenue by 8.2% to $32.72 billion at Monday’s exchange rate; this may boost further its planned expansion to increase production. The company has reported that average output at pre-salt fields reached a record 310,000 daily barrels in June and peaked at 326,000.
As the accelerated demand for petroleum products in Brazil cannot be met by existing production capabilities, Petrobras is now importing oil from abroad and even maxing up its own refining capacity. The company owns oil field in the Campos Basin which accounts more than 80% of the Brazilian oil production, yet the increased demand cannot be met with it.
Recent expansion plans on the part of Petrobras to meet national requirement include buying and controlling important energy companies in South America. Moreover, as it is known for its deep-water exploration, it is trying to get huge deep-water fields of West Africa and the Gulf of Mexico.
To contact the reporter of this story: Jonathan Millet at email@example.com