São Paulo – The Brazilian oil company Petrobras has become the company with the second highest market value in the world, after having promoted a fundraising operation aimed at structuring out the oil drilling in the pre-salt layer. The state-owned enterprise received an inflow of approximately US$ 70 billion, after which its market value reached US$ 220 billion.
According to the Brazilian minister of Finance, Guido Mantega, only the United States-based company Exxon is worth more than Petrobras. Exxon has an approximated value of US$ 290 billion. This Friday (24), during the launch of Petrobras’ public offering of stock in São Paulo, Mantega claimed that the company’s size will enable its investment plan.
As Petrobras’ capital increases, so does its debt capacity. Thus, according to the minister of Finance, it should be able to raise the US$ 224 billion required for structuring out pre-salt layer exploration. "With more capital in its hands, the company can obtain more loans and work in a less leveraged way," he explained. "The fundraising still leaves the company with US$ 25 billion to invest."
The minister also stated that these investments should drive the risk of a so-called "Dutch Disease" away from the country for good. The term is used to describe excessive dependency from certain countries on exports of their natural resources, such as oil.
"Petrobras is now one of the country’s leading development agents. A significant share of its investment is aimed at stimulating the domestic industry," said the minister. "The curse of petroleum has been driven away from Brazil," he finished off.
*Translated by Gabriel Pomerancblum
