PetroRio – UPDATE IN CHEVRON’S VENDOR FINANCE AMORTIZATION SCHEDULE

June 16, 2020

Petro Rio S.A. (“Company” or “PetroRio”) (B3: PRIO3), in addition to the Material Fact of March 25, 2019, informs its shareholders that it has signed amendments to  agreements with certain subsidiaries of Chevron Corporation (“Chevron”) to establish a new amortization schedule for the vendor finance associated with the acquisition of the 51.74% interest in the Frade Field (“Frade”), and the FPSO operating in Frade.

The original agreement – signed in 2019 – has US$ 142 million of principal outstanding, with US$ 77 million previously scheduled for September 2020, and approximately US$ 64 million in March 2021 with an estimated interest of 5.82% p.a.. The new principal amortization schedule is effective immediately, and establishes US$ 15 million of principal to be paid in November 2020, US$ 30 million in May 2021, and the remaining US$ 97 million in November 2021, at a new interest rate of 7% p.a.

The new agreement, which was negotiated during the COVID19 pandemic, significantly improves short- and medium-term liquidity, therefore contributing to a more equalized cash flow and better management of the Company’s cash position.

Finally, PetroRio would like to thank Chevron and its management for their professionalism and commitment which made this agreement possible.

The incorporation of Frade in 2019 was an important step in the execution of the Company’s growth strategy, through the acquisition and redevelopment of producing fields. Since its acquisition, the Frade Field has allowed for significant cost reductions through land, air and sea logistics synergies, resulting in reduction in Company-wide lifting costs to US$ 17.3 per barrel, and leaving PetroRio well positioned for uncertain and volatile commodity environments.

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