Joaquim Silva e Luna, left. Picture: REUTERS/ADRIANO MACHADO
Joaquim Silva e Luna, left. Picture: REUTERS/ADRIANO MACHADO

Rio de Janeiro — Incoming Petrobras CEO Joaquim Silva e Luna, an army veteran with no oil experience, has endorsed four career executives to head up key company divisions rather than bringing in more outsiders, people with knowledge of the matter said on Thursday.

The board of directors of Petroleo Brasileiro, as Brazil’s state-controlled company is formally known, meets on Friday to vote on the new division heads, the company said. The board is also expected to officially confirm Luna as CEO.

Luna's decision to endorse seasoned company executives sends a message of some continuity to a market wary of non expert appointments to lead the company.

Brazil's president, Jair Bolsonaro, announced the 71-year-old Luna would take the helm of Petrobras in a Facebook post in February. Luna served as Brazil's defense minister in 2018. He is the first military man to run Petrobras since the 1980s.

Half of the company's eight-seat executive director team is currently vacant, including the CFO post. Four divisional heads left the company after previous CEO Roberto Castello Branco was fired by Bolsonaro in February in a dispute over fuel prices. He officially ended his term on Monday.

Among the candidates for executive directors, chief accounting and tax officer Rodrigo Araujo is expected to be named CFO, said the sources, who requested anonymity because the information is private.

Long careers

Executive manager of Commercialization Claudio Mastella will, if approved, be head of the logistics and commercialisation department, in charge of fuel prices, a sensitive topic for Petrobras.

Executive manager Fernando Borges, who led the massive Libra field offshore project, has been put up as candidate for the Exploration and Production division, according to the people.

Joao Henrique Rittershaussen is candidate for the Production Development division, the people said. He is currently an executive manager of the same department.

Petrobras declined to comment.

All of the candidates have had long careers at Petrobras, the people said. Araujo, Borges and Mastella were part of the company's succession plan.

In the past, both Borges and Rittershaussen have publicly criticized nationalistic rules implemented during the Worker's Party governments to promote platform construction in Brazil by local builders. Petrobras has recently decided to resume platform construction overseas.

A retired general with no experience in the oil sector, Luna was the latest in a slew of active duty and former military men with whom Bolsonaro has surrounded himself since he took office.

Castello Branco’s sacking after hiking fuel prices more than 30% within a couple of months sent jitters through financial markets.

Fuel prices remain a sensitive topic for investors after Petrobras lost $40bn between 2011 and 2014 as the government, which controls a majority of the company's voting shares, forced it to subsidise local pump prices.


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