Petrobras (PBR)

d) Interest on Own Capital

On October 20, 2006, the Board of Directors approved the distribution of payment to shareholders in the form of interest on own capital in the amount of R$ 4,387,038 thousand, in accordance with Article 9 of Law 9.249/95 and Decrees 2.673/98 and 3.381/00, already reserved for in the financial statements dated September 30, 2006.

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1. Currency Exposure

Currency exposure of the PETROBRAS System is measured as per the following table:

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INTEREST ON OWN CAPITAL

The interest on own capital (R$ 0,50) will be subject to 15% withholding tax while the value of R$ 0,0180, corresponding to the variation in the SELIC rate, since December 31 2005 until March 22, 2006 will be subject to 22,5% withholding tax. The above-mentioned Withholding Tax is not applicable to tax immune or exempt shareholders.

This interest on capital will be offset against any remuneration payable at the end of the 2005 fiscal year

INTEREST ON OWN CAPITAL

The interest on own capital (R$ 2,00) will be subject to 15% withholding tax while the value of R$ 0,0053, corresponding to the variation in the SELIC rate, since December 31 2005 until June 05, 2005 will be subject to 22,5% withholding tax. The above-mentioned Withholding Tax is not applicable to tax immune or exempt shareholders.