Rio de Janeiro, April 19, 2016 – Petróleo Brasileiro S.A.-Petrobras hereby responds to Official Letter No. 165/2016/CVM/SEP/GEA-1, which requests the following clarifications:

Official Letter No. 165/2016/CVM/SEP/GEA-1

“Dear Sir,

We refer to the news item published today in the newspaper Valor Econômico, Business section, under the title: “Petrobras Plan does not reduce the volume of debt”, which contained the following statements:

“The calculations for the PNG are the result of a study carried out by the technical staff of the state-owned company, to give support to the board in the plan’s reduction announced in January.

The information is in the employees’ anonymous tip taken to the Board of Directors on March 28. The focus of the initiative was to point out what would be historical problems in the management, which weren’t getting to the Board’s attention.

The volume intended of funding would bring the total debt to US$112 billion in 2020, in the best scenario. The estimate is based on the maturities reported for this period, from US$78.7 billion. The amount is the result of the difference between what the company has to pay and what the company estimates to contract, which amounts to a reduction of US$14 billion on current commitments.

This will be the scenario if everything goes exactly according to plan for the projects: no budgets burst and the estimated production achieved. In the end, Petrobras will be producing 2.7 million oil barrels per day.

However, the company’s execution history is different and that is the concern pointed out to the board in the delation, given the size of the PNG. Optimists projects reported to the board would have the potential to make the scenario be costlier to the state-owned company.

In the last five years, on average, the exploration and production projects were delayed in five months and the consumed investments exceeded what was planned by 19%. When in operation, the production achieved was 12% down than the expected and the operating costs exceeded the initial calculation by 10%.

The PNG is the long-term planning’s guideline of Petrobras and is made for a five-year schedule. From 2015 to 2019, the state-owned company announced, in January, that it would cut 30% of the investment, to US$98 billion.

This review, if maintained, will amount to an investment of US$93 billion for the period of 2016 to 2020, according to the data sent to the board members. The amount indicates that the board chose the most aggressive plan among the ones studied to base the adjustment.

Petrobras did not respond to the inquiries made in the news article. […]”

In view of the above, we request that you clarify whether the information in question is true, and if so, why it was not disclosed through a Material Fact, as well as comment on other information deemed relevant to the issue.”

Clarification

Petrobras and its Board of Directors have continuously monitored the development of the 2015-2019 Business and Management Plan, in order to ensure its adherence to internal and external variables, which resulted in the adjustments made to the 2015-2019 BMP on 10/05/2015 and 01/12/2016. Those revisions reduced the investments estimate by more than US$ 30 billion, with revaluation of the portfolio, which resulted in reducing oil production forecast in Brazil to 2.7 million bpd in 2020.

Regarding the Company’s financing needs, 2015-2019 BMP provides US$ 15.1 billion of divestments for 2015 and 2016, as well as business restructurings and additional divestments of US$ 42.6 billion for 2017-2018. Thus, the value shown in the news article, of US$ 65 billion of funding, does not necessarily correspond to additional debt, because it includes resources that will come from business restructuring, cost optimization, demobilization of assets and additional divestments.

It is noteworthy that, in Petrobras’ operations in the pre-salt area, which concentrates most of BMP 2015-2019 investments, the Company has had operational performance and costs consistent with the assumptions used in BMP. Thus, it is worth noting that:

– six of the seven final production systems currently in operation in the pre-salt were implemented before or within the original terms planned. The Company has started up a large production unit every nine months, which makes the results achieved in the implementation of such projects even more significant;

– wells construction time in that layer came from 310 days in 2010 to approximately 80 days at the latest drilling and well productivity average is greater than 25 thousand barrels per day;

– the performance of the pre-salt production systems has been shown to be better than initial expectations, with higher overall productivity and lower expenditures than originally planned: the first 4 installed production platforms remain producing almost at full capacity; and the 3 most recent ones, that are in the growth phase of production have also the same good performance with respect to producing wells already in operation;

– the lifting cost in 2015 is also declining, decreasing from US$ 9.10/bbl in 2014 to about US$ 8.50 in 2015.

Finally, we emphasize that the Company is subject to risk factors that may impact its projections, such as:

– Changes in the market variables, such as oil prices and exchange rates;

– Divestments of operations and other business restructuring, subject to market conditions prevailing at the time of the transactions;

– Accomplishing the oil and natural gas production goals, in a difficult scenario with suppliers in Brazil.