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ICBC Leasing signs $2 billion sale and leaseback agreement with Petrobras
| Funder | ICBC Financial Leasing Co., Ltd. (ICBCFL) (ICBC Leasing) |
|---|---|
| Recipient Organization | Petróleo Brasileiro S.A. (Petrobras) |
| Country | Brazil |
| Start Date | Oct 13, 2015 |
| End Date | Jul 22, 2032 |
| Duration | 6,127 days |
| Number of Grantees | 1 |
| Roles | Recipient |
| Data Source | AidData Chinese Aid |
| Grant ID | 72679 |
Grant Description
ICBC Leasing signs $2 billion sale and leaseback agreement with Petrobras On October 13, 2015, Petróleo Brasileiro S.A. (Petrobras) announced the conclusion of successful negotiations on a $2 billion financing agreement with ICBC Financial Leasing Co., Ltd. (ICBCFL; ICBC Leasing).
The sale and leaseback agreement spans 10-years and provides a financial lease for two of Petrobras' existing deep-water oil platforms (P-52 and P-57) from its wholly-owned subsidiary Petrobras Netherlands B.V. (PNBV). The funds were to be made available to Petrobras once both parties fulfilled the precedent conditions of the agreement.
Then, on March 8, 2016, Petrobras received $1 billion from ICBC Leasing in exchange for the P-52 offshore oil platform, per the October 2015 agreement. The P-52 offshore oil platform was sold to the bank (ICBC Leasing) and the debt was to be settled by lease payments. The transaction had a 10-year maturity.
Full ownership of the oil platform was to be transferred back to Petrobras by the end of the lease term in March 2026.
Then, on September 10, 2018, Petrobras prepaid $750 million for financial leasing on P-52 despite the original maturity of March 2026. The P-52 oil platform is located in Roncador oil field in Brazil’s Campos Basin. The P-57 oil platform is located in Jubarte oil field.
Staff Comments
- This project represents one part of a larger cooperation agreement signed by Chinese Premier Li Keqiang during his visit to Brazil in May 2015 to facilitate cooperation between Petrobras and ICBC.
- Sale and leaseback (or sale-leaseback) agreements are generally considered to be off-balance-sheet hybrid debt products.
Sources & References
- Financing Agreement with ICBC Leasing, 2015 Annual Report
- Petrobras conclui negociação com ICBC Leasing para financiamento de US$ 2 bi
- Petrobras signs $2bn sale and leaseback deal with China’s ICBC
- Petrobras Gets Financing Worth $1 Billion from ICBC of China
- Form 6-K Petrobras - Petroleo Brasileiro Sa
- Consolidated Financial Statements as of September 30, 2015
- Petrobras receives $1 billion in financing from China's ICBC Leasing
- PETROBRAS-CHINA RELATIONS: TRADE
- INVESTMENTS
- INFRASTRUCTURE PROJECTS AND LOANS1, 2016 20F, 6k 9/12/2018 Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.
All Grantees
Petróleo Brasileiro S.A. (Petrobras)
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