Petrobras (PBR)

7. Dividends and Interest Paid on Capital

Dividends in the amount of R$7,017.8 million were proposed and paid for the year 2005. On a per share basis, the dividend represents R$ 1.60 per each ordinary or preferred share. Total dividends were declared and paid on three separate occasions:

1) Interest on Capital of R$2,193.1 million, or R$ 0.50 per each ordinary or preferred share (equivalent to R$2.00 per share prior to the stock split that occurred in September 2005) was approved by the Board of Directors on June 17, 2005 and paid to shareholders on January 05, 2006 to holders of record on June 30, 2005. This amount was adjusted for inflation as of December 31, 2005, in accordance with the SELIC (Special System for Settlement and Custody) rate.

2) Dividends in the amount of R$ 2,193 million, or R$0.50 per each ordinary or preferred share were approved by the Board of Directors on December 16, 2005 and paid on March 22, 2006 to shareholders of record on December 31, 2005.

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3) Dividends in the amount of $1,096.5 million, or R$ 0.25 per each ordinary and preferred share were approved at the General Ordinary Meeting on April 03, 2006 and payable on April 3, 2006 to shareholders of record on April 3, 2006. Additionally Interest on Capital in the amount of R$ 1,535 million, or R$0.35 per each ordinary and preferred share, was approved by the General Ordinary Meeting on April 03, 2006 and will be distributed as dividends, payable on April 03, 2006 and based on share holdings at April 03, 2006. The Interest on Capital is subject to withholding at a 15% rate, except for shareholders that are exempt; in accordance with the Law number 9.249/95.