Petrobras to Appeal P-34 Fines, Denies Wrongdoing

Brazil's federal energy company Petrobras (NYSE: PBR) has denied wrongdoing in its contract with local engineering company GDK for construction of the P-34 vessel, the company said in a statement.

As a result, Petrobras will appeal federal audit court TCU's move to fine four Petrobras managers 10,000 reais (nearly US$5,000) each, Petrobras said.

The audit court wants the two companies to prove that contract values to build the offshore production unit were not artificially increased.

Petrobras will comply with TCU's determination to withhold some US$5.3mn and pay GDK when the contractor has proven services were concluded.

Petrobras hired GDK to build the P-34 FPSO for US$88mn in 2005 to produce oil in the Jubarte field.

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