Petrobras Reported in Jumbo Marubeni Loan

Petrobras has signed an MOU with Japan’s Marubeni to potentially borrow $10bn from the Japanese conglomerate, mines and energy minister Edison Lobao has told local paper Valor in an interview. The proceeds would go towards financing the construction of a large refinery in the state of Maranhao, which would cost a total of $20bn. The facility could be ready as early as 2013, speculates Itau Securities. “Given that the situation is fraught with political issues, which means it shouldn’t be taken for granted, we believe that this is negative news because it puts additional pressure on Petrobras debt levels at a critical moment,” writes Itau analyst Paula Kovarsky in a report. If confirmed, however, this would be another $10bn the Brazilian energy giant would not have to raise elsewhere in the markets. Marubeni would in exchange, demand payment in the form of refined products coming from the facility, according to analyst reports citing the interview. In February, Petrobras said it would seek $10bn from China’s development bank. Petrobras finance officials did not return calls seeking comment.