CGU finds that Petrobras sold refinery below price

The sale of the Landulpho Alves Refinery, in Bahia, in November 2021, presented weaknesses, an audit by the Federal Comptroller General (CGU) found. The main problem, the report pointed out, was the sale below the market price, mainly due to the choice of timing of the deal – in the midst of the Covid-19 pandemic – at a time when international oil prices were falling.

Renamed Mataripe Refinery, the project was sold for US$ 1.65 billion (R$ 8.08 billion at current exchange rates) to the Mubadala Capital fund, an investment division of Mubadala Investment Companyan Abu Dhabi investment company that belongs to the UAE royal family.

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The report did not categorically state that there was an economic loss with the sale of the refinery. The document, however, questioned the timing of the deal, arguing that Petrobras could have waited for oil to recover on the international market.

The sale, highlighted the CGU, took place in a “perfect storm” scenario, with the combination of economic uncertainty and volatility brought by the pandemic, pessimistic assumptions for economic growth at the end of 2021 and high sensitivity of profit margins, which resulted greater loss of value.

Other problems

The CGU found weaknesses in the use of scenarios to support decision-making, with emphasis on the lack of realistic probability measurement in future events. The report also questioned the application of hitherto unused methodologies for the sale of Brazilian state-owned companies.

The control body suggested that, in situations of great uncertainty, two options could have been considered: wait for the future scenario to stabilize or make a single assessment, adjusting operational and price assumptions.

In its statement, Petrobras defended the use of scenarios as a common and appropriate practice, even while recognizing limitations. The state-owned company claimed that the projections were made consistently and that the pandemic made the analysis more challenging. The company acknowledged challenges and agreed to evaluate suggested improvements, such as including probability measurement in future analyses.

Jewelry

The release of the report reignited suspicions surrounding gifts given by the United Arab Emirates government to former president Jair Bolsonaro in October 2019 and November 2021, precisely the month in which the refinery was sold.

The former president returned to Caixa Econômica Federal a 5.56mm rifle and a 9mm pistol given by the UAE government, following a decision by the Federal Court of Auditors (TCU).

In addition to returned gifts, Federal Policy investigates jewelry and sculptures given by public authorities in the United Arab Emirates. On two official trips, one in October 2019 and another in November 2021, he received a table clock studded with diamonds, emeralds and rubies, a censer in gilded wood and three sculptures, one of which was decorated with details in gold, silver and diamonds.

The former president is also investigated for three boxes of jewelrybudgeted at R$18 million, received from the Saudi Arabian government and returned in March and April of last year.

Repercussion

Through the social network

“It is important to clarify whether there is any connection with the jewelry episode, which is already under investigation by the Federal Police. Leading the opposition in the Senate [durante o governo passado]We did [os partidos de oposição] numerous complaints about the inconsistencies of this privatization, clearly damaging public assets and Brazilian consumers”, wrote Messias.

Also through the same social network, the CGU minister, Vinicius Marques de Carvalho, informed that the audit on the sale of the refinery is with the Federal Police. “The PF has already had access to the report, which is already published on the CGU website”, he highlighted.

In March last year, when suspicions of a link between the sale of the refinery and the receipt of gifts from the United Arab Emirates began to circulate, former president Bolsonaro posted that the privatization was approved by the Federal Audit Court (TCU). “The TCU monitored and approved the sale of the Bahia refinery to the Arabs,” he wrote at the time.