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How Biden’s LNG Export Pause Could Backfire

How Biden’s LNG Export Pause Could Backfire

President Biden's temporary pause on…

Petrobras To Issue $2B New Bonds, Exchange Shorter-Term Debt

Petrobras plans to offer U.S.-dollar denominated global notes in one or more series for a total principal amount of up to US$2 billion, and to purchase or exchange five series of outstanding notes, Brazil’s state-controlled oil firm said on Monday as it seeks to cut debt and extend bond maturities.  

The new notes issue is subject to market and other conditions, said Petrobras, which is the world’s most indebted oil company. Petrobras plans to use the net proceeds from the sale of the new notes for general corporate purposes, including for refinancing of upcoming maturities, it said in its filing with the SEC.  

The new notes will be due in 2025 and in 2028, while the outstanding notes up for exchange or purchase are maturing between 2019 and 2021. 

Last year, Petrobras cut its massive net debt from US$100.4 billion as of the fourth quarter of 2015 to US$96.4 billion as of Q4 2016: a US$4-billion decrease in the huge debt.

At the end of Q2 2017, Petrobras further cut its net debt, by 7 percent, from US$96.4 billion at end-2016 to US$89.263 billion as of June 30, 2017, the Brazilian company said last month. The average maturity of outstanding debt increased from 7.46 years as of December 2016, to 7.88 years as of June 30, 2017.

Related: Does Russia Really Need The OPEC Deal?

Last week, Petrobras said that it had carried out the pre-payment of a debt with JPMorgan Chase Bank, N.A. in the amount of US$1.13 billion, maturing between June 2019 and March 2020. At the same time, Petrobras agreed with JPMorgan a new funding of US$847.5 million to mature in 2022.

Petrobras will continue to search for and assess new funding opportunities under its liability management strategy that is aimed at improving its debt repayment profile, taking into account the deleveraging target set in the 2017-2021 Business and Management Plan, the company said last week.  

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 By Tsvetana Paraskova for Oilprice.com

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