Petrobras: Committee sees impediment to government appointment – 06/04/2023 – Market

The committee that analyzes the resumes of nominees for the top management of Petrobras evaluated that there are impediments to the appointment of the executive secretary of the MME (Ministry of Mines and Energy), Efrain Cruz, to the company’s board of directors.

He is the third among the 11 nominees to the collegiate by President Luiz Inácio Lula da Silva (PT) to face questions from internal governance bodies: last week the board of directors rejected the nominations of Pietro Mendes and Sérgio Machado Rezende.

Cruz’s nomination will still be evaluated by the council, but the trend is that it will also be rejected, given the possibility of a conflict of interest between his role in the government and his role in the body that defines Petrobras’ strategies.

Former director of Aneel, Cruz is seen with reservations both within the state company and in the energy market. On the day his nomination as secretary of the MME was announced, the shares of companies in the sector plummeted on the São Paulo Stock Exchange.

Managers assess that his participation in the government raises the perception of political risk in the energy sector, since he is associated with political groups linked to Centrão and seen as a representative of lobbies, especially in the gas sector.

The opinion of the committee that analyzes resumes at Petrobras is not decisive and has already been disregarded a few times during the Jair Bolsonaro (PL) government.

In 2022, the company defended that the board’s position is not final and allowed the election of names rejected by the collegiate, in an action that was considered an attack on the State-Owned Companies Law.

Based on this argument, Bolsonaro elected the number two of the Civil House, Jonathas Assunção, and the attorney general of the National Treasury, Ricardo Soriano, to the collegiate, who had been vetoed by the committee.

Critical of the law, the Lula government has also insisted on names with clear prohibitions on positions in companies controlled by the Union. Bolsonaro repeated, for example, when he appointed the head of the National Treasury, Anelize Lenzi Ruas de Almeida.

His name has not yet been evaluated by the board. At the first meeting on the list of Lula’s nominees, Jean Paul Prates was approved; the director of ANA (National Water and Sanitation Agency), Vitor Saback; economist linked to PT Bruno Moretti; and Suzana Kahn Ribeiro, who was Secretary of Climate Change at the Ministry of the Environment in the second Lula administration.

Pietro Mendes was considered ineligible for holding a position in the ministry and Sergio Machado Rezende, for belonging to the national directory of the PSB.

Petrobras’ board of directors has 11 seats and the Union, the largest shareholder, is entitled to run for eight. Another two are reserved for representatives of minority shareholders and one, the representative of workers.

The election will be on April 27. Once again, the government will face competition from Petrobras’ largest individual shareholder, banker João José Abdalla Filho, known as Juca Abdalla, owner of Banco Clássico. He and lawyer Marcelo Gasparino will compete for vacancies on the board.

The two are already members of the collegiate, in vacancies conquered in the last shareholders’ meetings. With the support of other minorities, the two were left with two seats that were normally occupied by Union nominees.

Petrobras said it will not comment on the matter.