(Adds information from Petrobras press conference)
By Gram Slattery and Marta Nogueira
RIO DE JANEIRO, May 8 (Reuters) - Oil and gas production at Petroleo Brasileiro SA is on the rise, executives said on Wednesday, telling analysts that the company was on course to hit its annual production target despite lagging output in the first three months of the year.
In a call with analysts following the release of first-quarter results, Petrobras Exploration and Production Director Carlos Alberto de Oliveira reaffirmed the company’s production goal of 2.8 million barrels of oil equivalent per day (boepd) for 2019, adding that the company has been exceeding that figure in May.
First quarter production, 2.538 million boepd, was held back by a number of stoppages.
Talking to reporters later in the day, Petrobras Chief Executive Roberto Castello Branco credited rising production for lifting the company’s share price on Wednesday, saying twice that investors liked the firm’s quarterly figures more than the press did.
On Tuesday night, Petrobras reported a 42 percent drop in first quarter net profit, missing Refinitiv estimates.
Analysts at BTG Pactual led by Thiago Duarte called the results “uninspiring,” noting in particular a 38 percent increase in net debt because of the adoption of new accounting standards.
Brazil-listed preferred shares of Petrobras were up 3.5 percent in afternoon trade, topping a 1.5 percent rise in Brazil’s benchmark Bovespa index.
Executives at Petrobras also pledged on Wednesday to keep forging ahead with an ambitious divestment program.
Castello Branco said the company would look to divest its remaining 10 percent stakes in TAG and NTS, two natural gas pipeline units recently sold to investors, as soon as it closes the sale of 90 percent of TAG.
The company in June will also offer first details to investors on the sale of eight refineries that could fetch some $15 billion, according to Anelise Lara, the head of downstream operations.
Castello Branco told reporters fuel distribution unit Petrobras Distribuidora SA, which is being privatized, would not be a potential purchaser of the refineries, contradicting comments on Tuesday by that unit’s CEO.
He also challenged a March statement by Israel’s energy minister that Petrobras would take part in a gas tender there, remarks that spooked analysts, who saw the comments as proof of political interference at the company, as Brazil’s current government is a staunch Israeli ally.
Petrobras paid for the rights to examine opportunities in Israel and in Guyana to gather market intelligence, Castello Branco said, but has no intention of making new investments outside Brazil.
Reporting by Gram Slattery Editing by Marguerita Choy, Alistair Bell and Steve Orlofsky