Petrobras(PBR) - 2024 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Recurring EBITDA for Q3 2024 was $11.6 billion, with a recurring net income of$5.9 billion, reflecting a robust cash generation of $11.3 billion, a 24$59.1 billion, the lowest level since 2008, with a successful bond issuance of $1 billion at the lowest spread to US Treasury bonds since 2011 [11][16][17] - The company paid$64.4 billion in taxes, marking a 14% increase compared to the same period last year [18] Business Line Data and Key Metrics Changes - Exploration and production saw record production levels, with Tupi reaching 3 billion barrels and Mero's Sepetiba FPSO achieving peak production [8][10] - The company maintained a high utilization rate of 95% for the quarter, with a peak of 97% in September [9] Market Data and Key Metrics Changes - Brent oil prices decreased compared to the previous quarter, impacting margins, but the company offset this by increasing sales of byproducts [12][13] - The Brazilian real appreciated by 2% in Q3 compared to an 11.2% depreciation in Q2 2024, positively impacting financial results [13] Company Strategy and Development Direction - The company is focused on increasing production capacity and exploring new fields, with significant investments planned for exploration and production, including 7 billion allocated for exploration [22][23] - Petrobras aims to revitalize the Campos Basin and maintain production levels, with a goal of increasing production by 200,000 barrels in the near term [60][88] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future production levels, despite challenges from scheduled and unscheduled downtimes, and emphasized the importance of maintaining operational integrity [26][31] - The company is actively working to clear regulatory requirements and enhance its operational capabilities to ensure long-term sustainability [32][79] Other Important Information - The company is exploring international opportunities, including acquisitions in regions with high potential, such as Africa and South America [24][83] - Petrobras is committed to distributing dividends, with a proposed compensation of BRL 1.32 per share to be paid in two installments [17] Q&A Session Summary Question 1: Q3 production levels and future outlook - Management acknowledged that scheduled and unscheduled downtimes impacted production, but they expect higher production levels moving forward [21][26] Question 2: Exploration strategies and reserve replenishment - The company is investing over 7 billion in exploration, focusing on both domestic and international opportunities to replenish reserves [22][24] Question 3: Cash position and surplus management - Management indicated that surplus cash is being evaluated for potential distribution or reinvestment, with a decision expected by November 21 [34][37] Question 4: Tupi production decline and resource allocation - Tupi's production decline is below 10%, and the company is implementing strategies to maintain production levels [44] Question 5: Environmental licensing for equatorial margin - The company is actively working with regulatory bodies to expedite the environmental licensing process for the equatorial margin [76][79] Question 6: Fertilizer negotiations and production plans - Petrobras is exploring partnerships for fertilizer production and aims to resume operations in specific plants by 2025 [80]