Washington, D.C., June 18, 2003—
The International Finance Corporation, the private sector arm of the World Bank Group, announced a $40 million loan investment to support the exploration and production operations of Queiroz Galvão Perfurações S.A. (QGP), the oil and gas subsidiary of Queiroz Galvão S.A., a diversified Brazilian business group. The IFC financing will support QGP’s investment program that includes the development of a significant domestic gas discovery in Brazil’s north-eastern region as well as exploration and appraisal in several other concession areas in the country.
“IFC’s investment in Queiroz Galvão Perfurações S.A. represents our support to a growing local E&P company in the recently liberalized oil and gas sector in Brazil. QGP has demonstrated an active response to the liberalization, having acquired participating interests in eleven oil and gas concessions in the country; several of these also lie in the relatively less developed north-eastern region,” said Rashad Kaldany, IFC Director of Oil, Gas, Mining and Chemicals Department.
Mr. Antonio Augusto Galvão, Director of Queiroz Galvão Perfurações S.A., said: "It is very important to our company to obtain a loan like this one that IFC is providing. Exploration and Production is a long-term business and with the projects we have in our portfolio, we need credit lines with repayment schedules that meet our cash flow projections. We hope this deal, which is the first we make with IFC, is the beginning of a long term relationship, that will play a fundamental role in our growth strategy.”
The Queiroz Galvão Group, founded in 1953 in Recife, Pernambuco, is a successful business group from Brazil’s Northeast. Starting in construction and engineering, QG has actively participated in developing large scale industrial and infrastructure projects in Brazil. It is also participating in public infrastructure concessions related to hydropower, roads, water supply and sanitation. In oil and gas, the Group was traditionally engaged in provided drilling services and has subsequently diversified into oil and gas exploration and production activity. Other group interests include industry, farming, trade and financial services.
“IFC’s investment in Queiroz Galvão demonstrates our continued commitment to work with private companies that are dedicated to investing in sectors that are important to the economy. We recognize the group’s active participation in making local project investments in infrastructure and energy, and are pleased to launch our partnership with the Queiroz Galvão group”, said Bernard Pasquier, IFC Director for Latin America and the Caribbean.
IFC has worked actively to support the development of a sustainable private sector in Brazil. With a US$1.23 billion portfolio, Brazil is the largest IFC client in Latin America and worldwide. In 2002, IFC played a critical role in providing much-needed long-term finance to Brazilian enterprises, and in supporting trade finance facilities for export companies. At that time flows of international capital had declined and economic growth was slow. IFC’s emphasis has therefore been to continue to facilitate access to finance for private sector investments.
The mission of IFC (
www.ifc.org
) is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. Since its founding in 1956 through FY02, IFC has committed more than $34 billion of its own funds and arranged $21 billion in syndications for 2,825 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY02 was $15.1 billion for its own account and $6.5 billion held for participants in loan syndications.
