Petrobras (PBR)

SECOND AMENDMENT TO MEMORANDUM OF UNDERSTANDING

As is known to the market, on July 3, 2001, Odebrecht Química S.A., Petroquisa and Petroquímica da Bahia S.A. (“PQBA”) entered into a Memorandum of Understanding regarding the execution of a Shareholders’ Agreement in respect of Copene Petroquímica do Nordeste S.A. (the former name of Braskem) (the “Memorandum”), which was amended on July 26, 2002 by Odebrecht, Petroquisa, PQBA, Norquisa, Petrobras and Braskem (the “First Amendment”). The Memorandum and the First Amendment granted Petroquisa (1) the right to sell its shares upon a transfer of control of Braskem (tag-along rights), (2) veto rights over certain actions by the shareholders and the board of directors, (3) the right to designate two members of Braskem’s board of directors and their respective alternates, and (4) an option to acquire additional shares so that its ownership interest in Braskem’s voting and total share capital would be equal to the ownership interest of Odebrecht.

In light of the changes that have occurred in the petrochemical sector since the execution of the Memorandum and the First Amendment and the importance to the Brazilian economy and to Brazilian companies and their shareholders to accelerate the integration process in this sector in order to capture synergies, increase the competitiveness of these companies and, consequently, create value for all of their shareholders, the parties agreed to amend the terms and conditions of the Memorandum and the First Amendment related to the exercise of Petroquisa’s option to acquire additional shares of Braskem.

Towards these ends, Odebrecht, Norquisa, ODBPAR and Petroquisa entered into a Second Amendment regarding the execution of a Shareholders’ Agreement in respect of Braskem (the “Second Amendment”) on April 29, 2005, with Braskem and Petrobras as intervening parties, which Second Amendment amends and restates the First Amendment and maintains the terms of the Memorandum. The principal terms of the Second Amendment are set forth below: