Brazil's Petrobras Gets Record Earnings Despite Higher Extraction Costs
Written by Newsroom
Monday, 14 November 2005
Brazilian government owned Oil Company Petrobras announced Friday, November 11, a record high third-quarter net profit on a rise in output and fuel prices. Net consolidated profit was the equivalent of US$ 2.6 billion, below market estimates, plus signs of rising oil extraction costs.
Petrobras said in a statement profit rose 27% from approximately US$ 2 billion a year earlier, excluding a one-time tax benefit obtained in the third quarter of last year. But when compared to its total profit of US$ 2.57 billion, the increase from a year earlier was only about 1%.
Earnings before interest, taxes, depreciation and amortization rose to 5.74 billion dollars from 4.39 billion a year earlier, Petrobras said. Analysts, on average, expected Brazil's industrial flagship to post net consolidated profit of about US$ 2.7 billion and gross earnings of US$ 6 billion. Net consolidated revenues rose 18% to US$ 16.52 billion.
Petrobras' domestic oil output rose a steep 13% from year-ago levels, reaching nearly 1.73 million barrels per day on average as two new rigs started operating on the Barracuda and Caratinga fields in the Campos basin.
However the costs of oil extraction in Brazil between January and September rose 33% from a year earlier to US$ 5.54 per barrel despite an increase in output. They also rose 19% in the third quarter from the previous quarter.
Petrobras attributed the increase to a 16% appreciation of the local currency against the dollar and a rise in drilling and production equipment costs on the world market. Refining costs rose 50% in the period due to the currency effect and programmed maintenance stoppages at four refineries.
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Brazil received a huge boost in its international image with its selection as the host of the 2016 Olympics, but it was really just the cherry on top of the overall recognition of the country's ascension to the ranks of one of the world's most important countries. Now, as it finally takes its place on the world scene, there has been a great deal of concern about what kind of image Brazil hopes to project, now that the world is really paying attention. 
The only good thing to say about the visit to Brazil of Iran's president, Mahmoud Ahmadinejad, on Monday November 23, is that it was mercifully short and lasted less than 24 hours. Ahmadinejad had his picture taken being hugged by president Luiz Inácio Lula da Silva who gave him a warm welcome and said Iran had every right to develop nuclear energy for peaceful purposes. 
The small, coastal town of Condé is located just a twenty minute's drive from João Pessoa, the capital of Paraíba. The Northeast of Brazil has historically been a place of encounter and mixing between peoples. For millenia groups of indigenous people fished, farmed, migrated and sometimes fought along this large, fertile area. 
The Brazilian diplo-MÁ-cia (bad diplomacy) carries on its accelerated course towards the non-acknowledgment of human rights, although sometimes it takes pleasure in saying that it does precisely the opposite. The visit of Iran's president, Mahmoud Ahmadinejad, is another example of a diplomatic omission that verges on hypocrisy. 
On July 4, 2006, representatives of Argentina, Brazil, Paraguay and Uruguay met in Caracas to sign the protocol for the entrance of Venezuela into the Southern Common Market (Mercosur). After two and a half years, the protocol was approved by the legislative bodies of Argentina and Uruguay, and as of now it may be only days away from being ratified by the continent's economic megalith, Brazil. 
Some sectors of the fight against AIDS have suggested that Thabo Mbeki, the former president of South Africa, committed genocide through his absence from the fight against the illness in his country throughout his two terms. 
One hundred and eleven years after Brazil abolished slavery, the number of workers deprived of their freedom is still huge. They raise cattle, produce charcoal, sugar cane or timber. Some of them, most undocumented Bolivians, work in basements of small apparel factories in São Paulo and other metropolis. 
On November 7, 2009 a few friends and I had an opportunity to take a look inside a Brazilian jail outside the city of Rio de Janeiro. We were able to take some amateur footage of our experience on video (see link below). It's no surprise, of course, that the typical Brazilian jail lacks some of the functionality of those in North America or Europe, but our experience that day was quite shocking. 
Depletion of the Amazon Rainforest is not a new concern facing environmentalists, biologists, ecologists, and a growing number of the Amazonian indigenous peoples. For decades they have feared for the fate of the world's most biologically diverse and species-rich hothouse. 
Geisy Arruda made history this week in Brazil, but for all the wrong reasons. What began as a poorly planned fashion statement has become a worldwide tale. Geisy decided to wear a pink mini-dress to her private college in São Paulo state, and after that, all hell broke loose.