The PROMINP 10th Anniversary: results, challenges andperspectives for the maritime industry in Brazil

Paulo Sergio Rodrigues AlonsoPetrobras Local Content Advisor to the CEO

Executive Coordinator of PROMINP

Houston, 06th May 2014

Undocking of P-66’s hull in Rio Grande Shipyard, the first hull for Pre-Salt fully built in Brazil

PETROBRAS’ Local Content Policy

Brazilian Local Content Regulation

PROMINP: O&G Brazilian Industry Mobilization Programme

Offshore and Maritime Equipment Demand

Agenda

Conclusions

Agenda

PETROBRAS’ Local Content Policy

Brazilian Local Content Regulation

PROMINP: O&G Brazilian Industry Mobilization Programme

Offshore and Maritime Equipment Demand

Agenda

Conclusions

O&G Operators

Union(represented by the ANP)

Local Content Offered

Signing Bonus

Minimum Exploratory Program (PEM)

Goods and Services Suppliers

Contract goods and services with local content requirement, without jeopardizing price, time

and quality

Local Content Certifiers

Accredited by ANP Local Content Booklet (official methodology) Measure the local content that is effectively

manufactured in Brazil

Manufacture equipment and provide services and hire

certification entity to measure local content

Concession of Exploratory Blocks

12 Bidding Rounds (1999-2013)

Transfer of Rights (2010)

Production Sharin Contract – Libra (2013)

Assessment methodology:Winner Bid = Max (0.4 x Minimum Exploratory Programme) + (0.4 x Signing Bonus ) + (0.2 x Local Content offered)

Brazilian Local Content RegulationConcession Model - Agreement with the ANP

ANP: National Agency of Petroleum

PETROBRAS’ Local Content Policy

Brazilian Local Content Regulation

PROMINP: O&G Brazilian Industry Mobilization Programme

Offshore and Maritime Equipment Demand

Agenda

Conclusions

PETROBRAS' Local Content Policy

The projects and acquisitions for Petrobras must support the challenges of Company’s Strategic Plan and therefore maximize local content based on competitive and sustainable basis, accelerating the

development of markets where it operates, guided by ethics and generating continued innovation.

December 22nd, 2011

PETROBRAS’ Local Content Policy

PETROBRAS’ Local Content PolicyDrivers

Ensure adherence to capital discipline, assuring the competitiveness of procurement and reducing financial and logistical risks in implementation and operation of projects.

Capital Discipline

Execute procurement in a coordinated manner for the items of common use.Integration of Supply

Uniform criteria for measuring and requiring local content in Petrobras acquisitions.

Local Content Standardization in

Petrobras

Encourage the development of local markets in a sustainable manner.Local Suppliers

Prioritize supplies with local engineering development.National Engineering

Encourage the development of the local market to overcome technology gaps.Technology Gaps

DRIV

ERS

PETROBRAS’ Local Content PolicyLocal Content Requirements

Minimum Local Content requirement for financing concession (BNDES)

Local content requirements

established in oil field concession contracts

There is no Local Content requirementOil Company declares target and proves rate achieved

Petrobras Local Content Policy determines that all business areas must achieve minimum local content on its activities (capital and operational expenditure)

Upstream Refining Gas & Power

Local content requirements set by Petrobras according to the list of goods and services demanded by capital projects and local industry capacity to provide them

ANP with O&G Operators Petrobras with Suppliers

Cont

ratu

al Ob

ligat

ion

PETROBRAS’ Local Content Policy

Brazilian Local Content Regulation

PROMINP: O&G Brazilian Industry Mobilization Programme

Offshore and Maritime Equipment Demand

Agenda

Conclusions

Agenda

PROMINP: O&G Brazilian Industry Mobilization Programme

"The PROMINP is perhaps the largest programme involving a set

of national entrepreneurs so that they can, government and

entrepreneurs, say that this country is already too big and can

not be asking permission all the time to do some things."

Luis Inácio Lula da SilvaPresident of the Republic, 2003

Governance Model

Prominp is a government programme that aims to maximize goods and services national industry content, within competitive and sustainable basis, in the implantation of oil and gas projects in Brazil and abroad.

MMESteering

Committee

Oil, Natural Gas and Renewable Fuels Secretariat

Executive CommitteeExecutive Coordinator

Sectorial Committee

O&G IND

E&P MaritimeTransportation

G&P and Pipelines Downstream

Steering Committee: MME and MDIC Ministers, Petrobras’ CEO and Services Director, BNDES CEO, IBP COE and ONIP CEO.Executiv Committee: Oil, Natural Gas and Renewable Fuels Secretariat (MME), Development, Industry and International Trade Secretariat (MDIC), BNDES Director, Petrobras Engineering Executive Manager, Prominp Execuvite Coordinator, ONIP Director, IBP Director, and Presidents/Directors of Industry ClassAssociations (ABCE, ABDIB, ABEMI, ABIMAQ, ABINEE, ABITAM, SINAVAL and CNI)Sectorial Committee: Petrobras, IBP, BNDES, Industry Class Associations and other stakeholders

Programme EstructureEstrategic Themes

Industrial Capacityand BusinessPerformance

Industrial PolicyTools

Inno

vatio

nan

dTe

chno

logi

cal

Deve

lopm

ent Qualification

Competitiveness and Productivity

Goods and Services Export

Industrial Capacity

Sustainability and EHS

Technological QualificationInfraesctruture

FinancingRegulation

Tax PolicyFoster Micro and Small Enterprise

Profissional Qualification

Employability

Local Content

Maximization

• The “Cartilha” (booklet) is the official methodology for measuring local content, published by the ANP in 2007 – Resolution ANP n. 19 (former n.36);

• It aims to identify the added value of national components or manpower that compose each:

• For the booklet, an item is not simply "national“, but has "x%" of Local Content.

Goods (%) = 1- cost of imported inputs x 100selling price without taxes

Services (%) = cost of local labor x 100cost of total labor

*Source: Local Content Booklet (“cartilha”) - 2007

Goods Services Goods for temporal use Systems

Pieces of Equipment Parts Raw Materials Chemicals

In-house labor Contracted labor Consultancy Services Software

Pieces of Equipment Boats and Ships Drilling Rigs Ground and Air Logistics

Combinations of goods, services and temporary goods in the same certification process

Ferramenta para Cálculo do Conteúdo Local de Bens

Cliente

Fornecedor

Bem

Identificação (código do material)

Quantidade

Valor FOB unitário

(moeda de origem)

Valor FOB Total

(moeda de origem)

Valor CIF unitário

(moeda de origem)

Valor CIF total (moeda de origem)

MoedaValor CIF unitário

(R$)

Imposto de Importação

(R$)

Valor CIF + I.Importação

unitário(R$)

Valor CIF + I.Importação

total (R$)

Preço de aquisição unitário s/IPI e s/ICMS

(R$)

Preço de aquisição

total s/IPI e s/ICMS

(R$)

Fornecedor Fabricante DOCUMENTO (DI/NF)

( a ) ( b ) ( c ) ( d ) ( e ) ( f ) ( g ) ( h ) ( i ) ( j ) ( k ) ( l ) ( m ) ( n ) ( o ) ( p )

Diretamente pelo Comprador

- - - - - - - - - -

- - - - - - - - - -

- - - - - - - - - -

- - - - - - - - - -

- - - - - - - - - -

- - - - - - - - - - 1

Diretamente pelo Fabricante

- - - - - - - - - -

- - - - - - - - - -

- - - - - - - - - -

- - - - - - - - - -

- - - - - - - - - -

- - - - - - - - - - 1

1

LEGENDA

Conteúdo Local

NÃO APLICÁVEL

NÃO APLICÁVEL

NÃO APLICÁVEL

NÃO APLICÁVEL

NÃO APLICÁVEL

PREÇO DO BEM COMPLETO, SEM IPI E ICMS

VALOR DO IPI

VALOR DO ICMS

-

VALOR TOTAL DOS COMPONENTES IMPORTADOS (R$)

0,00%

PREÇO TOTAL DE VENDA DO BEM (valor da NF)

CONTEÚDO LOCAL % (CLb)

Informações sobre produtos, quantidades, preços, fornecedores, fabricantes e tipos de documentos.

Resultados decorrentes das fórmulas encontradas na planilha. Não pode ser digitado (cálculo automático).

Data da emissão da Nota Fiscal de venda

Principal moeda de origem

Taxa de conversão para R$

COMPONENTES

NÃO APLICÁVEL

NÃO APLICÁVEL

NÃO APLICÁVEL

NÃO APLICÁVEL

NÃO APLICÁVEL

NÃO APLICÁVEL

NÃO APLICÁVEL

Adicionar Componente:Diretamente pelo Fabricante

Adicionar Componente:Diretamente pelo Comprador

Adicionar Componente:3os Mercado Interno

Adicionar Componente:3os e incorporados a itens

Adicionar Componente:Componentes Nacionais

SALVAR Adicionar Moeda(s)

Ver Resultado

Ferramenta para Cálculo do Conteúdo Local de Equipamentos

Cliente

Fornecedor

Bem

0

0

Data da emissão da Nota Fiscal 01/01/1904

Principal moeda de origem 0

Taxa de conversão para R$ 0,00000

VALOR DO IPI -

0

VALOR DO ICMS -

PREÇO DO BEM COMPLETO, SEM IPI E ICMS -

VALOR TOTAL DOS COMPONENTES IMPORTADOS (R$) -

CONTEÚDO LOCAL % (CLb) 0,00%

VOLTAR

RegulationOfficial Methodology for Measuring Local Content

Advanced

Regular

Level of the Professional Category

High Specialization

• Examples: Production operators, etc.;• High investments in infrastructure for the viability of

professional qualification;• Only experienced professionals.

• Examples: Cargo Operator, inspectors etc.;• Only experienced professionals.

• Examples: Engineer, Technician, Electrician, etc;• Professionals with or without experience.St

ructu

ring o

fpro

fessio

nal C

aree

rs

EXAMPLES OF DEMANDED PROFESSIONAL CATEGORIES

Lack of qualified professionals to

respond competitively

BOTTLENECK“Provide skilled professionals in the country to operate in different links of the supply chain for the categories and

quantities necessary for the oil and gas projects implementation.”

ACTION

PROFESSIONAL GAPS IDENTIFICATION

Professional QualificationEstablishment of the Professional Qualification Plan (PNQP)

Establishment of PNQP (2006)

Professional QualificationProfessional Qualification Plan: Results

Projeção

Professional Qualification from 2007 to 2013 and Projection until 2015Accumulated professional qualificationprojected until 2015

Accumulated professional qualification to be offered- 5º and 6º public selection cicle

Realized accumulated of public selection cicle

Projection

45 Investment Projects Prioritized inPetrobras Business Plan 2013-2017

Construction & Assembly of Investment Projects in 6 Shipyards

Main Demands for Operation & Maintenance

Professional QualificationFuture Demand Diagnosis: Professionals Required (2013-2015)

+ +

UO-BCUO-BS

UO-ES

Business Area Training Demands (# professionals)

Gas and Energy 1.764Refining 5.999Exploration and Production (C&A) 5.482Exploration and Production (O&M) 3.962

Total 17.207

8 States with training demands

10%

35%32%

23%

Training Demands

Gas and EnergyRefiningExploration & Production (C&A)Exploration & Production (O&M)

Merchant Marine Gaps

Simulators (bridge, machinery, dynamic positioning, ARPA radar and GMDSS system)

Laboratories (automation, electronics, machinery, engines, navigation etc.).

Classrooms

Hiring new teachers:• Replacement for retirement• Increased class sizes

Renovation and expansion of accommodation, cabins (new building in CIABA) and bathrooms

Reform Kitchens and dining rooms

Instructional Resources

FacultyTeam

Housing Areas

Investment of US$ 35 million in the modernization and expansion of training centers for Merchant Marine officers - CIAGA CIABA, increased by 91% the annual capacity of officer training

Professional QualificationInvestment in Centers for Merchant Marine Officers

CIABA –Almirante Braz de Aguiar Instruction Center; CIAGA – Almirante Graça Aranha Instruction Center

CompetitivenessNational Industry Competitiveness Diagnosis

High Competitiveness SectorsMedium Competitiveness Sectors

Sectors with no significant domestic production

(rotary)

(steam) (gas)

(centrif.)

(large)

SectorsTechnological Basis

Expansion ofCapacity of

NationalSupply of

Goods andServices

6. Encourage the installation offoreing companies in Brazil;

5. Encourage association for domestic and foreign companies;

4. Encourage collaborationbetween industry and university;

3. Encourage the development ofnew national entrants;

2. Developing the competitivenesssectors;

1. Expand production capacity ofhigh competitiveness sectors

Techonological Gaps(medium competitiveness sectors)

Valves

Flanges and Connections

Boiler works

Umbilicals

Offshore Construction

Instrumentation and Automation

7

5

5

6

7

8

Competitiveness diagnosis Routes

Technological QualificationTechnological projects and Infrastructure investment

US$ 61 MM

US$ 16 MM

Technological Projects

Labs and Infrastructure

58 ongoing projects

8 labs (valves andpipping, safety andumbilicals)

Main focus: Overcome Pre-Salt technological challenges with brazilian knowledge embeedded

- Financiadora de Estudos e Projetos – Studies and Projects Financier

Develop domestic suppliers in a competitive and sustainable way, for the manufacture of equipment and materials that are not provided by the national market.

Offshore cranes

Industrial CapacitySuppliers development and attraction

Coated TubeOnshore

reciprocating pumps

Examples of Successful Cases

Programmable Logical Controllers

LSR / HSR: Low / High Shift Reaction

Subsea Valve Smart Actuator

Carbonaceous Materials (Plasma)

LSR and HSR Catalysts

Develop domestic suppliers in a competitive and sustainable way, for the manufacture of equipment and materials that are not provided by the national market.

Industrial CapacitySuppliers development and attraction

Equipment historically imported with potential to attract foreign suppliers

Equipment produced nationally but with potential bottlenecks in production capacity

Rio Oil & Gas - RJ, Brazil (09/2012)Shipbuilding and Offshore: Petrobras Mission – London, Aberdeen andNewcastle, UK (12/2012)OTC – Houston, USA (04/2013)Mission to Denmark – Copenhagen, DK (06/20/13)Supply Opportunities Seminar – RJ, Brazil (08/2013)Brazil Seminar: Opportunities for Oil& Gas – Singapura (09/2013)Petrobras Procurement Mission -San Jones e Calgary, Canada(10/2013)Mission to Germany – Hamburgo, Germany(11/2013)

Petrobras Production Increase

Ongoing Project: Offshore and Maritime Suppliers Attraction

Vessels demand 2012-2020 Mapping of significantequipment yearly demand

Demand dissemination actions

+ 38 ProductionUnits;

+ 28 DrillingRigs.

+ 198 SupplyBoats;

+ 88 TankerVessels;

1 2 3 4

Formulate policy for the consolidation and strengthening of the Oil, Gas & Naval supply chain, organizedin local clusters (clusters, districts, parks, etc..).

Metal-mechanic Electrical and Electronic Automation Equipment

Sectors linked to economic and social development,traditional or income effect, in territories with a low degree ofindustrialization or newly industrializing.

Clusters of Specific Sectors Clusters of Varied Sectors Naval – Offshore gantry Naval – Large Structures Subsea etc.

Purpose and Location

Foster Micro, Small and Medium EnterprisesLocal Clusters

Ipojuca – SUAPE (PE)

Maragogipe (BA)

Ipatinga – Vale do Aço (MG)

Itaboraí – COMPERJ (RJ)

Rio Grande (RS)

EAS (Shipyard)RNEST (Refinery)

ERG I (Shipyard) EBR (Shipyard)

QUIP (Shipyard)ERG II (Shipyard)

EEP (Shipyard)

COMPERJ (Refinery)

National Frame Agreement

(anchor)

US$ 41 MM

50% 50%

Frame Agreement Financial Resources

Companies InvestmentUS$ 23 MM

232 companies / institutions

Micro and small companies situation in Brazil:

99% of formal enterprises 26% of salaries 57% of formal jobs

Micro and small companies areagile, flexible

and innovative

13,000 MSEs

Participants

Business Rounds

2005-2013*

Total - 122 roundsUS$ 2.9 Bi (estimated)

*until 1st Quarter - 2013

- Serviço Brasileiro de Apoio às Micro e Pequenas Empresas – Micro and Small Enterprises Brazilian Support Service

16 States

Foster Micro and Small EnterprisesPetrobras x Sebrae Agreement

Agreement between Petrobras and Sebrae in order to prepare the micro and small enterprises (MSEs) to participate in the Oil and Gas supply chain

Over US$ 3.6 billion granted in loans;

Over 1.600 transactions involving 600 companies of 21 states in all regions of Brazil;

Reduction of 20% to 50% in interest rates.

Supplier Financing Programme for Petrobras entire supply chain (until 4th tier);

Financing guarantee: Contract signed with Petrobras;

10 participating banks; Operated by a Unique tool – Progredir Portal

Financing Schemes for Oil & Gas Supply Chain with more competitive conditions

Results

FinancingFinancing Schemes

Management Committee (Petrobras, Banks and Prominp)

Buyers Portal Banks

1) Financing request throughProgredir Portal;

2) All banks offer financingproposal;

3) Supplier selects best financingcondition

Operating ModelProgramme Overview

Fund to anticipate major receivable credits. 10 funds participating on the Promimp

Receivables Programme.

2.600 contracts; Over 450 financed suppliers; US$ 2.1 billion in anticipation of receivables.

Investment fund to foster the O&G Industry There is one operating fund (FIP Caixa Modal Óleo & Gás) – net worth of US$ 246 million.

FIDCsInvestment Funds in

Credit Rights

FIPsFunds of Private

Equity

Programme Overview Results

Vard Promar (PE)Estaleiro Atlântico Sul (PE)

Estaleiro BrasFels (RJ)Estaleiro OSX (RJ)Estaleiro Inhaúma (RJ)

Enseada do Paraguaçu (BA)Jurong Aracruz (ES)

Estaleiro Rio Grande (RS)

/ IHI

Petrobras’ Demand Attracting ShipyardsSeveral Technological Partnerships With International Shipyards

¹ Company responsible for bringing technology and know-how to the shipyard, whether being or not its partner.² Through the EEP consortium. ³ IHI Corporation, previously Ishikawajima-Harima Heavy Industries Co. Ltd.

Europe

Asia-Pacific

BrazilianShipyard

Technological Partner¹(Country of Origin)

Atlântico Sul (PE) Japan Marine United Corporation / IHI² (Japan)

VARD Promar (PE) VARD - Grupo Fincantieri (Italy)

Enseada do Paraguaçu (BA)

Kawasaki Heavy Industry, 30% stake (Japan)

Jurong Aracruz (ES) Sembcorp, 100% stake(Singapore)

Brasfels (RJ) Keppel Fels, 100% stake(Singapore)

OSX (RJ) Hyundai Heavy Industry,10% stake (South Korea)

Inhaúma (RJ) Cosco (China) ³

Rio Grande (RS) Mitsubishi Heavy Industries (Japão)

Brazil

Brazil

North America

Europe

Segment Supllier ( OriginCountry)

BrazilianState

Submarine PipelinesNKT Flexibles

(Denmark) RJ

Technip (France) RJ

UmbilicalsOceaneering - Marine Production Systems

(USA)RJ

Polyster Cables Lankhorst Ropes(Netherlands) RJ

Engineering Services AMEC (United Kingdom) RJ

Submarine Equipment

Aker Solutions (Norway) PR

FMC (USA) RJ

Cameron (USA) RJ

Seamless ProductionTube (OCTG* CRA**) V&M (France) MG

Package Drilling RigEquipment Aker Solutions (Norway) RJ

Package of Generation, Propulsion and DynamicPosition Equipment (Rig)

Kongsberg (Norway) RJ

Turbo Machinery

Rolls-Royce (United Kingdom) RJ

Dresser-Rand (USA) SP

Automation Emerson (USA) SP

MG

RJSP

PR

International Suppliers AttractionMotivated by the Long Term and Consistent Demand

(*) Oil Country Tubular Goods(**) Corrosion Resistant Alloys

Petrobras Promoting Technology Exchange: R&D Agreements Relationship with International Scienceand Technology Institutions

NorwaySwedenUKIrelandBelgium

USA

Japan

NetherlandsFranceGermanyPortugalItaly

Canada

ArgentinaAustralia

Country Theme

USA

Enhanced Oil Recovery, Drilling Engineering, Subsea Production Systems, Refining Technologies Licensing Reservoir Characterization and Modeling, Nanotechnology

France

Refining Technologies Licensing, NaphthaHydrodessulfurization Technologies, DrillingEngineeringGeosciences, Seismic Data Acquisition, Reservoir Characterization and Modeling, Materials technology

Norway

Seismic Monitoring, Hydrodynamic Modeling, Subsea Production SystemsOil Contaminants and Hydrates, Environmental Impacts in the Oil and Gas Industry

Country Theme

CanadaBiomass Gaseification, Reservoir Characterization and ModelingSeismic Data Acquisition

United KingdomMaterials technology, Reservoir Characterization and ModelingCarbonatic Reservoirs

Australia Geology, 4D Seismic Data Acquisition

Netherlands Production OptimizationPolymers

Japan, Belgium, Germany, Italy,

Portugal, Argentina, Sweden, Ireland

Geology and e New Materials

Process Simulation, CO2 Removal, Gas Hydrates

Brazil

Brazil

International R&D Centers AttractionMotivated by the Long Term Consistent Demand

North America

Europe

ES

RJSP

SegmentSupplier

(Origin Country)Brazilian

State

Submarine Pipelines Technip (France) ES

Submarine Equipment

FMC (USA) RJ

Cameron (USA) SP

Production Pipes in Special Metallurgy V&M (France) RJ

Oil Field Services

Schlumberger (France) RJ

Halliburton (USA) RJ

Weatherford (USA) RJ

Baker Hughes (USA) RJ

Turbo machinery General Electric (USA) RJ

Automation

Siemens (Germany) RJ

IBM (USA) RJ / SP

EMC (USA) RJ

O&G Operator BG (UK) RJ

Topside Equipment 3M (USA) SP

2014 and 2015 outlook

Assist the Energy Ministry in setting the optimal pace of new block bids, ensuring the sustainability of installed suppliers in Brazil;

Encourage the development of technological local content and innovation within the supply chain (start-ups and spin-offs);

Develop the concept of local clusters.

ProminpPerspectives for the future

PETROBRAS’ Local Content Policy

Brazilian Local Content Regulation

PROMINP: O&G Brazilian Industry Mobilization Programme

Offshore and Maritime Equipment Demand

Agenda

Conclusions

1.93

3.2

4.2

2.32

3.9

5.2

2013 2014 2015 2016 2017 2018 2019 2020

Oil and NGL Production (million bpd)

Oil, NGL and Natural Gas Production(million boe)

2014-2018 Business and Management Plan:Investments and Oil and NGL Production Curve in Brazil

DistributionBiofuels

Downstream

Other Areas 1

InternationalGas and Energy

Engineering, Technology and Materials

E&P

2014 Growth:7.5% ± 1p.a.

Oil NGL and Natural Gas Petrobras’ production in Brazil will grow 124% by 2020

4.2

2013 2014 2015 2016 2017 2018 2019 2020

2014-2018 BMP:Petrobras Oil and NGL Production Curve in Brazil

9

32

7 7

1

11

66

4

12

98

13

2

6

13

5

3

13

1

10

12 unitsdelivered + 9 + 13 + 23 + 22 + 30 + 21 + 21

149 new units to be delivered by 2020: 89 Tanker Vessels ( ), 32 Production Units ( ) and 28 Drilling Rigs ( )89 32 28

(1) Future Demand includes hired demand, demands in hiring phase and yet to be hired demand.

Petrobras VesselsCurrent and projected fleet

Source: Transpetro; BMP 2014-18; Petrobras (E&P-SERV/US-CONT and AB-LO/TM)

+ 154 Large Supply Boats

Business and Management Plan 2014-2018

Significant equipment demand mapping: Historically imported equipment with potential to attract foreign suppliers

Equipment produced nationally but with potential bottlenecks in production capacity

+ 32 Production Units by 2020 and+11 from 2021 to

2030 (Libra) + 28 Drilling Rigs

* AHTS, ORSV, PSV

+ 89 Tanker Vessels

Future Demand (2014-2020)

CriticalResources

Dec/2013Situation

Future Situation:Incremental values considering

acquisitions(1) and disposals2020

Situation2014-15 2016-17 2018-20

Tanker Vessels 55 13 23 38 127Supply Vessels 414 44 44 66 568

Production Units(SS and FPSO) 54 3 13 16 86

Drilling Rigs(SWD > 2.000 m) 40 -1 8 7 54

Example of equipment with potential for national development

PROMEF I and II EBN I and II49 Vessels by 2020 40 Vessels by 2020

7 delivered Vessels and 20 Vessels in advanced stage of construction

22 Vessels in hiring phase or initial construction phase

12 Products8 LPG

3 Bunkers

14 Suezmax8 Aframax4 Panamax

6 Bunker

7 LPG

1 delivered Vessel and 2 Vessels in advanced stage of construction

37 Vessels in hiring phase or initial construction phase

Equipment demand not yet addressed for 59 Vessels (by 2020)

Petrobras Fleet Growth Program with Brazilian Vessels

Tanker VesselsFleet increase by 2020

Source: Transpetro; Petrobras (AB-LO/TM)

59 Sewage Treatment Units

59 Inert Gas Generation System 122 Life Boats

1.770 Accomodation Cabines

6 Panamax

21 Products

Example of equipment with potential for national development

+ 154 Large Supply Vessels

by 2020

Source: E&P-SERV/US-CONT

OSRVOil Recovery

PSVGeneral Cargo + Oil + Bulk + Cement

TSTugs + Oil Recovery

LHSOS Standby + Handling Spy (messenger)

AHTSMaintenence TO´s + DMA´s + New Production Units

Instalation + FPSO`s and NT´s Operation

UT / PEmergency Cargo / Passenger

65

45

171

21

58

49

Current Petrobras Fleet Quantity Future Demand

154 Offshore and Provision Cranes 154 Vacuum Sewage Systems 1,232,000 meters of Metal Pipes 173,250 Manual Operated Valves 35,933 ton of Classified Profiles 3,730 ton of Fitting

Large Supply VesselsFleet increase by 2020

Example of potential equipment for national development

81 Chemical Injection Units

81 Offshore Cranes

27 Vacuum Sewage System

54 Offloading System

108 Life Boats + Davit

189,000 Manual Operated Valves

54,000 ton of Piping

43,200 ton of Fittings

Equipment demand not yet addressed for 27

Production Units to be delivered by 2030

Production UnitsFleet increase by 2030

Production Units considered for the equipment demand analysis

Operation Startup Timeline for Petrobras Production Units

Source: BMP 2014-18; Petrobras ND: Not defined * Charted Production Unit ** Integrated in Brazil with imported Hull or Modules

Abroad/Brazil ** Brazil To be contracted

Construction Site

2014 2015 2016 2017 2018 2019 2020//

2030

Example of equipment with potential for national development

21 Derrick Structure 21 Traveling equipment 21 Choke and Kill Manifold 21 sets of Risers 21 BOP (parcial) 21 sets Eletrical System 126 Main Diesel Generators (parcial) 21 Emergency generators 63 Deck Cranes 126 Azimut Thrusters 2,037 Pumps 630 HVAC System 21 Accomodation

Drilling RigsFleet increase by 2020

Equipment demand not yet addressed for the 21 drilling rigs to be delivered by 2020

Source: Petrobras; Sinaval

Drilling rigs considered for the equipment demand analysis

Petrobras Drilling Rigs Startup Timeline

+6

+4

+6

+3

+8

+1

2014 2015 2016 2017 2018 2019 2020

Abroad/Brazil **

Construction Site

2

31

Aerial view Rio Grande shipyard ERG1 – RS (dec/13).(1) Portico with 600 tons capacity (2) Portico with 600 tons capacity ; (3) Patio slabs of Ecovix; (4) FPSO Replicante P-66 blocs of hull

4

Rio Grande Shipyard (ERG 1) - RS • 8 Hull Constructions (“Replicantes” ) Local Content: 70%

2

Rio Grande Shipyard ERG1 – RS (april/14)(1) P-66 final hull construction activities at quay – the first hull for Pre-Salt fully built in Brazil – 70% Local content;(2) P-67 hull construction on dry dock: integration of mega blocks built in China;(3) P-67 and P-69 mega blocks built in Rio Grande Shipyard.

Rio Grande Shipyard (ERG 1) - RS• 8 Hull Constructions (“Replicantes” )

Local Content: 70%1

3

3

Rio Grande Shipyard (ERG 2) - RS

Works' Aerial View of Rio Grande 2 Shipyard (ERG2) – RS (06/08/13). Construction work of the ERG 2 Shipyard where it will be built 3 DRILLSHIPS (NS Cassino, NS Curumim and NSSalinas). (1) Workshops

1

1

• 3 Drilling VesselsLocal Content: 55%, 60% and 60%

Inhaúma Shipyard - RJ

2

1

Overview of Inhaúma Shipyard, in Rio de Janeiro - RJ (05/07/13). (1) P-74: Conversion of the ship VLCC's hull (hull structural reinforcement, expansion, renovation and adaptation of accommodation, equipment installation and anchoring system's adjustment

and utilities), (2) Dry dock recovered by Petrobras.

• 4 Hull Conversions (P-74,P-75,P-76,P-77) Local content: 70%

Atlântico Sul Shipyard - PE

1

4

5

3

2

Aerial View of Atântico Sul Shipyard (Ipojuca-PE): Construction of the Zumbi dos Palmares ship in dry dock and integration of P-62 on the shipyard dock (27/06/13).(1) P-62: Integration of the FPSO to the 15 modules, including 3 built in EAS, 7 in the UTC gantry and 5 in the Nuclep gantry(2) Zumbi dos Palmares SHIP of Suezmax type (2nd Lot's Ship of PROMEF 1) in dry dock; (3)Panel manufacturing workshops and pre-assembly of block, (4) Future area for construction of 6 Setebrasil's rigs ; (5) Future area of Promar Shipyard , responsible for building the batch of 8 Promef Phase 2's gas tankers.

• 6 Drilling Vessels

Local Content (LC): 55% - 65%

• 7 Suezmax: 72% LC

• 5 Aframax: 68% LC

• 4 Suezmax DP: 73% LC

• 3 Aframax DP: 73% LC

/ IHI

Enseada do Paraguaçu Shipyard- BA

Overview of future Enseada do Paraguaçu Shipyard Area in Maragogipe - BA (april/2014).The Enseada do Paraguaçu Shipyard has contract with Setebrasil to build the 6 DRILLSHIPS (Ondine, Pituba, Boipeba, Interlagos, Itapema, Comandatuba)(1) Integration pier; (2) Cutting and sheet metal processing; (3) Drydock

• 6 Drilling VesselsLocal content: 55% - 65%

1

2

3

BrasFels Shipyard - RJ

1

23

Overview of BrasFels Shipyard in Angra dos Reis - RJ (31/08/12).(1) P-61 (CL:65%): HULL'S Construction of TOPSIDE's TLWP and integration (deckbox and built modules in Singapore). (2) São Paulo City FPSO (CL: 65%): HULL's Conversion in China and integration of the 16 mod., Built in Brasfels (5 mod), Enaval (1 mod), Thailand (8 mod) and China (2 mod). (3) Paraty City FPSO (CL: 65%): HULL's Conversion in Singapore and integration of 15 modules built in the Brasfels (5), Nuclep (4), Enaval (2), and Singapore (4).

• 5 Building Modules and Integration

(Mangaratiba, Itaguaí, P-66, P-69

and Caraguatatuba)

• 6 Drilling SS. Local content

55% - 65%

BrasFels Shipyard - RJ

Overview of BrasFels Shpyard in Angra dos Reis - RJ (08/31/12).(1) Hull of P-61, (2) São Paulo City FPSO, (3) Paraty City FPSO; Paraty City FPSO's Modules: (4) TS072 - Main Gas Compressor B; (5) TS062 - Oil Treatment A; (6) TS063 - Oil Treatment B; (7) TS071 - Main Gas Compressor A; (8) TS075 - Gas TreatmentB; (9) TS073 - Compressor CO2; (CL: It was contracted full package of modules with 65% local content).

1

2

3

4

5

6

7

8

9

• 5 Building Modules and Integration (Mangaratiba, Itaguaí, P-66, P-69 and Caraguatatuba)

• 6 Drilling Vessels. Local content 55% - 65%

Brasa and Mauá Shipyards - RJ

Overview of Brasa and Maua Shpyards in Rio de Janeiro - RJ (april/2014).(1) Brasa Shipyard with modules construction activities;(2) Mauá Shipyard;(3) FPSO Cidade de Ilha Bela being integrated on Mauá Shipyard – 65% Local content

1

2

3• Mauá: 12 tanker vessels (4 Panamax

and 8 Products)

• Brasa: 3 Building Modules, Topside and Integration (Cidade de IlhaBela, Cidade de Maricá and Cidadede Saquarema

PETROBRAS’ Local Content Policy

Brazilian Local Content Regulation

PROMINP: O&G Brazilian Industry Mobilization Programme

Offshore and Maritime Equipment Demand

Agenda

Conclusions

PROMINP and Petrobras’ Business Plans have fostered the Oil and Gas Industry inBrazil;

Local Content Policy is a Government requirement and is a consolidated practice forExploration and Production projects in Brazil;

The challenges to put the Pre Salt fields into operation are known but the MaritimeIndustry plays a key role considering the demands;

The average Local Content today for E&P Projects range between 55% and 65%.There are plenty of opportunities for foreign companies wishing to establish inBrazil; Petrobras Foreign Suppliers Attraction Programme is moving fast;

The association between brazilian and foreign manufacturers is a good approachas to provide the solutions for technology bottlenecks.

Conclusions