(Yicai Global) Dec. 6 -- China and Brazil signed an USD5 billion energy financing agreement, which will see 50 million tons of oil traded between the two countries in the next decade, state-run Xinhua News Agency reported.
The deputy governor of China Development Bank (CDB), Cai Dong, held a meeting with Pedro Parente, president of Petrolio Brasilieiro S.A. Petrobras [NYSE:PBR; BVMF:PETR3] (Petrobras), at the headquarters of the Brazilian oil multinational in Rio de Janeiro. Both sides signed an oil trade financing agreement worth USD5 billion, Xinhua said.
With the financing support from CDB, Petrobras and China International United Petroleum & Chemicals Co. (UNIPEC), a wholly-owned subsidiary to China Petroleum & Chemical Corporation (Sinopec), will have about 50 million tons of crude oil trading in the next 10 years. Aside from securing steady crude oil supplies to the Chinese market, CDB will help Petrobras expand its business in China and provide robust financial support to help Petrobras stabilize its oil output and serve the recovery of the Brazilian economy. Sources said that the agreement is not only a win-win deal for all but also a good example of development-oriented financial service and bilateral oil & gas production cooperation.
Petrobras is the largest semi-state-owned enterprise in Brazil, and its business covers the entire oil & natural gas industry chain in the country. It is the leading player in Brazil's domestic oil exploration, exploitation, and product sales, as well as one of the world's leaders in deep-sea oil exploitation technologies.
CDB is the world's largest development-oriented financial institution, China's largest foreign investment and financing bank, and China's number one bank in financing cooperation with Brazil. Since 2009, CDB has carried out five large-amount financing cooperation deals with Petrobras, and the accumulated amount of loans committed by CDB has reached USD28 billion. CDB supports China-Brazil cooperation in fields of oil blocks, oil trade, and equipment manufacturing.