Petrobras to overhaul corporate structure and cut jobs

As the crisis deepens and its stock prices sink even lower, Petrobras decided today to slash management jobs as part of an efficiency drive approved by its board of directors.

Management jobs in non-operating areas will be cut by 30 percent. Petrobras has about 5,300 management positions in non-operating areas, meaning approximately 1590 people will be fired. Petrobras announced that the plan is a response to the lower gas and oil prices and that it hopes the restructuring will trim about R$ 1.8 billion — or $450 million — from its annual costs.

Petrobras also announced that it plans to reform procurement processes, which now will necessarily involve three areas of the company in an attempt to achieved economies of scale and raise transparency and responsibility. Previously, procurement was decentralized.

The company said it will also attempt to improve its financial profile through an aggressive drive to reduce debt. Petrobras has recently initiated plans to get rid of unprofitable areas with the sale of Gaspetro to Japanese group Mitsui.

Source: The Associated Press

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Emerging Markets Insights

a blog by Frontier Strategy Group

longandvariable

A blog on macroeconomics and public policy by Tony Yates.

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