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Gold/Mining/Energy : Big Dog's Boom Boom Room
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To: JimisJim who wrote (123996)9/2/2009 9:19:43 PM
From: Elroy Jetson2 Recommendations  Read Replies (3) of 206089
 
I think the reality is that the rising costs of sub-salt made a proposed PBR debt offering not marketable at a "reasonable" interest rate.

One of the few alternative source of financing is for the Brazilian government to buy newly issued and over-priced PBR shares or lend PBR money at a subsidized rate. From the government's standpoint the over-priced shares are preferable as the subsidized debt would act as a subsidy for wealthy shareholders around the world.

Once you've already tapped the Export-Import bank financing from a few nations, you're sucking wind and running out of options.

Brazil will buy Petrobras shares because no one else will at a high enough price, not because there's some big juicy prize they're trying to capture.

Likewise, if Brazil/Petrobras continue with their Brazil-ification of well services, it is merely as a public works project, not because there is so much profit being thrown off by sub-salt.
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