Operational Results - 3rd Quarter 2014

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OPERATIONAL RESULTS

3rd Quarter 2014

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Conference Call / Webcast

November 17th, 2014

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DISCLAIMER

FORWARD-LOOKING STATEMENTS:

DISCLAIMER

The presentation may contain forward-looking statements about future

events within the meaning of Section 27A of the Securities Act of 1933, as

amended, and Section 21E of the Securities Exchange Act of 1934, as

amended, that are not based on historical facts and are not assurances of

future results. Such forward-looking statements merely reflect the

Company’s current views and estimates of future economic circumstances,

industry conditions, company performance and financial results. Such

terms as "anticipate", "believe", "expect", "forecast", "intend", "plan",

"project", "seek", "should", along with similar or analogous expressions, are

used to identify such forward-looking statements. Readers are cautioned

that these statements are only projections and may differ materially from

actual future results or events. Readers are referred to the documents filed

by the Company with the SEC, specifically the Company’s most recent

Annual Report on Form 20-F, which identify important risk factors that

could cause actual results to differ from those contained in the forward-

looking statements, including, among other things, risks relating to general

economic and business conditions, including crude oil and other

commodity prices, refining margins and prevailing exchange rates,

uncertainties inherent in making estimates of our oil and gas reserves

including recently discovered oil and gas reserves, international and

Brazilian political, economic and social developments, receipt of

governmental approvals and licenses and our ability to obtain financing.

We undertake no obligation to publicly update or revise any forward-

looking statements, whether as a result of new information or future

events or for any other reason. Figures for 2014 on are estimates or

targets.

All forward-looking statements are expressly qualified in their entirety

by this cautionary statement, and you should not place reliance on any

forward-looking statement contained in this presentation.

NON-SEC COMPLIANT OIL AND GAS RESERVES:

CAUTIONARY STATEMENT FOR US INVESTORS

We present certain data in this presentation, such as oil and gas

resources, that we are not permitted to present in documents filed with

the United States Securities and Exchange Commission (SEC) under

new Subpart 1200 to Regulation S-K because such terms do not

qualify as proved, probable or possible reserves under Rule 4-10(a) of

Regulation S-X.

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3Q14 Financial Statements Release

Context

In light of the accusations and investigations of the “Lava Jato Operation”, Petrobras is unable to

publish its 3Q14 financial statements, because the accusations, if found to be true, could potentially

affect the company’s financial statements.

On October 8th, the testimonies of former Downstream Executive Director, Paulo Roberto Costa, and

Mr. Alberto Youssef, in a hearing at the 13th Federal Court of Paraná revealed information that can

lead to possible adjustments in the financial statements.

Therefore, more time is needed to: (i) make any possible adjustments to the financial statements, (ii)

gain greater understanding from the ongoing investigations by the independent law firms and (iii)

improve internal controls.

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Petrobras has been taking various steps aimed at strengthening its internal controls, among

which:

Set up of Internal Investigation Committees to examine evidence or incidents relating to certain

transactions that may be construed as having breached norms, procedures or corporate regulations.

All of them are already concluded.

Systematic compliance with external authorities (Brazilian Federal Accounting Court – TCU, Brazilian

Office of the Federal Controller General – CGU and Brazilian Prosecution Office);

Requested access to the content of the state’s evidence and testimonies by former executive director

Paulo Roberto Costa and by Mr. Alberto Youssef as well as access to the inquiries instituted by the

Brazilian Federal Police

Hiring, on October 24th and 25th of 2014, of two independent law firms specialized in inquiries (Trench,

Rossi e Watanabe Advogados and Gibson, Dunn & Crutcher LLP);

Appropriate legal remedies aimed at redressing the alleged misapplication of funds and any amount

resulting from the overpricing and for redressing damages to the Company’s image;

Implementation of 60 relevant measures to improve governance and management processes between

2012 and 2014, while six are still under implementation.

In order to support their analysis, these 66 measures were sent to Independent Auditors and firms

hired to conduct the independent investigation.

Strengthening of Internal Controls

Measures adopted by Management

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Petrobras Operational Performance Presentation

Oil production record in Brazil: 2,126 th. bpd on Oct/14.

FPSO Cidade de Mangaratiba Start-up: October 14th, 2014 (20 days ahead of schedule) Capacity: 150 thousand barrels per day Field: Iracema Sul - Santos Basin Pre-salt Local Content: 65%

Abreu e Lima Refinery (Rnest) Unit under Pre-operation phase Atmospheric Distillation Unit License issued by ANP in 11/17/14 Capacity: 230 thousand barrels per day of oil products (70% of output is Diesel – 161 thousand barrels per day)

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Petrobras: Oil and NGL production in Brazil Production Operated by Petrobras in 3Q14 was 2,207 th. bpd

2,500

2,450

2,400

2,350

2,300

2,250

2,200

2,150

2,100

2,050

2,000

1,950

1,900

1,850

Oct-14

2,267

Sep-14

2,239

Aug-14

2,232

Jul-14

2,152

Jun-14 Até 10

nov-14

Dec-13

2,029

Nov-13

2,012

Oct-13

1,997

Sep-13

2,025

Aug-13

1,954

Jul-13

2,120

May-14

2,078

Apr-14

2,019

Mar-14

2,017

Feb-14

2,012

Jan-14

1,990 1,932

Jun-13

2,024

May-13

1,925

Apr-13

1,977

Mar-13

1,846

1,893

Feb-13

1,957

Jan-13

1,996

Production Operated by Petrobras

+6.5%

3Q14

2,207

2Q14

2,072

3Q13

1,969

Th.

bpd

+12.1%

3Q14

Average 2.207

Th. bpd 2013: 1,977 th. bpd 9M14: 2,096 th. bpd

1Q13

Average 1.948

2Q13

Average 1.975

4Q13

Average 2.013

3Q13

Average 1.969

FPSO Cid. São Paulo (Sapinhoá)

Jan/5th Capacity:

120 kbpd (45% Petrobras)

FPSO Cidade de Itajaí (Baúna)

Feb/16th Capacity:


P-55 (Roncador)

Dec/31st

Capacity:

180 kbpd

(100% Petrobras)

FPSO Cid. Paraty (Lula NE Pilot)

Capacity:


Jun/6th

1Q14

Average 2.006

2Q14

Average 2.072

Capacity:

180 kbpd (100%)

P-62 (Roncador)

May/12th

Capacity:

140 kbpd

62.5% Petrobras)

P-63 (Papa-Terra)

Nov/11th

Capacity:

180 kbpd

(100% Petrobras)

P-58 (Parque das Baleias)

Mar/17th

Oct/14th

FPSO

Mangaratiba (Iracema)

Capacity:

150 kbpd (65%)

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Petrobras: Oil and NGL production in Brazil Petrobras Production in 3Q14 was 2,090 th. bpd, an increase of 118 th. bpd over 2Q14

3Q14

Average 2,090

Th. bpd 2013: 1,931 th. bpd

1Q13

Average 1.910

2Q13

Average 1.931

4Q13

Average 1.960

3Q13

Average 1.924

1Q14

Average 1.922

2Q14

Average 1.972

9M14: 1.995 th. bpd

+6.0%

3Q14

2,090

2Q14

1,972

3Q13

1,924

Th.

bpd

+8.6%

Main factors that contributed to production growth

New wells on P-55 (Roncador), P-58 (Parque das Baleias), P-62 (Roncador) and FPSO

Cidade de Paraty (Lula Nordeste).

Start-up of Iara Oeste EWT and Tartaruga Verde SPA (Early Production System).

2.450

2.500

2.400

2.350

2.300

2.250

2.200

2.150

2.100

2.050

2.000

1.950

1.900

1.850

Até 10

nov-14

Oct-14

2.126

2.267

Sep-14

2.118

2.239

Aug-14

2.105

2.232

Jul-14

2.049

2.152

Jun-14

2.008

2.120

May-14

1.975

2.078

Apr-14

1.933

2.019

Mar-14

1.926

2.017

Feb-14

1.923

2.012

Jan-14

1.917

1.990

Dec-13

1.964

2.029

Nov-13

1.957

2.012

Oct-13

1.960

1.997

Sep-13

1.979

2.025

Aug-13

1.908

1.954

Jul-13

1.888

1.932

Jun-13

1.979

2.024

May-13

1.892

1.925

Apr-13

1.924

1.977

Mar-13

1.846

1.893

Feb-13

1.920

1.957

Jan-13

1.965

1.996

Production Operated by Petrobras Petrobras Production

Oct/14th

FPSO

Mangaratiba (Iracema)

Capacity:

150 kbpd (65%)

FPSO Cidade de Itajaí (Baúna)

Feb/16th Capacity:


Capacity:

140 kbpd

62.5% Petrobras)

P-63 (Papa-Terra)

Nov/11th

FPSO Cid. São Paulo (Sapinhoá)

Jan/5th Capacity:


P-55 (Roncador)

Dec/31st

Capacity:

180 kbpd

(100% Petrobras)

FPSO Cid. Paraty (PLula NE Pilot)

Capacity:


Jun/6th

Capacity:

180 kbpd (100%)

P-62 (Roncador)

May/12th

Capacity:

180 kbpd

(100% Petrobras)

P-58 (Parque das Baleias)

Mar/17th

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Connection of New Wells and Arrival of New PLSVs

LARGER PLSVs FLEET: 11 in 1Q14, 13 in 2Q14, 15

in 3Q14 and 19 in 4Q14.

HIGHER PRODUCTIVITY: from 91.2 km / PLSV / year

in 3Q13 to 94.2 km / PLSV / year in 3Q14 (+3.3%).

READINESS: Reduction in the non productive time of

the PLSVs from 34.37% of time in 3Q13 to 31.40% of

time in 3Q14.

Seven Waves

Sapura Diamante

Polar Onyx

Seven new PLSVs under operation

May/14th

Jun/15th

Jul/1st

North Ocean 105 Sep/3rd

Coral do Atlântico Oct/20th

Sapura Topázio Oct/1st

North Ocean 102 Oct/15th

(*) 42 wells operated by Petrobras and 4 by Shell

Estrela do Mar Dec/6th

2013 (51 wells, 34 producers)

2014 9M14 Accomplishments : 58 wells, 46* producers

2014 Projection: 91 wells, 62 producers

95 7 9 8 7 9 10

1417 15 16

43

3 7 4 4

8

17

22

22

0

5

10

15

20

25

30

35

4Q14

33

3Q14

23

2Q14

19

1Q14

16

4Q13

14

3Q13

13

2Q13

14

1Q13

10

4Q12

12

3Q12

10

2Q12

7

1Q12

13

11 PLSVs UNDER OPERATION 11 13 15 19 12 PLSVs UNDER OPERATION

2012 (42 wells, 30 producers)

Production Wells Injection Wells

4Q14: start-up until Nov 12th of 12 wells, of which 3 were producers and 9 injections wells

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2014 Projections – Oil and Natural Gas Production in Brazil

Domestic Natural Gas Supply (MM m³/day) Higher domestic supply with lower LNG imports

Oil Exports (th.bpd) Sustainable oil exports growth

302

166207

+82%

2H14

Projection

1H14 2013

464041

+15%

2H14

Projection

1H14 2013

Oil Production (th. bpd) 2014 Growth between 5.5% and 6.0%

2014

Projection

2013

1,931

+5.5% to 6.0%

Reasons for production below the target

(+7.5% +/- 1 p.p)

Delay in the delivery of own platforms and needs of

onboard construction

Delay in licensing processes

Delays in the connection of some wells

Offset by:

Better pre-salt reservoir performance

Replanning of stoppages.

Improvement of operational efficiency.

10 (*) Others – Lubricants, Asphalt, Coke, Propene, Solvent, Benzene, Querosene and Intermediates.

Oil Products Output in Brazil 3Q14 oil products output was 1% higher than 2Q14, with larger share of diesel and gasoline

Oil Products Output

Thousand bbl/d +4%

864 857 865

512 496 507

134 135 133

239 284 288

211 219 224

808774

10810294

+1%

Diesel

Gasoline

LPG

Naphtha

Jet Fuel

Fuel Oil

Others*

3Q14

2,204

2Q14

2,180

3Q13

2,128

3Q14 x 2Q14

Oil products output was 1% higher than 2Q14 mainly due to the

conclusion of stoppages of RLAM and RECAP as well as the start-

up of HDT of REFAP in Sep/14.

Higher throughput (+ 37 kbpd; +2%) with larger share of imported

oil (from 18% in 2Q14 to 19.6% in 3Q14).

+1%

+2%

Util

izat

ion

Fac

tor

382 379 418

100%98%96%

0

10

20

30

40

50

60

70

80

90

100

1103,000

2,500

2,000

1,500

1,000

500

0

%

3Q14

2,138

1,720

2Q14

2,101

1,723

3Q13

2,072

1,690

Imported Oil Domestic Oil Utilization Factor T

hrou

ghpu

t (k

bpd)

NGL (th.bpd) 46 38 44

Reference feedstock 2,102 2,102 2,102

Throughput and Utilization (%)

3Q14 x 2Q14

Daily throughput was 2% higher due to less stoppages in 3Q14.

Domestic oil accounted for 80% of total volume of processed oil.

Utilization factor of our refineries has remained high, reaching

100% in 3Q14 against 98% in the previous quarter.

2H14 projection: production of 2,213 thousand barrels per day, 3% higher than 1H14 (2,152 thousand barrels per day).

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3Q14 x 2Q14

Higher thermoelectric gas consumption (+4%). Natural gas thermoelectric generation supplied by Petrobras was 7.7

average GW, of which 4.6 average GW was own generation.

Higher natural gas supply (+11%) due to higher production in the fields of Mexilhão, Uruguá-Tambaú, Sapinhoá and

Lula Nordeste.

Higher national supply reduced the imports needs of LNG (-16%).

Natural Gas Supply and Demand Higher supply of natural gas reduced the needs of LNG in 3Q14

39,9

million m³/day

National

Bolivia

LNG

Non-thermoelectric

Thermoelectric

Downstream/Fertilizer

SUPPLY DEMAND

40,2

37,0

11,7

39,3

+14% +14%

32.1

39.7

+1%

3Q14 2Q14

96.3

2.0 13.4

41.9

38.9

3Q13

85.8

2.1 11.9

97.7

1.9 13.3

43.5

39.0

18.5

33.6

45.6

2Q14

96.3

12.8

31.5

41.4

22.1

33.0

41.2

3Q13

85.8

97.7

3Q14

+1%

+4%

+11%

System Gas* -16%

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3Q14 Financial Statements unaudited: December 12th, 2014

Justified by Managements’ duty to inform, acting with diligence and transparency.

Company has financial contracts with covenants that provide for the delivery of quarterly financial

statements, even unaudited, to the financing agents, within 90 days following the end of the quarter (in

other words, up to 12/30/2014).

Statements will reflect, in the best way possible, the situation of the Company’s financials in light of the

facts known up to the date of disclosure.

The unaudited financial statements do no substitute the Company’s obligation to release the 3Q14

statements with the Independent Auditor (PwC) revision.

Schedule of 3Q14 Financial Statements Release

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Financial Statements audited by Independent Auditors

Petrobras is providing all the conditions for Independent Auditors and the independent law firms to

investigate with efficiency and celerity.

Independent investigation will prioritize themes directly related to the allegations in “Lava Jato

Operation” and the managers and executives responsible for the production and the signing off of

financial statements released by Petrobras.

Credit rating agencies will be informed of the reasons why the Company did not disclose its financial

statements with a review for the third quarter within the time period prescribed under Brazilian law, as

well as the measures that have been taken by the Company.

As soon as there is a definition on the conclusion date, the Company will announce the disclosure date

to the market, at least 15 days in advance.

Schedule of 3Q14 Financial Statements Release

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Information:

Investor Relations

+55 21 3224-1510

[email protected]

OPERATIONAL RESULTS

3rd Quarter 2014

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