Brazil's Petrobras to raise USD 5 billion in bonds

Brazilian energy giant Petrobras has said it will sell USD 5 billion in bonds to help finance development of offshore oil fields over the coming five years.
The bond sale constitutes four tranches on the New York Stock Exchange -- three of them euro-denominated in four, seven and 11-year notes -- with the other a 20-year sterling note.
The euro issues totaled 3.05 billion euros (USD 4.15 billion) with the sterling issue worth 600 million pounds (USD 984 million).
The bonds, issued via the firm's Petrobras Global Finance B.V. Subsidy, bear yields of 2.829 per cent for 2018 expiry, 3.849 per cent (2021), 4.845 per cent (2025) and 6.732 per cent (2034).

"The resources derived will be used to finance investments as per the company's 2013-2017 investment plan," said the state-owned firm, Latin America's biggest oil producer in terms of market value.
The move reinforces a shift in strategic focus as the company concentrates its efforts on tapping huge and lucrative "pre-salt" deepwater deposits off Brazil's Atlantic coast.

Petrobras' investment plan of USD 236.7 billion is one of the world's biggest corporate spending programs and three fifths of the cash has been earmarked for pre-salt operations.
Pre-salt deposits buried beneath several kilometers of ocean, bedrock and hot salt beds may hold up to 100 billion barrels of high quality recoverable crude, providing Petrobras and Brasilia with a huge bonanza.

Last October, Petrobras headed a five-strong consortium which won 35-year production rights at the massive Libra oilfield.
Joining in the enterprise were China's CNOOC and CNPC, Anglo-Dutch giant Royal Dutch Shell and France's Total.
Tough Brazilian government conditions stipulated that Petrobras, which took a 40 per cent stake in Libra, would act as sole operator.
The company has also been selling off non core assets as it looks to plough resources into the Libra operation.
Last week it sold its 35 per cent stake in the Parque das Conchas offshore project in the southeastern Campos Basin area to Shell and India's ONGC Videshfor USD 1.636 billion.

Yesterday's bond sale was just half of last May's record USD 11 billion issue for the company, which was a record for an emerging market.