The name of the executive who participated in the elaboration of the government plan of Bolsonaro was well received by the industry.
Economist Roberto Castello Branco will be the president of Petrobras under Jair Bolsonaro, replacing Ivan Monteiro, who took office in June after Pedro Parente’s departure. The executive’s name had been circulating on the bet list as one of the favorites and was confirmed last Monday, by advisers to the future Minister of Economy, Paulo Guedes.
With a strong and liberal profile of local content requirements, Roberto Castello Branco will continue the management policies initiated by Pedro Parente, prioritizing an open market vision. The bet is that the executive directs the company to focus its activities in the segment of offshore E & P, increasingly reducing its interests in the areas of Gas, Refining and Logistics.
With Castello Branco in charge, the preliminary evaluations are that Petrobras could become a large E & P asset company, prioritizing the reduction / exit of other areas, seen not profitable. Aside from the medium and long-term strategies, the executive will have the challenge of speeding up the closing of the divestment processes and negotiating the review of the onerous assignment contract in the short term.
In this sense, market sources believe Castello Branco will accelerate the sale of refining, TAG and E & P projects on land and shallow water (Topaz and Arctic). For this, the relationship of the presidency with the National Congress will have to be well oiled. This is because, there is a decision of the Supreme Court determining that the sale of assets that imply in the sale of the control must pass through the legislative houses.
Proximity with Bolsonaro and clashes with board
A graduate in economics from the University of Chicago, Castello Branco studied with Paulo Guedes, with whom he has a close relationship, and has been advising elected president Jair Bolsonaro in the oil sector since the campaign, accumulating the task with the post of director of the FGV . His appointment marks the return of the executive to Petrobras, after a brief passage by the Board of Directors from May of 2015 to April of 2016, during the management of Ademir Bendine.
Sources heard by PBE confirmed that the executive had several battles with the former president of Petrobras and with the board, formed at the time by Solange Guedes, Hugo Repsold, Jorge Celestino Ramos, Roberto Moro, João Elek and Ivan Monteiro. At the time, Castello Branco presided over the financial committee and worked with Segen Estefen and Luiz Nelson de Carvalho, who still remain in the committee.
The great expectation regarding Castello Branco’s management is linked to his position on the composition of the company’s management. As most of the directors were still appointed in the management of the PT government, the bet is that the future president of Petrobras chooses to replace at least part of the executives.
It is estimated that a change in the board would further oxygenate the company at a time when it needs to prepare for the greater competition in the market, both in the E & P area and in the Gas and Refining areas, of which Petrobras is partially giving up .
Of the seven executives who make up the current board of directors, three are the remnants of Graça Foster’s nomination: Solange Guedes (E & P), Hugo Repsold (Development of Production and Technology) and Jorge Celestino Ramos (Refining & Natural Gas). Rafael Grisolia (Finance), Eberaldo de Almeida (Corporate Affairs), Rafael Gomes (Governance & Compliance) and Nelson Silva (Strategy, Organization and Management System) were appointed during the management of Pedro Parente and Ivan Monteiro.
In the list of people close to the executive is Clarissa Lins, current adviser of Petrobras and executive of the consultancy Catavento. Castello Branco has been acting more actively in the oil sector for about four years.
Discreet, the executive is part of the transition team of Jair Bolsonaro’s government. Recently, shortly after the result of the elections, he was meeting with the President of Petrobras and the director general of the ANP, Décio Oddone.
Although his name was being named for the post, Castello Branco was not the only. Prior to his election, other names in the industry were surveyed, such as Jorge Camargo, former director of Petrobras and former president of Equinor, and João Carlos de Luca, former oil chief executive and former IBP president.
Ivan Monteiro was also invited, but chose not to remain and may lead the Bank of Brazil. BE Petroleo sought the current president of Petrobras, but the executive chose not to comment on the matter.
Castello Branco’s professional experience also includes a career spanning over ten years at Vale. The executive will be the 38th president of Petrobras.
Impressions and profile
People heard by BE Petroleo who worked with Castello Branco reported having had a good impression of him. They also highlighted the great experience of the executive in both public and corporate management positions.
Although he is favorable to privatize Petrobras and has already expressed this in articles and public statements, the perception of people in the sector is that he will not focus on this agenda, prioritizing only the sale of businesses where Petrobras has no competitive advantage over other companies.
In addition, it is also remembered that Castello Branco arrives with a speech in line with the policies that are already being implemented in the oil and gas sector through the ANP and CNPE guidelines. This, according to sources, will give tranquility to industry and the market.
There is, however, those who warn of the need to wait to know how the liberal speech of Castello Branco will be applied in the company. Although it is a consensus that it is not good for Petrobras, or the country, to have a monopoly agent, a source recalls that Petrobras has a history of driving development and invests where private companies do not want to put money. One example is the discovery of oil and gas in the Amazon and the discovery of the pre-salt.
Source: Brasil Energia | Claudia Siqueira and Roberto Francellino