Petrobras Needs Cash Injection of Up to $26 Billion, Maua Says

Brazil’s state-run oil producer Petrobras needs a capital injection of as much as 100 billion reais ($25.5 billion) to balance its finances, even if it takes three years to complete, saidLuizFernandoFigueiredo, a former central bank director and Chief Executive Officer of Maua Capital.

“Everyone knows that Petrobras needs to be capitalized at some moment, and every day that passes this gets more expensive,” Figueiredo said Tuesday at an event in Sao Paulo organized by Bloomberg and the capital markets association known as Anbima. “It needs a capitalization soon, even if it is a plan for the next one, two or three years.”

The injection could be done by development bank BNDES, which is already a shareholder, he said. While Rio de Janeiro-based Petrobras is making efforts to cut costs amid the low oil price environment that has made many of its projects uneconomical, this hasn’t been enough to lower its enormous debt load and reduce leverage, Figueiredo said.

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