International Law

Let?s Buy Some Commodities

By Stan

The market is certainly more attractive for Chinese purchasers than it was a couple of years ago, hmm? I wonder how many of these we’ll see over the next 18 months or so. Mining, petroleum, what’s next?

From Bloomberg:

Petroleo Brasileiro SA, Brazil’s state-controlled oil company, agreed to a $10 billion loan from the China Development Bank and to supply oil to the Asian nation.

“There are two important commercial agreements and a finance accord that demonstrates new possibilities for raising money,” Chief Executive Officer Jose Sergio Gabrielli told reporters after a signing ceremony in Brasilia today.

Petrobras, as the Rio de Janeiro-based firm is known, also agreed to sell as much as 100,000 barrels of oil this year to China Petroleum & Chemical Corp.’s Sinopec unit, Gabrielli said.

The loan will be used for general corporate purposes and to help Petrobras pay for a $174.4 billion, five-year investment plan, Gabrielli said, without giving details of the loan’s cost. The final terms of the loan will be worked out between now and May, when Brazilian President Luiz Inacio Lula da Silva travels to China on a state visit, a spokeswoman for Gabrielli said. The spokeswoman asked not to be named, citing company rules.

Petrobras has been talking with China about the loan since last year. The company has been seeking alternatives to international bank lending and bonds to finance its spending plan in the face of an international credit crunch.

Full post as published by China Hearsay on February 20, 2009 (boomark / email).