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RIO DE JANEIRO, April 27 (Reuters) – Shareholders of Brazil’s Petrobras (PETR4.SA) on Thursday approved new members of the state-run oil firm’s board of directors, a key step for the government of President Luiz Inacio Lula da Silva.
Until now, Petrobras’ board was mostly comprised of directors chosen by the administration of right-wing former President Jair Bolsonaro.
The election of the new members paves the way for Lula’s government to make further changes in the strategy of company, such as a change in its fuel pricing policy, which has been pushed by Lula’s administration.
Under Chief Executive Jean Paul Prates, Petrobras is set to also focus on renewable energy, expanding its refining capacity. However, Prates has signaled he also intends to focus on oil production and exploration.
This marks a sharp contrast from its former management’s strategy of selling off assets to focus on oil production on Brazil’s southeast coast, while paying out hefty dividends.
Petrobras’ previous board and an internal committee had previously ruled that three of the newly elected members, including new Chairman Pietro Mendes, were unsuitable for the role. Shareholders, however, backed their appointment.
The board and committee had argued that Mendes’ election would present a potential conflict of interest, as he also serves as oil and gas secretary at Brazil’s Mines and Energy Ministry. The two other members that had been deemed unsuitable are also officials on the ministry.
Shareholders also approved the full payout of 35.8 billion reais ($7.19 billion) in dividends, announced earlier this year, to be divided in three installments.
($1 = 4.9771 reais)
Reporting by Marta Nogueira; Editing by Sarah Morland
Our Standards: The Thomson Reuters Trust Principles.
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