Lula puts forward three new names for Petrobras board

In a securities filing, Brazilian oil giant Petrobras said it had received eight nominations from the federal government for the company’s new board of directors — three of which do not sit on the existing board. The government, Petrobras’s controlling shareholder, holds six of its 11 board seats. The eight names will be assessed and six will be chosen by a shareholders’ meeting scheduled for March 25. 

The appointments come a week after Petrobras CEO Jean Paul Prates revealed that the government had directly interfered with the company’s dividend policy, resulting in a decision not to pay so-called extraordinary dividends for the final quarter of last year.

Two weeks ago, Petrobras reported a 6.3 percent drop in net profit for the fourth quarter of 2023 and a more than 24 percent decline in annual results to BRL 136 billion (USD 27.3 billion). Following the new dividend policy, the company confirmed that it will not pay any extraordinary dividends for Q4 2023. 

Since Q2 2023, Petrobras has distributed 45 percent of its free cash flow to shareholders, down from 60 percent under the former Jair Bolsonaro administration.

The market was already expecting to see one of the names on the list: Rafael Dubeux, Brazil’s assistant to the deputy finance minister. In addition to Mr. Dubeux, Ivanyra Maura de Medeiros Correia, a production engineer, and Benjamin Alvez Rabello Filho, a lawyer, were nominated.

The government also requested that five other individuals de retained: Pietro Adamo Sampaio Mendes, as chairman of the board; Jean Paul Prates, CEO and member of the board, and Bruno Moretti, Renato Campos Galuppo, and Vitor Eduardo de Almeida Saback.

Mr. Gallupo joined the company’s board earlier this year, thanks to a Supreme Court ruling that suspended some parts of the 2016 law on state-owned companies. Last year, the company’s eligibility committee barred Mr. Galuppo’s because he had served as a national director of a political party until March 2022. 

Before the Supreme Court’s decision, the law imposed a three-year quarantine for politicians or party leaders to hold positions in state-owned and state-controlled companies.

Petrobras employees, who always occupy one of the 11 seats, re-elected Rosangela Buzanelli Torres again, who must also be confirmed at the shareholders’ meeting. The other four seats belong to minority shareholders, who will compete among themselves for these positions.

To be effectively put up for voting, the company’s eligibility committee must vet all of these names and the board of directors themselves.

The government nominated eight people for six seats, but not all of them will pass. They will also compete with other names put forward by other shareholders.

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