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Petrobras announces agreement with Halliburton on Barracuda-Caratinga Project
As announced on June 20, 2003, and subsequently signed on October 31, 2003, after all necessary
approvals had been obtained, Petrobras, on behalf of the special purpose company, created to develop
the Project - Barracuda and Caratinga Leasing Company BV (BCLC) - entered into an amendment to the
existing construction contracts that partially solved the pending issues between itself, BCLC,
Halliburton and its KBR subsidiary (the Parties) and directed that those not settled to be solved under
arbitration according to the United Nations Commission on International Trade Law (UNCITRAL) rules.
After further extensive negotiations, the Parties have reached the Agreement with the purpose of
solving all still remaining outstanding issues. The terms and conditions of the Agreement are subject
to the project lenders approval and final agreement. Negotiations amongst all parties are already under
way, aiming to amend existing documents in the coming months.
The Agreement covers compensation for KBR, for some additional work, and sets new milestones and
liquidated damages, aiming at creating the best and most certain conditions for the conclusion of the
works to allow the vessels to sail-away on August 1, 2004 (Barracuda) and September 28, 2004
(Caratinga), so that the first oils may flow by Oct 10/2004 and December 6, 2004 for Barracuda and
Caratinga, respectively.
Both production units are already in Brazil being converted at the Mauá-Jurong Shipyard in Niteroi
(P-43) and at the BrasFELS Shipyard in Angra dos Reis (P-48), and are in an advanced stage of
completion (approximately 90%).
Successful implementation of the Agreement will mean that the anticipated arbitration for solving the
pending issues will no longer be required. Nevertheless if the Agreement for any reason cannot be
implemented, the arbitration procedures will have to take place. In this case Petrobras understands it
will be a long process until final resolution is achieved of all pending issues, but is strongly
confident in its arguments to defend its interests.
http: //www.petrobras.com.br/ri/english
Petróleo Brasileiro S.A – PETROBRAS |
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PETRÓLEO BRASILEIRO
S.A--PETROBRAS | ||
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By: |
/S/ José Sergio Gabrielli de Azevedo
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José Sergio Gabrielli de Azevedo
Chief Financial
Officer and Investor Relations Director
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This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management's current view and estimates offuture economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.