Rio de Janeiro, April 22, 2016 – Petróleo Brasileiro S.A. – Petrobras hereby answers to the Official Letter No. 175/2016/CVM/SEP/GEA-1, which requests the following clarifications:

Official Letter No. 175/2016/CVM/SEP/GEA-1

“Dear Officer,

We refer to the news item published on 04.19.2016 in Fausto Macedo’s blog under the title: “Federal Police identifies loss of R$1.9 billion to Petrobras in four of Andrade Gutierrez’s contracts”, which contained the following statements:

A new expert report of the Federal Police shows that in four contracts won by Andrade Gutierrez within the cartel and corruption scheme in Petrobras may have generated a loss of R$1.98 billion. These contracts were signed between 2006 and 2009 in the Replan refinery in Paulínia (SP), in the Regap refinery in Minas Gerais, in the Rlam refinery in Bahia and in the Complexo Petroquímico do Rio de Janeiro (Comperj), and were analyzed within a set of procurement processes, confirming the cartelization and the favoring of the group composed by 16 contractors that shared the works in the state-owned company.

“It was concluded that the procurement processes that originated the contracts (…) were frustrated by the direct action of the cartel composed by the criminal organization known as ‘Clube dos 16’. These contracts, won by Construtora Andrade Gutierrez (alone or in consortiums with other companies), resulted in a direct loss of R$1,983,185,853.45, in current values, to the state-owned company”, says the 158/2016 report.

The direct loss is “due to proposals with artificially scaled up prices”, as the document states, dated from February 2 and which was attached this Monday (April, 18) to the inquiry that investigates the participation of Andrade Gutierrez in the cartel and corruption scheme. This month, the contractor’s executives signed an agreement for a plea agreement with the Attorney General’s Office.

[…]

The loss pointed out refers only to four contracts totaling R$4.76 billion –  a contract with Refinaria Gabriel Passos (Regap) in Minas Gerais, a contract with Refinaria de Paulínia (Replan) in São Paulo, a contract with Refinaria Landulpho Alves (Rlam) in Bahia, and a contract with Comperj in Rio.

Given the above, we would like you to confirm if the content of this news item is in fact true and, if so, why such information was not deemed to constitute a material fact. We also request that you comment on any other relevant information on this topic, especially regarding the works performed by the company’s internal and external auditors, as well as the conclusions of the reports by any of PETROBRAS’s internal committees of investigation.

Clarification

The modernization works of the refineries Paulínea (Replan) and Gabriel Passos (Regap) and the implementation of Comperj, mentioned in the Federal Police report, were subject to Internal Investigation Commissions installed by Petrobras to investigate possible irregularities in the procurement of goods and services. The final reports of these Commissions showed non-compliance and were submitted to the applicable authorities for further investigation.

Petrobras reiterates that it has been taking legal measures against individuals and companies that have caused the Company financial losses or damage to its reputation and that these measures are being aligned with the public authorities for increased effectiveness.