DnB NOR - Financing and Risk Competence in Emerging Markets International Corporates and Institutions – Tom Ringseth

2 DnB NOR Bank – International Corporates and Institutions Agenda: I.Norwegian Business in Brazil II.Political and economic update III. Energy and shipping in Brazil Brazil seminar on Energy and Shipping

3 DnB NOR Bank – International Corporates and Institutions Norwegian Business in Brazil Trade Stortingsmelding 15 Norwegian investments in Brazil Companies and sectors Today over 100 Norwegian companies established or represented in Brazil

4 DnB NOR Bank – International Corporates and Institutions Political and economic update Short overview of economic situation Politics –President Lula government –Difference between first and second administration –Current financial crisis –Elections 2010 –Political challenges

5 DnB NOR Bank – International Corporates and Institutions Economic update 70-mid 90’s several domestic and international crisis President Cardoso (FHC) –Orthodox economic policies President Lula –Continued orthodox policies –Second mandate more social focus –Prior to crisis, historical best moment –Crisis, 4th quarter 2008 GDP – 3.6% –Crisis, Lula administration measures –S&P’s view

6 DnB NOR Bank – International Corporates and Institutions Economic update Economic challenges in Brazil Inflation or growth ? World’s highest interest rates Current account deficit Lower trade surplus Increasing fiscal deficit

7 DnB NOR Bank – International Corporates and Institutions Challenges Political challenges: Social security, fiscal and political reforms Social developments Education, health and security Infra structure

8 DnB NOR Bank – International Corporates and Institutions Energy and shipping Energy matrix Oil & gas Petrobras and OGX, SH, Shell Chevron, Repsol, BG, etc. Current production peaks 2.2 million of bpd Pre salt potential Investments of USD 800 billion (UBS Pactual) Future production 3.7 million of bpd by million of bpd by 2020 Petrobras Investment Plan 2009 – 2013 Basis USD 40 p/barrel Financing secured for 2009 and 2010

9 DnB NOR Bank – International Corporates and Institutions Energy and shipping Oil or fluids exporter LNG importer -> exporter Petrobras now entering market for equipment and services Travels to Singapore last week and this week to Korea. Invitations for ship building companies to establish themselves in Brazil.

10 DnB NOR Bank – International Corporates and Institutions Shipping Brazilian flag FMM – BNDES and Banco do Brasil Offshore segment case – a success story ! Clients Technology Financing

11 DnB NOR Bank – International Corporates and Institutions Shipping Offshore vessels vessels Petrobras new build program + 50 vessels for other operators Rig Drill ships Tankers Transpetro Local shipping companies FPSO’s Shuttle tankers Need for shipyards

12 DnB NOR Bank – International Corporates and Institutions Challenges oil & gas sectors Higher local content Local production as part of industrial policy New legislation, 1% of gross revenues into domestic R&D Development of local technology clusters Petrobras – Cenpes Development of Brazilian oil equipment and service industries Brazilian and Norwegian partnerships, jv., patents Establishment in Brazil of Norwegian companies: Sales office Local production Manpower - competence EXPORT CREDITS

13 DnB NOR Bank – International Corporates and Institutions Challenges in Shipping sector Lack of reliable shipyards Weak local network of domestic equipment suppliers Manpower challenges Shipyard On vessels CSR initiatives Naval Academy CSR Maritime group – DLW Dream Learn Work

14 DnB NOR Bank – International Corporates and Institutions Finance BNDES Reais FMM – USD ECA’s GIEK, Eksportfinans and DnB NOR IFC Project finance – more challenging

15 DnB NOR Bank – International Corporates and Institutions Conclusions Oil & gas and shipping in Brazil has decades ahead with good business potential. Come to Brazil, consider doing direct business within Brazil. The most successful companies have established themselves during many years. Build up your network, with contacts within finance, banks, BNDES. Try to fund yourselves in Brazil in Reais or USD depending on your business segment. Develop your network with lawyers, consultants, listen to your contacts in Norway and at the Brazilian Embassy. There are strong Brazilian–Norwegian networks through BNCC, NBCC, INTSOK, Innovation Norway.