Petrobras / Clarification on News: Financial Statements

Petrobras

Clarification on News: Financial Statements

Rio de Janeiro, April 2, 2015 – Petróleo Brasileiro S.A. – Petrobras complies with OFFICIAL LETTER/CVM/SEP/GEA-1/No. 108/2015, which requests the following clarification:

OFFICIAL LETTER /CVM/SEP/GEA-1/No. 108/2015

“In reference to news released on March 31, 2015 in the newspaper Folha Online entitled “List also prevents the release of Petrobras’s balance sheet”, containing the following statements:

“Even if Petrobras managed to prepare its 2014 audited financial statements for release this Tuesday (31th), last day according to CVM (Brazilian Securities Commission) regulations, a list containing the names of 35 employees would probably derail the release.

The list represents the last names of an initial group of 150, out of 2,000 employees in total, whose recent conduct is under scrutiny by both of the law firms hired in October to investigate and try to understand the effects of the corruption scheme uncovered by Operation Lava Jato.

The 2,000 employees participated in acts related to the 23 contractors indicted under Lava Jato – and with whom Petrobras suspended business contracts late last year.

The 150 names became a priority because the employees either engage with or engaged with PwC, the firm auditing Petrobras’s balance sheets.

By order of the committee created to monitor the work of both law firms, the balance sheet will only be signed by PwC after an investigation into these employees is complete.

Petrobras has been in default with its third quarter statements since November 14. The company has to pay a fine of R$ 500 for each day the document is late.

If the audited third quarter statements are not released by July, Petrobras will be placed in CVM’s “delinquency list”.

If they are not published by November 14, Petrobras’s registration with CVM will be suspended and it will no longer be able to trade shares in the stock exchange. After a year of suspension, the company’s registration will be cancelled.

‘CREDIBLE’ NUMBER

PwC will only approve the balance sheets when Petrobras is able to present a “credible” number to be subtracted from assets, related to the amounts improperly added as investments between 2004 and 2012, but disbursed, in reality, in the form of kickbacks.

In January, two consultancies presented assets overvalued at R$ 88.6 billion. The amount ended up being discarded because it also contained variables, such as exchange rate, operational factors and inefficiency. Now, the search for another formula has begun.”

We request Petrobras’s clarification regarding the veracity of these statements.

Clarification

As informed on December 23rd, 2014, Petrobras created a Special Committee that will serve as a reporting line for the independent internal investigation conducted by the firms Trench, Rossi e Watanabe and Gibson, Dunn & Crutcher. This Committee acts independently and has a direct reporting line with the Board of Directors.

As announced on January 27th and reiterated in clarifications disclosed on March 12th, 20th,25th and 26th, Petrobras reaffirms that it is assessing the most adequate accounting treatment for the improper payments identified in the investigations of the Lava Jato Operation to proceed with the adjustments in the financial statements for the third quarter of 2014 as well as its 2014 annual statements, reviewed by the independent auditors.

The work of the Special Committee and the areas within the Company involved in the preparation of the financial statements is in progress. Petrobras is working to release these statements at the earliest possible time. However, no date has yet been set for their release.

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