Abreu e Lima Politics Trump Financial Concerns

BMI View: Petrobras has confirmed that it still expects PdVSA to remain its sole partner when undertaking the construction of the 230,000b/d Abreu e Lima project, despite the Venezuelan NOC's various financial setbacks. This conforms with our long-held view that, although spiralling costs have brought into question the long-term profitability of the plant, the political and diplomatic dimensions of the project are too great for both sides to renege on their 2005 agreement.

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