Lula to appoint Prates as Petrobras CEO, transition team sources

Brazil's President-elect Lula speaks in Sao Paulo


Thu, December 22, 2022
By Marta Nogueira and Rodrigo Viga Gaier

RIO DE JANEIRO (Reuters) -Brazilian President-elect Luiz Inacio Lula da Silva will appoint Senator Jean Paul Prates of his Workers Party to be the next chief executive of state-run oil company Petrobras, a member of his transition team said on Thursday.

Lula announced 15 appointments for his future cabinet on Thursday and said his vice president, Geraldo Alckmin, will double as industry and trade minister.

Deyvid Bacelar, head of oil workers' union FUP, said on social media that Lula had picked Prates based on the labor group's recommendations. He added that Senator Alexandre Silveira would be chosen to be mines and energy minister.

Later, Bacelar deleted his social media post.

A source close to the talks told Reuters that Prates was indeed Lula's pick to head Petrobras, but it was decided that the announcement would be delayed for political reasons.

"He still has edges to smooth in the ministries and it causes strife," the source said on condition of anonymity.

The source added Bacelar had to delete the post because he "made an unauthorized announcement."

Silveira said in an interview he had not yet been offered the job, but was willing to accept any role Lula offered him.

The transition team, Prates and Petrobras did not immediately respond to requests for comment.

Prates, already seen as a strong candidate for the job after being appointed to the transition team's mining and energy group, had previously said the incoming government would not have an interventionist stance on Petrobras.

"I think Prates is a good choice. I like him very much," said Bento Albuquerque, a former mines and energy minister under outgoing far-right President Jair Bolsonaro, whom Lula narrowly defeated in the October elections.

"He's not radical and knows about the oil and gas sector."

Preferred shares of the oil company rose more than 2% after Bacelar's post, outperforming Brazil's benchmark stock index Bovespa <.BVSP>, before ceding half the gain.

Market participants have been showing concern over how the Lula administration might run Petrobras, with shares in the firm down more than 15% since his election victory.

Prates, however, said last month that the incoming government had no intention of causing a "breakdown" of the company and that everything would be discussed with investors.

CABINET APPOINTMENTS

Lula said economist Esther Dweck would lead a newly created Management Ministry that will be responsible for efficient government and innovation, while business-friendly congressman Alexandre Padilha was appointed to be institutional affairs minister, dealing with political relations with Congress.

Among the half-dozen women appointed to his future cabinet, Lula named Anielle Franco, the sister of Rio de Janeiro city counselor Marielle Franco — whose murder in 2018 has yet to be solved — to be minister of racial equality.

For health minister, Lula picked Nisia Trindade, head of the country's main biomedical research center Fiocruz that produced the COVID vaccine developed by British drug maker AstraZeneca and Oxford university.

Lula still has to announce almost half of the positions on his planned 37-member cabinet. He said he would do that next week, before he takes office on Jan. 1.

(Reporting by Marta Nogueira, Rodrigo Viga Gaier and Gabriel Araujo; Editing by Steven Grattan, Andrea Ricci and Richard Chang)