Petrobras Hits Record Production Amid Brazil Crisis; Stock Climbs More Than 7%
Today 3:58 PM ET (Benzinga)
Shares of Petroleo Brasileiro SA - Petrobras (ADR) (NYSE: PBR) rose more than 7 percent on Wednesday trading.The surge was triggered by the announcement that the company had hit record production in August.Most of the oil and gas was produced in Brazil; however, the company also extracted resources from the Gulf of Mexico.
Brazil’s state-controlled Petrobras said, on Wednesday, that its average production of oil and natural gas (both in Brazil and overseas) had reached 2.88 million barrels of oil equivalent per day (boed) in August.
This compares to the 2.8 million boed produced on average in July and implies a 3.1 percent surge, month-over-month.
Moreover, the company assured, this is a new output record, surpassing the last high of 2.86 million boed set in December 2014. Year-over-year, production saw a 4.5 percent boost – from the 2.76 million boed registered in August 2014.
Related Link: Curbing Enthusiasm For Oil Upside
Corruption Scandal
The news came as a surprise to many investors and analysts, as the company is going through a massive corruption scandal that involves high ranked politicians and public servants.
Despite the turbulence, the company explained that it had managed to hit a new record on the back of the commencement of operation of the FPSO Cidade de Itaguaí on July 31. This platform is anchored in Iracema Norte, in the northwest section of the Lula field, and can process 150 thousand barrels of oil and 8 million cubic meters of gas each day.
Brazil's Production Numbers
In Brazil, the company disclosed production of 2.69 million boed, meaning that most of the oil and gas came from within the country. Moreover, if the company’s partners’ production is taken into account, Petrobras’ total production in the country reached 3.01 boed.
Disclosure: Javier Hasse holds no stakes in any of the securities mentioned.
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