Clarification on the lease of Ishibras and ICMS Tax of P-36

Rio de Janeiro, May 12^th, 2010, Petróleo Brasileiro S.A. – Petrobras clarifies the news issued by the Brazilian media concerning the lease of the Ishibrás shipyard area and ICMS payment to the State of Rio de Janeiro related to Platform P-36.

The Company confirms that it is assessing the possibility of leasing the Ishibrás shipyard, located in Rio de Janeiro and that for such, it is in negotiation with the current owners of the shipyard, with the Government of the State of Rio de Janeiro and with the City Hall of Rio de Janeiro with the aim of minimizing the tax burden. However, as of now, negotiations have not yet been concluded and no agreement or contract has been executed by Petrobras.

Concerning ICMS (State Sales and Services Tax) collection, the company clarifies that in 2001, the Platform P-36 was imported by Petrobras for temporary admission, under the scope of the tax suspension customs system (REPETRO) and therefore in this occasion state taxes were not due.

With the sinking of the platform, the State started the collection of the ICMS which had been suspended through a tax foreclosure suit against Petrobras.

In February 2010, with the unfavorable judgment in the last level of appeal in the State Court of Appeals of Rio de Janeiro, Petrobras started to assess the legal aspects of the suit and the economic stemming from the utilization of the tax amnesty benefits provided in State Law no. 5.647, of 01/18/2010, which permits the elimination of fines and the expressive reduction of other charges, in addition to the possibility of payment with judicial orders.

Given that the current deadline for the taxpayer’s manifestation of interest to adhere to the conditions of payment is 05/30/2010, Petrobras is assessing the alternatives of either continuing the legal discussion or adhering to the conditions of payment of the referred to State Law. Moreover, the State of Rio de Janeiro has committed itself to analyze the tax benefits related to other projects in negotiation.

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