oil & gas presentation sep12 - indo...

!Brazil’s Macro Trends & Oil & Gas Vertical!Background Information for Successfully !

Expanding your Presence in Brazil

Setember, 2012 Anand Hemnani

President, Indo Bras United Ltda.

!

The Overview

•  MACRO TRENDS IN BRAZIL DRIVING GROWTH IN EQUIPMENT DEMAND

•  INFRASTRUCTURE GROWTH CONTEXT & KEY TRENDS

– OIL & GAS

•  The Tasks & Structural Strategic Considerations

!

6

Despite Brazilian economic slowdown in 2011 a rebound in economic growth is expected in 2012, supported by investment in infrastructure

1 Estimated by HSBC Brazil

Source: IBGE (Brazilian Institute of Geography and Economy) and Brazilian Central Bank

Brazilian GDP growth

Investment rate forecast (FBKF/GDP)

• Brazilian economy is the largest

in Latin America (2011 GDP

USD 2.5tn) and is ranked

among the 10 world’s largest

economies

• Looking forward, policy easing

and credit cycle will help

leverage growth in future years

– Low investment/GDP

(especially infrastructure)

generating bottlenecks

– Significant opportunities

related to ~USD 500bn

infrastructure investment

by 2015

– Low savings ratio and

short tenor of liabilities are

challenges for investment

Economic overview

2013

4.0

2012

3.2

2011

2.7

2010

7.5

2009

-0.3

2008

5.2

2007

6.1

2006

4.0

Forecast1

13141516171819202122

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

F

20

12

F

20

13

F

20

14

F

Forecast1

%

!

GDPGrowth–KeyDrivers

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

World Cup BRL 100 Bi

Olympics BRL 20 Bi

Petrobras without Pre-Salt BRL 240 Bi

Ethanol Industry BRL 50 Bi

Pre-Salt BRL 190 Bi

Source: PwC, FFB

Estimated investments of BRL 600 billion between 2011 and 2016

!

Brazil… The Real Growth Drivers….

Topics: Brazil, and opportunities in private equity

2

January 18, 2011

It would be difficult to understate the importance of Brazil’s commodity riches. At a time of voracious commodity demand

in the emerging world2, Brazil is ideally suited to meet it, with commodities now roughly 2/3 of total exports. China’s

emergence from Maoist central planning into being an engine of urbanization and modernization is a boon to Brazil. The same

goes for India’s development since the Rao reforms of the early 1990s (see EoTM “From Nehru to Now”, October 26, 2010),

which contributed to a quadrupling of Brazilian exports to India. We have questions about the viability of sub-salt oil extraction

(see footnote 4), but it’s hard to argue with Lula on the Tupi field: “Deus é Brasileiro”. More on agribusiness and Brazil’s

natural resource advantages on page 5.

0

50

100

150

200

250

300

350

400

!"#$

%&

'()

*+,

,%#

-./%

#

01%

.#

)+,2

"#&%#

0#.

#/#

)"34

.2%.

#

(+/#

.

).35

&#

-./5

.4,%

#

6%3

4"%#

05&

+78%

#

Non-cultivated areaCurrent cultivated area

Source: Food and Agriculture Organization.

Availability of arable landMillions of hectares

0 100 200 300

MexicoAlgeria

BrazilAngolaChinaQatar

USCanadaNigeria

KazakhstanLibyaBrazil

RussiaUAE

KuwaitBrazil

IraqIran

VenezuelaSaudi Arabia

Source: British Petroleum, Petrobras.

2009 oil reserves, billions of barrels

Sub-salt (best)

Sub-salt (official)

Without sub-salt

$0

$5

$10

$15

$20

$25

$30

'80 '84 '88 '92 '96 '00 '04 '08Source: Banco Central do Brasil, MDIC, Secex.

Brazil's trade with ChinaBillions, USD

Brazil exports to China

Brazil imports from China

The rise of 50 million Brazilian consumers

The by-product of improved monetary and fiscal policy and the commodity boom: the lowest unemployment in over 20 years,

declining poverty rates and the emergence of a growing middle class. As interest rates fall, many households have access to

credit for the first time, fueling an increase in private consumption. Direct payments to the poor, increases in the minimum

wage, and incentives to lower class families to attend school have all been designed to sustain Brazil’s upward income mobility.

Retail sales are growing at 10% per year in real terms, and consumer confidence is at its highest level in 4 years.

0

20

40

60

80

100

120

Upperclass Middle class

Lower class

Bottom class

200320092014

50 million people join Brazil's middle class, 2003 to 2014, Millions of people

Source: FGV, IBGE, LCA, Ministerio da Fazenda.

0%

25%

50%

75%

100%

125%

150%

175%

200%

'9

0#.

#/#

'()

:#;#

.

<"#.

=4

>4"

7#.

?

-2#&?

!"#$

%&Source: IPEA, Ministerio da Fazenda.

Consumer creditPercent of household income

-4%

-2%

0%

2%

4%

6%

8%

10%

1987 1990 1993 1996 1999 2002 2005 2008

Source: Ministry of Finance.

Private consumptionPercent real increase over prior year

Wall and floor tiles 2nd largest

Cosmetics 2nd largest

Mobile phones 3rd largest

Chocolate 4th largest

Soft drinks 5th largest

Vehicles 5th largest

Computers 5th largest

Education 8th largest

Brazil: one of the world's largest consumer

markets

Source: Euromonitor, ANFAVEA, IDC, Abicab,

Anfacer, FGV research

75%

80%

85%

90%

95%

100%

1992 1994 1996 1998 2000 2002 2004 2006

School enrollmentStudents aged 7 to 14

Source: Instituto de Pesquisa Econômica Aplicada.

5%

10%

15%

20%

25%

30%

'01 '02 '03 '04 '05 '06 '07 '08 '09

Source: FGV, Ministerio da Fazenda.

Decreasing povertyPercent of population

2 As outlined in our 2011 EoTM Outlook on Jan 1, the share of commodities like zinc, aluminum, copper and nickel consumed by emerging

economies has doubled since the mid 1990’s to 50-75% of global demand.


2

January 18, 2011








0

50

100

150

200

250

300

350

400

!"#$

%&

'()

*+,,

%#

-./%#

01%.#

)+,2"

#&%#

0#.#

/#

)"34

.2%.#

(+/#

.

).35

&#

-./5.

4,%#

6%34

"%#

05&+7

8%#




0 100 200 300

MexicoAlgeria


USCanadaNigeria


RussiaUAE

KuwaitBrazil

IraqIran




Sub-salt (best)

Sub-salt (official)

Without sub-salt

$0

$5

$10

$15

$20

$25

$30











0

20

40

60

80

100

120


Lower class

Bottom class

200320092014



0%

25%

50%

75%

100%

125%

150%

175%

200%

'9

0#.#

/#

'()

:#;#

.

<"#.

=4

>4"7

#.?

-2#&?

!"#$

%&

Source: IPEA, Ministerio da Fazenda.


-4%

-2%

0%

2%

4%

6%

8%

10%

1987 1990 1993 1996 1999 2002 2005 2008












markets



75%

80%

85%

90%

95%

100%

1992 1994 1996 1998 2000 2002 2004 2006



5%

10%

15%

20%

25%

30%

'01 '02 '03 '04 '05 '06 '07 '08 '09





!

Brazil… Consumers Driving Clusters….


2

January 18, 2011








0

50

100

150

200

250

300

350

400

!"#

$%&

'(

)

*+,

,%#

-./%

#

01%

.#

)+,

2"#&

%#

0#.

#/#

)"3

4.2%.

#

(+/

#.

).3

5&#

-./5

.4,%

#

6%3

4"%#

05&

+78%

#




0 100 200 300

MexicoAlgeria


USCanadaNigeria


RussiaUAE

KuwaitBrazil

IraqIran




Sub-salt (best)

Sub-salt (official)

Without sub-salt

$0

$5

$10

$15

$20

$25

$30











0

20

40

60

80

100

120


Lower class

Bottom class

200320092014



0%

25%

50%

75%

100%

125%

150%

175%

200%

'9

0#.

#/#

'(

)

:#;

#.

<"#

.=4

>4"

7#.

?

-2#&

?

!"#

$%&



-4%

-2%

0%

2%

4%

6%

8%

10%

1987 1990 1993 1996 1999 2002 2005 2008












markets



75%

80%

85%

90%

95%

100%

1992 1994 1996 1998 2000 2002 2004 2006



5%

10%

15%

20%

25%

30%

'01 '02 '03 '04 '05 '06 '07 '08 '09






2

January 18, 2011








0

50

100

150

200

250

300

350

400

!"#

$%&

'(

)

*+,

,%#

-./%

#

01%

.#

)+,

2"#&

%#

0#.

#/#

)"3

4.2%.

#

(+/

#.

).3

5&#

-./5

.4,%

#

6%3

4"%#

05&

+78%

#




0 100 200 300

MexicoAlgeria


USCanadaNigeria


RussiaUAE

KuwaitBrazil

IraqIran




Sub-salt (best)

Sub-salt (official)

Without sub-salt

$0

$5

$10

$15

$20

$25

$30











0

20

40

60

80

100

120


Lower class

Bottom class

200320092014



0%

25%

50%

75%

100%

125%

150%

175%

200%

'9

0#.

#/#

'(

)

:#;

#.

<"#

.=4

>4"

7#.

?

-2#&

?

!"#

$%&



-4%

-2%

0%

2%

4%

6%

8%

10%

1987 1990 1993 1996 1999 2002 2005 2008












markets



75%

80%

85%

90%

95%

100%

1992 1994 1996 1998 2000 2002 2004 2006



5%

10%

15%

20%

25%

30%

'01 '02 '03 '04 '05 '06 '07 '08 '09





!

7

Inflation only partially tamed and lower interest rate levels are expected throughout 2012

1 Extended National Consumer Price Index

2 Estimated by HSBC Brazil

Source: IBGE

Inflation

Economic overview

20

15

10

5

0

201420132012201120102009200820072006

Forecast2

SELIC interest rate (end of period)

IGP-MIPCA!

2009

8.75

2008

13.75

2007

11.25

2006

13.25

2013

8.0

2012

8.0

2011

11.00

2010

10.75

Forecast2

• Although short-term outlook is positive, service sector inflation remains a source of concern

• Even with slightly higher unemployment, wage inflation will continue to put pressure on service prices

• IPCA inflation to fall to 5.3% in 2012, but to return to just under 6% in 2013

• Selic policy rate expected to be 8.0% at year-end, and to remain at that level through the end of 2013

!

8

The Brazilian economy is much more than just commodities

Source: MDIC (Brazilian Ministry of Development Industry and Trade)

Economic overview

Brazilian exports evolution

USDbn

+27%

2011

256

48%

52%

2010

202

45%

55%

• Industrialized productsrepresent more than half of Brazilian total exports (~USD 134bn in 2011)

• Driven by Chinese demand, raw materials were the fastest growing component of exports from 2010 to 2011, but still account for less than half of total exports

• Brazil's diverse industries include automobiles, petrochemicals, machinery and equipment, computers and electronics, aircrafts, textiles, consumer durables

Other

18%

Textile 7%

Capitalgoods

13%

Petrochemical

14%Aircraft

16%

Auto32%

Industrialized exports breakdown

%, 100% = USD 134bn

Raw materials

Industrialized

!

27

Demographics are favourable to our retail banking and support our strategic intent to explore the affluent segment

• Majority of the population will be at the age to buy real estateand invest in pension plans

• By 2030, 126m Brazilians should be in the 20-60 age range

• If current trend holds, 29m people will enter middle class and 13m will exit poverty by 2014

• Per capita GDP is expected to more than double by 2030, reaching USD 22,000 in purchasing power parity

E

D

C

A/B

2014f

198

7%20%

57%

16%

2009

188

15%

23%

51%

11%

2003

175

28%

27%

38%

7%

Population by class

#, millionDemographics and increasing household income are positive drivers for the next 2 decades

Brazilian age Pyramid expected by 2030

MEN WOMEN

Population

in working age

20 - 24

75 - 79

70 - 74

60 - 64

50 - 54

30 - 34

35 - 39

15 - 19

5 - 9

65 - 69

55 - 59

40 - 44

25 - 29

80 - +

10 - 14

0 - 4

45 - 49

Source: Finance Ministry; IBGE and ANBIMA

Outlook

!

!"

!"#!$!"#%&'(&)*+,-./,*.-0&12234+,5&67&(,.34638-&'4835&49&:;3,<.43-&;*&=>*,&#?@&!"#!

!"#!$!"#%&(,3;45ABC&!?%DE&';FF;4*&

#$%&'(()*(+,-./01.,0/(234)256(78'(+,(9:;

< (83;.7&G;.H&)/243.,5&I;F&(345><.-&(3;<,-&

< J8;*.,*8*<,&49&)*+,-./,*.&K385,0

$ L,+,38M,&F4G,3&.H8*&?EN

$ O,.&:,6.PQ')R:1&F4G,3&.H8*&!DES&

< RH,3,&;-&*4&;-->8*<,&49&*,G&-H83,-

< :;+,-./,*.-&49&ABC&#TDU&';FF;4*@&94<>-;*M&4*&

8--,.-&4>.-;5,&'38V;F

W;*8*<;86;F;.7 1-->/2.;4*-

!='

>+/04+3?0+), @+)*?.ABCD E:9 ;.04)FG.1+F2A9:; H)4I)420.

J8%8'KLMN("$"6=(@+AA+),O

!P%P'KLMN(J&%&(@+AA+),O

"%Q'KLMN(Q%8(@+AA+),O

"%J'KLMN(Q%=(@+AA+),O

"%&'KLMN(Q%J(@+AA+),O

!%"'KLMN(&%8(@+AA+),O

&%='KLMN("Q%=(@+AA+),O

QX(

The Oil and Gas Growth Drivers…. !

!""#

$%&'(

!"%"

%))%

*+#,

%))#

!"""

%,+!,

-./01203456-017.869.4.07.46:86;03<:=6>2:==:18621.?

! 9.4.07.@-01ABC/:186!!!! %)+!6D.304

! 9.4.07.46E8C10F103/.A6:86!"%%

G1/3=56%+!'62:==:18621.

-0.HI3=/56%62:==:18621.

"#$%&'%()*+%,-,./,+%,0123,4,56+%2678+9+:;;<+=8.+6>,+?;6> 385-,3@67/,+A,2.

;9JKEL56L.3A.04M:F6:86N.O6P:4C17.0:.46:86P..F6Q3/.04

;034:=

! E86 /M.6 =34/6 #6 D.304R6 S10.6 /M386 #"(6 1T6 /M.6 8.O6

A:4C17.0:.46 O10=AO:A.6 O.0.6 S3A.6 :86 A..F6 O3/.04+6

;03<:=63=18.63CC1B8/46T106&,(61T66/M.4.6A:4C17.0:.4+

! -01U.C/:1846 :8A:C3/.6 /M3/6 346 ;03<:=6 A.7.=1F46 /M.4.6

8.O=D6 A:4C17.0.A6 0.4.07.4R6 :/6 O:==6 =.3A6 818HV-WX6

4BFF=D6Y01O/M6B8/:=6!","6>-ZX6W8.0YD?+

!"%%

&6>,.+B7-38/,.7,-

B,,0+C26,.-

,,R)[)6S:==:18622=N

.O

6P:4

C17.0:

.46!

""#

H!"%"

;03<:=

,!(

%)(

')(

:?

%#+*%

$,(

The Oil and Gas Growth Drivers…. !

The Oil and Gas Growth Drivers….

!"#$%&'(")*+!"#$%&'#()%*+,&-#./%&+0%&.1*#%",%&.1&'#(-2*+.(1

*,-./0

123

!"#$%&'#()

*&+,%-.%/'0$01%

2345$%0(6%71'6

899:999%;<0

/$=>$#()1%$30

-$#1'$%*5$3=$%

*&+,%/$<'?$;$

899:999%;<0

@$5#'A%+"#

A(0"#1%BC";$5)1%

-$#1'$%2D"#

*&+,%/'0$01%%01%

23=>'1)$

899:999%;<0

E*&+,%F6<$0$5)1%

&$<$GH155$%

H!.&%&GI8%J

*&+,%&GIB

K"$5L%EM(5)>N%

*&+,%

8O9:999%;<0

&$5P"1%0$6%

-$#1'$6

*&+,%&GOQ

8Q9:999%;<0

@1?'#>R(

C$P"1)$

SK

T5"4"L

*&+,%/'0$01%01%

+$3)(6

BO:999%;<0

K"$5L%&'#()%U

*&+,%/'0$01%%01%

+R(%&$"#(

8U9:999%;<0

!"#$%MF

*&+,%/'0$01%01%

&$5$)V

8U9:999%;<0

/153$A;'%

+(")>

*&+,

8O9:999%;<0

*&+,%&GIW%

71<#'=$3)%U

8O9:999%;<0

-@+GX%("588!

!

!

C"5"L%MK

H$A;$Y%

*&+,%/'0$01%

01%+$3)(6

MK

"#*/

!

!

*5$3=(%8%

H5$36Z15%(Z%

7'4>)6

*&+,%

8O9:999%;<0

%456+789$7:3$*47:/;54$-;$&<=,9/$%4->5?9/

!@$%4->5?9/$ %-/96+789$%4->5?9/

3.070

3000

10

++%&GOI

899:999%;<0

C";$5)1%

*&+,%&GOW

8Q9:999%;<0

E*&+,%F6<$0$5)1%

51$##(=$)'(3N

7(3=$0(5%

A(0"#1%[%%

*&+,%&GIU

8Q9:999%;<0

7(3=$0(5%

A(0"#1%B

++%&GOO

8Q9:999%;<0

*&+,%&GIB

8O9:999%;<0

H'5(\+'0(3

*&+,%/'0$01%%%01%

])$^$_

Q9:999%;<0

H'5(%&'#()

++G88

2)#$3)'=%`1<>'5

B9:999%;<0

F.H%K"$5L

*&+,%aV3$A'=%

&5(0"=15

B9:999%;<0

F+&\@$5'A;L

*&+,%

[9:999%;<0

25"$3R

*&+,%

899:999%;<0

@$5(A;$

*&+,%

899:999%;<0+'5'

C$P"1)$%1%

*&+,

O9:999%;<0

[%F.H6%

&51G6$#)

*&+,%&GII

71<#'=$3)%8

8O9:999%;<0

-@+GX%(5%88

!

!

!

-$#1'$%2D"#

*&+,

I9:999%;<0F.H6%!"#$%MF%%

1%/153$A;'

*&+,%-.%

/'0$01%+R(%

b'=13)1

B9:999%;<0

!

F.H%/$5'(=$%

*&+,%aV3$A'=%

&5(0"=15

B9:999%;<0

B%F.H6%

&51G6$#)

O%F.H6%

&51G6$#)

O%F.H6%

&51G6$#)

2.1002.004

0

500

1000

1500

2000

2500

3000

2010 2011 2012 2013 2014 2015

!

Natural Gas Pipeline Expansion

! !"#$%&'("#)"*)+,-.&,/)0,')(#-")*%&-(/(1%&'),#2)

"-3%&)4,')53%6(5,/)7&"2.5-')89:+);;;<)

! +,-.&,/)0,'=)%>7,#'("#)"*)7&"5%''(#4),#2)

-&,#'7"&-,-("#)5,7,5(-?

! @,(#-%#,#5%)"*)(#2.'-&(,/)5"67/%>=)

-3%&6"%/%5-&(5A))*%&-(/(1%&)7/,#-'A)#,-.&,/)4,')

7&"5%''(#4).#(-'A)%-5

! B#%&4?)0%#%&,-("#

! +%C)D+0)&%4,'(*(5,-("# -%&6(#,/

E;0ED;0EFG)HIJHKHIJL

0,')M)B#%&4?)K ;#$%'-6%#-')K N.'(#%'')O/,#)HIJHKHIJL

!"#$%&'

($"#)%&'

*("#(%&'

+"#$%!'

(,"#)%-'

)$"#$%+'

./01234567892/6:;<=2;284>4?087@A6+%+6B?==?08

O&"P%5-')9#2%&)B$,/.,-("#=)7@A6&%-6C?==?08

D4E2/

FG<>85?086H F=234/?36F82/IJ6K282/>4?08

FG<>85?086H L>4M/>=6K>56N0I?54?35

O>?8428>832

FG<>85?086H NLK6P2I>5?Q?3>4?08

FG<>85?086H K>56RE2;?3>=

!,

!

Local Content is a must….

Supply policy to maximize local content

Petrobras

(as G&S

purchasing

company)Local content -

also for G&S on

downstream

contracts

Minimum Local

Content

requirement at

contracts for oil

field development

!"#$!%#"&'(&'%) *+,,!-%,"!.#-

19

Financing Agent(BNDES -

development bank)Minimum Local

Content requirement for financing concession

Brazilian Regulatory Agency(ANP)

Minimum Local Content requirement

in 9 bidding rounds of exploratory blocks

(since 1997)

Local content(Manual for Local

Content Assessment)Calculated with

specific methodology to measure the real

value of locally manufactured goods

and services.

!

Local Content Examples

!"

!"#$%&'"()*()+,,-."/*&'"01$(2*-&342%52(6&#$1$#2)7&2(&8/$92%

:/"54#)- :/";*#)-&2(&8/$92%

<43-*$&:21*%2(*-

! =>? @%*A23%*-

! "#$%&'#()*'#%+)+#%+',-.%)-%/0,1)' )-%23456

! ?*#.(21

! 7-8.,'',.)9-%9&%-#$%+',-.6

! B*%%-)/*$0

! :;00#-. +',-.%#(+,-8)9- )-%2345%<=3> ?,+,?).@%)-?0#,8#A6

! :/7-02$(

! B',-.%#(+,-8)9-%.9%+09C;?#%&'#()*'#%+)+#86

! 84))2(6

! :9-8.0;?.)9-%9&%,%-#$%+',-.%&90%.D#%+09C;?.)9-%9&%')-#%+)+#86

C032%2#$%-

! D4#" $(5&=*A$(-

• E-F9)-F%C)8?;88)9-8%.9%#8.,*')8D%-#$ +',-.8%)-%/0,1)'6

! +#*$(**/2(6 EF<DG&

• :;00#-. G,-;&,?.;0)-F%?,+,?).@ $)''%C9;*'# *@%#,0'@ 23456

! F@H&

• H3> #(+,-8)9- )- G,-;&,?.;0)-F%?,+,?).@ *@%23456

<43-*$&IJ4210*()

! KL*/

• 7-?0#,8#%9& G,-;&,?.;0)-F%?,+,?).@6

! @F'

• 7-?0#,8#%9& G,-;&,?.;0)-F%?,+,?).@ ,-C%?9-8.0;?.)9-%9& ,%.#?D-9'9F@%?#-.#06

! MI

• I(+,-8)9-%9&%.D#%J,-C)0, B',-. ,-C%.D#%?9-8.0;?.)9-%9& ,%-#$ ;-).6

! '$0*/"(

• 7-C;8.0),'%I(+,-8)9-6K=

!"#$%&'( !"#)*&'(+,-+."/0,1

2%"3#4/&5,-*(

!"#6#11(76#8&*

! $%&'()*+(,%&#%-#&./#012&(#,&#32&(2#$)*4#56*)7%8.&.)2(%)'9"#####

! 9"*((*"76/-$

! $%&'()*+(,%&#%-#&./#*&,(#,&#32&(2#:;)72)2#<%#=.'(.

56*)7%+%>0).''%)'9"

:;;(5#"*+&"/-*(! <=!+!*11*>",-,

! ?%)@,&8#(A)%*8A#02)(&.)'A,0'B#%&8%,&8#<,'+*'',%&'#(%#.'(271,'A#&./#012&(#

,&#:)24,1"

9",11+?,?*(! @A<+$#+."/(,1

! C<20(,&8#+*)).&(#*&,('#(%#>2&*-2+(*).#0,0.'"

B6C+2%3,->! @A<+$#+."/(,1

! $202+,(D#(%#0)%<*+.#A,8A#+%))%',%&E).','(2&(#211%D'

D,>5+$,/4*'*"+?,?*(! EFG<GHCF

! $*)).&(#*&,('#*&<.)#F*21,-,+2(,%&"

:;;(5#"*+('**1+

('"%&'%"*(

! <*'/(/

• G&<*'(),21#.H02&',%&"

C%'#4/',#-! =4*"(#-

! G&<*'(),21#.H02&',%&#(%#2''.>71.#.F*,0>.&('#,&#:)24,1"

!"

I#&/1+B#-'*-':;;(5#"*+B#4?/-,*(+3%,1$,->+&/?/&,'8+,-+."/0,1

IJ

!

Importing Equipment Issues to Consider

Temporary Import Duty Redution Extension

  Government of Brazil recently announced a extension of thereduc7onofimportdu7esfrom18%to2%forequipment.

 WeexpectthatthisbeextendedgiventhemacroeconomicpoliciesadoptedbyBrazilinordertomaintainitsinfla7onrate.

2%

!

Logistics & Installation Turnkey Sales

Financing Leasing

Training&SpareParts

Idea: Market Creation; Long-Term Source of Revenue; Value Creation

O & M

The Value-Added Sales Components !

Evaluating your Options

Sales Agent(s) Distributor(s)

JV(s) Acquisition

Brazil

When you take this plunge its full body immersion.

Louis V. Gerstner, Jr.

!

Key Decision Factors

  Structure Profitable Contracts  Financial estimating  Negotiation

  The “labor bottleneck in Brazil  Price Skills & Results

  Assess (and Mitigate) Risk  Share risk locally and

internationally

People

Experience

Relations

Discipline

!

Service Value Chain - 2 Phases

Design Feasibility Finance Install O&M Evaluate

Sell Design Services for production line integration

Product

Sell Feasibility Services - Efficiency, or Expansion, etc.

Calculate and Sell financing For expansion Or efficiency

Total Package For installation - Inc’ing permit, Guarantees, …

Management Production line Inc’ing perform, Improve…

Quick analysis production line Performance - Projects…

Production

P H A S E 1

P H A S E 2

Manufacture Finance Intelligence Relationships

Services

Technology‐detec7on

Financing‐ Lease‐Perform…

Intelligence‐B.Prac7ce

Rela7onships‐Na7onal

Rela7onships‐Int’l

TotalServiceAOtude

Contracts+Risk+Pricing+Service

!"#"$%&'(%)%'%*+,)'-$%./& 2

Largest economy in Latin America8th economy in the world

*Source: International Monetary Fund, World Economic Outlook

Database, Abril 2010

Total area 8.514.876 Km!

States 27

Coast 8.511 Km

Population 192 million

GDP 2009 $ 1.577Source: MDIC million2010 Statistical Yearbook

Now 6th

Remember….Country Facts

!"!#$%!&'!()

!"!')

($(!*"!

($+,%*!

"!-$./($&&$

-$0!%-*%&

/$*)&

"!-$./($&&$+$.&12

"!(!%34$

'*!15

06!()

(*$./(!%+6+$.%$(-6

'6(%!"710$

7!3*!

"*%!&./6(!*&

&4$.'!12$

'!(!%)

&!%-!0!-!(*%!

(*$./(!%+6+$.&12

&6(/*'6

!0(6

!"#"$%

%"#&"'(!

)*+(!

,-+"./0.10#/*

-&"2$-

30'&"+*4"

"'*-".)'"#1"

#"&"+

1")*/*+0

%$"5*

!"1*-6

%"+,"/0'

"'"&$

-+7($%

)"''"./0.'-"170

,-&6'-"

'-0./*.8"#*-'0

-&"9$":.;%<=<>?@AB

%C0.%*)"%&-C0

%"#&0%

5"'"#"9$D

%C0.3'"#1-%10./0.%$+

-&"8":

-!)-&$)"

5*+0&"%

'-0.9'"#/*

!"1"5D

'*1-3*

#-&*'6-

30'#0

"#&0#-#"

"#9'"./0%.'*-%

50'&0."+*9'*

+"9$#"

5$)+-1.!"'-&-!*.50'&%

EF

10

19

!"#$%&"'"()*+,-&+&".$/0)-&*

7

12

6th!!

!

Key Pragmatic Considerations

Clients• Minimum Rev • Geography • Performance Oriented

Distributors

LocalJVs

Options / Decisions Remember..

• Vertical • Geography • After-sales Service

• Risk Mitigation • Funding • Fiscal Incentives

After-sales • Spare Parts • Terms

• No exclusivity contacts•  Trade Shows

• US is the low-cost base Brazil Labor Brazil Interest Rates Brazil FX Rate

!

Executing on Strategic Objectives

Service/Solutions Orientation

Clean-up Market through Acquisitions & JVs

Internationalization

Integrate Technology

Higher Margin

Strategic Acquisitions

Lower Competition

Key Acquisitions • Range • Capability

Finance • EximBank • OPIC • BNDES • Own Finance

Task Force = Brazil Leverage with Strong Local Presence

Finance Long-Term

!

Thank you!

For further information please contact: Anand Hemnani

([email protected]) Indo-Bras, United Ltda.

Av. Ipiranga, 318, Cj. 302 São Paulo – SP– Brazil Tel: (5511) 3285-2055

!

oil & gas presentation sep12 - indo...

Documents