Energy Business

Petrobras Reveals Receipt of SEC Subpoena

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Source: Wikimedia Commons
Brazil’s government-controlled oil giant Petroleo Brasileiro SA (NYSE: PBR), or Petrobras, issued a statement Tuesday morning saying that the company had received a subpoena from the U.S. Securities and Exchange Commission (SEC) on Friday, November 21, “requesting certain documents related to an investigation into the company initiated by the SEC.”

The company’s statement is brief and lacks any details, including whether or not the SEC subpoena is related to the corruption charges that have been leveled against a former Petrobras employee and another person, alleging that the two skimmed funds from company construction contracts to pay kickbacks to Brazilian politicians.

Members of Brazil’s ruling political party, the Workers Party or PT, are charged with having received payments of 3% of the value of construction contracts from a number of companies in exchange for contracts. The PT and Brazilian’s recently re-elected President Dilma Rousseff have denied the charges. Rousseff was the minister of energy from 2003 to 2005.

Petrobras has already delayed filing its audited third-quarter financial statements because its outside auditing firm refused to verify them. That delay makes it harder for Petrobras to raise funds in the capital markets and if the delay extends beyond next April, the company’s creditors may begin to call in loans and bonds valued at more than $120 billion.

In its Tuesday announcement Petrobras said:

The subpoena requests a number of company documents, which will be sent following joint work with Brazilian law firm Trench, Rossi e Watanabe Advogados and U.S. law firm Gibson, Dunn & Crutcher, already hired by Petrobras to conduct an independent internal investigation.

Petrobras reiterates its commitment to cooperate with U.S. public authorities with the same dedication that it has been cooperating with the Brazilian public authorities.

The company’s ADSes are trading about 6.3% higher Tuesday morning at $11.13 in a 52-week range of $8.80 to $20.94. Petrobras announced last week that it had begun production at an offshore well that is expected to yield about 150,000 barrels of oil a day.

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