Petrobras has raised its debt ceiling to $75bn from $65bn while increasing investments to expand oil and gas production. Credit: Wirestock Creators/Shutterstock.

Brazilian state-controlled oil company Petrobras has unveiled a plan to distribute up to $55bn in dividends up to 2029 as part of its five-year business strategy, aiming to maintain its commitment to returning cash to investors, as reported by Bloomberg.

The company stated in a recent securities filing that it may also disburse up to $10bn in extraordinary dividends during this period.

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Payment of an additional 20bn reais ($3.4bn) in extraordinary dividends to shareholders has also been approved by the company.

Analysts have responded positively to the continued shareholder payouts, with 83% rating the stock as a buy, according to Bloomberg data.

Petrobras has confirmed a 9% increase in its strategic plan to $111bn, though it has reduced estimated capital spending for 2025 to $18.5bn from $21bn.

A significant portion of the expenditure, $77.3bn, is allocated to exploration and production projects both within and outside the country. The business plan includes ten new offshore production units, with an additional five vessels planned post-2029.

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Petrobras is also considering six more production vessels, including a 12th platform for the Buzios field in the pre-salt region of the Atlantic.

The company has raised its debt ceiling from $65bn to $75bn while increasing investments for the expansion of oil and gas production. Its minimum cash holding is lowered to $6bn.

Petrobras CFO Fernando Melgarejo stated in an interview in September 2024 that the increased debt ceiling does not necessarily imply more debt but offers increased flexibility in debt management.

Petrobras is under pressure to balance rewarding shareholders with dividends and investing sufficiently to help the government achieve its economic growth targets.

The company’s next five-year plan of renewable spending allocates $11bn to gas, energy and low-carbon projects, with only 27% of this spending directed at projects currently underway. The remainder is still under evaluation.

The renewables strategy includes solar, onshore wind and biofuels, with a return to ethanol production.