Eletrobras to pay Petrobras in debt settlement, government says

miércoles 5 de agosto de 2015 20:09 GYT

By Luciano Costa and Leonardo Goy

BRASILIA/SAO PAULO Aug 5 (Reuters) - Brazil's two largest energy companies, Eletrobras and Petrobras , settled a quarrel on Wednesday worth billions of dollars in late payments for fuel supplies, the government said.

Brazil's Energy Ministry said Centrais Eletricas Brasileiras SA, as Eletrobras is known, will pay Petrobras a bill that at one point late last year was estimated at around 8.6 billion reais ($2.47 billion) related to the supply of fuels for several thermal power plants over some years.

The government, which controls both power company Eletrobras and oil company Petrobras, did not provide an updated figure for the current size of the debt, saying only that it will be paid in 36 monthly installments adjusted by the country's reference Selic rate, currently at 14.25 percent per year.

The deal is a major step taken by the government to address huge debts created during Brazil's worst energy crisis in 15 years, as expensive thermal power plants were used nonstop for at least two years to guarantee supplies while a severe drought cut hydro plants' reservoirs.

The settlement should also help the battered finances of Petroleo Brasileiro SA, as the oil company is formally known.

"This renegotiation will provide Petrobras with a regular flow of payments," Brazil's energy minister, Eduardo Braga, told reporters in Brasilia.

Petrobras had threatened to sue Eletrobras due to the fuel bills in arrears.

The money for the deal, which includes another settlement of debt, will come from the CDE, a fund fed by extra payments imposed to every power consumer in the country in their monthly bills.   Continuación...