This blog loves talking about Petrobras… after all, the company shows over and over the following: 

1. The “marvels” of being a state-owned company 
2. How not to meet production goals
3. How it feels to be a Brazilian government “cash cow”… and, of course, that can only give us a lot of material to talk about.
Jokes apart, what Itau’s research note concludes below is what we have been saying for a while (here and here), but now it’s the bank’s opinion (more important that ours, perhaps?):

Petrobras just released production numbers for November, showing a small improvement … growing 1.5% over November 2010…

In its last conference call back in October, Petrobras shared with the market high expectations for November and December production numbers. At that time, the company expected to be able to reach a peak of 2,200 kbpd production by the end of 2011…

If we assume production to reach 2,100 kbpd in December, average production in 2011 would be 2,023 kbpd, implying 1% growth over 2010, lagging 4% behind the company guidance. It is worth noting that this year’s initial guidance of 2,100 kbpd implied a 5% growth over the 2010 number.

… 2012 still looks tough from a production standpoint. In our view, the company will likely take a more conservative approach on production guidance for 2012… far from the plan’s 10% CAGR forecast. But the exercise presented above indicates a reasonable risk of lagging behind expectations, even considering a more conservative guidance….

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