PETRÓLEO BRASILEIRO S.A. - PETROBRAS

Material Fact

Payment of interest on capital

Rio de Janeiro, May 14, 2010 – Petróleo Brasileiro S.A. - Petrobras, informs that, the Board of Directors approved today an advanced payment of interest on own capital, in accordance with Brazilian legislation (Article 9 of Law 9,249/95 and Decrees nº 2,673/98 and 3,381/00).

The amount of R$ 1,755 million to be paid, corresponding to a gross value of R$ 0.20 per common and preferred shares, is being accrued in our Financial Statements on March 31, 2010. Payment date has not been set, but will be no later than August 31, 2010. The record date will be May 21, 2010.

The shares will be negotiated ex-interest on capital from May 24, 2010.

This interest on own capital, restated at the Brazilian Interest Rate – SELIC from the payment date to the end of 2010 fiscal year, will be offset against the remuneration (dividends plus interest on own capital) to be paid related to the 2010 fiscal earnings.

Almir Guilherme Barbassa
CFO and Investor Relations Director

www.petrobras.com.br/ri
Para mais informações: PETRÓLEO BRASILEIRO S. A. – PETROBRAS
Relacionamento com Investidores | E-mail: petroinvest@petrobras.com.br / acionistas@petrobras.com.br
Av. República do Chile, 65 - 2202 - B - 20031-912 - Rio de Janeiro, RJ | Tel.: 55 (21) 3224-1510 / 9947 I 0800-282-1540

This document may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act) that merely reflect the expectations of the Company’s management. Such terms as “anticipate”, “believe”, “expect”, “forecast”, “intend”, “plan”, “project”, “seek”, “should”, along with similar or analogous expressions, are used to identify such forward-looking statements. These predictions evidently involve risks and uncertainties, whether foreseen or not by the Company. Therefore, the future results of operations may differ from current expectations, and readers must not base their expectations exclusively on the information presented herein.

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act) that are not based on historical facts and are not assurances of future results.  These forward-looking statements are based on management's current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results o f operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations. 
All forward-looking statements are expressly qualified in their entirety by this cautionary statement, and you should not place reliance on any forward-looking statement contained in this press release. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events or for any other reason.